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Statutes and regulations associated with Regulated Finance Companies

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By Shiranthi Gunawardana –
Attorney at Law and Legal Consultant to the Finance
Houses Association

Regulated Finance Companies (RFCs) are major financial intermediaries which are duly regulated and governed by the laws of Sri Lanka. RFCs are strictly governed by virtue of statutes and Acts such as Finance Business Act No. 42 of 2011. The other statutes which are applicable are Finance Leasing Act No. 56 of 2000 as amended, Consumer Credit Act, Mortgage Act, Motor Traffic Act, Inland Trust Receipts Act, Debt Recovery Special Provisions Act, Criminal Procedure Amendment Act, Companies Act and so on.

The Finance Business Act No. 42 of 2011 is an Act to provide control and supervision of finance companies registered in the Central Bank and the act has repealed the Finance Companies Act No. 78 of 1998. The Act outlines the licensing procedures, directions, rules and requirements of finance companies, including core capital reserve funds, admissible business activities by finance companies. Under this act, it is mandatory that a company cannot accept public deposits unless it is registered and licensed as a finance company under the Act and to be registered as a Licensed Finance Company, that company needs to have registered under the Companies Act, No. 7 of 2007. The Act also provides for a separate director in the CBSL to monitor and control NBFIs. According to the sections 13 and 14 of the Act, the director is vested with power to act upon NBFIs if they fail to comply with the directions which are listed in sections 13 and 14 suggested under the Finance Business Act.

All RFCs are legally bound and obliged to comply with all the directions and circulars issued under the Finance Businesses Act No. 42 of 2011.

Importance of the Finance Leasing Act

The Finance Leasing Act No. 56 of 2000 as amended by Act No. 24 of 2005 and Act No. 33 of 2007 makes it that it is mandatory to have a license under the Finance Leasing Act to carry on finance leasing businesses. Section 32 of the Finance Leasing Act clearly sets out the repercussions of carrying on Finance Leasing Businesses without registration. Under this section, the director of the Central Bank has the right under Section 32(2) and Section 32(3) (a) (b) to apply to the High Court and obtain an injunction.

Under the Finance Leasing Act, there are 4 mandatory provisions which have to be strictly followed as provided by Section 31 of the Finance leasing Act No. 56 of 2000.

 

The mandatory provisions are

• Section 11 – Right to undisturbed possession

• Section 16 – Termination on variations of a supply agreement.

• Section 22 – Computation of damages recoverable from the Lessee.

• Section 24 – Which has been amended by Act No 24 of 2005 – Which provides for transfer or assignment of Lessor’s rights.

For RFCs – To carry out finance business and to accept public deposits, a license has to be obtained from the monetary board which has to be annually renewed and for finance leasing businesses a separate license which is again renewable annually has to be obtained.

Approved credit agency status is granted under the Mortgage Act No. 06 of 1949 as amended. The Trust receipt ordinance No. 12 of 1947 and the Inland trust receipt Act of No. 14 of 1990 also are Acts under which businesses can be carried on.

Under these Acts, with the relevant authority given, a finance company can engage in mortgage of movables and mortgage of shares and allied businesses.

The mortgage of corporeal movables such as gold articles, motor vehicles can be carried on by finance companies who are also approved credit agencies and can enjoy the special benefits granted under these Acts in their recovery process.

It is evident from the above statues and regulations that RFCs are well regulated and governed and are legally bound to abide by the said regulations and directions. RFCs are aware of the consequences of failing to abide by these regulations, accordingly 99% of RFCs do comply with these regulations which is an encouraging sign for customers to embrace the services of RFCs.

The writer is the Legal Consultant of the FHA with 45 years of experience in the finance industry.



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Sri Lanka Tourism makes a strong impression at CMT 2026 in Stuttgart, Germany

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Sri Lanka Tourism marked its presence at CMT 2026, held in Stuttgart, Germany, one of the largest consumer travel fairs in Europe. The Sri Lanka Stand accommodated representatives from the local tourism industry, providing a valuable platform to connect directly with the German travel community, particularly travellers with long-haul travel intentions.

Sri Lanka’s participation at CMT 2026 enabled direct engagement with consumers and helped stimulate interest in exploring the country’s diverse and year-round travel experiences. This presence addressed a long-standing need for Sri Lanka Tourism to participate in major consumer-focused travel platforms, effectively taking destination promotion directly to the travellers’ doorstep.

A wide range of travel packages, customised itineraries, accommodation options, and experiential offerings were presented to interested German consumers by Sri Lankan DMCs, under the umbrella of Sri Lanka Tourism. The platform also allowed potential travellers to clarify concerns and queries related to planning travel to Sri Lanka through direct, face-to-face interactions with industry professionals.

