ANNOUNCEMENT 28 May 2014

In May 2014, the government of Sri Lanka announced a rule change for commercial cross-border financial flows.

NUMBER OF INTERVENTIONS

1

  • 0 harmful
  • 0 neutral
  • 1 liberalising

SOURCE



Official press release
http://www.cbsl.gov.lk/pics_n_docs/latest_news/press_20140528ea.doc

Daily FT - Central Bank relaxes forex regulations
http://www.ft.lk/2014/05/29/central-bank-relaxes-forex-regulations/


Inception date: 28 May 2014 | Removal date: open ended

Controls on commercial transactions and investment instruments

On 28 May 2014, the Central Bank of Sri Lanka relaxed certain foreign exchange regulations. The new regime liberalises several aspects of the transactions in foreign currency:

  • Authorised Dealer (AD) banks were permitted to issue foreign travel cards to eligible customers
  • Minimumbalancerequirement onSpecialForeignInvestmentDeposit Accounts (SFIDA) was withdrawn
  • ForeignExchangeEarners'Account(FEEA)holdersareallowedtomake payments relating to foreign contracts out of the existing funds in the FEEA.
  • Authorised Dealers are allowed to extend loans in foreign currency to FEEA holders
  • Authorised Dealer banksarepermittedtoissue,extendthevalidityperiodandamendclausesofaLetterofCredit(LC)withoutreferringtotheControllerof Exchange.
  • Foreign investors are permitted to invest in non-listed debenture in addition to listed debentures through the Securities Investment Account (SIA).
  • The eligibility to obtain debit cards known as Electronic Fund Transfer Cards (EFTC) is widened to include holders of Migrant Blocked Accounts, SIA's, Diplomatic Accounts etc.
  • Loncal banks were permitted to facilitate international transactions of students intending to study abroad
  • The time restriction on suppliers' credit for importers was removed

AFFECTED SECTORS

 
N/A

AFFECTED PRODUCTS

 
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