The highly-anticipated report of the Ministry of Finance on the controversial release of 323 shipping containers by Sri Lanka Customs in January has been submitted to President Anura Kumara Dissanayake, Deputy Minister of Economic Development Prof. Anil Jayantha Fernando confirmed yesterday (5).
The five-member committee headed by Treasury Deputy Secretary Ananda Kithsiri Seneviratne had presented the report to then Treasury Secretary Mahinda Siriwardana on 12 June, a week prior to the latter’s retirement.
The report reveals that the five-member investigative committee had been vastly divided on the views expressed.
As stated in the report seen by The Sunday Morning, the committee’s investigation had probed the circumstances surrounding the uninspected release of containers flagged ‘red’ by the Customs’ Risk Management System.
The committee’s findings were critical, indicating that the release of these high-risk containers significantly deviated from accepted Customs risk management procedures.
While the action had reportedly been taken to alleviate severe container congestion, the committee has concluded that the Director General of Customs had exceeded the general authority granted by the Customs Ordinance.
It is revealed that 999 containers classified as ‘red’ had been released over 13 occasions in a period spanning July 2024 to 18 January 2025 without physical inspection.
The report has deemed the release method contrary to law and in violation of established operational systems, raising serious concerns about potential adverse impacts on State revenue, national security, and public health due to the uninspected removal of these high-risk goods.
Furthermore, questions have been raised regarding the effectiveness of the release in resolving congestion and the transparency of the committee responsible for the operation, alongside doubts about the accuracy of the current Risk Management System.
The report’s conclusions are stark and assert that the release of ‘red’ categorised containers by the internal committee, operating outside the standard Customs Department procedures, constitutes a clear procedural violation.
The report highlights that the Director General’s approval for this committee’s actions amounts to an overstepping of the powers bestowed by the Customs Ordinance.
A critical point of concern is the inadequacy of follow-up measures to mitigate the risks arising from the uninspected release of these containers, which, according to the report, has compromised the integrity and fundamental role of the Customs Department.
Consequently, an internal investigation has been recommended regarding uncertainties identified during scan inspections on containers that were nevertheless released without physical examination.
To address these serious lapses and prevent their recurrence, the committee has put forth a series of stringent recommendations. These included the immediate suspension of the existing container release method involving an internal committee.
A comprehensive post-audit has been proposed to ascertain the full economic loss and identify all irregularities stemming from the controversial container releases. To enhance transparency, the report has recommended establishing a system for direct exchange of container clearance information with importers.
Furthermore, it has advocated the exploration and implementation of Artificial Intelligence (AI) technology for advanced container scanning to improve both accuracy and efficiency. Finally, a forensic audit has been urged for all containers released under the disputed committee’s directive.
However, the committee’s findings have not been unanimously endorsed, revealing significant divisions among its members.
Ministry of Transport, Highways, Ports, and Civil Aviation Additional Secretary E.M.S.B. Jayasundara, while largely agreeing with the report’s general observations and recommendations, has expressed reservations regarding its conclusions on the limits of the Customs Director General’s general powers, suggesting that such determinations should come from an appropriate external authority.
Department of Trade and Investment Policy Director General M.K.P. Kumara has concurred with the recommendations, proposing minor adjustments to safeguard the Director General’s general authority and remove a specific phrase. Critically, Kumara has dissented from other parts of the report, citing concerns over structural issues, predetermined linguistic usages, unclear authorship, and the approach to legal interpretations, also noting a lack of prior access to the draft.
Most notably, Sri Lanka Customs Senior Director M.K.S.P. Jayawardena has explicitly disagreed with the entire report, asserting that the committee’s reliance on specific court decisions concerning the Director General’s powers is based on a flawed understanding and made without obtaining an expert opinion from the Attorney General.
These dissenting opinions underscore the complexity and contentious nature of the issues examined within the report.
A copy of the report was tabled in Parliament last week by Samagi Jana Balawegaya (SJB) Member of Parliament (MP) Mujibur Rahman, after revealing several key findings in the report during his speech in the House.