Following the practice of most countries, Sri Lanka also has a list of business activities, which restrict foreign investment and require approval by other statutory agencies. The degree of restriction varies across different areas of investment.
A comparative study among other Asian countries shows that our list of restricted activities is relatively small. The government is committed to reducing this list further to broaden opportunities for foreign investors.
Areas Totally Reserved For Sri Lankans
Foreign investment is not permitted in the following areas:
- Money lending
- Pawn broking
- Retail trade investment with a capital of less than One Million US Dollars
- Providing personal services other than for the export or tourism sectors
- Coastal fishing
- Education of students who are citizens of Sri Lanka and not over 14 years of age
- Award of local educational degrees
Areas Subject To Automatic Or Conditional Approval
Foreign investments in the areas listed below will be approved limited to 40%. Foreign ownership in excess of 40% will be approved on a case-by-case basis by the BOI.
- 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
Regulated Areas
Foreign investments in the areas listed below will be approved by the respective Government agency or BOI (upto the percentage of foreign equity specified by BOI). The BOI assists potential investors by referring applications to the appropriate agency and approval is usually straight forward.
- 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 poisons, narcotics, alcohols, dangerous drugs and toxic, hazardous or carcinogenic materials
any industry producing currency, coins or security documents
- Large scale mechanized mining of gems
- Lotteries
|
