The Committee on Public Finance (COPF) has approved a key set of updated guidelines aimed at easing restrictions on outward investments by Sri Lankan companies, in a bid to encourage cross-border expansion and retain high-growth industries such as technology and software within the country.
The decision was made at a COPF meeting held on July 29, chaired by MP Dr. Harsha de Silva, following consideration of an order issued under Section 22 of the Foreign Exchange Act, No. 12 of 2017, and published in Gazette Extraordinary No. 2441/14 dated June 18, 2025.
Under the revised framework, the investment threshold for listed companies has been increased from USD 500,000 to USD 750,000, while unlisted firms can now invest up to USD 200,000 abroad, up from the previous USD 150,000 cap.
Additionally, companies requiring larger investments may borrow up to USD 2 million from foreign sources, subject to Central Bank oversight.
Any investment exceeding that figure will require special approval.
To ensure transparency and regulatory compliance, all outward investments must be processed through a designated Outward Investment Account (OIA) maintained in Sri Lanka. The Central Bank has granted general permission to licensed banks to facilitate these transfers efficiently.
Central Bank officials, who attended the session, reiterated that these reforms are designed to promote global competitiveness for local firms while maintaining capital flow oversight.
They noted that overly rigid restrictions in the past may have pushed some firms to relocate operations overseas.
The officials also clarified that short-term supplier credit arrangements under DA (Documents Against Acceptance) terms will continue to be treated as current account transactions, with no additional restrictions.
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