Press briefing of Cabinet Decision taken on 2021-06-28

Facilitating the raising of foreign funds to local Companies

- In view of providing the opportunity to raise foreign funds to local Companies onshore, the Colombo Stock Exchange (CSE) has submitted a proposal to list foreign currency denominated shares issued by the Companies registered in Sri Lanka, in the Colombo Stock Exchange. In terms of the Foreign Exchange Regulation No.02 of 2021, it is not permitted to credit the proceeds arising from debt securities listed in foreign currency or an Initial Public Offering of foreign currency denominated shares or payment of dividends or any other distribution in foreign currency, to a Business Foreign Currency Account. Having considered the matters such as boosting the interest of foreign investors in Sri Lankan listed Companies, attracting foreign currency inflows and increasing the number of participants, limiting pressure on the Sri Lankan Rupee and creating an alternative for reaching foreign share markets by the Sri Lankan Companies to raise foreign funds, the Monetary Board of the Central Bank of Sri Lanka has recommended the implementation of the proposal made by the Colombo Stock Exchange. As such, the proposal made by the Hon. Prime Minister in his capacity as the Minister of Finance to issue an Order under section 7 (1) of Foreign Exchange Act, No.12 of 2017 amending the Regulation No.02 of 2021 currently issued to provide for the necessary provisions to implement the said proposal and to submit the same in Parliament for approval, was approved by the Cabinet.