RECENT RELAXATIONS OF EXCHANGE CONTROL REGULATIONS

RECENT RELAXATIONS OF

EXCHANGE CONTROL REGULATIONS

11COMMERCIAL BANK OF CEYLON PLC

HOW THE EXCHANGE CONTROL REGIME HAS EVALUATED IN SRI LANKA

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COMMERCIAL BANK OF CEYLON PLC

1950 -subject to a minimum degree of control 1960 -the intensity of the degree of control was progressively

increased 1977 -controls were relaxed to a greater extent 1994 -With the acceptance of obligations under article VIII of the

IMF articles of agreement all restrictions under current international transactions were removed.

2010 -Liberalization of capital account

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Following policy initiatives were announced by the Central Bank of Sri Lanka (CBSL), with a view to encourage both local and foreign entities to enhance their business activities. These were implemented in three phasesa)Implemented w.e.f 11th March 2010b)Implemented w.e.f 22nd Nevember 2010c)Implemented w.e.f 1st January 2011

RECENT POLICY INITIATIVES

A) POLICIES IMPLEMENTED W.E.F 11TH MARCH 2010

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1) Permission for Sri Lankans (SL) to open and maintain accounts with banks, based outside SL.

2) Removal of restrictions on pre payment of import bills.3) Removal of margin requirement on selected imports under advance

payment terms.4) Provision of greater flexibility in foreign currency contracts to cover

current and capital account transactions.5) Amalgamation of SIERA, TIERA, TIERA -2 and TIERA-D accounts and

renamed as Securities Investment Account (SIA).6) Permission for International Service Providers and their employees to

open and maintain foreign currency accounts (w.e.f 07th May 2010)

RECENT POLICY INITIATIVES, AT A GLANCE

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1) Permission to foreigners to invest in Rupee Denominated Debentures issued by local companies.

2) Expedition of approvals for SL residents to borrow from foreign sources.3) Permission for foreign companies to open places of business in Sri Lanka4) Permission to foreigners on tour or business in Sri Lanka to open

accounts in foreign currency5) Permission to importers of gem and jewellery to open accounts in

foreign currency 6) Permission for Diplomatic Missions, their staff and family members in Sri

Lanka to do certain banking transactions in foreign currency and Sri Lanka Rupees .

7) Increase of the advance payment limit for imports from USD 10,000 to USD 50,000

B) POLICIES IMPLEMENTED W.E.F 22ND NOVEMBER 2010

RECENT POLICY INITIATIVES , AT A GLANCE

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1) Permission to SL residents to invest in equity of foreign companies and sovereign bonds.

2) Permission to make payments in respect of setting up of places of business outside SL.

C) POLICIES IMPLEMENTED W.E.F 1ST JANUARY 2011

RECENT POLICY INITIATIVES , AT A GLANCE

EXCHANGE CONTROL LIBERALIZATIONSON

CAPITAL ACCOUNT TRANSACTIONS

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DETAILED EXPLANATION

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1. Allowing Sri Lankans to invest in equity of overseas companies and Sovereign Bonds issued by Foreign Governments

2. Allowing foreigners to invest in rupee denominated debentures issued by local companies

3. Allowing foreign companies to open places of business in SL4. Expedition of approvals for companies to borrow from foreign sources5. Allowing SL companies to open and maintain overseas offices

EXCHANGE CONTROL LIBERALIZATIONS ON CAPITAL ACCOUNT TRANSACTIONS (SUMMARY)

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Persons resident in Sri Lanka should obtain prior permission of the Hon. Minister of Finance for making investments abroad (section 17 (2) of the ECA).

General Permission is effective from 1st January 2011 by which permission has been granted for companies and Individuals to invest in shares outside the country subject to certain limits.

A new account dedicated for foreign investments namely Outward Investment Account (OIA) (which had discussed earlier) has been introduced under the general permission.

ALLOWING SRI LANKANS TO INVEST IN EQUITY IN OVERSEAS COMPANIES & SOVEREIGN BONDS ISSUED BY FOREIGN GOVERNMENTS

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Click here to see details of OIA

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General permission to any person resident in SL or any company registered under Companies Act, No. 7 of 2007 or any partnership registered in SL, to acquire, hold and transfer shares of companies incorporated outside SL and the sovereign bonds issued by foreign governments and governmental organizations rated on or above the sovereign credit rating for the time being of SL.Permission is not applicable for the following:-

Any company limited by guarantee within the meaning of the Companies Act No.7 of 2007;

Any non-governmental organization; Any person against whom, or any company or partnership against

which legal proceedings are pending in respect of a prosecution made against such person, company or partnership under the provisions of Exchange Control Act.


