It's pretty safe to assume "which government" is the government in which the PayPal account was opened. This is an employee of a financial business trying to determine if an organization they're underwriting is doing anything illegal in their jurisdiction, as that would be a prohibited use of the service. He/she is a normal human being, who isn't an expert in every possible line of business, trying to suss out the information he/she needs to approve this account -- put yourself in their shoes for a moment.
