WORLD TRADE ORGANIZATION  
ORGANISATION MONDIALE DU COMMERCE  
ORGANIZACIÓN MUNDIAL DEL COMERCIO WT/TPR/M/128/Add.1 
16 April 2004 
 (04-1708) 
Trade Policy Review Body 
3 and 5 March 2004 Original:  English/ 
                 anglais/                  inglés 
  
TRADE POLICY REVIEW 
SRI LANKA 
Minutes of Meeting
 
Addendum  
Chairperson:  H.E. Mr. Milan Hovorka (Czech Republic) 
 This document contains the advance written questions, and replies provided by Sri Lanka.1 
__________________________________________________________________________________  
Organe d'examen des politiques commerciales 
3 et 5 mars 2004  
EXAMEN DES POLITIQUES COMMERCIALES 
SRI LANKA 
Compte rendu de la réunion
 
Addendum  
Président:  S.E.  M. Milan Hovorka (République tchèque) 
 
 Le présent document contient les questions écrites communiquées à l'avance et les réponses 
fournies par Sri Lanka.1 
__________________________________________________________________________________ 
 
Órgano de Examen de las Políticas Comerciales 
3 y 5 de marzo de 2004  
EXAMEN DE LAS POLÍTICAS COMERCIALES 
SRI LANKA 
Acta de la reunión
 
Addendum  
Presidente:  Excmo. Sr. Milan Hovorka (República Checa) 
 
 En el presente documento figuran las pre guntas presentadas anticipadamente por escrito, 
junto con las respuestas facilitadas por Sri Lanka.1 
 
                                                      
1 In English only./En anglais seulement./En inglés solamente. WT/TPR/M/128/Add.1 
Page 3 
 
 
ADVANCE WRITTEN QUESTIONS BY MEMBERS1 AND 
REPLIES PROVIDED BY SRI LANKA 
 
CONTENTS 
    P a g e  
 1. Economic Environment and Trade Policy Developments 5 
 1.1 New Economic Policy Objectives  5  1.2 Diversification of Exports and Markets 5  1.3 Labour Market Reforms 6 
 1.4 State-owned Enterprises and Privatization 7 
 1.5 Regional Trade Agreements 7  1.6 Corruption 8  2. Trade Policy Regime 8 
 2.1 Tariff Policy 8 
 2.2 Non-Tariff Barriers 11  2.3 Measures Affecting Exports 11  2.4 Import Licenses 12  2.5 Quantitative Restrictions  15  2.6 Import Procedures 15 
 2.7 Customs Procedures 16 
 2.8 Sanitary and Phytosanitary Standards 18  2.9 Technical standards 20  2.10 Contingent Trade remedies 21  2.11 Sri Lanka’s Trade Strategy and Trade Policy 21 
 2.12 Regulatory Policy – Consumer Protection 22 
 2.13 Government Procurement 23  2.14 Intellectual Property Rights 25  2.15 Copyright and Related Rights 30  2.16 Patents  30  2.17 Trademarks 31 
 
3. Sectoral Policies 31  3.1 Tariff on Agricultural and Food Products 31  3.2 Agriculture Policy 33  3.3 Industry and Investment 34 
 3.4 Special tax incentives 34 
 3.5 Telecommunications 35  3.6 Electricity 39  3.7 Financial and distribution services and Insurance 40  3.8 Computer and Related Services 42  3.9 Tourism 42
  
                                                     
 
1 From Australia;  Hong Kong, China;  Japan;  New Zealand;  the Republic of  Korea;  the European 
Union;  the Separate Customs Territory of Taiwan Penghu, Kinmen and Matsu;  Canada;  and the United States. WT/TPR/M/128/Add.1 
Page 5 
 
 
1. Economic Environment a nd Trade Policy Developments  
 
1.1 New Economic Policy Objectives [Regaining Sri Lanka]  
 
From Japan  – Government Report - Economic Po licy Developments New Economic Policy 
Objectives (WT/TPR/S/128, page 64, paragraph 257)   
1.1.1 We note that the time consumed by dispute se ttlement cases is an impediment for carrying out 
business in Sri Lanka.  According to the Governme nt Report “commercial legal reforms” have been 
raised as one of the major reforms on schedule. 
 
(a) Do such “commercial legal reforms” include the improvement of dispute setting system for 
business?   
 In the new Company Law which is being draf ted at present includes specific provisions for 
expeditious resolution of disputes by arbitration and other means.   
  Sri Lanka also has enacted a new Consumer Affairs Authority Act, in addition to the 
existing means of addressing commercial disp utes, a Banking Ombudsman has already been 
appointed and an insurance ombudsman will be appointed shortly. 
 (b) If so, please indicate the specific contents of the improvement.  
 
 At present existing system causes undue delay.  Proposed changes will redress this situation 
effectively.  
 
1.2 Diversification of Exports and Markets
 
 From U.S.A.
 
 
1.1.2 Sri Lanka is heavily dependent upon a few West ern industrialised markets for its exports, 
with the US market alone accounting for 38 per cen t of Sri Lanka’s exports.  According to the 
Government Report, Asia accounts for only ten percen t of Sri Lanka’s exports and the SAARC region 
(which includes Bangladesh, Bhutan, India, the Ma ldives, Nepal and Pakistan) accounts for only 5 per 
cent of Sri Lanka’s exports.  Textiles and garmen ts compromise over fifty per cent of Sri Lanka’s 
exports, but only 5.3 per cent of its gross domestic product, of which 94 per cent of the exports are 
destined to the United States and European Union. 
 
(a) We note that Sri Lanka is engaged in efforts to  negotiate regional trade agreements with its 
neighbours to enhance its export opportuniti es.  Does Sri Lanka have a complimentary 
multilateral strategy to improve market access opportunities for its products in neighbouring 
markets? 
 
While we pursue bilateral and reg ional agreements with our neig hbors, we strive to develop 
a multilateral strategy to gain great er market access in those countries. 
 
(b) We note in Table II.2 of the Secretariat report that Sri Lanka has not been successful in 
utilising its tea and garment quot a allocations in the India-Sri Lanka Free Trade Agreement 
(II.FTA), because of restricted access to Indian  ports and lack of competitiveness for the 
products.  Given the importance of these products to the Sri Lanka export earnings, what steps 
is Sri Lanka taking to enhance the competitiveness of these products? 
 WT/TPR/M/128/Add.1 
Page 6  
India has agreed to increase the number of ports  from two to five for tea.  Currently, Sri 
Lanka is in the process of negotiating with Indi a to address the issue of other Non-Tariff Barriers 
affecting Sri Lanka’s exports related to tea and garment products. 
 
1.3 Labour Market Reforms
 
 
From Japan  – Government Report 
4. Economic Policy Developments 
4.1 Macro Economic Policy Developments 
4.1.2 Recent Developments in Labour Market  (WT/TPR/S/128, pages 32 to 33, paragraphs 
144 to 150) 
 
1.3.1 We note that foreign direct investment is pr evented, partly because Sri Lanka’s labour laws 
provide advantages for employees, such as making it too difficult for employers to dismiss their 
employees.  According to the Government Report, w ith a view to creating a flexible labour market, 
Sri Lanka has made progress in amending the ex isting labour laws and in implementing them. 
 
(a) Please indicate the specific plans for doing so. 
 
 Sri Lanka considers its work force as the most valuable asset of the country.  Therefore, we 
have always made efforts to strike a balance be tween employment security of workers as well as 
interests of investors. In doing so, the government  has recently amended a number of labour laws 
including termination of Employment Act of Workmen and Industrial Disputes Act.  
 
 Termination of Employment Act was amende d, allowing employers greater flexibility in 
retrenching staff.   Accordingly, the quantum of compensation has been  re-scheduled whereby 
reducing the maximum compensation limit.  The m aximum amount of compensation is now fixed 
at 30 months wage instead of 50 months wage.  This formula of payment of compensation was 
gazetted on 31st December 2003 and now in force. 
  However, its noteworthy to state that with  all these positive steps th ere are instances where  
investors have closed down their projects without any intimation to the employees or the relevant 
authorities and also defaulting statutory benefits  entitled by the employees, eg: EPF, ETF, and 
wages.   
 From the Republic of Korea
 
On the Government Report  (Page 32, Para. 147 ) 
 
1.3.2 In our understanding, laying off a workman requi res his agreement and the prior approval of 
the Commissioner of Labour and the employers ar e supposed to pay compensation to the laid-off 
employees. Further softening of the regulation on  the layoff procedure a nd amending the related 
articles of the laws concerning the compensati on for laid-off employees would probably increase the 
flexibility of the labour market in Sri Lanka and encourage more foreign investment.  
(a) What is the view of the Government of Sri Lanka on this opinion? 
 
 Please refer the responses provided above in section 1.3.1.  
 
(b) It is our feeling that too much authority is c oncentrated in the Office of the Commissioner of 
Labour. What is the view of the Government of Sri Lanka on the suggestion of providing 
some limitations on the authority of the Commi ssioner, for example, by allowing for appeals 
to the judiciary about decisions by the Commissioner? 
 WT/TPR/M/128/Add.1 
Page 7 
 
 
 Please refer the responses provided above in section 1.3.1. 
 
1.4 State-owned Enterprises and Privatization  
 From Japan
 
 
Secretariat Report –  (2) Measures Affecting Production and Trade (vi) State-Owned Enterprises and Privatization (WT/TPR/S/128, pages 65 to 66, paragraphs 
127 to 132) 
 
1.4.1 Japan welcomes that Sri Lanka has promoted pr ivatization, which encourages foreign direct 
investment.  However, according to the Secretaria t Report, state involvement remains strong, despite 
progress of privatization in some areas.  
(a) Please indicate the specific plans for completing a full privatization of the areas stated in the 
Secretariat Report.  
 
 At present only 10% of business undertakings have state involvement.  This too will be 
privatized before end 2004.  The exceptions could be the two state banks. 
 
(b) Please also indicate the areas that areas planned for privatization, other than those above, if 
such areas exist. 
 
 Please see the above response.  
 
1.5 Regional Trade Agreements
 
 
From U.S.A.  
 
1.5.1 Regional trade agreements appear to play an  important role in Sri Lanka’s trade policy 
strategy.  Perhaps the most important such agre ement for Sri Lanka is India-Sri Lanka Free Trade 
Agreement (ILFTA). 
 (a) Since the signing of the ILFTA on 28 December  1998, have Sri Lanka and India taken steps 
to expand coverage of the agreement, by reducing the negative list of products cited in 
footnote 46 of the Secretariat report?  Has Sri Lanka been able to meet its schedule for the 
8-year schedule for the eliminati on of tariffs for covered products? 
 
 The elimination is on schedule. 
 
(b) We note in the Government report that Sri La nka and India have deci ded to expand the scope 
of ILFTA to cover trade in services, investme nt and cooperation to form a Comprehensive 
Economic Partnership Agreement.  What is th e current status of the services negotiations?  
Given the large public sector involvement in th e Sri Lanka economy, has consideration been 
given to expanding ILFTA to in clude government procurement? 
 
 Liberalization of services is being di scussed under the Comprehensive Economic 
Partnership Agreement, (CEPA).   Inclusion of pr ovisions relating to government  procurement in 
to CEPA will be considered in order to broaden the scope.  
 WT/TPR/M/128/Add.1 
Page 8  
1.5.2 Sri Lanka is a party or is nego tiating participation in several regional trade agreements, which 
appear to provide overlapping covera ge, under different terms, to some  of the same trading partners.  
For example, the South Asian Free Trade Area (S AFTA) will include Bangladesh, Bhutan, India, the 
Maldives, Nepal and Pakistan; the Bangkok Agreemen t includes Bangladesh, China, India, Korea and 
Laos; and the BIMST-Economic C ooperation agreement includes Bangladesh, India, Myanmar and 
Thailand.  In addition, Sri Lanka has or is deve loping bilateral agreements with India, Egypt, 
Singapore and Bangladesh. 
 (a) What is the relationship of these various agreements to each other? 
 
The intention of all agreements is to impr ove market access and promote of freer trade 
within the region.  Whenever overlapping concessi ons are present deepest concession is applied.  
 
(b) How does Sri Lanka’s participation in the SAFTA, Bangkok Agreement and BIMST affect its 
ability to conclude free trade agreem ents within the region and beyond? 
 
Those agreements are necessary precursors for free trade in Asia as it provides invaluable 
experience to policy makers and market participants.  
 
1.6 Corruption
 
 From the EU
 
 
1.6.1 According to the recent report by Transparen cy international, Sri Lanka has made progress in 
fighting corruption.  However, the EC continues to receive complaints over persistent corruption 
among government officials.  What systems are being used or foreseen to address this problem?   The Bribery and Corruption Commission functions as an independent body and is comprised of retired supreme court an d other judges of repute and integrity.  
 
