Govt. tightens rules after $ 85 m bogus import payments disclosure

• Banks now required to report more details on import remittances to Customs in real time
• Importers must register with Customs before making advance payments
• Move follows investigations into over $ 85 m in alleged remittances for imports that never entered Sri Lanka

The Government has moved to tighten oversight of outward remittances linked to imports, introducing new regulations that require real-time reporting of import-related foreign currency payments to Sri Lanka Customs and mandatory registration of importers before advance payments can be made.

The measures, gazetted on 18 June under the Imports and Exports (Control) Act, come amid investigations into alleged foreign exchange fraud involving more than $ 85 million in overseas remittances for imports that authorities say never entered the country (see: https://www.ft.lk/business/Authorities-probe-85-m-fraud-linked-to-bogus-imports/34-793171)

The new regulations require commercial banks to assign a unique identification number to every import-related remittance transaction and immediately transmit detailed information to Customs. The data will include the importer’s Taxpayer Identification Number (TIN), addresses of the remitter and beneficiary, account details, bank and branch information, currency and value of the transaction, payment and delivery terms, date of remittance, proforma invoice details and a description of the goods being imported.

In a further tightening of controls, importers making advance payments will be required to register with Sri Lanka Customs beforehand. Banks have been instructed not to process advance import payments unless the importer has completed the required registration.

The Imports and Exports (Control) Regulations No. 06 of 2026, signed by President Anura Kumara Dissanayake in his capacity as Minister of Finance, Planning and Economic Development, came into effect yesterday.

The regulations represent one of the most significant enhancements to Sri Lanka’s monitoring framework for import-related foreign exchange transactions in recent years, reflecting growing concern among authorities over the misuse of trade payments to transfer funds overseas.

The move follows disclosures made in Parliament this month by Public Security Minister Ananda Wijepala, who outlined several ongoing investigations into alleged fraudulent telegraphic transfer (TT) transactions conducted through shell companies.

According to the Minister, one investigation uncovered a company that remitted Rs. 12.89 billion through 953 transactions to 256 companies across 26 countries, resulting in an outflow of $ 42.7 million. Investigators found no evidence that goods corresponding to those payments had been imported into Sri Lanka.

The Minister also disclosed details of a third investigation covering the period from 2023 to 2025, which identified 26,108 TT transactions routed through 227 bank accounts maintained at 13 banks. Investigators linked 105 local companies to the operation, many of which had been incorporated under a small group of individuals before being wound up within months.

Preliminary findings suggest that shell companies were repeatedly established to facilitate outward remittances before being dissolved, raising concerns over possible money laundering, foreign exchange violations and other criminal activity.

Against that backdrop, the latest regulations appear designed to close information gaps between financial institutions and Customs by creating a direct reporting mechanism for import-related remittances and linking foreign currency payments more closely to import documentation and tax records.

The requirement for Customs registration before advance payments are made is also expected to strengthen the authorities’ ability to track importers and verify whether goods corresponding to foreign currency outflows subsequently enter the country.

The Controller General of Imports and Exports has been empowered to issue operational guidelines to Customs, commercial banks and other relevant institutions to facilitate implementation of the new framework.

The Government has separately indicated that it intends to amend legislation to once again classify foreign exchange control violations as offences that can be investigated under anti-money laundering laws, signalling a broader effort to strengthen enforcement as investigations continue.

Authorities are also examining whether any public officials or banking personnel failed to carry out required oversight responsibilities in relation to the transactions currently under investigation.