News
Colombo Port City under high-powered body
A high-powered five-member Colombo Port City Economic Commission, with adequate powers at its disposal, will oversee the development of 446.6153 hectares of land as a special economic zone in the heart of Colombo city.
The commission is to function as a Single Window Investment Facilitator in relation to the grant of any registration, licence, authorisation or approval for business entities in the Special Economic Zone (SEZ). Only persons authorised by the Commission will be permitted to engage in business in and from the Colombo Port City, according to a bill gazetted following the Cabinet approval early this week.
The commission will consist of five members including a chairperson appointed by the President.
Every project company that wishes to invest in the SEZ should contribute Rs 400 million to the Commission Fund which will be used by the commission to “defray initial setting up and operational expenditure of the Commission, including international promotional expenditure of the Colombo Port City and Sri Lanka and such other expenses as may be incurred by the Commission in terms of this Act.”
The Commission will also set up an International Commercial Dispute Resolution Centre within the Colombo Port City for the purposes of offering conciliation, mediation, adjudication, arbitration and any other alternative dispute resolution services.
Any legal proceedings instituted on civil and commercial matters where the cause of action has arisen within the area of authority of the Colombo Port City, the bill indicates that priority should be given by court to hear them on a speedily day-to-day basis to ensure the expeditious disposal of the cases.
As an interim measure, the Commission can permit an authorised person to engage in business from a location in Sri Lanka, outside the area of authority of the Colombo Port City for five years from the date the act comes into effect. “Such business shall, for such period of five years be entitled to all the privileges accorded to, and be deemed for all purposes to be, a business situated within and engaged in business, in and from, the Area of Authority of the Colombo Port City,” the bill said.
Any transfer, lease or agreement executed by the Urban Development Authority (UDA) to be deemed to be documents executed by the commission while the same will apply to agreements entered into by the Board of Investment of Sri Lanka (BOI).
According to the bill, seven enactments have no application within the area of authority of the Colombo Port City. Among them are the Urban Development Authority Act, No. 41 of 1978, the Municipal Council Ordinance (Chapter 252), and the Board of Investment of Sri Lanka Law No. 4 of 1978.
On Tuesday, a Cabinet Memorandum on the Colombo Port City Economic Commission bill submitted by President Gotabaya Rajapaksa was approved by the Cabinet of Ministers. The bill is expected to be submitted for Parliamentary approval shortly.
CHEC Port City Colombo, local implementing partner under China Harbour Engineering Company (CHEC) owned by the state-owned China Communications Construction Company Limited (CCCC) welcomed the Cabinet approval this week saying the Port City Economic Zone would bring more Foreign Direct Investments (FDI) to the country.
“It is expected that the Special Economic Zone (SEZ) will attract multinational enterprises to set up headquarters or regional offices in the Port City and in turn bring in financial resources, technology and technical and managerial know-how. We hope the establishment of an SEZ will accelerate Sri Lanka’s economic growth,” a statement from the company said.
Meanwhile, Prime Minister and Finance Minister Mahinda Rajapaksa issued an order this week under the Strategic Development Projects Act, giving a tax exemption for eight years on Corporate Income Tax, Dividend Tax, Withholding Tax, Personal Income Tax, Value added Tax (VAT) for new development projects within the Port City.