Central Bank to make exemption for non-resident investors of local companies

The Cabinet nod was given earlier this week to make an exemption for non-resident investors who “inadvertently”or “unknowingly” invested their remittances directly in local companies against foreign exchange regulations.  

Based on Central Bank recommendations, the Cabinet on Monday granted approval to the Central Bank to issue the relevant orders under Section 7 (10) of the Foreign Exchange Act No. 12 of 2017 allowing local companies to issue shares for the investments made directly by non-resident investors.   

When investing their remittances in locally incorporated companies, non-residents are required to make such investments through inward Investment Account (IIA).

“To regulate and promote foreign exchange in Sri Lanka, the Monetary Board of the Central Bank has recommended to the Finance Minister to issue an order authorising the companies established in Sri Lanka under Companies Act No. 07 of 2007 to issue shares to non-resident investors who have inadvertently or unknowingly made remittances directly to the account of the resident company

without using an inward investment account,” the Government Information Department elaborated.