Defer or be damned!

The country’s private sector yesterday renewed last-ditch attempts to drive sense into the Government from either withdrawing or deferring the controversial takeover bill.

Issuing its second statement in three days, the six chambers of commerce and industry appealed that given the likely negative impact of the proposed Act to Revive Underperforming Enterprises and Underutilised Assets, and the widespread negative publicity it has received, the Government should defer the Bill until it is subjected to wider public and stakeholder discussion and debate.

“We believe that the proposed Bill may impact investor sentiment negatively and will thus be counterproductive in an environment where the country seeks investments in excess of US$ 15 billion per annum from the private sector, both local and foreign. Further, the expeditious manner in which the legislation is being enacted is likely to heighten such negative sentiments,” said the joint statement issued by Ceylon Chamber of Commerce, the Federation of Chambers of Commerce and Industry of Sri Lanka, National Chamber of Commerce, National Chamber of Exporters, Chamber of Young Lankan Entrepreneurs and Joint Apparel Association Forum.

“We are made to understand that the intention of the above Act is to put into productive use underperforming entities and underutilised assets that are in some way connected to the State, although currently in private hands. We have consistently maintained that all State enterprises and State assets must be put into productive use.

“However, we believe that the proposed Bill may impact investor sentiment negatively and will thus be counter-productive in an environment where the country seeks investments in excess of US$ 15 b per annum from the private sector, both local and foreign. Further, the expeditious manner in which the legislation is being enacted is likely to heighten such negative sentiments.

“Considering the above circumstances and to mitigate the associated risks, the business chambers have jointly submitted a series of proposals to the Government. In addition, the business chambers have urged that operating entities which are going concerns and land if any that is privately held be excluded from the schedules.

“The Government has provided the business chambers with certain assurances, the details of which were intimated previously.

“Considering the likely negative impact of the proposed legislation and the widespread negative publicity it has received, we urge the Government to defer this Bill until it is subjected to wider public and stakeholder discussion and debate.”

The latest statement comes despite the private sector having been given several assurances at a meeting with President Mahinda Rajapaksa and his team on Saturday. At this meeting the business chambers presented a set of amendments as well whilst getting an opportunity to hear the Government’s side of the story from proponents of the new legislation, Economic Development Minister Basil Rajapaksa and Secretary Dr. P.B. Jayasundera.

Following that meeting, the private sector issued its first statement, which said, “At this meeting the chambers appraised the President of the impact of the proposed bill, suggested some amendments and requested that some companies be removed from the schedule.”

The chambers were given the following assurances:

1. That this is a one-off bill

2. The intention of this one-off bill is purely to revive the 37 underperforming enterprises and underutilised assets listed in schedules 1 and 2.

3.  The bill is not meant to target privately-owned land.

4.  The Government proposes to revive these enterprises or assets through the private sector.

5. The present holders of these enterprises or assets will be given the opportunity to submit proposals to the Government to revive their respective enterprises or assets.

The business chambers will continue to remain engaged with the Government on the proposed bill, the statement added.