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Terms and Conditions: This make outward remittances only out of an Outward Investment

Account (OIA) opened in a licensed commercial bank Repatriate within three months from the date of payment, all dividends,

capital gains and profits from the sale of shares, liquidation or capital reduction receivable from a foreign company and proceeds of sale and maturity of sovereign bonds, including the capital gains, if any, with the interest earned on such sovereign bonds, credited to the Outward Investment Account through which the initial investment was made;

Submit a request to an authorized dealer along with a recommendation from a Fellow Member of the Institute of Chartered Accountants of Sri Lanka who possesses a valid certificate to practice at the time of issue of such recommendation;


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Click here to see details of OIA

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Terms and Conditions cont…: Submit an affidavit stating that no outward remittance has been effected

through any other authorized dealer for the same investment and that no application has been forwarded to obtain foreign exchange allowance for the purpose of migration.


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Limitations: US dollars five hundred thousand (USD 500,000/) or an equivalent

amount in any designated foreign currency per annum, in respect of a company listed at the Colombo Stock Exchange;

US dollars one hundred thousand (USD 100,000) or an equivalent amount in any designated foreign currency per annum, in respect of a company which is not listed at the Colombo Stock Exchange;

US dollars one hundred thousand (USD 100,000) or its equivalent amount in any designated foreign currency, in respect of a partnership registered in SL, subject to providing a tax clearance certificate by each partner to the authorized dealer to cover the amount to be remitted;

US dollars one hundred thousand (USD 100,000) or its equivalent amount in any designated foreign currency, in respect of any individual resident in SL, subject to providing a tax clearance certificate to the authorized dealer to cover the amount to be remitted;


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Limitations cont…: US dollars one hundred thousand (USD 100,000) or its equivalent amount

in any designated foreign currency per individual employee of a branch in SL or subsidiary of a company incorporated outside SL, to acquire shares of such company under an Employee Share Option Scheme:

Provided however, maximum number of shares that can be acquired by all employees of the branch in SL or of subsidiary shall not exceed five percent(5%) of the value of total shares issued by the company incorporated outside SL;

Obtain the prior written approval of the Minister of Finance, prior to make an investment which exceeds the above limitations;

Shares under bonus issue and shares received by capitalization of reserves of companies incorporated outside SL, shall also be deemed to have been acquired pursuant to the general permission;


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General permission for the issue and transfer of convertible or non-convertible, redeemable or non-redeemable debentures denominated in Sri Lankan Rupees in a company classified as a specified business enterprise in terms of the SL Accounting and Auditing Standards Act, No. 15 of 1995, to foreign institutional investors, corporate bodies incorporated outside SL, individuals resident outside SL and Sri Lankans resident outside SL.

ALLOWING FOREIGNERS TO INVEST IN RUPEE DENOMINATED DEBENTURES ISSUED BY LOCAL COMPANIES

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Terms and Conditions Applicable to Debentures : All debentures shall be listed in the Colombo Stock Exchange, while issue

may be made either by private placement or initial public offer. The period of redemption or conversion to ordinary shares, of the

debentures shall not be less than five years and such conversion should be subject to the exclusions and limitations stipulated in the Government Gazette Notification No.1232/14 dated 19th April 2002.

The debentures issued shall have a current credit rating from a local rating agency or international rating agency acceptable to the Securities and Exchange Commission of SL.

The rate of interest on the debentures shall not exceed the five year secondary market Treasury bond rate published by the CBSL plus 200 basis points at the date of issuance of the debentures.


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Terms and Conditions applicable to the Debenture-Issuing Company: The Board of Directors shall ensure that cash inflows of its business

operations are adequate to service the repayment of interest payments on the debentures, so as to prevent any material liquidity risk to the company.

The Board of Directors shall establish a risk management process that ensures the company addresses the possible risks arising from the foreign investment in the debentures of the company and/or the contagion risk of any default and the other risks to the company in the case of such an eventuality.

- the company shall make appropriate sinking fund arrangements for the orderly repayment of debentures on the maturity date and these arrangements shall be reviewed by the company’s auditors.


