Rescue, Rehabilitation and Insolvency (Corporate and Personal) Act 2026 · As enacted · Part X · Compromises
270. Compromise proposal
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
Any of the following persons may propose a compromise under this Part, if that person has reason to believe that a company is or is likely to become insolvent –
the board of the company by resolution;
a receiver who is appointed in respect of the whole, or substantially the whole, of the property and undertaking of the company;
an administrator of the company;
a liquidator of the company; or
with the permission of the court, a creditor of the company, a receiver appointed by a creditor of the company or a shareholder of the company.
Where the court grants permission to a creditor, receiver or shareholder under paragraph (e) of subsection (1), the court may make an order directing the company to send to the creditor, receiver or shareholder, within such period as may be specified in the order, a list of the names and addresses of the company’s creditors, setting out the amount or estimated amount of the company’s debt or liability to each creditor and such other information as may
Rescue, Rehabilitation and Insolvency be specified in the order, to enable the creditor, receiver or shareholder to propose a compromise.
A compromise shall be proposed to each class of creditors in a separate meeting convened by the proponent.
For the purposes of subsection (3) –
the proponent shall constitute creditor classes in such a way that creditors whose interests are so dissimilar that they cannot sensibly consult together with a view to acting in their common interest are in different classes; and
if the members of a class of creditors do not have a genuine economic interest in the company, a meeting of that class does not need to be convened.
On the application of the proponent or the company, and at any time before a meeting is convened under subsection (3), the court may give directions in relation to any of the matters referred to in subsection (4).
On the application of the proponent or the company, and at any time before a compromise is approved by creditors, or a class of creditors, under section 272, the court may give directions in relation to any matter that would or might be relevant if an application was to be made under subsection (2) of section 274.
Without prejudice to subsection (5), subsection (6)
shall not apply to the matters referred to in subsection (4).
In view of the importance to the company’s position of the subject matter of subsections (5) and (6), a determination on an application under either of those subsections shall be made as expeditiously as possible.
Rescue, Rehabilitation and Insolvency
Part XI
Micro Small Medium Enterprise (MSME) Company Debt Restructuring Arrangements
Part XII
Part XIII
Part XIV