• COPF gives Treasury 3 weeks to resolve impasse

Customs officials this past week informed the parliamentary Committee on Public Finance (COPF) that a proposed settlement to release more than 1,000 imported vehicles stranded at the Colombo and Hambantota Ports had been rejected by the Treasury, prolonging a long-running impasse.

Following the revelation, the COPF had decided to give the Treasury three weeks to resolve the issue.

The committee was informed that the Hambantota International Port Group (HIPG) had agreed to cap demurrage charges at Rs. 1.5 million to facilitate the release of the vehicles. However, the proposal failed to proceed after the Treasury Secretary declined to approve it.

The issue resurfaced during last week’s COPF meeting, where Chairman Harsha de Silva and Deputy Minister Chathuranga Abeysinghe questioned why no resolution had been reached despite previous discussions, court-mediated settlement efforts, and repeated deliberations by the committee.

De Silva expressed frustration over the prolonged delay, saying the vehicles had been left to deteriorate while importers continued to bear the consequences.

“Plants must have sprouted in those vehicles by now,” he remarked, adding that many of the vehicles belonged to honest people.

De Silva cited the case of a retired ministry secretary who had used his pension savings to import a vehicle, only for it to remain stranded at the port because of regulatory issues.

Rejecting earlier suggestions that the vehicles could simply be re-exported, he said: “We told you not to tell such stories because they cannot be re-exported.”

He argued that the continued stalemate served no public interest: “The Treasury is not getting any money, honest, genuine people do not have their vehicles, and nobody is making any money except the lawyers.”

The committee was further informed that although a settlement had been proposed during court proceedings, it had not been implemented because the Treasury had rejected the proposed demurrage arrangement.

De Silva stressed that if the courts had encouraged a settlement, the relevant authorities should agree on a reasonable demurrage payment that would allow vehicle owners to clear their imports while acknowledging the regulatory issues surrounding the original imports.

Abeysinghe also questioned officials over the lack of progress, seeking clarification on why a settlement remained elusive despite previous discussions.

“What we need to do now is inform customers that they can collect their vehicles after paying the demurrage charges, even though the Letters of Credit (LCs) remain in question. This is the proposed solution,” Abeysinghe said.

Describing the issue as a long-standing public finance matter, the COPF said that it would formally intervene.

“We are going to write to the Treasury and give it three weeks to resolve this matter,” Dr. de Silva said.

More than 1,000 imported vehicles have remained stranded at the Colombo and Hambantota Ports since last year, creating significant congestion and affecting port operations. It was reported that most of the stranded vehicles were Japanese imports brought into Sri Lanka using LCs issued through third countries. The issue emerged following regulatory concerns raised in May last year, prompting several importers to seek legal action.

The matter was previously discussed at a COPF meeting in 2025, when Treasury officials informed the committee that the Government intended to re-export the affected vehicles in line with the relevant legal provisions. However, they noted at the time that the matter was before the courts, preventing further action.

Although court proceedings later explored the possibility of a negotiated settlement, the vehicles remain at the ports without any solution.