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Terms and Conditions applicable to the Debenture-Issuing Company cont…:

- funds for the investment in debentures and the payment for debentures by the non-resident investor shall be made only out of funds received as inward remittances through a “Securities Investment Account” (SIA), or funds available to the credit of a SIA of the foreign investor, opened and maintained in a licensed commercial bank in SL in accordance with directions given by the Controller of Exchange.-the company shall furnish a report to the Exchange Control Department within 30 days of receipt of remittances for investment in debentures providing the following details:-The total amount received through SIAs.The names and addresses of the Authorized Dealers through whom the remittances were received. A certificate from the Company Secretary confirming that the provisions of the Exchange Control Act and the directions issued under the Act with regard to the issuance of debentures have been duly complied with.


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Permission has been granted by Gazette Extraordinary No.1681/10 dated 22.11.2010 for companies incorporated outside SL and registered as overseas companies under Companies Act No. 07 of 2007 to carry on business in SL through a place of business such as Branch, Project, Liaison, Representative Office or similar office.

OPENING OF PLACES OF BUSINESSES IN SRI LANKA03

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Activities which may be carried on by an overseas company : Type A: Any commercial, trading, or industrial activity other than those

specified in Schedule I, provided prior permission has been obtained from the Controller of Exchange for any such activity specified in Schedule II.

Type B: Any non-commercial, non-trading or non-industrial activity such as the activities undertaken or carried on by a liaison office, representative office, regional office or other similar office, provided such activities do not provide any income directly or indirectly to the company.


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Schedule I :Commercial, trading or industrial activities that are not permitted for

overseas companies: Money lending Pawn broking Retail trade with a capital of less than two million US dollars Coastal fishing Growing and primary processing of tea, rubber, coconut and rice Mining and primary processing of non-renewable national resources Freight Forwarding Shipping agency business Mechanized mining of gems Lotteries


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Schedule II :Activities which require the prior permission of the Controller of Exchange : Production of goods where Sri Lanka’s exports are subject to

internationally determined quota restrictions Growing and primary processing of sugar, cocoa and spices Timber based industries using local timber Deep sea fishing Mass communication Education Outbound travel agency business


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Schedule II :Activities which require the prior permission of the Controller of Exchange

cont….:Local air transportationCoastal shippingAny industry manufacturing or producing:–Arms, ammunitions, explosives, military vehicles and equipment, aircraft

and other military hardware–Poisons, narcotics, alcohols, dangerous drugs and toxic, hazardous or

carcinogenic materials –Currency, coins or security documents


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Inward Investment Account (IIA) IIA may be initially opened in the name of the parent company

incorporated outside SL on production of certified copies of the Certificate of Incorporation and Memorandum and Articles of Association of the said company.

After the said parent company is registered as an overseas company in SL by the Registrar General of Companies, the account shall be re-designated in the name of the company registered in SL, upon submission of a certified copy of the Certificate of Registration.


Click here to see details of IIA

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Financing of the Activities of Overseas Company :For Type A: Invest a minimum of United States Dollars (USD) 200,000 or equivalent

amount in other designated foreign currencies, out of remittances received from abroad and channeled through IIA.

Provide evidence of remittance of a minimum total of USD 200,000 or equivalent amount in other designated foreign currencies, to the Registrar of Companies, within 30 days of registration; and

Record the funds remitted as above in the Company’s books as an investment and maintain such record in the company until the company ceases its business in SL.


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Financing of the Activities of Overseas Company :For Type B: Shall remit the funds required for the maintenance of such place of

business from abroad in designated foreign currency via IIA.


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Foreign Borrowings require prior approval of the CBSL in terms of the provisions of section 5 of the ECA. New Policy to be effective from 22nd November 2010.

Procedure: Request to be forwarded to ECDPermission to be granted by the Controller of Exchange

Maximum amount to be borrowed: USD 20 million at any given time.

