Hon. Kathiravelu Shanmugam Kugathasan

¶ 01 Hon. Deputy Speaker, I wish to present my views on the amendment to the regulations under the Imports and Exports (Control) Act.

¶ 02 The Imports and Exports (Control) Act, No. 1 of 1969, provides the legal framework to regulate imports and exports in Sri Lanka. Over time, amendments and regulations were introduced to reflect economic priorities, foreign exchange conditions, and trade policy objectives.

¶ 03 From 2022 to 2024, due to the economic crisis, the country faced a foreign currency shortage. Consequently, on 17 May 2024, the former President, Hon. Ranil Wickremesinghe, issued Special Gazette No. 2384/34 temporarily suspending the import of certain motor vehicles until 30 April 2025. Buses, cars, sports utility vehicles, vans, electric vehicles, and others were temporarily prohibited; motorcycles up to 250 cc, SUVs up to 7500 cc, and mobility door vehicles faced special restrictions.

¶ 04 As the economy improved, the Government, with Cabinet approval, issued Special Gazette No. 2421/04 on 27 January 2025, lifting those bans and allowing new vehicle imports under revised rules. Under the May 2024 Gazette, vehicle imports were tightly controlled and allowed only with specific Government approval. Under Gazette No. 2421/04, imports were re-allowed with caps on registration time limits and per-person quantities. At registration, payment of taxes, assignment of an identification number, penalties, and a bond are mandatory. Registered dealers may import multiple vehicles; a private individual may import only one vehicle per year; registration must occur within 90 days of import. Delays incur a monthly penalty from 3% up to 45% of the CIF value. Government officials, diplomats, or those using special approvals cannot import code 115(006) vehicles. If rules are violated, vehicles must be re-exported within 90 days at the importer’s cost.

¶ 05 Further amendments were gazetted on 19 March 2025 in Special Gazette No. 2468/07. These amend the 2013 Vehicle Import and Export Control Regulations. A key change is that the Registration Certificate, its English translation, and related documents must bear the seals of both the issuing local bank and the corresponding bank in the exporting country. Additional verification to ensure the authenticity of export inspection certificates is introduced: documents must be sent directly by the relevant bank, their legal validity must be confirmed online by the designated inspection agency, and an official authentication of the verification is now mandatory.

¶ 06 These rules also introduce specific measures to verify the authenticity of vehicle import documents. The Sri Lanka Customs Department must examine all such documents, including those specified earlier, before approval.

¶ 07 To implement these, regulations were placed before Parliament on 12 September 2025, following the frameworks set out in 2020 (Regulations No. 4; Gazette 2184/21) and 2023 (Gazette 2335/26). Under the 2025 (No. 7) and 2024 (No. 12) regulations, the Controller of Imports and Exports, the Director General of Customs, and licensing authorities will issue operational instructions. Licensed banks must ensure online verification of authenticity prior to approval, and all approved documents are subject to online verification by Sri Lanka Customs. This aims to strengthen the integrity of trade documents and reduce clearance delays.

¶ 08 Bureau Veritas, headquartered in Paris, has been appointed the responsible verification agency for vehicle imports from all countries. It is authorized to issue inspection certificates for vehicles imported from any country. Accepting Bureau Veritas certificates for all countries marks a significant policy shift—reducing administrative barriers and costs, broadening eligible vehicles, and lessening dependence on country-specific certificates. Prioritizing online document verification will speed up customs, reduce turnaround time, and improve overall trade efficiency, aligning with global trends toward digitization and transparency. The regulations provide specific guidance to vehicle importers and commercial banks involved.

¶ 09 The most recent amendment in Special Gazette No. 2449/60 dated 15 August 2025 extends the validity period from 30 June 2025 to 30 September 2025. This applies only to customs release of motor vehicles under import permits granted by the Ministry of Tourism and only for vehicles imported under Letters of Credit established on or before 31 January 2025. The Controller, Customs, banks, and other authorities may issue operational instructions accordingly.

¶ 10 Compared to the 2020 regime (Gazette 2184/21, Schedules I and II), which imposed broad restrictions and suspensions on a wide range of imports—food, agricultural commodities, industrial raw materials, machinery, vehicle parts, cement, sugar, palm oil, etc.—as a protective stabilization measure during COVID-19, including credit terms of 90–180 days and complex conditions for exporters and BOI projects; and compared to 2023 (Gazette 2335/26) which maintained selected temporary suspensions but began gradual liberalization by removing some items and relaxing certain areas—the 2025 Gazette No. 2449/60 focuses solely on vehicles and does not carry broad HS prohibitions or suspension schedules. Instead, it provides time extensions to release vehicles already financed under valid LCs, indicating a move away from blanket bans toward targeted administrative facilitation for previously approved transactions.

¶ 11 In summary: 2020 regulations reflected emergency controls; 2023 amendments reflected selective liberalization with lingering sensitive-item curbs; 2025 amendments mark administrative changes and a return toward normal trade policy, while remaining cautious on vehicle imports—consistent with improving reserves and stability and moving to controlled liberalization and digital management.

¶ 12 On rice: while discussing vehicle imports, we must also focus on rice imports. Once, our country exported rice; Tamil literature records foods from Eelam arriving in South India via ports like Musiri, Thondi, and Korkai. Now we import rice. We can achieve self-sufficiency, but adequate action is lacking. In Trincomalee District, before 1985, 205 tanks and 25 bunds used for cultivation remain unrestored. If restored, we could produce 500,000 metric tons in one season and 1,000,000 in two. Additionally, since 1985, 118,710 acres once cultivated are held by the Forest Department, 111,619 acres by Wildlife Conservation, 2,599 acres by Archaeology, and 3,320 acres by Buddhist monks. Releasing these for paddy would achieve self-sufficiency. I urge the Government, Ministers and officials to act. Thank you.