2. Trade Policy Regime
 
 2.1 Tariff Policy
 
 
From the EU  
 
 A transparent and efficiently working tariffs regime remains very important for enhancing 
trade and furthering economic development. In the case of Sri Lanka it appears that a rationalization 
of the tariff structure has not been attained and there remains a number of escalating tariffs.  
Furthermore, a number of other excise duties, le vies and taxes are imposed on imported products. 
 
 Sri Lanka’s tariff structure has been rationali zed to a great extent.  Broadly, raw materials 
are placed at lower tariff rates wh ile finished goods are placed at higher rates.  The present rate 
structure was achieved with prior periodical rev iews by several Presidential Commissions on 
Tariffs and Trade.   
  Tariff escalation is a global phenomenon. During  last 5 years, Sri Lanka’s levels of tariff 
escalations has declined.    
 Sri Lanka imposes only four types of levies, - customs duties, VAT, port and airport 
development levy and excise duty.  Excise duty is applicable to less than 10 items. 
  WT/TPR/M/128/Add.1 
Page 9 
 
 
2.1.1 When does Sri Lanka expect to rationalize its ta riff structure?  What new rate structure is 
likely to be proposed?  Does Sri Lanka envisage con tinuing with the conversion of specific duties to 
ad valorem duties?  
 With a view to rationalizing the tariff structure on a continuous basis, a permanent Tariff 
Advisory Council (TAC) has been appointed to  make recommendation on rationalization, 
simplification and reduction of tariff.     An integral part of rationalization is conversi on of specific duties to ad valoram duties in 
the context of overall tariff rationalization.    
 
2.1.2 When does Sri Lanka intend to remove the import surcharge of 20% on imported goods 
which was supposed to be phased out by end 2003?   
 The import surcharge was brought down from in itial 40% in 2001 to 10% with effect from 
2004.  Surcharge will be phased out in the near future.   
2.1.3 When does Sri Lanka intend to remove the Po rt and Airport Development Levy (1% on CIF 
value) levied on all imports and a tax paid by all exporters (excep t gems, jewellery and diamonds) of 
0.75% on their imported inputs, both of which act as constraints to exporters, in particular in the 
clothing industry?  
 
 PAL was introduced in 2002 in lieu of stamp duty.  PAL has been reduced to 0.5% on 
imports for export purposes.   
 
2.1.4 Although tariff rates for intermediate goods and raw materials have come down, there is room 
for high effective protection rates for some sector s producing for the domestic market.  It could be 
argued that the effect is not only that productivit y improvements in those sectors are not coming 
through, but also that the costs of non-tradable, such as water and electricity, become higher.  The 
latter effect is detrimental to the international co mpetitiveness of Sri Lankan exporters.  What does Sri 
Lanka intend to do to reduce this anti-export bias?   In the context of the country’s development  needs, Sri Lanka has undertaken a programme 
of trade/tariff liberalization which includes rationa lization, simplification and reduction over the 
years.  Most of these reforms are designed to ad dress this question, among others, of reducing the 
anti-export bias. Further, the present economi c reform programme under the “Regaining Sri 
Lanka (RSL)” envisages the broadening the scope of  competitive environment including in those of 
the utility sector.    
From New Zealand
 
 
2.1.5 New Zealand notes with disappointment that the planned two-band tariff system has not been 
attained mainly because of revenue considerations  and political pressure from protected producers and 
other interest groups.  Of further disappointment is  the decision by the Sri Lankan Government firstly 
to introduce a 40 percent import surcharge and sec ondly, not to phase it out by the end of 2003.  
 
How does Sri Lanka justify the surcharge under its current bindings? 
 
 The final affect of the surcharge is well below the current bindings.  The surcharge has 
been gradually reduced from 40% in 2001 to 10% in 2004, and will be phased out in the near future. 
 WT/TPR/M/128/Add.1 
Page 10  
2.1.6 Given the comment by the Secretariat ( Chapter IV, Para 1 ) that less protection on 
agricultural goods and other forms of assistance togeth er with the adoption of a more predictable trade 
policy regime would lead to a better allocation of  resources, thus raising productivity and increasing 
living standards, is the Sri Lankan Government gi ving further consideration to removing the import 
surcharge and moving to a simplified two tariff system?  If so, when?   
Sri Lanka expects to phase out the surcharge in the near future.  
From U.S.A.
 
2.1.7 It is our understanding that the Parliament passed  new tariff rates and import surcharges in its 
2004 budget proposal. 
  
(a) Have these changes been enacted?  Have they en tered into effect?  If not, what items are still 
pending and when the changes will be enacted? 
 
 Yes. Gazette notification has been issu ed giving effect to the proposals. 
 
 The import surcharge applicable to most goods was reduced from 40 per cent in 2001 to 20 
per cent in 2003 and has been 10 per cent since the beginning of 2004.   (b) Does the Government have a plan for the el imination of the remaining 10 per cent import 
surcharge? 
 
Yes.  To be phased out in the near future. 
 
2.1.8 Reform of tax system - We note Government’s strategy to achieve a simple, broad-based and 
transparent tax structure with a view to improvi ng tax administration and creating an environment 
conducive to promoting socio-economic  development.  Ideally, reform of the tax system will reduce 
Sri Lanka’s current reliance on revenues from customs duties (projected at 14 per cent in 2004) and will allow Sri Lanka to rationalize its tari ff structure and reduce its tariff levels. 
 
(a) As part of its taxation reform process, Sri Lanka intended to shift from a two band VAT 
system to a uniform VAT rate of 15 per cent, as from 1 January 2004.  Has the uniform VAT 
rate of 15 per cent entered into force? 
 
Yes, at present, it is in force. 
 
From New Zealand
 
2.1.9 New Zealand commends the Sri Lankan Government  for reduction its average applied tariff 
on agricultural products from 27.6 to 21.3 percen t between 1998 and 2003.  However, New Zealand 
notes that this level of protection is relatively hi gh compared to the average applied tariff in the 
industrial sector (8.0 percent) and Sri Lanka’s overall average tariff of 9.8 percent.  As noted in the 
Secretariat Report ( Chapter III, Para 17 ), Sri Lanka’s tariff shows a clear pattern of escalation in 
certain industries, particularly for agri cultural and forestry related products ( Chart III.2, P32 ). 
 
(a) What future changes to tariff policy is Sri Lanka  currently considering with respect to these 
issues?  
 
 Tariff escalation and high tariff levels in agriculture are common occurrences and are 
global phenomena. Nevertheless, tariff levels applie d on Sri Lanka’s agriculture are low compared 
to many other countries.  Sri Lanka wishes to stat e that between the two periods of comparison the WT/TPR/M/128/Add.1 
Page 11 
 
 
level of tariff escalation has declined.  With a vi ew to addressing these concerns, a Tariff Advisory 
Council has been appointed to make reco mmendations on future tariff policy. 
 
2.1.10  New Zealand also notes with disappointment th e small increase from 19 to 20.7 percent in the 
average tariff applied to dairy products between  2001 and 2003.  Given the Sri Lankan Government’s 
policy to move towards a low standardized tariff structure ( Secretariat Report, Chapter III, Para 19 ), 
New Zealand hopes that significant reductions of these tariff rates will be made in the future. 
 
 As we have explained rationalization, simplif ication and reduction of tariff over the years is 
a task entrusted with the TAC. 
 
2.1.11  Although the Secretariat notes that tariff escal ation has promoted the development of a 
manufacturing sector, what consideration has Sri Lankan given to the impact of tariff escalation on end-users, both processors and consumers, espec ially their ability to purchase quality processed 
agricultural and forestry products at internationally competitive prices?  
 
 TAC is at present studying the tariff structure and its impact on both consumers and 
industry.  TAC is required to make suitable recommendations.  
 
2.1.12  The Secretariat Report ( Chapter III, Para 25 ) notes that Sri Lankan replaced a number of ad 
valorem duties relating to agricultural products with specific duties to provide domestic farmers with 
adequate protection, minimizing price risk due to seasonal fluctuation of commodity prices.   
 (a) What measures has Sri Lankan put in place to ensu re that the level of protection provided by 
specific duties does not exceed the bound ad valo rem rate in Sri Lanka’s WTO Schedule of 
Commitments? 
 
 When deciding specific duties, maximum cautio n has been exercised to fix the final custom 
duty to be within the bound level.    2.2 Non-Tariff Barriers
 
 
From U.S.A.  
 
2.2.1 When Sri Lanka has taken numerous steps to  open its economy, non-tariff trade barriers 
continue to impose high economic costs.  
(a) What efforts are underway to address non- tariff barriers, such as import licensing and 
certification requirements? 
 
 Sri Lanka has very few NTBs imposed for non-economic reasons, and to achieve objectives 
set forth in Articles XX and XXI of the GATT. Those are also being reviewed periodically to prevent them acting as trade barriers.   
 
2.3 Measures Affecting Exports
 
 
From U.S.A . 
 2.3.1 Does the Export Development Board (‘EDB’) pr ovide financing or other kinds of support to 
exporters, other than the subsidized loans, and grants  to direct, indirect, and potential exporters with a 
maximum of Rs. 1 million per project, described in paragraph 86 of the Secretariat report?  If so, please describe the types of financing or tax incentives available through the EDB. WT/TPR/M/128/Add.1 
Page 12  
 
At present, the EDB does not provide subsidized  loans, grants or financial assistance to 
exporters.  In addition to its general skills, produ ct supply and market development  programmes, 
EDB implements following assistance scheme for SMEs with the objective of fostering regional 
development. 
(a) Assistance to handloom exporters (10% of the FOB) value of exports affected for a two 
year period and will be phased out on 31
st December 2005.  The total payment in 2003 is 
only US$ 0.16 million and 12 exporters were assisted. 
 (b) Assistance for exporters own marketing effo rts overseas or for the export oriented SMEs. 
In 2003, SMEs were assisted to the amount of US$ 0.01 million. 
 
(c) Tax Incentives:   Tax incentives for exporters are not provided under EDB law.  
 2.3.2 According to paragraph 88 of the Secretaria t report, duties paid ‘on imported materials used 
to manufacture and process goods’ in Sri Lanka may be  partially or fully rebated or refunded once the 
final good is exported.  (a) Is the drawback scheme applied solely to duties levied on inputs consumed in the production 
process of another product, or does it also apply to duties levied on capital goods? 
 
This drawback scheme is not applicable to the capital goods.  It is only applicable to duties 
levied on inputs consumed in the production process of another product. 
2.4 Import Licenses
 
 
From the EU  
 
2.4.1 According to the report of the Government and the repot of the WTO Secretariat, Sri Lanka 
imposes import licenses on a large number of products (474-546 products) under the Special 
Licensing Scheme for reasons related to national secur ity, health and environment (those referred to in 
GATT Articles XX and XX1), as well as economic reasons. This creates an additional burden on 
imports and acts as an obstacle to trade. 
 
 Could Sri Lanka please provide detailed inform ation on the formal procedure for issuing 
licenses?  
 
 Sri Lanka has in place import licensing requi rement to achieve the objectives set forth in 
Articles XX and XXI of the GATT. The Departm ent of Export and Import Control has adopted 
formal procedures for issuing licenses.  Accordingl y, any person desirous of obtaining a license to 
import an item listed in the `Commodity List ` published by the Department shall make an 
application to the Controller in respect of each prod uct, which he intends to import. Generally, the 
Controller may request th e following documents: 
 
1. The Proforma Invoice 
2. Approval from the relevant government institution, which authorises the 
importation. 
3. The nominal fee depending on the case. 
 WT/TPR/M/128/Add.1 
Page 13 
 
 
When the Controller receives the above docum ents and the necessary fees, the import 
licenses are generally issued in all ca ses with in two normal working days.  
 
From Canada  
2.4.2 Please specify which items are subject to automatic licensing and which are not. 
 
 Sri Lanka maintains a system of automatic licen sing which applies to  items referred to in 
Notification No.G/LIC/N/LKA/1 
From the EU  
 
2.4.3 Would Sri Lanka consider removing licenses fo r products that are already covered by 
domestic legislation already requiri ng products to meet requirements re lated to health and safety (e.g. 
sanitary and phyto-sanitary requirements and t echnical regulations and standards), as such 
requirements cover the health, safety and envir onment protection objectives mentioned in GATT 
Article XX? 
 
 At present following agencies administer requirements under domestic legislation 
depending on the type of good being imported.   
 