EXPEDITION OF APPROVALS FOR COMPANIES TO BORROW FROM FOREIGN SOURCES

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Permitted borrowers : Companies engaged in the following businesses will be permitted to borrow in foreign exchange subject to the condition that repayments should be made out of the foreign exchange earnings of the company. Merchandise exporters registered with the Export Development BoardTourismTourists Entertainment CentresGem and JewelleryFood ProcessingShippingDomestic Air Travel


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Permitted borrowers cont….. : Companies engaged in the following businesses will be permitted to borrow in foreign exchange irrespective of the capacity to repay the loans out of the foreign exchange earnings of the company. Agriculture, Livestock and PlantationFisheriesFood ProcessingEducation and trainingPower generation and transmissionResearch and DevelopmentHospitals and Provision of Health and Health care ServicesCommercial Housing Construction


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Permitted borrowers cont….. : Construction of Roads and BridgesMass TransportationEnvironmental ProtectionDepartmental Stores Vehicle AssemblingPorts & Ancillary ServicesIndustrial ParksUrban Infrastructure (water supply, sanitation and sewage projects)IT Service ProvidersHeavy Industries and Manufacturing


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Permitted borrowers cont….. : Sole proprietorships in the following businesses will be permitted to borrow in foreign exchange irrespective of the capacity to repay the loans out of the foreign exchange earnings of the proprietorship. Consultancy ServicesHandicrafts manufacturers registered with the Government AuthoritiesAdvertising, Publishing, PhotographyServices related to sportsFashion Modeling and Film industryEntertainment Industry (Music, Dancing Event Management etc.)


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Permitted lenders: International banks or Finance InstitutionsMultilateral financial institutionsForeign shareholders or parent companies of the borrowing companiesExport credit agenciesIndividual lenders: subject to furnishing of a confirmation from the banker of his/her country of residence that he/she had been maintaining an account with the said bank at least for a period of one year prior to the date of lending along with evidence that he/she is a tax payer in the country of residence;


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Repayment period: shall be at least three years from the date of receipt of the loan proceeds;

Cost of Borrowing: All costs including fees, charges and interest applicable for the loans shall not exceed the prevailing Sri Lanka’s International Sovereign Bond rate in the secondary market + 200 basis points;


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Conditions governing the receipt and utilization of the loan proceeds:

Loan proceeds shall be used only for the purpose of working capital, investment in the business of the borrower, restructure the company or settle existing foreign currency loans.

Entire loan proceeds must be remitted into SL.

If any part of the proceeds of the loans are to be used for any overseas investment, such proceeds shall first be credited to an Outward Investment Account opened at a licensed commercial bank according to the current guidelines issued by the Controller of Exchange.

In the case of a borrowing by a sole proprietorship, such business should have had a satisfactory banking relationship with a commercial bank in SL for the last three years, and should have also paid its taxes during the same period, if not exempted from payment of tax.


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Information required to be furnished:

Application Form in the manner prescribed by the Controller of Exchange;

A statement cum analysis of the business performance of the applicant during the past five years;

Statement of purpose of the loan with projected repayment, cash flows;

Audited accounts for the last two years;

Terms and conditions agreed or proposed regarding the loan;

Business profile of the lender; and

Tax clearance certificate in the case of sole proprietorships.


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General Permission to any company registered under Companies Act, No.7 of 2007 or any partnership registered in SL, to make payments to persons resident outside Sri Lanka where the same is required for the purpose of setting up and maintaining any Branch, Liaison, Agency, Project or Representative Offices (“overseas offices”).

Permission is not applicable for the following:

Any company limited by guarantee within the meaning of the Companies Act No. 7 of 2007;

Any non-governmental organization;

Any company or partnership against which legal proceedings are pending in respect of a prosecution made against such company or partnership under the provisions of Exchange Control Act (Chapter 423);

ALLOWING SRI LANKAN COMPANIES TO OPEN AND MAINTAIN OVERSEAS OFFICES

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Terms and Conditions:

A request should be submitted to an authorized dealer along with a feasibility report on setting up of a place of business outside SL, recommended by a Fellow Member of the Institute of Chartered Accountants of Sri Lanka who possesses a valid certificate to practice at the time of issue of such recommendation;

Make all outward remittances only out of an OIA

Repatriate within three months from the date of payment, all profits, margins and surplus funds from the overseas offices to SL only through the OIA through which the initial investment was made;


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Terms and Conditions cont…:

Submit with every request an affidavit stating that no outward remittance has been effected through any other authorized dealers for the purpose stated herein;

Submit all relevant information and documents required by the authorized dealer in accordance with the guidelines issued by the Controller of Exchange


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Limitations:

All payments shall not exceed US Dollars one hundred thousand (USD100,000) or its equivalent amount in any designated foreign currency:

However, prior permission of the Controller of Exchange shall be obtained, if any payment exceeds the above limitation.


