📈 Beneficial Ownership Rules Risk Uneven Playing Field for Investors

• Key Issue: Sri Lanka’s beneficial ownership disclosure regime under the Companies Act, No. 12 of 2025, creates practical hurdles and investment delays. • Administrative Conflict: While the Act places the legal obligation to disclose beneficial ownership on shareholders, prescribed declarations force Company Secretaries, Directors, and officers to independently verify and certify accuracy. • Impact on Investment: Complex ownership structures—such as overseas holding companies, trusts, and proxies—make independent verification difficult, leading some Company Secretaries to decline signing incorporation documents. • Liability Concerns: Company Secretaries face long-term personal exposure for certifying information outside their knowledge, risking an uneven playing field for incoming investors. • Proposed Solutions: Immediate regulatory amendments to the prescribed declaration are recommended to exempt Company Secretaries from verifying matters beyond their direct knowledge, avoiding prolonged incorporation delays.