• The Ministry of Health – The Food Act No.26 of 1980  and its subsequent 
amendments, which contain the laws and regulations for food safety;  
• Ministry of Agriculture – The Pl ant Protection Act No.35 of 1999  and its 
subsequent amendments, which contain the laws and regulations for protection of 
plants, fresh fruits and vegetables, soil and other organisms; 
• The Department of Animal Production an d Health – The Animal Diseases Act 
No.52 of 1992  and its subsequent amendments, which contain the laws and 
regulations for protection of animal health; 
• Ministry of Commerce and Consumer Affai rs – Imports and Exports (Control) Act 
No. 1 of 1969  and its subsequent amendments , which contain regulations on 
articles that can not be imported in to Sri Lanka, if they do not conform to the Sri 
Lanka Standards set out by Sri Lanka Standard Institute; 
• The Ministry of Health – The Cosmetics, Devices and Drugs Act no. 27 of 1980  and 
its subsequent amendments, which contai n the provisions for regulating imports 
and local production of cosmetics, devices and drugs, through a system of registration.  
 
 The licensing authority, Department of Import and Export Control, acts as a central agency 
coordinating those activities.  This procedure w ill be reviewed to minimize undue difficulties and 
duplication. 
 
From U.S.A.
 
 
2.4.4 We understand that importers have been discour aged from applying for licenses to import US 
chicken. 
 WT/TPR/M/128/Add.1 
Page 14  
(a) Please describe the requirements for imports of  poultry and meat products and rationale for 
import restrictions of such products. 
 
 Sri Lanka has a control mechanism in pla ce to prevent introduction of exotic animal 
diseases into the country through import of livestoc k and livestock products.  The legal back up for 
such a system is provided by the Animal Diseases Act No. 59 of 1992. 
 
2.4.5 The Secretariat Report describes import licen sing as a policy instrument used to control 
domestic supply and prices, particular ly on agricultural products.  Comment 
 
 Import licensing is not used as a policy inst rument at present to control domestic supply 
and prices in general, except in a very few instances . 
 
(a) Please explain how the above-mentioned practi ces are consistent with WTO disciplines. 
 
Please refer to at responses provided in Section 2.4.1, 2.4.2 and 2.4.3 
 (b) What steps are being taken to adopt less trade-distorting practices? 
 
Please refer to at responses provided in Section 2.4.1, 2.4.2 and 2.4.3. 
 
(c) Which sectors within agriculture are subject to such policy? 
 Please refer to at responses provided in Section 2.4.1, 2.4.2 and 2.4.3.  
 
(d) How does Sri Lanka intend to inform othe r WTO members of when licenses are open? 
 
The government’s intention to bring such  items under import licenses, which are of 
temporary in nature, are informed well in  advance through Government gazette. WTO members 
are informed of these changes notifications.  
 
From Japan
 
 
Secretariat Report –  
Section II - Trade Policies and Practices by Measure (2) Measures Directly Affecting Imports (v) Import prohibitions, restrictions and licensing ( WT/TPR/S/128, page 38, paragraph 34)} 
 2.4.6 According to the Secretariat Report, the Speci al Licensing Scheme (SIL) was introduced on 
grounds of national security, health and e nvironment, as well as “economic” reasons. 
 (a) Please indicate what is meant by “economic reasons”. 
 
 Import licenses are not u sed for economic reasons. 
 (b) Please also indicate the items that are subject  to imports licensing for “economic” reasons”. 
 
Not applicable 
 
From Canada
 
2.4.7 The Secretariat reports that Sri Lanka’s Special Licensing Scheme was introduced “on the 
grounds of national security, hea lth and environment, as well as ‘ economic’ reasons”, and that 474 WT/TPR/M/128/Add.1 
Page 15 
 
 
items at the eight-digit level are currently subject to  licensing.  Canada is concerned about the large 
number and variety of products subject to licensing requirements, and also about the fact that the list 
of products subject to licensing is changed frequently .  A number of the products subject to licensing 
would not appear to raise issues related to national security, health  or environment concerns.  Would 
Sri Lanka please explain what “economic” reasons are being used to impose licensing requirements?   
 
(Report by the Secretariat (WT/TPR/S/128)) 
III Trade Policies and Practices by Measure; (2) Measures Directly Affecting Imports; (v) Import 
prohibitions, restrictions, and licensing; (b) Import licensing; paragraph 34  
Please refer the responses referred above. 
2.4.8 We note that Sri Lanka issues import licenses for a fee of 0.1% of c.i.f. value.  This is 
contrary to GATT Article VIII, which stipulates that fees should be limited to the approximate cost of 
the service rendered.  What steps will Sri Lanka take  to eliminate the ad valorem fee and institute a 
charge that is based on the cost of the transaction?   Each import license issued is consistent with GATT Article VIII as the fee levied to commensurate with the cost of the services rendered. Practically, it is not feasible to institute a flat 
charge based on the cost of the transaction as the quantity and the value vary depending on each 
transaction. 
 
2.5 Quantitative Restrictions
 
From Canada  
2.5.1 Canada is concerned that quantitative restri ctions (QRs) could be inconsistent with Sri 
Lanka’s GATT Article XI VIII, which stipulates that fees should be limited to the approximate cost of 
the service rendered.  What steps will Sri Lanka take  to eliminate the ad valorem fee and institute a 
charge that is based on the cost of the transaction? 
 Sri Lanka does not maintain any quantitative restrictions. 
 
2.6 Import Procedures  
 Cosmetic products - From Australia
 
 
2.6.1 Sri Lanka’s import regime requires that importers  of cosmetic products provide details of the 
composition of the products, including the exact pe rcentage of each constituent ingredient. This 
requirement has significant intellectual property implications. What is the rationale behind the 
requirement?  Responses: 
 
 Under the Cosmetics, Devices and Drugs Act No. 27 of 1980, all cosmetics, devices and 
drugs  that are imported and produced locally should be registered with the Cosmetics, Devices and 
Drugs Authority. This is a mandatory requireme nt applied on both imports and goods produced 
domestically for safety reasons. Once the registra tion is granted for a particular cosmetic, device 
and a drug the registration will be valid for fi ve years from the date of issue of registration 
certificate.   WT/TPR/M/128/Add.1 
Page 16   The Act requires the applicant to submit informa tion specified in Form A of Schedule 1 of 
the Act. The information to be provided includes,  among others, name of the cosmetic with brand 
name or official or approved name, composition of the product, which are ingredients that need to 
be listed by their chemical name and exact quantities and certificate of analysis and full 
information concerning analytical assessment and other control methods to ensure strength, 
quality and stability. The information sought herein is  used only to ascertain the safety aspect of 
the product, so those substandard products will not be permitted to enter the country. The Authority 
who receives the information is bound to mainta in the confidential nature of the information 
provided by the applicant.  
 
From Japan
 
 
Secretariat Report –  Section II - Trade Policies and Practices by Measure (2) Measures Directly Affecting Imports (I) Procedures  (WT/TPR/S/128, Page 28, Paragraphs 5 to 8)  
 
2.6.2 According to the Secretariat Report, the Import, Division of the Sri Lanka Customs 
Department consists of two separate units and th e import documents to be submitted may vary by 
case.  (a) Is it so that each custom’s office requires a different procedure or document to be submitted 
when importing goods or entering persons to Sri Lanka?  
 
 No. 
 
(b) Please explain why the custom procedures for ai r cargo and for sea cargo are different from 
each other.  
 
 Import division of SL Customs has two units  as sea and air cargo. However, when 
CUSDECS are processed under ASYCUDA Sy stem, document processing time is same. 
 
The custom procedures for air cargo and for sea  cargo are not different from each other. 
 
(c) Please indicate the measures to be taken fo r making common procedures among all customs. 
 
Responses: 
 
There are common procedures already in place. 
 2.7 Customs Procedures
 
 From Japan
 
 
Secretariat Report –  
Section II - Trade Policies and Practices by Measure (2) Measures Directly Affecting Imports (I) Procedures (WT/TPR/S/128, Page 28, Paragraphs 5 to 8)  
 2.7.1 The Secretariat Report states that, in 1994 the processing of import documents was 
computerized with the implementation of the ASYCUDA system, and that Sri Lanka is trying to implement an electronic data interchange system.  WT/TPR/M/128/Add.1 
Page 17 
 
 
 To what degree, is the ASYCUDA syst em equipped in each customs office?  
 
 The ASYCUDA System is fully equipped in all Custom offices located in Colombo, where 
99% of import cargo is discharged.  All imports / exports (Sea and Air), temporary imports, bonded 
cargo operational areas are automated for cust oms declaration processing in ASYCUDA system. 
 
2.7.2 Please specifically indicate the difference of time required for custom procedures between 
those where the ASYCUDA system is installed and those without,   
One day. 
 
2.7.3 Please indicate the specific schedule for implem enting an electronic data interchange (EDI) 
system.   
May 2004. 
 
2.7.4 Please explain how an EDI system will have an effect on improving custom procedures. 
 
 Faster dispatch of vessels and avoiding time consuming physical clearance by shipping 
agents and freight clearing houses. 
 
From U.S.A
. – On improving Customs procedures 
 2.7.5 We are pleased to note in the Government re port that Sri Lanka is moving toward Customs 
procedures based on risk-assessment.  The repor t highlighted the Sri Lanka Automated Cargo 
Clearance System (SLACCS) and new import clearance procedures in an Electronic Data Interchange 
(EDI) environment.  We are interested in learning more about this and the module that is used for 
automatic selectivity of low, medium and high-risk declarations.  (a) Please clarify what is meant by “risk declarations” and how are the low, medium and high 
risks degrees defined?  Please provide examples of  the kinds of imports that would be in each 
of the three risk categories. 
 
 “Risk Declaration” is a statement by a firm  if it has committed an offence or contravened 
the Customs Ordinance. This is promptly verifi ed against the computer data base of offenders. 
  Low risk category of importers are those cla ssified by name who have excellent reputation 
and have committed no offences in the past.  Medium risk importers  are those who have 1-3 minor 
offences against their names with convictions.  High  risk declarations are from those with more 
than 3 convictions of contravening customs Law.   The Colombo Port will very shortly purchase 
scanners.  Medium and high risk importers’ and exporters’ containers will be scanned fully and containers of high risk category will in addition be  opened and be subject to physical examination. 
 
(b) What is the electronic address for the Customs website? 
 
www.customs.gov.lk 
 WT/TPR/M/128/Add.1 
Page 18  2.8 Sanitary  and Phytosanitary Standards 
 
 From the EU
 
 
2.8.1 The Department of Animal Production and Hea lth in Sri Lanka does not allow for meat 
products from EU to enter the Sri Lankan mark et, with reference to the mad cow disease as 
justification.  Furthermore the same department do es not allow the import of other meat products form 
EU such as pork, salami etc., However, no justificati on for this measure has been given.  Due to these 
restrictions the EC has noticed that more and mo re substitute meat products such as salami etc. 
manufactured in Australia with European-sounding bra nd names are being imported to Sri Lanka thus 
depriving the European compan ies’ export’s to Sri Lanka. 
  On the recommendation of the National Comm ittee dealing with mad cow disease (BSE), 
the regulations under the Import and Export Cont rol Act were amended and came into force on 
12
th November, 1996.  The amendment brought severa l animal products intended for import under 
the license.  Accordingly, import license will be issued by the Co ntroller of Imports and Exports, 
subject to prior approval from Director Genera l of the Department of Animal Production and 
Health (DG/AP&H).  The DG/AP&H approves imports  only from countries that are free from 
BSE.     There are a wide variety of products origin ated from animals that may carry BSE agent 
into the country.  This includes meat and meat products and bi-products, which are covered under 
the existing Animal Disease Act and products (i.e. Ca tgut, gelatine, Di-calcium Phosphate) that are 
used by some other industries and not covered by  the same Act.  Therefore, it is necessary to 
categorise all those products that may carry the BS E agent into the country into a licensing system 
and to screen these products based on the BSE status of the exporting countries prior to import.  In 
addition, all live animals and animal products imported into Sri Lanka are evaluated based on the 
disease status of the exporting country other than  BSE having considered the appropriate level of 
protection (ALOP). 
 
2.8.2 Should Sri Lanka not review its restrictions related to the mad-cow disease?  
 
 Restriction on import of beef and related me at products was imposed some time back due to 
mad cow disease (BSE). The Department of Anim al Production and Health does not allow import 
of animal products originating from Ruminants from countries infected with BSE.  This restriction is not applicable to other meat products.  (eg. Pork, poultry, etc.) which are originating from non-ruminant species.  However, importation of other meat products (pork and poultry) will be subjected to health requirements stipulated by the same department which depend on the disease 
status of the exporting country (i.e. out breaks of avian influenza).  
  The status on this is still the same and the department of Animal Production and Health 
may review the measure at the appropriate time.    There is a national committee in Sri Lanka 
representing members from the Department of Animal Production and Health and the Ministry of Health dealing with the BSE issue.  This Co mmittee regularly reviews the global BSE status, 
restrictions imposed by Sri Lanka and makes nec essary amendments to relax the measure from 
time to time. 
 