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NEWFOREIGN CURRENCY / RUPPE

ACCOUNTS

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SECURITIES INVESTMENT ACCOUNT(SIA)

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Share Investment External Rupee Accounts (SIERA), Treasury bond Investment External Rupee Accounts (TIERA), Treasury bill Investment External Rupee Accounts (TIERA 2) and Treasury bonds/bills Investment External Rupee Accounts- Deshabhimani (T IERA-D) have been renamed as Securities Investment Accounts( SIA) with effect from 11/03/2010

Eligible Investors : Foreign Institutional Investors. Corporate bodies incorporated outside Sri Lanka. Citizens of foreign states whether citizens SL or outside SL. Non-resident Sri Lankans. Dual citizens who receive inward remittances.


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Permitted Credits: Inward remittances received through banking system.Transfer of funds from NRFC/FCBU/RNNFC accounts of the same account holder.Sale proceeds realized out of sale or transfer or maturity of T-bonds/T-bills or any capital gain thereof.Sale proceeds of shares and dividends.Proceeds realized out of sale or transfer or maturity of debentures.Interest accrued on debentures.Commissions relating to share transactions.Liquidation proceeds of companies.Interest received on T-bonds.


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Permitted Debits: Payments for investment in shares/T-bonds/T-bills/debentures.Outward remittances of sale/redemption/maturity or liquidation proceeds of shares/units/T-bonds/T-bills & dividends of shares or units.Payment to brokers, primary dealers, lead managers and bank charges.Payment for local expenses.Transfer of funds to the accounts maintained by the account holder at FCBU.Transfer of funds between SIA of the same account holder.

Back to Slide 18

PERMISSION FOR SRI LANKANS TO OPEN AND MAINTAIN ACCOUNTS WITH BANKS ABROAD

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Eligible Persons :Residents proceeded temporary outside SL for business, studies or medical purposes.Individual/company/firm who provide professional/vocational services outside Sri Lanka.Individual/company/firm permitted by the Minister of Finance to invest outside Sri Lanka.Individual/company/firm permitted by the CBSL to lend foreign currency abroad.Exporters of merchandise goods.

PERMISSION FOR SRI LANKANS TO OPEN AND MAINTAIN ACCOUNTS WITH BANKS ABROAD

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Credits:Foreign currency received legally outside SL or obtained from an authorized dealer/person in SL.

Debits:Funds may be utilized towards any foreign exchange transaction permissible for a resident person.

Closing of accounts:Balance shall be repatriated to SL through banking channels, within a month of such closure of accounts.

NON RESIDENT NON NATIONAL FOREIGN CURRENCY ACCOUNT (NRNNFA)

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CBSL has given the permission to foreigners on tour or business in SL to open NRNNFA accounts in the Domestic Banking Unit (DBU) in designated foreign currencies.

Eligible Persons:Non –nationals either on temporary visit to SL or intending to visit SL.

Type of Accounts:The accounts may be opened only in the form of current or savings accounts.


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Permitted Credits:Inward remittances received infavour of the account holder.Foreign currency in the form of traveler's cheques, bank draft or designated foreign currency notes brought into the country on declaration to SL Customs.Interest accrued on the funds held in the account.Transfers from FCBU account of the account holder or the company on whose behalf temporary visit to SL is undertaken.


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Permitted Debit:Withdrawals in Sri Lanka Rupees for local disbursements.Withdrawals in foreign currency.Outward remittances.

FOREIGN CURRENCY ACCOUNTS FOR GEM & JEWELLERY DEALERS

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Permission has been granted to extend the foreign currency account facilities available to direct and indirect exporters of gem and/or jewellery to importers of gem and/or jewellery. Minimum balance of accounts should be USD 1,000.

Eligible Persons:Individuals, firms & companies engage in:-a) Export of gem and/or jewelleryb) Import of gem and/or jewelleryc) Supply of finished or unfinished gem and/or jewellery to exporters

Type of Accounts:Non-chequeable, savings or fixed deposit account


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Opening of Accounts:Certificate should be obtained from National Gem and Jewellery Authority

Permitted Credits:Export proceeds from gems and/or jewelleryProceeds of gem and/or jewellery sold abroad & brought into the countryLocal receipts in foreign exchange by importers of gem and/or jewellery in respect of supply of raw materials to indirect/direct exportersLocal receipts in foreign exchange indirect exporters of gem and/or jewellery in respect of supply of raw materials to direct exportersInterest


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Permitted Debits:Payments in foreign exchange for import of cut and polished or rough gem stones and other raw materials.Withdrawals in foreign currency notes not exceeding USD 50,000 for purchasing cut and polished or rough gem stones and other raw materials abroad.Withdrawals in Sri Lanka Rupees.Payments in foreign currency to a local supplier in the form of bank transfer or bank draft.

