Regulatory & Policy News
View all(90)Port City Colombo Expands Gulf Investment Footprint at Dubai Summit 📈
• High-Level Bilateral Forum • Event: Sri Lanka Beyond Your Dreams (2nd Edition) in Dubai. • Participation: 400+ UAE business leaders, investors, and diplomats alongside a senior Sri Lankan government delegation. • Key Objective: Deepening economic diplomacy and expediting a Comprehensive Economic Partnership Agreement (CEPA) between Sri Lanka and the UAE. • Special Economic Zone Capital & Figures • Investment Pipeline: Over US$ 2.00 Bn secured to date; targets set to cross US$ 4.00 Bn in coming years. • Strategic Focus: Serves as a gateway for Gulf capital into South Asia, offering a SEZ legal and regulatory framework. • Strategic Alliances & Target Sectors • Landmark Deal: Signed investment promotion agreement between Colombo Port City Economic Commission, CHEC Port City Colombo, and Umm Al Quwain Free Trade Zone Authority—establishing the first formal SEZ-to-free-zone bridge between PCC and the UAE. • Focus Sectors: High-impact opportunities in logistics, real estate, financial services, technology, tourism, and regional headquarters/business continuity operations.
🌐 Sri Lanka Reaffirms Commitment to Digital Future at UN-ESCAP ICT Committee
Sri Lanka pledged support for a secure, inclusive, and digitally connected Asia-Pacific during the 5th Session of ESCAP's ICT Committee held in Bangkok. • National Strategy & Infrastructure • Aligned efforts with the _Digital Economy Strategy and Blueprint 2025–2030_, placing digital inclusion at its core. • Emphasized Digital Public Infrastructure (DPI) to expand financial, educational, and public service accessibility. • Highlighted progress in personal data protection, digital interoperability in the public sector, and electronic commerce. • Technology, Innovation & Sector Growth • Outlined steps to boost the ICT/BPM and tech sectors by linking universities and industry through University/Institutional Business Linkages. • Promoted Technology and Innovation Support Centers to aid IP access and tech-transfer, targeting research & development (R&D). • Regional & International Cooperation • Backed the Asia-Pacific Information Superhighway (APIS) Action Plan 2027–2030 to bolster regional connectivity. • Reaffirmed leadership via the BIMSTEC Technology Transfer Facility in Colombo. • Urged enhanced regional capacity-building, technical assistance, and tech exchange to bridge regional digital divides.
🇱🇰 Southern Chambers Press Treasury to Clear Operational Bottlenecks
• Key Meeting: The Southern Province Chambers Forum met with Finance & Planning Deputy Minister Dr. Anil Jayantha Fernando and Economic Development Deputy Minister Nishantha Jayaweera to address mounting policy, regulatory, and administrative barriers. • Core Issues Raised: Medium and large-scale businesses highlighted critical constraints in taxation, customs, and regulatory processes that are actively impacting investment and expansion decisions. • Government Response: • Policy-level agreement has been reached on several key issues, with timelines for implementation currently under discussion. • Discussions included senior officials from Sri Lanka Customs and the Inland Revenue Department (IRD) to directly address revenue and administrative hurdles. • Initial measures to resolve business concerns have already been initiated by the Treasury. • Business Sentiment: Representatives welcomed the prompt engagement from the Treasury, stressing the need for a predictable and enabling operating environment to support regional growth.
Legal Action Against Obstruction of Geological Bureau Officials ⚖️
• Incident Details: Ven. Ampitiye Sumanarathana Thero was arrested by the Batticaloa Police for allegedly obstructing officers from the Geological Survey and Mines Bureau while they were carrying out official duties in Batticaloa. • Legal Proceedings: Following his arrest, the monk was produced before the Batticaloa Magistrate’s Court and remanded in custody until September 8, 2026.