2.8.3 On what specific justification and scientific evidence does Sri Lanka motivate the restriction 
on the import of meat products such as pork salami etc. from the EU?  Does Sri Lanka intend to 
review its approval procedures so that th ese products can be imported into Sri Lanka? 
 
 This question does not arise as there is no such restriction on imports of meat products 
originating from non ruminant species imported from the EC. WT/TPR/M/128/Add.1 
Page 19 
 
 
 
From Japan  
 Secretariat Report –  Section II - Trade Policies and Practices by Measure 
(2) Measures Directly Affecting Imports 
(I) Procedures  (WT/TPR/S/128, page 28, paragraphs 5 to 8)  
 
2.8.4 Procedures such as SPS requirements, other than custom procedures, may be complicated, if 
such procedures are needed when importing cargo. 
 
(a) Please indicate the actual time required for each procedure, section by section.  
 
 There are many SPS measures taken by Department of Agriculture, Department of Animal Production and Health and Ministry of Health.  Relevant units of the department/Ministry in 
general attend to these measures in the minimum po ssible time and facilitate expeditious clearance. 
 
(b) Please explain if there are any plans to simplify procedures, e.g. by adopting a single-window 
procedure 
 
 The Customs with the Department of Comm erce has taken an initiative to introduce a 
computer system for CUSDEC and clearance procedures.   Under this, Sri Lanka Standard Institute 
and Department of Animal Production and Health and other related institutions have been linked 
up directly.  This would be a definite improv ement towards the simplification of the above 
procedure.    
From Canada
 
Trade policies and practices by measure: (2) Measures directly affecting imports; (vii) 
Standards and other technical requirements;  (b)  Sanitary and phytosanitary measures;  paragraph 48, and (c) Labeling and marking requirements; paragraph 54 
2.8.5 Canada notes that according to the Secretariat report, Sri Lanka has implemented restrictions 
on the import of 21 genetically modified products, although we understand that  this information might 
be outdated.  Canada had been c oncerned about the July 19, 2001 SPS notification on the restrictions 
of imports of GM products and at the time made numerous representations to Sri Lankan officials.  
On August 4, 2001, the Canadian High Commi ssioner met with Secretary of Health, Thilak 
Ranavirajah, who informed us that an expert comm ittee had been appointed to look into the ban and 
that a delay in implementation would occur until th e committee submitted its report.  On September 3, 
2001 Reuters News Service published a report stating that Sri Lanka had postponed indefinitely plans 
to impose a ban on 21 genetically modified food pro ducts.  According to a Sri Lankan senior official, 
a circular had been issued by the Secretary of the Mi nistry of Health, ordering that the regulations not 
go into force until further notice.  The Ceylon Ch amber of Commerce requested a delay until 2004.  
Canada still has not received any further informati on on the expert committee’s report, leading us to 
understand that the implementation of the ban is s till pending.  Please clarify Sri Lanka’s position on 
the import of genetically modified food products. 
 
 A gazette notification restricting the importatio n of GM foods was issued in April 2001.  
This Regulation was issued under the Food Act by th e Director General of Health Services who is 
the Chief Food Authority.  On representations m ade by local and international agencies, the 
effective date for implementation of the relevant ga zette had been differed until further notice. The 
expert group appointed by the Health Mini stry recommended, among others, introducing a WT/TPR/M/128/Add.1 
Page 20  mandatory labeling scheme. However, this was not implemented following the Cabinet Decision.  
Considering the consumers’ right to know, a schem e of labeling is expected to be introduced.   
 
2.8.6 The Secretariat report notes that Sri Lanka ba nned the importation of products containing 
biotechnology on 1 September 2001. However, accordi ng to Sri Lanka’s Ministry of Health Gazette 
Notification, published on August 29, 2001,  the ban was suspended indefinitely. 
 
(a) What is the current status of this regulation? 
 
Please refer responses above. 
 
(b) What entity within the Ministry of Hea lth is responsible for the regulation? 
 
 Food and Drug Advisory Committee 
 
(c) When does Sri Lanka expect to define a regulatory system for products containing 
biotechnology? 
 
 Sri Lanka recognizes the important role played by Biotechnology in addressing issues relating to food shortages and generating high yielding varieties.  Sri Lanka covers few areas such as improved plant breeding &  multiplication (viz : gene transfer, tissue culture), control of diseases 
and pests food processing etc.  Such activities are regulated by the Ministries of Agriculture and 
Environment. 
  Biotechnology in any other areas have not yet been developed.  As it develops an 
appropriate regulatory regime will be designed taki ng into account international best practices. 
 
2.9 Technical standards
 
 
From U.S.A . 
 2.9.1 According to the Secretariat report, do mestic and overseas manufacturers whose products 
conform to Sri Lanka standards are entitled to put  the “SLS mark” on their products.  For certain 
products, the SLS certification mark appears to be mandatory for importation.  However, only local 
producers have been approved for using the SLS mark.  (a) Please identify any products that require the SLS mark in order to be imported.   
 
 Conformity to relevant Sri Lanka Standard had been made compulsory for 84 specified 
items under Regulations issued under the Import/Expor t Control Act.  Also it should be noted that 
there is a difference between conformity standards  and having the SLS mark specifically granted 
by SLSI under the Product Certification Sche me. SLS mark (Product Certification) is not 
compulsory for these items imported into the co untry.  However, conformity to the relevant 
standard is a regulatory requirement.  With regard to 84 items listed, exporters are required to 
provide quality certificates from the exporting co untries. Surveillance inspection and monitoring 
activities are carried out at the Port of entry to Sri Lanka.  
 
(b) Please explain why no overseas producers have been granted the SLS mark.  
 
 The SLS marketing scheme is a product certification scheme which is open to local manufacturers as well as ov erseas manufacturers.  On app lications made by overseas 
manufacturers, we have already granted th ree licenses to a manufacture in India. 
 WT/TPR/M/128/Add.1 
Page 21 
 
 
2.9.2 Question raised by Hong Kong with respect to standard and technical requirements in their 
statement made on 3rd March. 
 
 In formulating our national standards Sri Lanka Standards Institute (SLSI) practices a 
policy of direct adoption of international standar ds promulgated by international standard setting 
bodies such as ISO and IEC, whenever feasible an d available.  In cases where SLSI standards are 
identical with available international standar ds, corresponding reference numbers are indicated 
against them.  The technical content of certain other national standards are same as those of 
available international standards. Due to the capac ity constraints Sri Lanka Standards Institute is 
pleased if reference is made to any specific nationa l standards not aligned with  the above practice.  
 2.10 Contingent Trade remedies
 
 
From Japan  
 Secretariat Report –  Section II - Trade Policies and Practices by Measure (2) Measures Directly Affecting Imports 
(V) Contingency Measures (WT/TPR/S/1 28, page 40, paragraphs 36 and 37) 
 
2.10.1  According to the Secretariat Report, Sri Lanka  has no laws or regulations governing anti-
dumping or countervailing actions, nor any laws or regulations relevant to safeguards measures. 
 
(a) Please indicate the specific timetable for establishing laws or regulations regarding trade 
remedies. 
 
 The Government of Sri Lanka has deferred the decision of enacting the Anti Dumping, 
Countervailing & Safeguard Legislation in Sri Lanka indefinitely.  
 
2.11 Sri Lanka’s Trade Strategy and Trade Policy
 
 From the EU
 
 
2.11.1  Sri Lanka has adopted strategies for developing capacities in a number of fields.  How is the 
issue of trade being dealt with in Sri Lanka’s na tional strategies?  Are the strategies based on the 
possibilities for advancing the country’s develo pment objectives in the context of increasing 
globalization through trade?  What is the relations hip between Sri Lanka’s strategy vis-à-vis trade 
liberalization and other development strategies?    Trade policy liberalization is an important part of the overall development policy outlined 
in “Regaining Sri Lanka”. One of the key strategies in this sector has been to increase international integration by lowering barriers to trade on unilateral basis. 
 
2.11.2  The EC considers that the WTO and multilateral liberalization is the most certain way for 
small countries to promote their interests.  Ho w does Sri Lanka judge the relative importance and 
weight of bilateral/FTA policies and further deve lopment of the WTO system in terms of its own 
trade and development needs?   
 Sri Lanka is committed to the primacy of the multilateral trading system. Sri Lanka 
considers regional integration initiatives as complementary processes to multilateralism. WT/TPR/M/128/Add.1 
Page 22  Multilateral trade liberalization agenda generally has not responded to the global challenges and 
therefore bilateral/FTA policies are d esigned to address these challenges.  
 From New Zealand
 
 
2.11.3  Chapter II, Para 1 of the Secretariat report notes that Sri Lanka’s general trade policy 
objectives include moving to a more outward-orien ted trade regime, strengthening and increasing 
overseas market access for Sri Lankan products th rough multilateral, regiona l and bilateral trade 
negotiations.  New Zealand notes that Sri Lanka ’s Free Trade Agreement with India includes a 
number of ‘carve-outs’ and tariff quotas for agricultural products.  
(a) Given that a significant proportion exported produc ts is made up of agricultural products what 
plans does Sri Lanka have to ensure that this agreement is actually comprehensive? 
 
 To expand bilateral trade on agricultura l products, the Joint Ministerial Committee 
established under the Framework Agreement is reviewing the negative list.  
 
2.12 Regulatory Policy – Consumer Protection
 
 
From New Zealand  
 
2.12.1 New Zealand notes that the Consumer Affair s Authority, established in mid 2003, contains a 
Consumer Protection Authority (CPA) which “functi ons to control or eliminate restrictive trade 
agreements among enterprises, arra ngement between companies with regard to price, abuse of 
dominant position, restraining competition, investigat e in to anti c competitive practices and protect 
consumer rights” [ SL Govt. report Paras 280-282].  
 
 The name of the institution should be Co nsumer Affairs Authority.  Section 18 of the 
Consumer Affairs Authority Act No. 9 of 2003 em powers the Minister in consultation with the 
Authority to prescribe by order published in the Ga zette any good or service, if the Minister is of the 
opinion that such good or service is essential to th e life of the Community or part thereof.  Once a 
good or a service is prescribed, the manufacturer or trader concerned is required to obtain the prior 
written approval of the Authority before the price of such good or service is increased.  The law 
requires the Authority to be satisfied that such increase is reasonable.  The Authority is required  to 
communicate its decision within one month of receipt of the application for increase of price. 
 
2.12.2  New Zealand would appreciate clarification of whether the CPA’s powers are limited to these 
functions, or whether, as it appear s, the CPA is further empowered to determine prices for “specified 
articles essential to the life of the community” [ SL Govt. report Para 284 ], and whether or not there is 
any evidence of anti-competitive practices.   
 Yes, powers are limited to those functions.   
 So far we have not found any evidence on anti-competitive practices.   
 2.12.3  New Zealand would appreciate an  explanation of the basis for determination of a “specified 
article” in this context.  It is also unclear as to what checks and balances operate on the CPA, given 
that both it and the Consumer Protection Council fo rm part of the Consumer Affairs Authority.  
Clarification on this point would also be appreciated.    Specified article is one deemed by the authority to be an essential item very important in the day to day life of the majority of consumers.  Thu s, at present eight such items have been declared 
as specified.  WT/TPR/M/128/Add.1 
Page 23 
 
 
 It is important to highlight that the Consum er Affairs Council, even though incorporated in 
the same law, functions independently.  There are two situations where the Council is mandated to 
act.   
 
1. Where at the conclusion of an investigation into the existence of an anti-competitive 
practice, the Authority refers a report to the Council for determination. 
2. Under Section 19 where it appears to the Director  General that any good or service is being 
sold at excessive prices or any market manipu lation or other market imperfection exists 
with regard to such goods or services, in cons ultation with the Authority, such issues may 
be referred to the Council for investigation and report. 
 
2.13 Government Procurement  
 From Japan
 
 
Secretariat Report –  
Section II - Trade Policies and Practices by Measure (2) Measures Directly Affecting Imports (viii) Government Procurement (wt/ tpr/s/128, page 44, paragraph 55) 
 
2.13.1  According to the Secretariat Report, Sri Lanka is considering joining the WTO GPA 
 
(a) Please indicate the specific pl ans for acceding to the GPA 
 
 Sri Lanka has prepared a four-year implemen tation plan outlining  the measures to be 
taken for improving the government procurement mechanism and studies are in progress on the 
actual program for  the liberalization of govern ment procurement sector  in line with the 
requirement under GPA. Sri Lanka considers it important to improve its  capacity within the 
procurement program, for which the finalization of the four year implementation plan is underway. 
 From the EC
 
 2.13.2  In the report of the WTO Secretariat ( paragraph 55 ), it is written that Sri Lanka considers 
joining the Agreement on Government Procurement.  When do the Sri Lankan authorities expect to 
join the Government Procurement Agreement (GPA)?  
  
