Before discussing conversion, we must understand what a .pkg file actually is on both consoles.
pkg_builder.exe ps4_build/ final_game.pkg
The PS3 to PS4 PKG Converter is an unofficial software tool designed to convert PlayStation 3 game packages (PKG format) into PlayStation 4 PKG files. The goal is to allow PS4 users with custom firmware (CFW) or jailbroken consoles to play PS3 games via emulation or compatibility layers, though actual performance and compatibility are limited. ps3 to ps4 pkg converter