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CBSL to extend limitations on capital transactions

15 Jun 2022

  • Cabinet approves new rule extending December 2021 restrictions
  • Limited capital transactions include suspension of fund repatriation
    Cabinet approval was granted to the issuance of a rule initially proposed by the Central Bank of Sri Lanka’s (CBSL) Monetary Board to extend the limitations imposed by the rules under Section 22 of the Foreign Exchange Act No. 12 of 2017. Prime Minister (PM) Ranil Wickremesinghe, in his capacity as the Minister of Finance, Economic Stabilisation, and National Policies had submitted the new rules under Section 22 of the aforesaid Act to Cabinet for approval.  Cabinet approval was previously granted at the Cabinet meeting held on 6 December 2021 to issue a rule under Section 22 of said Foreign Exchange Act in order to impose limitations for a period of six months on certain capital transactions that cause the outflow of foreign exchange, while the period of validity of the rule imposed by the relevant Gazette Notification issued at the time was for a period of six months, to be ended on 1 July 2022. This notification is accordingly to be extended by the new measure, although an expiry of its term has not been stipulated in said notification. The measures stipulated in the notification included the suspension of the repatriation of funds under the migration allowance out of funds received as monetary gifts by an emigrant from an immediate family member. These measures also limited the repatriation of funds under the migration allowance through Capital Transactions Rupee Accounts by emigrants who have already claimed a migration allowance, up to a maximum of $ 10,000 or equivalent in any other designated foreign currency. 


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