Press briefing of Cabinet Decision taken on 2018-03-20

Amending the Companies Act, No.7 of 2007 incorporating the provisions to eliminate money laundering and countering the financing of terrorism

- 'Financial Action Task Force' (FATF) has taken action to grade Sri Lanka as a country with strategic deficiencies pertaining to the prevention of money laundering and countering of financing of terrorism. The European Union (EU) has accordingly, blacklisted Sri Lanka in this regard in February 2018. Taking into consideration the serious negative consequences which may be caused to the economy and the financial system of the country, the necessity of making further legal provisions for the prevention of money laundering and countering financing of terrorism has been identified.

One of the important provisions to be incorporated will be the necessity of maintaining a register providing for information of the persons who own a share entitlement of 25% or more the ownership of their own Company, and all the other Companies except a Public Limited Company (PLC) or on the beneficiaries who exercise effective control over the operations of such a Company. Further, provisions have to be made to provide such information to the Registrar of Companies and other relevant authorities as well. Accordingly, the proposal made by Hon. A.D. Champika Premadasa, the Acting Minister of Industry and Commerce, to make the necessary amendments to the Companies Act, No.7 of 2007 and to instruct the Legal Draftsman to draft amending legislation for the purpose, was approved by the Cabinet.