Financial Times

The government has bowed to pressure from importers of reconditioned vehicles and put off till December enforcing new regulations (earlier effective from August 1) on compulsory export inspection certificates for used car imports.

The new process would have raised reconditioned car prices by at least Rs 200,000 each.

Neil Hapuhinna, Controller of Import and Export, said he had informed banks and other relevant authorities that the regulations are being postponed until 31 December 2006 with the old rules continuing for now. He said the Trade and Commerce Minister and Secretary decided to put off operation of the export inspection certificates as "there are lots of pros and cons with the regulations." "Some people are saying that to get the certificate is unnecessary and that there are additional costs involved. The regulations are good because it will increase the quality of the vehicles. Now we have to think about the cost," he said.

Several importers complained about the additional costs of acquiring certification from the country of export. Berty Widanagamage, Managing Director of Tokyo Express (Pvt) Limited and past president of the Vehicle Importers Association of Sri Lanka, said while it is important to prevent individuals from cheating the system, the regulations were unnecessary. "To achieve this goal, we have developed a plan which is very transparent and will be submitted to the minister next week," he said.

Authorities said last week that the new regulations were intended to overcome flaws in the current system where some importers give false details.

Chairman of the Motor Traders Association, Ranjan De Silva said however his association would be appealing against the decision to withhold the regulations.