The Hon. R.M. Jayawardhana - Deputy Minister of Trade, Commerce and Food Security

¶ 01 Madam Chair, today we debate the Bill to establish a modern framework for rescue, rehabilitation, and insolvency. Investment—whether by individuals, companies, groups, or institutions—is a pillar of economic dynamism. In crises, businesses can slip into insolvency; under our current framework, liquidation and asset disposal often follow, permanently ejecting entrepreneurs from productive activity and destroying jobs.

¶ 02 This Bill seeks to remove such rigid barriers, offering a second chance to those whose enterprises have failed—so they can restructure, restart, and again contribute to the economy. Insolvency arises when liabilities exceed assets and debts cannot be serviced—this is a critical issue in any economy. The very leaders now lecturing us presided over the country’s formal announcement of insolvency in 2022. Having driven the nation into crisis through mismanagement, they sit opposite and preach remedies.

¶ 03 When businesses close, hundreds of employees lose their livelihoods, with multiplied impacts on families. Covid-19 stalled the economy; then came an avoidable 2022 economic crisis fueled by corruption and misgovernance, crushing MSMEs and wage earners. Under the old, archaic legal regime, banks moved to enforce security, dissolve firms, and liquidate assets, wiping out years of painstaking enterprise-building.

¶ 04 Recently, Government policy deferred aggressive recoveries and provided structured schedules. But that cannot continue indefinitely; we need a permanent, rules-based solution. This Bill supplies that: instead of immediate closure, it enables dialogue, restructuring plans, administrative intervention, and time-bound procedures—e.g., an initial 60-day window for steps toward rehabilitation—so viable businesses can be preserved.

¶ 05 Passing this Bill will strengthen investor confidence—both foreign and domestic—by ensuring that Sri Lankan law protects value, jobs, and continuity where possible. It aligns us with international best practices and signals that Sri Lanka is a jurisdiction where entrepreneurship can survive shocks and recover under court-supervised, transparent processes. I urge all Members to support the Bill.