FOREIGN CURRENCY & RUPEE ACCOUNTS FOR FOREIGN DIPLOMATIC MISSIONS, DIPLOMATIC PERSONNEL AND THEIR FAMILY MEMBERS IN SL

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Eligible Persons:Foreign diplomatic missions, Diplomatic personnel & their family members in SL.

Type of Accounts:Current, savings or term deposit accountsJoint accounts on behalf of diplomatic personnel & their family members.Transfer of funds between one DFA to another DFA and between one DRA to another DRA may be made.Transfer of funds between one DFA to FCBU account of the account holder or between one DFA to a FCBU account of the Diplomatic Mission may be made.

DIPLOMATIC RUPEE ACCOUNT (DRA)

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Credits to DRA : Transfers from DFA accounts converted to Rupees Interest Refunds, reimbursements and payments due to the account holder

from any person or institution in SL.

Debits to DRA : Local expenses of the account holder. Any transaction approved by the Ministry of Foreign Affairs. Remittance outside SL with the approval of CE.


DIPLOMATIC FOREIGN CURRENCY ACCOUNT (DFA)

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Credits to DFA : Proceeds of inward remittances Designated foreign currency brought into the country by the account

holder on declaration to SL customs. Interest

Debits to DFA : Repatriation outside SL Withdrawal in foreign currency or in rupees for local expenses Transfer to DRA accounts converted into Rupee


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Guidelines: This account may be initially opened in the name of the parent company After registering the parent company as an overseas company account

shall be re-designated in the name of the company registered in SL.Credits: Rupee proceeds of inward remittances Local revenue of overseas companyDebits: Profit, Royalty, Franchise or other similar payments or surplus funds

subject to the submission of the documents specified in paragraph 3 of the Gazette No 1681/10 of 22.11.10.

Local expenses of the overseas company

INWARD INVESTMENT ACCOUNT (IIA)

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Permitted investments: Investments in shares of foreign companies, sovereign bonds. Payments towards setting up and maintenance of overseas offices.

Eligible persons: Companies incorporated in terms of Companies Act. Partnerships registered with the local government authorities. Individuals resident in SL.

OUTWARD INVESTMENT ACCOUNT (OIA)

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Credits to OIA: Rupee proceeds converted into foreign currency, up to the investment

requirement and subject to the stipulations set out in the Gazette. Transfers from foreign currency accounts (except special foreign currency

accounts) of the same person. Profits, margins ,surplus funds and proceeds realized by closure of an

overseas offices Inward remittances received as dividend payments Inward remittances as management fees, consultancy fees, and

commissions related to the investments made through this account. Inward remittances received as sale proceeds of shares (Including capital

gains and liquidation proceeds) Proceeds of sale and maturity of sovereign bonds Interest


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Debits to OIA: Payments for acquisition of shares and sovereign bonds. Setting up & maintenance costs for Branch, Liaison, marketing,

Representative, Project & Agency offices. Bank charges, broker fees, commissions related to the investments Withdrawals in LKR


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Eligible Service Providers: Any resident company or partnership registered in SL or any individual

resident in SL rendering services while based in Sri Lanka to non-residents in the course of carrying on any profession or occupation specified in the direction.

Individuals employed by the said eligible service providers.

FOREIGN CURRENCY ACCOUNTS FOR INTERNATIONAL SERVICE PROVIDERS AND THEIR EMPLOYEES (FCAISPE)

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Opening of Accounts:

In the form of current, savings or term deposits in designated foreign currency upon submission of,

EmployerA letter from the commissioner General of Inland Revenue confirming that

the employer is qualified for income tax exemptions.EmployeeA letter from an employer that the employee is directly involved in projects

carried out by the employer & is paid for his services in foreign currency.


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Permitted Credits: Proceeds on international services. Employment income paid out of foreign currency received by an

employer for exempt projects. Interest accruing on the funds held in the account.

Permitted Debits: Payments in foreign currency to employees directly involved in exempt

projects. Payments in foreign currency outside SL for transactions permitted to

residents in SL. Withdrawal in rupees


RECENT RELAXATIONS OF EXCHANGE CONTROL REGULATIONS

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