🌱 EU & CFI Partner with Sri Lanka to Boost Green Journalism
Sri Lanka has signed agreements with French media agency Canal France International (CFI), supported by the EU-funded Green Recovery Facility, to strengthen reporting on climate, environmental, and economic stories nationwide. • Partnership Scope: Implemented alongside Expertise France, the Sri Lanka Press Institute, and the Ministry of Mass Media to transition beyond traditional classroom-based training. • Key Objectives: Capacity building to analyze technical climate finance, public policies, green investments, and policy dimensions of the green transition. Focuses on mainstreaming a "just transition" and gender equity. • Core Pillars: • Trilingual Foundation Training for 60 journalists across Sinhala, Tamil, and English media. • 6 Mentored "Story Labs" providing direct editorial guidance for investigative green transition stories. • Youth Outreach across universities and young media practitioners. • Learning and Sharing networking events for journalists, policymakers, and industry experts.
Thailand to End Visa-Free Travel for Sri Lankans Starting Sept 15 ✈️
• Policy Shift Overview: Ordinary Sri Lankan passport holders will require a pre-approved visa to enter Thailand starting September 15, 2026, as Sri Lanka is among 21 nations removed from Thailand’s revised visa exemption scheme. • Exemption Rules: The general visa-free list has been reduced from 93 to 60 countries. Sri Lankans entering on or before September 14, 2026, can still utilize the current 60-day visa-free stay. • Application Process: Travelers must apply online through the official e-Visa portal (_thaievisa.go.th_); no in-person visits to the Embassy in Colombo are required. • Available Tourist Visas: - Single-Entry TR Tourist Visa: Valid for 3 months, permits a stay of up to 60 days (extendable by 30 days for 1,900 baht). - Multiple-Entry Tourist Visa (METV): Valid for 6 months, permits up to 60 days per entry. • Mandatory Requirement: All incoming travelers must complete the electronic Thailand Digital Arrival Card (TDAC) prior to arrival regardless of visa status.
🇱🇰 Govt Rejects Port City Tax Term Changes Amid Investor Backlash 🏢
• The Dispute: A public disagreement erupted on LinkedIn between Deputy Minister Chathuranga Abeysinghe and tech entrepreneur Shavini Fernando over shifting tax rules for ICT/BPM and tech companies at the Colombo Port City SEZ. • Investor Grievance: Investors allege tax rates shifted from an initial 3-year zero-tax offer to 15% for employees and 7% for corporates, and recently to the mainland corporate/income tax rate of 36%, driving some to consider relocating to regions like Dubai. • Government Stance: Deputy Minister Abeysinghe stated the revised law aligns all individual taxation under the Inland Revenue Act, leaving "no arbitrage between Port City and main land." He acknowledged confusion regarding foreign income taxation for Port City Approved Persons and noted clarification will be provided. • Core Classification Issue: Tax discrepancies stem from income treatment; foreign currency income deposited into Sri Lankan accounts receives a 15% rate, whereas income classified as local attracts the 36% rate. • Competitiveness Risk: Legal and corporate professionals warn that shifting tax policies weaken Port City’s value proposition compared to competing regional financial hubs like the Dubai International Financial Centre (DIFC).
📈 CBSL Eases Related-Party Guarantee Rules, Tightens Reporting
The Central Bank of Sri Lanka (CBSL) has issued Banking Act Determination No. 01 of 2026 (effective Sept 1, 2026), revising insider lending rules to prevent favorable treatment and mitigate conflicts of interest. • Key Policy Relaxations • Corporate Guarantees: Cover limit raised to 100% for guarantors rated 'BBB-' and above (previously capped at 60%–80%). • Machinery Collateral: Pledging machinery allowed as collateral for the first time, capped at 50% of external valuation. • Public Sector Lending: Treasury letters of undertaking now accepted for loans to Ministries, Departments, and SOEs (provided budget provision is disclosed). • Unchanged Collateral Ratios • Government/CBSL Securities & Cash Deposits: 90% • Freehold Property (Primary Mortgage): 80% • Life Insurance Policies: 75% • Gold: 70% • CSE Listed Shares & Corporate Debentures ('AAA' to 'BBB-'): 50% • Reporting & Compliance • FinNet Integration: Reporting shifts from unspecified formats to two required electronic returns (BSD-QF-06-RPC and BSD-QF-06-RPI), starting quarter ending Sept 30, 2026. • Stage 3 Provisions: Borrowers becoming related parties solely due to shared directors must provide approved collateral within 90 days if credit quality drops to Stage 3.
