Foreign Exchange Act 2017 · As enacted
7. Capital transaction
Official English translation. Where it differs from the Sinhala or Tamil text, the Act itself says which text prevails.
Official translationFrom Department of Government Printing, unchanged
The Minister shall in consultation with the
Monetary Board and with the approval of the Cabinet of
Ministers, authorize by regulations, the class or classes of capital transactions in foreign exchange for the purpose of this section.
In making regulations under subsection (1), the
Minister shall have regard to –
transactions required to be regulated in conformity with any treaty or agreement relating to international financial transactions to which the Government of
Sri Lanka is a signatory;
the impact of such authorization on the monetary policy of Sri Lanka and its stabilization.
The regulations published under subsection (1) may specify the limit up to which capital transactions may be authorized and the terms and conditions subject to which foreign exchange may be dealt with for the class or classes of capital transactions, so authorized.
Without prejudice to the provisions of section 5, a person shall be entitled to deal in foreign exchange in respect of a capital transaction of such person, through an authorized dealer or to the extent specified in the permit, through a restricted dealer, being capital transactions of a class or classes, which is or are authorized by regulations made under subsection (1).
An authorized dealer or a restricted dealer may deal in foreign exchange for a capital transaction as a principle or an intermediary, being a transaction authorized by regulations made under subsection (1).
Prior to dealing in foreign exchange in respect of a capital transaction under this section, the authorized dealer or the restricted dealer shall request the person requiring foreign exchange for such transaction, to provide such information or produce such documents or make such declaration as is reasonably necessary in order to satisfy himself that the requirement is in relation to a capital transaction authorized under subsection (1) and is in conformity with any other laws regulating such transactions.
An authorized dealer or a restricted dealer shall refuse to deal in foreign exchange for a capital transaction under this section where a request for information, documents or a declaration is not complied with or where the dealer is satisfied that the requirement is not for a capital transaction authorized under subsection (1) or is not in conformity with other laws regulating such transaction.
An authorized dealer or a restricted dealer refusing to deal in foreign exchange in respect of a capital transaction under this section shall communicate his decision in writing together with the reasons therefor, if requested by the person requiring the foreign exchange subject to the provisions of section 9 of the Financial Transactions Reporting Act, No. 6
of 2006.
Any person aggrieved by the decision of an authorized dealer or a restricted dealer under subsection (7), may within fourteen days after such decision is communicated to such person, appeal against such decision to the Central Bank, and the Central Bank shall, after giving such person and the dealer a reasonable opportunity of being heard, affirm, vary or revoke such decision.
An authorized dealer or a restricted dealer shall not deal in foreign exchange for a capital transaction that is not authorized by regulations made under subsection (1) unless the Monetary Board taking into consideration the existence of any exceptional circumstances has granted approval for such capital transaction in accordance with such directions as may be issued by the Minister in conformity with the approvals made under subsection (1).