 Sri Lanka is desirous of becoming a memb er of GPA and will, as a preliminary measure 
join GPA  as an observer. 
 
2.13.3  Although the Guidelines on Government Tender Pr ocedure prescribed for the creation of an 
Appeal Board to review complaints regarding aw ards, no such entity has been established to date 
(Paragraph 58). When do the Sri Lanka aut horities envisage creating such an entity?  
  This is an important area under finalization within the four year implementation plan.  
 
 In the report of the WTO Secretariat it is men tioned (paragraph 60) that calls for tender must 
be given the widest possible publicity. Are Electronic means currently in use, and if not, are there any 
plans to in introduce electroni c tendering in the future?  
 
 Sri Lanka’s tender guidelines, procedures, prac tices specify that wide publicity should be 
given to tender notices mostly in the printed me dia both in Sri Lanka and overseas as appropriate . 
Electronic tendering is progressively being used though it is currently limited to several WT/TPR/M/128/Add.1 
Page 24  government entities having the relevant infrastructu re. Sri Lanka has decided to actively promote 
electronic tendering in all government entities and this  aspect is well taken care of in the four year 
implementation plan. 
 
2.13.4  Price preferences for locally manufactured go ods (20%) or to governmentally approved 
societies (5%) are currently applied (paragraph 65) . To which extent would the Sri Lankan authorities 
be willing to eliminate these restrictions and with which time frame?  
 
 Price preferences for local ma nufacture were introduced in government procurement on 
the requirements stipulated under donor assisted projects by some donors. This was not introduced 
on the Government’s initiative. 
 
2.13.5  A number of companies continue to complain that they have been unfairly disadvantaged 
through a lack of transparency in tender proce dures. Reasons for this could be: The changing of 
specification part during the tendering procedures to  favour a competitor, poor evaluation of the 
tender documents or may be in-pro portionate  time, etc. How is the Government planning to address 
this issue? Are there plans to look at systems to try to increase the level of transparency? How does 
the Government assess the economic impact in  case of such inefficiencies in government 
procurement?  
 The government procurement regulations  require all government entities to follow 
stipulated regulations outlined in the tender gu idelines regarding the procurement of works, 
services, and supplies. The implementation of elect ronic tendering procedure helps eliminate issues 
associated with transparency in this respect. The  economic impact in case if any inefficiency is 
assessed by the Economic Poli cy Committee of the Cabinet. 
 
From the Republic of Korea
 
 
Secretariat Report –  Section II - Trade Policies and Practices by Measure (2) Measures Directly Affecting Imports (viii) Government Procuremen t (Page 44-47, Para.55-66) 
 
2.13.6  The Secretariat reports that the Government of Sri Lanka uses Government procurement as at 
important instrument of economic policy. It is our  understanding that the Government of Sri Lanka 
grants preferential treatment to local bidders compared with foreign businessmen.   Please clarify, if any, the differences in  policy between local and foreign bidders. 
 
 A margin of preference for local manuf acturers under specific circumstances was 
introduced in  to the procurement requi rements stipulated by some donors. 
 
2.13.7  What is the future plan of the Government  of Sri Lanka to enhance transparency in 
Government procurement (including with resp ect to joining the Government Procurement 
Agreement)? 
 
 Please refer 2.13.1 – 2.13.4 above. 
 
From the USA
 
 
2.13.8  We understand government tender procedures ma y be non-transparent and do not ensure a 
level playing field for all contenders.  Moreover, te nders are often delayed, subject to undue outside 
influence, and changed or cancelled without warning. WT/TPR/M/128/Add.1 
Page 25 
 
 
 (a) What efforts are underway to reform th e government procuremen t system and improve 
technical capacity? 
 
 Government tender procedure and guidelines ensu re a level playing field for all contenders. 
All government tenders on procurement of work s, services, and supplies are published in the 
principal newspapers fulfilling one of the transpar ency requirements giving both local and foreign 
suppliers the opportunity to tender. The four year implementation plan to improve procurement 
mechanism  includes among other things, capacity building in the government procurement sector.   
 
(b) What is the status of the establishment of  the Tender Appeal Board and when does Sri Lanka 
expect it to begin operations?  Who w ill make up the Tender Appeal Board? 
 
 The Economic Policy Committee of the Cabine t functions as the Tender Appeal Board. 
Government is in the process of implementing a four year plan to improve the government 
procurement mechanism.  These measures include among other things, development of functional 
specification of goods, introduction of electronic te ndering, introducing of a code of conduct for 
procurement professionals etc.    
 
2.14 Intellectual Property Rights
 
 
From Japan  
 Secretariat Report – (2) Measures Affecting Production and Trade (vii) Intellectual Property Rights (WT/TPR/S/128, page 67, paragraph 134) 
 
2.14.1  The Secretariat Report states that in July 2003, Parliament approved a new Intellectual 
Property Act of 2003.  (a) Please indicate the specific timetable for enacting and implementing the new Intellectual 
Property Act, which would appear to protect intellectual property rights comprehensively. 
 
 The new Intellectual Property Law is already effective from November 12, 2003 and is in 
operation now.    
 
From Canada
 
 
Trade Policies and Practices by Measure;  (4)  Me asures Affecting Production and Trade;  (vii)  
Intellectual Property Rights; paragraph 134  
2.14.2  It is Canada’s understanding th at the Sri Lankan Parliament has approved the new Intellectual 
Property Act of 2003, but that this Bill has not ye t been certified by the Speaker of the House, as 
required.  Could you please elaborate on when this  Bill, which would bring Sri Lankan intellectual 
property laws into compliance with WTO-TRI PS, will come into effect in Sri Lanka? 
 
 Intellectual Property Rights law is effective from 12
th November 2003.   
 
From Japan  
 
2.14.3  During the time period when the new Intellectual Property Act is not being enacted, it would 
seem that the laws and regulations of Sri Lanka ar e incompatible with the WTO TRIPS Agreement.  WT/TPR/M/128/Add.1 
Page 26    The new Intellectual Property Act No. 36 of 2003 contains the provisions that are compatible with the WTO TRIPS Agreement.    
 
2.14.4  Please explain how Sri Lanka plans to implement the obligations under the TRIPS agreement 
in the run-up to the new Intellectual Property Act being enacted and implemented. 
 
 Please refer the responses provided in question No. 2.14.1 and 2.14.2. 
 
2.14.5  According to the Secretariat Re port, a producer of sound recordings has the exclusive right to 
import. Secretariat Report – (2)  Measures Affectin g Production and Trade (vii)  Intellectual 
Property Rights (WT/TPR/S/128, page 68, paragraph 140)  
 
 Please provide the specific provisions whereby a producer of sound recording has the 
exclusive rights to import. 
 
 Section 18 (1)(b) of the new Act which states that the producer of a sound recording has the 
exclusive right to carry out or to authorise the importation of copies of sound recording or a 
substantial part thereof, even where such imported copies were made available with the authorization of the producer.  
 
2.14.6  Please also provide any other materials, regarding a producer having the exclusive right to 
import, if such material exists. 
 
 Not applicable.  
2.14.7  Please indicate how often this right is exerci sed by showing the relevant statistics. 
 
 Statistics are not available. 
 
2.14.8  Please explain how the enforcement of the intellect ual property right is realized in Sri Lanka, 
and please provide the relevant laws and regulations thereof. Secretariat Report – (2)  Measures 
Affecting Production and Trade (vii)  Intellectual Property Rights (WT/TPR/S128, page 70, 
paragraph 152)  
  The following measures are in place in the section relating to enforcement in the new IPR 
law.  
 a) Both civil remedies and criminal sanctions are available. 
 b) A special court has been established for IP litigation.  c) The Customs have been empowered to stop importation and exportation of goods 
that are in violation of IP rights. 
 From Canada
 
 2.14.9  Please explain what measures the Government of Sri Lanka is currently taking, or intends to 
take in the future, to enforce its intellectual property laws.    
 The following measures have been taken by the Government of Sri Lanka with regard to 
Intellectual Property Rights and the new IPR Act No.36 of 2003 contains necessary provisions in 
this regard.   (a) Both civil remedies and criminal sanctions are available. WT/TPR/M/128/Add.1 
Page 27 
 
 
 (b) A special court has been established for IP litigation. 
 (c) The Customs have been empowered to stop importation and exportation of goods in 
violation of intellectual property rights. 
 (d) The Intellectual Property Office has been empowered under the law to settle 
disputes involving copyright and related rights. 
 
2.14.10  What means, other than legal action, are ava ilable to foreign companies in Sri Lanka seeking 
redress for intellectual property violations? 
 
 On an adverse report issued by the specially  trained police officers on a complaint received 
from an affected party of a composer/song-writer/an artist or a company, the Ministry of 
Commerce will take action to susp end the trading license of the defaulting company and registrar 
of companies who functions under the Ministry of Commerce will be directed to cancel the business license/registration of the company. 
 
From Japan
 
 
2.14.11  According to the Secretariat Report, the piracy rate for optical discs in 99% for international 
repertoire. In this regard, please provide the releva nt statistics showing nation by nation the pirated 
data, if such statistics exist. 
 
 The statistics relating to the level of piracy are not available. 
 From the EC
 
 
2.14.12  To the knowledge of the EC, more than a year ago a new Intellectual Property Act was 
presented to parliament and according to the Intelle ctual Property Rights office in Sri Lanka this Act 
was finally made operational on 12 November 2003. In this light the EC should like to ask the 
following questions:  2.14.13  Is the Government planning to enforce this act by training customs & police officers? And do 
they have any training activity alr eady planned for the near future or  in progress? Even though the Act 
became operational in November we still see IPR in fringements and counterfeit activity going on with 
regard to software. CDs, DVDs, etc.  
The Government is planning to enforce this Act by training Customs and Police officers. 
Training activities have already been planned for the near future. However due to the financial 
constraints the opportunities that can be made available is rather limited.  Hence technical 
assistance in the form of training is very welcome.   In recognition of the importance of having a strong enforcement mechanism in place, the 
Government of Sri Lanka has initiated a number of measures to address counterfeiting activities, 
namely: 
 
1. Training of Customs and Police officers 
2. A core group on enforcement chaired by the Director of Intellectual Property and 
consisting of the representatives of main enforcement agencies and IP right owners have been established to enha nce the enforcement activities. 
3. A special unit for IP right related offen ces have been established in the Criminal 
Investigations Department of Sri Lanka Police. 
4. A similar unit will be established in Sri Lanka Customs and the Attorney General’s 
Department. WT/TPR/M/128/Add.1 
Page 28  
5. Extensive awareness programmes  have been earmarked for implementation.  
 From the U.S.A.
 
 
2.14.14  New Intellectual Property Law and Enforcement-  Sri Lanka should be commended for taking 
steps to enforce intellectual property rights includi ng Parliamentary passage of what we understand to 
be a new and stronger Intellectual Property Act in 2003.  We have received  reports of cooperation 
with private sector IPR committees and a willi ngness of Sri Lanka to accept industry and US 
Customs-led training.  We urge Sri Lanka to impl ement training, elevate public awareness, and begin 
enforcement and raids to reverse piracy trends and develop an e nvironment that protects local and 
international intellectual property. 
 
(a) Will the appropriate offices receive the n ecessary resources to fulfill their new responsibilities 
under the new Intellectual Property Law? 
 
The necessary resources will be provided to the maximum possible level.  The technical 
cooperation under the implementation of the TRIPS Agreement from the member countries is also 
expecte d. 
 
(b) Is intellectual property right s border enforcement provided for in the Code of Intellectual 
Property Act No.52 of 1979 as amended, the In tellectual Property Act of 2003, or other 
legislation?  If such border enforcement is  provided for in law, does Sri Lanka have 
implementing regulations that  can be made available? 
 
 The boarder control measures have been intr oduced under Section 206 of chapter XLI of 
the new Intellectual Property Act by amending the relevant provisions of the Customs Ordinance.  
The new provisions can be implemented even in the absence of implementing regulations.  The Sri 
Lanka Customs will make regulations, if necessary.  
 
(c) Please elaborate on Sri Lanka’s plans to enforce the new intellectual property bill. 
 
 The law is already in force since 12 November 2003.   
 (d) What steps is Sri Lanka taking to improve its  IPR enforcement and coordinate those efforts 
with rights holders, as well as with foreign governments?   
 