📈 FCCISL and Ministry Partner to Drive 25% SME Export Growth Target
• Roadmap & Blueprint: The Federation of Chambers of Commerce and Industry of Sri Lanka (FCCISL) and Deputy Minister Chathuranga Abeysinghe held policy talks to align private enterprise with the National SME Strategy Framework. A roadmap aims to identify, incubate, and scale 1,000 to 5,000 SMEs across all provinces to achieve a 25% export growth target. • Target Sectors: Joint incubation systems will focus on high-priority areas including Agriculture & Food Security, ICT, Transport & Logistics, Eco-friendly Products, Seafood, and value-added Coconut & Rubber products. • Global Trade Expansion: Through its "SMEs Go Global" initiative, FCCISL will leverage international chamber alliances (EU, GCC, CACCI, SAARC CCI, APTA CCI) to drive direct market entry. Upcoming trade missions include an India visit with FICCI, a trade trip to New Zealand, and a Saudi Arabia Investment Forum in early 2027. • Capital & Sector Support: Talks focused on unlocking specialized financing mechanisms, including mobilizing the Construction Guarantee Fund for the construction sector and establishing dedicated funding instruments for ICT ventures and emerging startups.
⚖️ SriLankan Airlines-Airbus Scandal: Judicial System Tested Over Unresolved Corruption Case
• Overall Case & Figures: • In 2013, aviation state-entity SriLankan Airlines agreed to buy 10 Airbus aircraft (six A330-300, four A350-900) and lease four A350s. • Airbus offered ~$16.84 Mn in bribes to influence the transaction, with ~$2 Mn transferred to Biz Solutions Inc. (linked to the wife of then-CEO Kapila Chandrasena). • $800,000 was routed to Sabre Vision Holdings (linked to investor Nimal Perera), who alleged handing the equivalent (~Rs. 100 Mn) to MP Namal Rajapaksa. • Despite high-profile arrests, zero convictions have been secured to date. • Economic Impact on Aviation & Governance: • The fleet deal, cancellation fees, and political mismanagement generated accumulated losses of nearly US$ 2 Bn for SriLankan Airlines, placing an immense burden on taxpayers. • The corruption case reflects systemic governance failures and weak accountability that contributed significantly to the nation's 2022 economic collapse. • Legal System Concerns: • Delayed judicial proceedings risk witness disappearance—such as the suspicious death of former CEO Kapila Chandrasena—and evidence loss. • Calls are made for dedicated, expeditious trials with transparent terms for cooperating witnesses, ensuring equal justice without media trials or political bias.
Sri Lanka Steps Up Enforcement to Combat Cybercrime & Fraud 🚔💻
• Regulatory Actions & Enforcement: • Blocked illegal online gambling websites and fraudulent platforms. • Initiated legal proceedings and deportation procedures for foreign nationals engaged in cybercrime. • Resource & Capacity Building: • Recruiting software engineers and lawyers to enhance technical and legal expertise in investigations. • Providing newly recruited officers with specialized field and overseas training. • Technological & Strategic Upgrades: • Planning a real-time centralized system for faster financial fraud and cybercrime investigations. • Coordinating with foreign institutions to resolve data-sharing barriers for cryptocurrency-related crimes. • Strengthening community policing services and securing sensitive information from Community Security Committees.
📜 Cabinet Approves Community Based Corrections (Amendment) Bill for Parliament
• Legal & Judicial Reforms: Cabinet granted approval to gazette and table the Community Based Corrections (Amendment) Bill in Parliament for final approval. • Targeting Repeat Offenders: The Bill updates provisions of the Community Based Corrections Act, No. 46 of 1999, ensuring more effective legal enforcement when dealing with repeat offenders. • Legislative Clearance: Drafted by the Legal Draftsman following initial Cabinet clearance on 7 April 2025, the Bill has received full clearance from the Attorney General. • Key Sponsor: The proposal was presented by Justice and National Integration Minister Harshana Nanayakkara.