📈 Institutional Insights: What Sri Lanka Can Learn from DIFC to Attract Foreign Direct Investment

Sri Lanka continues to face challenges in attracting long-term foreign capital. Insights from the Dubai International Financial Centre (DIFC) highlight that building institutional confidence and legal certainty is more vital for attracting investment than simply expanding tax incentives. • Core Pillars of DIFC's Success: Modern English-language common law framework operating alongside UAE civil law. Specialised DIFC Courts providing independent, predictable commercial dispute resolution. High procedural efficiency via digital hearings, active case management, and fixed timetables. A dedicated Mediation Centre under Court Law No. 2 of 2025 for direct enforcement of settlement agreements. Advanced institutional arbitration frameworks offering summary determinations and emergency arbitrators. • Key Recommendations for Sri Lanka: Legal Reforms: Update commercial legislation to align with internationally recognized common law principles. Dispute Resolution: Establish specialised business courts and strengthen local alternative dispute resolution mechanisms in key sectors like financial services and foreign commercial trade. Enforcement & Efficiency: Modernise execution procedures, insolvency frameworks, and adopt court digitalisation to eliminate judicial delays. Regulatory Governance: Ensure transparent, consistent, and predictable policy application to build investor trust. _Note: Analysis based on institutional insights published on August 21, 2026._