(a) A special Court has been established for IP litigation.  
(b) A Core-Group on Enforcement chaired by the Director of Intellectual Property and 
consisting of representatives of Enforcement Agencies, IP owners and certain 
embassies in Colombo have been established to enhance the enforcement activities.  
(c) A Special Unit for IP related offences have been established in Sri Lanka Police.  
Similar Units will be established in Sri Lanka Customs and Attorney General’s Department.  
(d) Training programmes for the Customs and Police Officers will be expanded.  
(e) The Consumer Affairs Authority will take part in the enforcement as far as 
consumer rights are concerned.  
(f) An extensive awareness programme will be implemented.  
(g) The Police and Customs will carry out enforcement activities including raids and 
prosecution. 
 
(e) With respect to the existing IPR regime, what  is the level of civil, criminal and border 
enforcement of IPR rights, including prosecutions, convictions, fines, etc., for criminal offences? 
  WT/TPR/M/128/Add.1 
Page 29 
 
 
 As provided for in Sections 177-203 of Chapt er XXXVIII of the new Act, violation of any 
IP right is a punishable offence carrying the punish ment of imprisonment of 06 months or Rs.500, 
000/- or both.  Second or subsequent convictions will double the punishment.  
 
(f) How does Sri Lanka impose deterrent civil and criminal penalties for infringement activities? 
 
For criminal penalties see the above answer.  
Injunctions both temporary and permanent and damages and other appropriate remedies 
are available as civil remedies, under Sections 170, 171, 172, and 173 of the new Act. 
 (g) How does Sri Lanka address copyright infringements committed over the Internet that have 
no profit motivation.   
 
 Any act, which is not an act of fair use, would be an act of infringement.  
 2.14.15  Are these actions criminalized?   
  
Response:    Yes.  
 2.14.16  Does Sri Lanka criminalize the import of counterfeit or pirated goods?   
 
Yes. 
 
2.14.17  Does it criminalize the export of such goods? 
 
Yes. 
 
2.14.18  How does Sri Lanka ensure that sentences for IPR crimes are proportional in accordance with 
TRIPS Art? 61?   Chapter XXXVIII of the new Act meets all requirements.  
 
2.14.19  Do Sri Lanka courts issue preliminary injunctio ns, including ex parte preliminary injunctions, 
for IPR infringements?   
Yes.  Please refer the responses provid ed under Section 2.14.14 above.   
 
2.14.20  Have Sri Lanka courts issued decrees to preserve evidence in IPR litigations? 
 
 Under the new law the courts will issue new orders.  
From the EC
 
 
2.14.21  According to an ordinance issued by the Minister of Commerce & Consumer Affairs 
(No.1286/18 of 2 May 2003) permits s uppliers of LPG to refill cylinders  belonging to other suppliers. 
This also applies to cylinders, which are the propert y of a company and bears its registered trademark. 
This appears to violate both TRIPS and general principles on property rights. 
 (a) Does Sri Lanka intend to withdraw this ordinance and if so when? 
 WT/TPR/M/128/Add.1 
Page 30  
This issue is pending in Courts as Shell Gas Lanka Ltd., has filed an action against the 
ordinance under reference.  In the circumstances, Sri Lanka will be bound by the Court decision.     
 From U.S.A.
 
 
2.15 Copyright and Related Rights  
 
2.15.1 Please clarify whether the principle codified in Article 6 (2) of the Intellectual Property Act 
applies to the categories of works listed in Article 7,  such that all works are protected from the time of 
their creation.  
Yes. 
 
2.15.2 How does Sri Lanka comply with Article 18 of the Berne Convention for the Protection of Literary and Artistic Works?  
The necessary requirements are compiled with. 
 
2.15.3 Does Sri Lanka intend to join the WIPO Pe rformances and Phonograms Treaty and the WIPO 
Copyright Treaty?  What is Sri Lanka’s  time-frame for joining these treaties? 
 
It is under consideration, but the time frame has not been decided. 
 
2.15.4 We note in the Secretariat Report that the pi racy rate for optical discs allegedly totaled 35 
percent for Sinhalese repertoire, 99 percent for inte rnational repertoire, and 100 percent for Tamil and 
Hindi repertoire.  
(a) Does the Government of Sri Lanka consider  these rates to be accurate?  Please describe the 
steps that are being taken to address this piracy problem.  How does Sri Lanka explain its relative lack of success in address internationa l, Tamil and Hindi repertoire products to 
Sinhalese repertoire products? 
 
It is difficult to say whether these rates are accurate, as a study has not been done.  With 
regard to the steps being taken, please see above answers.  Sri Lanka is trying its best, and at the 
same time, expects the owners of the Intellectual Pr operty also to be active in protecting their works 
and helping the enforcement agencies par ticularly in product identification. 
 
2.16 Patents
 
 
2.16.1 Please explain how the laws of Sri Lanka allo w process patent owners to exclude others from 
the acts of using, offering for sale, selling or importing a product obtained directly by the patented process, as required by TRIPS Article 28.  
Necessary safeguards are available under Sections 84 (3)(b) and 85 of the new act. 
 
2.16.2 Please explain how Sri Lanka provides for the protection of plants under TRIPs Article 
27.3 (b).  If Sri Lanka has a sui generis system of plant protection, please explain whether it is consistent with UPOV 91.   Sri Lanka is in the process of making a law on the protection of new plant varieties. 
 WT/TPR/M/128/Add.1 
Page 31 
 
 
2.16.3 Please provide examples of disclosures that may occur within six months of a patent application’s filing date that would not bar patentability due to abuse of the rights of the applicant or 
his predecessor in title, as described in Article 64 (3 ) (b) of the Intellectual Property Act of 2002. 
 
 We have not so far, come across any in stance where such claim has been made. 
 
2.17 Trademarks
 
 
2.17.1 Initials, names or abbreviated names of States are not required to be protected under the Paris 
Convention, nor is their protection required under inte rnational law.  Is the reference in Section 103 
(1) (i) of Chapter XX in the 2003 Code to “initials , names or abbreviated names” intended to apply 
only to intergovernmental international organizations?  
 It covers reproductions or im itations of armorial bearings, fl ags or other emblems, initials, 
names or abbreviated names of any State or  any other inter-governmental international 
organization or any organization crea ted by international convention. 
 
2.17.2  What is the rationale for the 2-year moratori um on registration of a mark that has been 
renounced?  If it is removed or nullified? For exam ple, would a claimant who had prevailed in a 
removal or nullification action against a third-party registration need to wait for two years before he 
could seek registration of that mark? 
 
The rationale underlining this provision is to remove the possibility of misleading the 
public.  Such claimant can make an application immediately, as such application is unlikely to mislead the public. 
 2.17.3  Under Section 104 (1) (b)-(c), what happens  where the applicant with a conflicting 
application is unaware of prior third-party use of a mark or trade name, i.e. in his application for 
registration refused?  
 In such circumstances, the applicant will be  advised to submit a fresh application for 
another name. 
 
2.17.4  Are there processes by which the registrations of certification marks and collective marks can 
be opposed? 
 
 Yes, as in the case of a normal trade mark.  
 
3. Sectoral Policies
 
 
3.1 Tariff on Agricultural and Food Products  
 From Australia
 
 
3.1.1 Sri Lanka maintains high tariff protection for most agricultural and food products, including 
milk and dairy products, fresh fru it and vegetables, fresh meat and processed foods. Does Sri Lanka 
intend to review the level of im port customs duty on these items?  
  Sri Lanka is predominantly an agricultural economy. Agriculture contributes to about 20% 
of GDP providing 33% of the total employment. Ag ainst this background, with a view to keeping 
the sector at a sustainable level, the present tariff structure, which is well below the bound tariffs, 
has been introduced. Sri Lanka co ntinues to review these tariffs.  WT/TPR/M/128/Add.1 
Page 32  
 
3.1.2 On 1 January 2004, Sri Lanka increased the Va lue Added Tax on fresh fruit and vegetables 
from zero to 15 per cent. What is the rationale for imposing a significant new tax on a basic foodstuff that is already subject to a large import duty?   
 Sri Lanka, during the past few years, was fa ced with a problem of reduction in government 
revenue to GDP continuously. The Report prepared by the government in section 2.3 (b) reveals 
that there has been a persistent decline in revenue m obilisation, as indicated by the decline in the 
revenue to GDP ratio from 19% of GDP in 1996 to below 14.5% in 2002. Among the measures 
taken towards augmenting revenue included the introduction of a uniform rate of 15% and 
broadening the tax base by reducing the number of items under the exemption list. In this exercise, 
fruits and vegetables along with several other items have been made liable for VAT. 
 
3.1.3 Wine [From Australia] - On 1 January 2004, Sri Lanka increased its import customs duty on 
wine from Rs. Sri Lankan 175 per litre to Rs. 200 per litr e. What is the rationale behind this increase? 
 
 On January 1 2004, when the uniform rate of VAT and the halving of the surcharge was 
introduced, with the sole purpose of keeping these changes revenue neutral, import duty on wine 
has been adjusted to present levels. The total duty incidence remains at the same level on a litre of 
wine. 
 
From the Separate Custom Territory of Taiwan Penghu, Kinmen and Matsu
 
Tariff on Agriculture products (Table III, Page 31 WT/T/S/128)  
3.1.4 My delegation would first like to express its fu ll support for Sri Lanka’s decision to replace 
control measures with high tariffs. We also appreciat e Sri Lanka’s efforts to simplify the tariff system 
while at the same time reducing non-tariff barriers. 
 
 My delegation notes from table III on page 31 of the Secretariat Report , which provides 
information on Sri Lanka’s structuring of MFN tari ffs, Sri Lanka binds most agriculture tariffs at 
49.5%. This figure greatly exceeds the applied rates of 21%. We realize how important the agriculture 
sector is to Sri Lanka’s economy. Nevertheless, we would like to see bound rates for agricultural 
products set as close to applied rates as possible.  
 
 It would be appreciated if the Sri Lankan go vernment could describe the rationale behind the 
disparate rates.  
 Sri Lanka is among the countries whose bound  rates are very low.  However, Sri Lanka 
wishes to indicate that this issue (disparate ra tes) is looked at in the context of multilateral 
negotiations.  These gaps are necessary to add ress further development needs of the country. 
 
From U.S.A
. 
 3.1.5 The Secretariat Report notes that agricultural tariffs fluctuate based on domestic supply. 
 
 Please identify the products subject to tariff fluctuation and describe how the tariff fluctuation operates. 
 
 Only five basic agriculture items are subject to seasonal tariff adjust ments. Having regard 
to production cycles of those five items, it is e ssential lower tariff to ensure regular imported 
supplies during the lean production periods.  It is necessary to discourage imports by levying higher tariff during glut/very heavy production. 
 WT/TPR/M/128/Add.1 
Page 33 
 
 
 What per cent of Sri Lanka’s agricultural products are subject to fluctuating tariffs? 
 
 It is marginal since only five items are subject to such tariff. 
 
 How does Sri Lanka intend to inform other WTO Members of its applied tariff rates in order 
to ensure transparency? 
 
Through notification to Integrated Data Base (IDB) of the WTO. 
 3.2 Agriculture Policy
 
 
From New Zealand - On the Secretariat Report  
 
3.2.1 The National Agricultural Policy and Strategy ( NAPS) identified the need for market reform, 
for enhancing the role of private entrepreneurs in  agriculture, for the closer integration of the 
agriculture sector with the food processing industr y and for the conservation and sustainable use of 
resources.  (a) Does the Sri Lankan Government have a timelin e for implementing policies identified in the 
NAPS to improve the fortunes of the agricultural sector? 
  Sri Lanka promotes industrialization in gen eral and promotes a conducive environment.  
In this environment, the private sector is encouraged to choose viable industries.  
 
3.2.2 According to Chapter IV, Para 10 of the Secretariat report , Sri Lankan authorities have 
stated that the elimination of non-tariff barriers a nd the reduction of tariffs in the agriculture sector 
have led to an increase in food imports which ha ve had an adverse effect on food production and 
consequently on food security.  New Zealand agrees that food security is important, but we also believe that true food security can only be obtained through an open international market rather than 
one striving for self-sufficiency, and that isolating markets leads to greater climatic and input risk 
effects as well as an inefficient global market.  
(a) How does Sri Lanka view the international mark et as contributing to its food security needs 
and how does this influence Sri Lanka’s overall trade policy? 
 
 Sri Lanka is a net food importing country.  In a global environment where agriculture is 
heavily protected, Sri Lanka’s tariff policy is desi gned to provide a level playing field for its 
farmers.  
From U.S.A.
 
 
3.2.3 According to paragraph 164 of the Government  report, the development of biotechnology 
policies is included among the activities covered under agri cultural policies.  What is the status of the 
development of its regulatory system pertaining to biotechnology ? 
 
