Securities and Exchange Commission of Sri Lanka Act 2021 · As enacted · Part V · Market Misconduct
152. Right of the Commission to recover damages and seek civil penalties
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
Whenever it appears to the Commission that any person has contravened sections 128, 129, 130, 131,
132 or subsections (2) and (3) of section 137 and where the
Commission considers it necessary having taken into consideration the nature and manner of the contravention, the impact it has on the market and the extent of the loss caused to any investor, the Commission may institute Civil
Proceedings in the court against that person.
In a proceeding instituted by the Commission under subsection (1), the court may if it is satisfied on a balance of probabilities, that the person has contravened the provisions of sections 128, 129, 130, 131, 132 or subsections (2) and (3) of section 137, make an order against that person-
to pay to the Commission an amount equal to three times the gross amount of the pecuniary gain made or loss avoided by such person; and
for the payment of a civil penalty as the court considers appropriate having regard to the severity or gravity of the contravention, being an amount not less than ten million rupees and not exceeding one hundred million rupees.
Notwithstanding anything to the contrary in any other written law, the court shall exercise jurisdiction in respect of the matters set out in subsection (2), and proceedings under subsection (2) shall be instituted by way of a plaint filed by the Commission and the provisions contained in the Civil
Procedure Code (Chapter 101) shall apply mutatis mutandis regarding regular actions instituted by way of a plaint.
Nothing in this section shall be construed to prevent the Commission from entering into an agreement with any person to pay with or without admission of liability an amount equal to three times the gross amount of the pecuniary gain made or the loss avoided by such person as determined by the Commission.
An amount recovered by the Commission in an action under subsection (1) or in terms of the agreement referred to in subsection (4), each one third of that amount shall be -
applied to reimburse the Commission for all costs of the investigation and proceedings in respect of the contravention;
applied to compensate persons who have suffered loss or damage as a result of the contravention; and
credited to the Compensation Fund:
Provided that, if the Commission considers that it is not practicable to compensate the persons referred to in paragraph (b) in view of the amount of any potential distribution to each person or the difficulty of ascertaining or notifying the persons to whom it is appropriate to compensate, as the case may be, the Commission may decide not to distribute to the persons referred to in paragraph (b)
and credit such sums to the Compensation Fund of the
Commission.
If the person fails to pay the civil penalty imposed on him within the time specified in the order made by the court referred to in subsection (2) or the sum to be paid in terms of the agreement as referred to in subsection (4), the
Commission may recover the civil penalty or such sum as the case may be, as if it were a judgment debt owing to the
Commission.
Part VI
Finance
Part VII