published by admin on Sat, 08/06/2011 - 08:49

1. Investment in shares of Companies incorporated in Sri Lanka 

Nonresident investment is permitted in respect of  rupee companies , subject to specific exclusions and restrictions as mentioned below .

1. Up to 100%  of the issued capital of a company carrying on or proposing to carry on any business other than  limitations and exclusions mentioned in b ,c and d below. 
2. Up   to the limitation of  up to 40%  of the issued capital or if approval has been granted by the Board of Investment of Sri Lanka for a higher percentage of foreign investment in any company, only up to such higher percentage of a company proposing to carry on or caring on any of the following businesses; .

• Production of goods where Sri Lanka’s exports are subject to internationally determined quota restrictions;
• Growing and primary processing of Tea, Rubber,  Coconut, Cocoa, Rice, Sugar   and Spices;
• Mining and primary processing of non renewable   national resources;
• Timber based industries using local timber;
• Fishing (deep sea fishing)
• Mass communications;
• Education;
• Freight forwarding;
• Travel agencies;
• Shipping agencies.

1. And  subject  to the limitation of percentage of the issued capital of the company for which percentage either general or special approval has been  granted by the Government of Sri Lanka or any legal or administrative authority set up for the approval of foreign investment in such businesses .

• Air transportation;
• Coastal shipping;
• Industrial undertaking in the second schedule of the Industrial Promotion Act, No. 46 of 1990, namely – any industry manufacturing arms, ammunitions, explosives, military vehicles and equipment aircraft and other military hardware; any industry manufacturing poison, narcotics, alcohols, dangerous drugs and    toxic, hazardousor carcinogenic material;any industry producing currency, coins or security documents;
• Large Scale mechanized mining of gems;
• Lotteries.

1. Foreigners are not allowed to invest in shares of companies in

   (i) Money lending,   (ii) Pawn Broking,   (iii)Retail trade with a capital of less than one Million U.S.   Dollars,   (iv) Coastal fishing.    

• Sale proceeds of shares of these investments could be remitted freely after meeting domestic liabilities such as taxes.
• Payment for shares shall be made via Securities Investment Account (SIA) designated for such purpose.