Biotechnology in Sri Lanka covers few area s such as improved plant breeding &  
multiplication (viz : gene transfer, tissue culture), co ntrol of diseases and pests food processing etc.  
Such activities are regulated by the Mi nistry of Agriculture and Environment. 
 
Bio technology in other areas have not yet been developed.  As it develops, an appropriate 
regulatory regime will be designed taking into account interna tional best practices. 
  WT/TPR/M/128/Add.1 
Page 34  
3.2.4 Since its last review, what are the new initia tives geared to encourage the growth of the 
domestic poultry sector ?  Specifically, whic h policies have been budgeted in 2004 ? 
 
 The new initiatives for the poultry sector are th e moves to increase productivity and reduce 
cost of production per unit of output, facilitation of  the adoption of quality standards of the private 
sector and more assistance for disease control.   
 
3.3 Industry and Investment
 
 From Japan
 
 
Government Report 
4. Economic Policy Developments 4.2.2 Industry (WT/TPR/S/128, page 50, paragraph 174)} 
 
 The Government Report States that in order to promote regional growth, a new BOI Act was 
passed in 2002 to create five Economic Zones (EZ) in the country. 
 
3.3.1 Are these Economic Zones (EZ) the same as th e “Specific regions”, stated on page 86, 
paragraph 44 of the Secretariat Report, for whic h a special tax incentive p ackage for enterprises has 
been approved under the new BOI Act?  
 
 Specific Regions mentioned in the report refers to Regional Economic Development 
Commissions (REDC’s). A new BOI Bill was pa ssed in December 2002 to create five REDC’s. 
However, this has not yet been enacted as a Law. However, this co ncept has been applied 
establishing REDC’s as Regional Offices of BOI until administrative procedures are fulfilled to 
enact this Law. At present the BOI Regulation No. 3 of 2003 is in force with regard to incentives 
offered under BOI Regime which is applicable to all Regions throughout the country and each 
Region will be marketing their comparative a ttributes professionally to foreign investors.  
 
3.3.2 If not, please fully describe what exac tly are these Economic Zones (EZ). 
 
 Not applicable.  
 
From U.S.A.
 
 
3.4. Special tax incentives  
 3.4.1 Please provide further details on the ‘speci al tax incentive package for enterprises approved 
under the new BOI Act’?    
 The new BOI bill does not specify any special incentives for BOI ente rprises. However it 
contains provision to incorporate incentives granted under the Inland Revenue Act to the 
agreement in the same manner and to the same extent.  
 
3.4.2 Are all industries in every sector elig ible to receive these ‘special tax incentives?’ 
 
 Only selected sectors/industries are eligible. 
 3.4.3 We note in the Secretariat Report that the Board of Investment of Sri Lanka administers 
export-processing zones and industrial parks.  WT/TPR/M/128/Add.1 
Page 35 
 
 
 Please describe the incentives available to i nvestors in the export processing zones and 
industrial parks, i.e., tax alleviation, pr oduction subsidies, and export promotion. 
 
 Investors entered into an agreement with the BOI, become eligible for incentives 
irrespective of their location of investment. Fo r details, please visit BOI website www.boi.lk 
 
3.5 Telecommunications  
 
From the EU  
  The EC appreciates and recognizes that Sri Lanka has taken commitments in a number of 
service sectors during previous negotiations, and hope th at Sri Lanka will also take an active part in 
the current round of services negotiations.  While full y recognizing this, the EC should like to ask the 
following questions.  
3.5.1 The telecommunications sector is bound to  play an important role for Sri Lanka’s 
development, as communication will become of increasing importance for both visitors as well as business in Sri Lanka. Given the importance of this se ctor why has the liberalization policy in telecom 
been suspended?  When will it resume, in particular  when will alternative operators be allowed to 
apply for licenses for fixed network services?   Although the National Communication Poli cy (NCP) is suspended, the process of 
liberalization is continuing and the following asp ects amongst others are being implemented as the 
national communication policy of Sri Lanka. 
 
1. Liberalization 
 
 Transforming the telecommunications mark et structure and regulation towards a more 
liberalized, technology neutral model; very few restri ctions on cross-ownership of multiple network 
and service exist; The  opening of the interna tional services market (E xternal Gateway Operator 
Licenses), with no predetermined limitation on th e number of licenses, liberal licensing regime to 
permit maximum entry with minimum barriers, pr ovisions for promoting and enforcing fair 
competition are important and noteworthy aspects. 
 2. Investment   Creating the conditions for continued private investment in the communication  sector  by 
ensuring a stable and transparent policy and regul atory environment, consonant with Sri Lanka’s 
international commitment ,is a pillar of telecom policy..  3. Regulator   Granting greater independence and authority for the TRCSL to regularize the 
Communication sectors, as well as complete tr ansparency and public participation in its 
procedures.  Restructuring of the organizatio n is planned for more effective functioning. 
 4. Regulation of scarce resources  
 Ensuring the efficient management of key technical facilities, including the frequency 
spectrum, numbers, and rights-of-way is pivotal.  This also envisages the strengthening of the 
Commission’s spectrum management functions and capabilities. Included is reinforcing the 
planning and allocation as well as the spectrum assignment, monitoring and control activities of WT/TPR/M/128/Add.1 
Page 36  the Commission.  Effective and efficient manageme nt of the use of this scarce resource amongst  
competing users, is a main responsibility of the Commission.  5. Tariff regulation and consumer protection   Redefining the Commission’s responsibilities fo r regulating tariffs, quality of service, and 
consumer protection; deregulation of tariffs for competitive services including mobile and internet 
services are planned. Enhancing the quality of service regulation with minimized barriers is to be 
shortly implemented.  6. International Relations and Trade 
 
 Ensuring that Sri Lanka’s international relatio ns and trade links are efficiently maintained 
and strengthened by the usage of Information and Communications Technologies.   The aspects of Telecommunication containe d in the National Communications Policy are 
being implemented. 
  However, an overall policy which would cont ain aspects of Broadcasting and Information 
Technologies as well would be developed in the near future. 
 
3.5.2 Further, has rebalancing of telecom tariffs been  completed?  If not why, given the long period 
since the start of the process, and wh at are the plans to complete it? 
 
 Yes, rebalancing is completed.  With the full liberalization of the International Telecom 
Sector, the Government of Sri Lanka has granted 32  External Gateway Operator (EGO) Licenses.  
Simultaneously, TRCSL gazetted Interconnection Rules in March 2003.  Even though the Rules 
and Regulations were in place, there were several practical problems faced by PSTN operators, i.e. 
Capacity, commercial arrangement for transit tra ffic etc., with regard to the provision of 
interconnection.  From Hong Kong, China
 
(WT/TPR/S/128, P. 100, Para.96 ) 
 
3.5.3 We are pleased to know that Sri Lanka has ta ken the initiative to further liberalize the 
telecommunications sector by announcing a new communication policy in 2002, which would open 
the telecommunication sector to competition. We however note from the Secretariat report that the policy has been suspended since August 2003. We w ould appreciate more information on the current 
status of liberalization of the telecommunications sector. 
  In order to continue the process of libera lization the following aspects amongst others are 
being adopted and implemented on the Nati onal Communications Policy of Sri Lanka. 
 
Please see the response given for 3.5.1  
 
From the Separate Custom Territory of Taiwan Penghu, Kinmen and Matsu 
 
(Paragraphe 182, page 52, WT/TPR/G/128 ) 
 
3.5.4 My delegation welcomes Sri Lanka’s 20 02 new policy to further liberalize 
Telecommunication services, including the operation of  international gateways. As a result of the 
policy, Sri Lanka’s Telecommunication sector has alr eady become more transparent and open in the 
face of foreign competition.  However, my delega tion would appreciate receiving clarification on the WT/TPR/M/128/Add.1 
Page 37 
 
 
legal status of the Telecommunication Regulatory Commission of Sri Lanka (TRCSL) specially, we 
would like to know whether the TRCSL is an independent regulatory body as defined in the WTO Telecommunication Reference paper.  
 The Telecommunications Regulatory Commission of Sri Lanka established by Act of 27 of 
1996 is separate from suppliers of basic tel ecommunication services. The  Telecommunications 
Regulatory Commission is empowered to make deci sions and procedures impartially with respect to 
all market participants. 
 
3.5.5 In addition, my delegation would like to encourage Sri Lanka to adopt the provisions 
contained in the WTO Telecommunication Referen ce Paper to ensure fair competition for all 
Telecommunication operators.  
Noted. 
 
From Canada - 
Trade Policies by Sector;  (5)  Services;   (iii)  Telecommunication services:  
paragraph 96  
3.5.6 Canada is pleased to see that Sri Lanka has taken steps to make its Telecommunications 
Regulatory Commission (TRC) more independent of the services providers.  Please explain specifically what was done to strengthen the independence of the TRC.  Also, please provide Canada with a general update on the process of strengthening TRC. 
 
 TRCSL has been granted financial independ ence and operational independence.  The 
Board consists of professionals drawn from independent bodies. 
 
3.5.7 Canada understands that as part of the Nationa l Communications Policy of 2003, a number of 
changes were to be made to telecommunications  regulations in Sri Lanka, such as requiring 
mandatory interconnection, introducing a liber al licensing regime, and lifting other licensing 
restrictions.  Please provide an update on the progre ss of these changes.  Is Sri Lanka experiencing 
problems in the implementation of these changes?  If so, what are the problems and when does Sri 
Lanka expect to fully implement the National Communications Policy? 
 
 An update on the progress of the changes and problems experienced- 
 
• Transforming the telecommunication mark et structure and regulation towards a 
more liberalized, technology neutral model;  few restrictions on cross-ownership of 
multiple network and services (planned); opening of both the switched access and dedicated network segments.  This will inter alia include opening of the international services market, with no pre-determined limitations on the number of 
licenses, liberal licensing regime to perm it maximum entry with minimum barriers, 
provisions for promoting and enforcing fair competition. 
 
• Creating the conditions for continued priv ate sector participation by ensuring a 
stable and transparent policy and regulatory consonant with Sri Lanka’s international commitments.  
 
• Granting greater independence and authority for the TRCSL to regulate the 
communications sectors, as well as comp lete transparency and public participation 
in its procedures. Restructuring of the organization, establishment of a separate budget and creating an environment of priv ate sector organization is in progress.  WT/TPR/M/128/Add.1 
Page 38  
 
• Ensuring the efficient management of  bottle neck facilities, including the 
frequency spectrum, numbers, and rights-of-way.  This also envisages the strengthening of the Commission’s sp ectrum, management functions and 
capabilities.  This includes reinforcing the planning and allocation as well as the spectrum assigned, monitoring and contro l activities of the Commission.  Effective 
and efficient managing the use of this scarce resource is among the competing uses 
is a main responsibility of the Commission. 
 
• Redefining the Commission’s responsibilities for regulating tariffs, quality service 
and consumer protection; deregulation of tariffs for competitive services, including 
mobile and internet services; quality of  service regulation with minimized barriers. 
 
• Ensuring that Sri Lanka’s international relations and trade links are maintained 
and strengthened by the usage of Information and Communications Technologies. 
 
• However, an overall policy which would contain aspects of broad casting and 
information technology as well would be developed in the future. 
  National Communications Policy will be resumed in the future 
 3.5.8 Canada is pleased to see that Sri Lanka Telecom Ltd. (SLT) no longer has a monopoly for 
international voice services and wire line operation.   Canada notes that SLT is still the sole provider 
of fixed line telephone services in Sri Lanka.  Give n that the waiting list for fixed access services is 
growing each year and was over 300,000 in 2002 (paragraph 95), additional suppliers of these 
services would likely help to fill this growing de mand.  When does the government of Sri Lanka 
intend to completely liberalise all sector s of the telecommunications market?   
 
 Improving competitiveness of all markets is the policy of the Government and it would be 
considered in the context of overall policy changes . 
 3.5.9 Canada is pleased to see that the government of Sri Lanka has allowed more foreign equity in 
SLT. IV.  Trade Policies by Sector;  (5)  Services;  (iii)  Telecommunication services;  paragraph 100  
 The Sri Lankan government  considers divest ure of commercial activities which includes 
telecom as well.  
 
3.5.10  Canada notes that Sri Lanka has not made co mmitments for the following sub-sectors in its 
services schedule:  
(a) Domestic basic telephone services through Fixed Local Loop; 
(b) Facsimile through Fixed Local Loop; 
(c) Data transmission through Fixed Local Loop; 
(d) Telex services; 
(e) Telegraph services; and 
(f) Private leased circuit services. 
 