These direct engagements enabled Sri Lankan industry participants to gain valuable insights into emerging travel interests, changing consumer behaviour, and evolving customer expectations in the German market. The face-to-face discussions with end consumers strengthened the industry’s understanding of demand trends and product requirements.

Strategically, Sri Lanka Tourism’s focus on B2C promotions serves as a catalyst for strengthening B2B platforms, ensuring that final decision-makers—the travellers—are actively engaged alongside trade partners. This alignment enhances the overall effectiveness of trade collaborations. Well-designed consumer promotion activities, including giveaways, contests, experiential engagements, and cultural performances, created emotional connections with visitors, improved destination recall, and reinforced Sri Lanka’s positioning as a compelling long-haul destination. (Sri Lanka Tourism)

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Adora raises the bar for hospital-backed aesthetic care in Wattala

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Dr. Piyumini Gunasekara on advanced non surgical treatments

Hemas Hospitals has strengthened its regional healthcare positioning with the launch of Adora Cosmetic Centre at Hemas Hospital Wattala, introducing a hospital-backed, clinically governed model of aesthetic medicine at a time when South Asia’s cosmetic sector is expanding faster than regulation.

Unlike standalone cosmetic clinics, Adora is fully integrated into the Hemas Hospital ecosystem, embedding aesthetic services within hospital-grade infrastructure, multidisciplinary medical support and internationally aligned clinical governance.

Speaking at the launch, Dr. Lakith Peiris, Managing Director of Hemas Hospitals & Labs, said the centre represents a deliberate shift in strategy.

“Adora is not about cosmetic enhancement alone. It is built on protocols, trained clinicians and governance. As healthcare providers scale across the region, safety and medical credibility must remain non-negotiable,” he told The Island Financial Review.

The centre is positioned as a health-class facility, combining advanced aesthetic technologies with evidence-based medical pathways. This approach addresses growing regional concerns over unregulated cosmetic practices, offering patients reassurance through professional oversight and ethical medical standards.

Prabhan Gunawardena, Director General Manager of Hemas Hospital Wattala, said the initiative reflects both clinical responsibility and business foresight.

“The cosmetic industry is evolving rapidly across South Asia. Adora demonstrates how innovation can be scaled responsibly when anchored in medical expertise and hospital governance,” he said.

Detailing the centre’s scope, Dr. Piyumini Gunasekara, Medical Officer – Adora Cosmetic Centre, said treatments are designed to address medical and aesthetic concerns through personalised, evidence-based care.

She told The Island Financial Review:”We offer advanced non-surgical treatments for concerns such as hyperpigmentation, acne and acne scarring, fine lines and wrinkles, collagen loss, enlarged pores, rosacea, UV damage, excessive sweating, warts and moles. Every procedure is clinically assessed and delivered within a hospital-backed framework to ensure safe and sustainable outcomes.”

Clinical governance remains central to operations, reinforced by Dr. Malith Atapattu, Director – Medical Services and Quality, who highlighted the importance of protocol-driven care in a sector often challenged by inconsistent standards.

As Sri Lanka positions itself as a regional healthcare and medical tourism destination, hospital-led aesthetic centres such as Adora signal a broader industry shift—where growth is aligned with governance, trust and long-term sustainability.

For Hemas Hospitals, Adora represents a calculated entry into a high-growth segment without compromising medical integrity. For the region, it underscores a clear message: the future of aesthetic care lies in hospital-backed, clinically governed models—not cosmetic shortcuts.

By Ifham Nizam

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John Keells Consumer Foods Sector dominates SLIM National Sales Awards 2025 with landmark wins

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The John Keells Consumer Foods Sector (JKCF) has reinforced its standing as a powerhouse in Sri Lanka’s FMCG industry with an exceptional performance at the SLIM National Sales Awards 2025, securing an impressive total of 27 awards. This remarkable achievement reflects the sector’s unwavering commitment to building high-performing teams, nurturing sales excellence, and driving sustained growth across its diverse business verticals.

Representing the iconic brands of Ceylon Cold Stores PLC (CCS), Keells Food Products PLC (KFP), and Colombo Ice Company (CICL), JKCF has long been recognized for its rich legacy of innovation and leadership in beverages, frozen confectionery, and processed foods. Its long-standing focus on people capability and performance culture continues to fuel industry-leading achievements, with the latest recognition at SLIM NSA 2025 marking one of the largest collective wins by a single organization in the event’s history.

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