 Is there any particular reason why Sri Lanka has not made such commitments?  Does Sri 
Lanka have any intention to offer commitments  for these services in the current round of GATS 
negotiations? 
 
 We have offered to open up a few more su b-sectors under communications services and 
further offers will be negotiated in the current round of negotiations.  WT/TPR/M/128/Add.1 
Page 39 
 
 
 
From U.S.A.  
 
3.5.11  Investors in the telecommunications sector have complained about Sri Lanka Telecom’s 
(SLT) role as provider of telecom services and as a competitor.  SLT appears to regularly ignore 
government instructions to provide access to liens  and other services to private telecom entities. 
 (a) Would the representative of Sri Lanka please comment on Sri Lanka’s plans for the National 
Communications Policy that was suspended in August 2003? 
 
 Please see the response at 3.5.1  
 
3.5.12  The Government Report states that the Telecommunication Regulatory Commission (TRC) 
has announced a new telecommunications policy to increase competition.  We understand that a key 
issue in Sri Lanka’s telecommunications sector is  that the TRC has not been enforcing existing 
regulations to establish an efficient and tran sparent interconnection regime.  Without an 
interconnection regime competition is less likely to flourish. 
 
 With the full liberalization of the Interna tional Telecom Sector, the Government of Sri 
Lanka has granted 32 External Gateway Op erator (EGO) Licensees. Simultaneously TRCSL 
gazetted Interconnection Rules in March 2003. Even  though the Rules and Regulations were in 
place, there were several practical problems faced  by PSTN operators. i.e. Capacity, commercial 
arrangement for transit traffic etc. with regard to the provision of interconnection. 
  Now SLTL is upgrading its network to a ccommodate requests for interconnection from 
EGOs and other domestic operators. The Commissio n has already initiated a process to address the 
transit issue. 
  SLTL has already submitted two Interconnec tion Agreements SIGNED by non affiliated 
EGOs to the Commission for its approval and more than 10 EGOs are in the process of negotiation 
with the PSTN operators for interconnection.  
 Further to the above the Commission is invol ved in the process of amending the Sri Lanka 
Telecommunications Act. With this amendment it is proposed to empower the Commission to 
establish an efficient and transparent Interconnection regime. 
 
3.6 Electricity
 
 
From the EU  
 
 An efficient supply of power is truly important for all sectors of the economy and for creating a basis for further development across the board.  In  this light the EC should like to ask the following 
questions about liberalization in the sector of electricity. 
 
3.6.1 In the report from the WTO Secretariat, section on trade policy by sectors.  It is mentioned 
that the reform of the electricity sector for the time being has a limited impact:  “ Sri Lanka is moving 
from one monopoly situation to another, compe tition will be allowed only in distribution”.  Could the  
Government of Sri Lanka kindly expl ain the rational of this reform and in particular what competition 
will be allowed in distribution:  Does this mean that customers will have the possibility to choose 
from different distributions?  And if so, how does th e Government estimate the likely impact if there 
is no competition at the level of the offer (g eneration of electricity remain a monopoly).  
 WT/TPR/M/128/Add.1 
Page 40   Power Sector Reforms Office (PSRO) und er the Ministry of Power and Energy is 
empowered to deal with the Policy matters with reg ard to the re-structuring of the Power Sector. 
  So far the PSRO has taken steps to re-struc ture the Power Sector under the following main 
groups. 
 
(a) A Generation Company 
(b) A Transmission Company (c) Five Distribution Companies (d) An ancillary services Company (e) A super-annuation Fund Management Company 
 
 It is pertinent to mention that apart from the Generation Company operating the CEB 
Power Plant, there are 07 other independent Pow er Producers (PP) to supply electricity to the 
National Grid pre-determined rates.  Future Therm al Plants also will be operated in a similar 
manner. However, as at present the customers do not  have the choice to select distributors.  
 
3.7 Financial and distribution services and Insurance
 
 
From the EU  
 
 Financial and distribution services are of gr eat importance for furthering development and 
ensuring growth.  In this light, the EC should like to ask: 
 3.7.1 The report of the WTO Secretariat (para 91) states that “limits on overseas reinsurance were 
eased”.  Could Sri Lanka please give more details?  Are there till limits on the cross-border provision 
of reinsurance services?  In particular, are ther e still compulsory cessions to the national company?  
 
 “Limits on overseas reinsurance was eased” 
 There are no limitations on the cross boarder provision of reinsurance services to the 
Insurance Companies in Sri Lanka by the oversea s reinsurance companies.  In terms of the 
previous insurance legislation, the control of In surance Act No. 25 of 1962, Insurance Companies 
were required to cede 15% of the gross premium on fire and marine Insurance business to the 
National Insurance Corporation, ho wever, with the introduction of the new Insurance Legislation, 
the Regulation of Insurance Industry Act No . 43 of 2000 which came into effect from 1
st March, 
2001, this requirement of compulsory cession was w ithdrawn and the insurance companies are not 
subject to any compulsory cessions. 
 
3.7.2 The report of the WTO Secretariat (para 91) st ates that “foreign branches must be locally-
incorporated firms”.  Could Sri Lanka explain unde r which legal form foreign insurance undertakings 
can establish in Sri Lanka?   Are subsidiaries an d branches both allowed?  If so, what are the 
differences between their regimes?   
 “Foreign branches must be locally incorporated firms” 
 For a foreign insurance undertaking to enga ge insurance business in Sri Lanka, the 
requirements in terms section 13 of the Regulation of Insurance Industry Act No. 43 of 2000 (RII Act), are that the undertaking has to incorporat e a public company under the Companies Act No. 
17 of 1982 and obtain the registration from the Insu rance Board of Sri Lanka under RII Act.  Even 
the subsidiaries and branches of foreign insura nce companies are also subject to the same 
requirement as above.   WT/TPR/M/128/Add.1 
Page 41 
 
 
3.7.3 The EC should like to enquire as to the to Sr i Lanka’s assessment of the effect of the 
distribution sector in overall economic growth, employme nt and social development, and also in other 
economic sectors like construction, transport, com puter services, education and professional training?  
 
 Distribution services are essential for Sri Lan ka. Sri Lanka has liberalized the sector 
subject to a condition that foreign equity hold ings are not permitted for small scale retailing 
services with less than US$ 1 Mn capital.  
3.7.4 Further would Sri Lanka inform the EC about existing legislation applicable to retailing 
services?   Existing regulation permits foreign equity participation in retailing services subject to a 
condition that foreign equity holdings are not p ermitted for small scale ret ailing services with less 
than US $ 1 Mn capital.  
 
From Hong Kong China
 
(WT/TPR/S/128, P. 98-99, Paras. 90-91)  
 
3.7.5 On the insurance sector , it is noted that foreign investment  limits have been removed since 
April 2002 as autonomous liberalization. Foreign inv estment restrictions were removed and limits on 
overseas re-insurance were eased, thus allowing unrestri cted entry of insurance companies. We are 
pleased to note that full commitment has been of fered in Sri Lanka’s initial offer on services for 
commercial presence of direct insurance services. Howe ver, it is noted that the offer has not included 
commercial presence in re-insurance and retrocession services. We would like to know if there remain any restrictions in this sub-sector, and if not, we  would like to encourage Sri Lanka to consider 
reflecting its more liberal regime in its services commi tments so as to bring its commitments into line 
with its actual regime and to increase the lega l certainty and predictability of the regime. 
 
 As the Regulation of Insurance Industry Act No. 43 of 2000 which regulates the insurance 
industry in Sri Lanka does not have the necessary prov isions in the Act to register and regulate the 
reinsurance companies. The commercial presence  of overseas re-insurers was not included under 
the WTO commitment. 
 
 The Regulation of Insurance Industry Act. No. 43 of 2000 may have to be amended to include the necessary provisions in order to register and regulate the reinsurance companies. 
 
The Separate Custom Territory of Taiwan Penghu, Kinmen and Matsu
 
(paragraph 80, page 95, WT/TPR/S/128)  
 
3.7.6 As indicated in this Secretariat Report, th e Banking Act and the Monetary Law Act of Sri 
Lanka, which regulate financial services, are to be fu lly overhauled within the next two years. It is 
mentioned that legislation to combat money laundering  is also being drafted covering a wide range of 
financial activities. My delegation would like to compliment the Sri Lankan government on its efforts 
in making such great strides, which should lead to more transparent and competitive financial market.  
 (a) We are interested in knowing what key areas  in the Monetary Law Act ant the Banking Act 
are due to be amended, and the policy objective of the changes. 
  Monetary Law Act –  The changes proposed to the Monetary Law Act are to make domestic 
price stability the primary objective of the Cent ral Bank; strengthening and streamlining the 
powers of the Central Bank with regard to moneta ry policy and exchange rate policy; to enhance WT/TPR/M/128/Add.1 
Page 42  the operational autonomy of the Central bank an d to strengthen the accountability and governance 
of the Central Bank   Banking Act - This Act has been enacted in  1988 & from time to time amendments have 
been introduced. The main objective of the present amendments is to rationalize the structure and 
classification of banks; to strengthen the powers  of prudential regulation, enforcement and bank 
resolution measures and to streamlin e the winding-up of banks. 
 
From Canada
:  Sri Lanka Services Schedule 
3.8 Computer and Related Services  
 3.8.1 Canada notes that Sri Lanka has not taken any commitments for computer and related 
services in its services schedule.  Does Sri Lanka have any intention to offer commitments for 
that sector in the current round of GATS negotiations? 
 
 No. 
 
3.9 Tourism
 
 
 Tourism is fairly important for Sri Lanka’s economy.  Given this, the EC should like to ask 
the following questions.  
3.9.1 Would Sri Lanka inform us about their existing plans to promote the tourism sector, and what 
measures the government is taking to ensure non- discrimination of Foreign Service suppliers?  
 
 Visas for tour managers/leaders are granted on a seasonal basis on requests made by travel 
agents, and to tour operators from time to time,  and there is no discrimination whatsoever, with 
regard to those matters. The policy of the Sri La nka Tourist Board has always been to facilitate 
operations of all service providers. 
 
3.9.2 What is the approach of Sri Lanka to the re gulation of tourism-rela ted aspects of general 
interests such us environment, wildlife, urban planning, etc?  
 
 The Sri Lanka Tourism takes maximum prot ection in product development in terms of 
conserving and preserving environment, wild life, and to be in accordance with urban planning.  
Sri Lanka tourism does not approve any product, which have not been given adequate clearance 
from the Central Environmental Authority, the Coast Conversation, the Department of 
Archaeology etc.  Whatever clearance required fr om the Department of Wild Life Conservation and 
the Urban Development Authority are also ensured. 
 
3.9.3 What is Sri Lanka’s viewpoint about the tourism sector and promotion of local cultures, 
development of water supply and san itation services, and public security?  
  Tourism is considered as an industry where th e community involved is playing a major 
role.  The Sri Lanka’s tourism has adopted a new promotional drive, which is “beyond beaches, 
nature, culture and adventure”.  Thereby, Sri La nka tourism takes maximum precautions with 
novel development projects ensuring adequate benef its to the local commun ity while preserving the 
culture and the environment within a broader p erspective.  With regard to Water Supply and 
Sanitary Services, Sri Lanka tourism has taken a prominent initiative to seek funding assistance 
from foreign donor countries to develop such faci lities in the most satura ted tourism resources WT/TPR/M/128/Add.1 
Page 43 
 
 
along the Southern coastal belt. Similar projects will not only support the tourism services but 
benefit the local community living in those areas. 
 
3.9.4 We would like to know about Sri Lanka’s assessme nt of the effect of the tourism sector in 
overall economic growth and employment, and in  particular in other economic sectors?  
 
 Sri Lanka’s tourism is considered by the Government and the private sector as an effective 
economic activity, which earns valuable foreign ex change to the economy, next to traditional 
exports, garments, Middle East employment an d machinery & equipment.  Tourism has the 
capacity to generate the maximum number of employment opportunities within the shortest 
possible time, which any other industry cannot do.  Therefore, the government takes maximum 
initiatives to support the tourism industry by way of  encouraging foreign investment in the tourism 
sector, which will bring in to the country most modern technologies and high quality tourism 
products. 
 3.9.5 Would Sri Lanka inform us about the existing legislation applicable to tour managers 
(professionals accompanying groups of tourists in  their travel through the country) and tourists 
groups? Would Sri Lanka inform us about the plans that the government is considering to reduce or eliminate discrimination of foreign service suppliers in these fields?  
 The existing legislation provides for the formul ation of regulations to govern the activities 
of tour mangers and tour operators and the touris t groups.  The Government of Sri Lanka is not 
contemplating any reduction or elimination of foreign service suppliers in these fields since 
tourism is considered a growth sector in the economy of the country.   
__________