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Tuesday April 23rd, 2024

Defence ministry vetting foreign spouses: Sri Lanka lawyer goes to human rights body

ECONOMYNEXT – A new and controversial requirement for Sri Lankans to obtain defence ministry approval before getting married to a foreign national is absurd, said a lawyer who lodged a complaint against it with the Human Rights Commission of Sri Lanka (HRCSL) on Monday (27).

“This is absurd and I honestly don’t understand what they are trying to do with it,” attorney-at-law Thishya Weragoda who filed the complaint against the marriage registrar’s circular told EconomyNext.

“In a world where we are very connected and a lot of our own younger generation travel abroad for studies and work, these things will become very commonplace.  Your saying that a person cannot marry a foreigner without the defence ministry’s permission is very absurd,” he said.

The Sunday Times, a weekly English-language newspaper, reported on Sunday (26) that a citizen will have to get a ‘Security Clearance Report’ from the Ministry of Defence to marry a foreign national.

Related: Sri Lanka defence ministry to vet foreign spouses of citizens, series of new controls: report

Analysts say the circular is a series of new barriers enacted to make it more difficult for the island’s residents to marry foreigners.

Article 16 of the Universal Declaration of Human Rights, to which Sri Lanka is a signatory, states:

  • Men and women of full age, without any limitation due to race, nationality or religion, have the right to marry and to found a family. They are entitled to equal rights as to marriage, during marriage and at its dissolution.
  • Marriage shall be entered into only with the free and full consent of the intending spouses.

Sri Lanka’s marriage registration ordinance prohibits the following, among other things:

  • Parties below the age of 18 cannot enter marriage
  • Couples who are direct descendants or siblings by full or half-blood and previously-married persons who have not dissolved their marriages cannot enter another marriage

“What is happening here is that you have to obtain the consent of a third party, and that party has the authority to veto,” said Weragoda.

The lawyer said if a requirement such as a ‘security clearance report’ is to be implemented it should be done through an amendment to the law.

“It cannot happen via a circular because the law would need to be changed. For that to happen it should be gazetted and debated in parliament before it is passed,” he said.

A gazette can be challenged in court but not a requirement declared via a circular, he added.

Weeragoda said there are three aspects to the issue.

One is that the marriage registration ordinance rules can only be made by the minister and not the registrar. “The registrar has no control or power over the people.”

The second aspect, Weeragoda explained, is that marriage and the freedom to marry fall under the freedom of thought and conscience in the constitution. “Therefore no restrictions can be placed on it.”

“No one can control a person’s emotion to fall in or out of love. Can the government say they will or will not allow you to get married to X or Y?”

The final aspect is that the government’s concern about Sri Lankans marrying foreigners or vice versa is that those foreign spouses may have ulterior motives in marrying a local to use them as a gateway to to illegal trade.

“Foreign spouses and their criminal track record are an immigration issue. The government can always deny a visa but it has no right to say one needs to obtain defence or health ministry clearance for them to get married here,” said Weragoda.

“These are two completely distinct aspects.”

Sri Lanka also has a diaspora community who visit the country to get married in the island or where their parents got married.

At the height of COVID-19 infections in the country, Sri Lanka was in discussions with India to host destination weddings under a bio-bubble concept.

“One of the biggest issues we have in this country is that people don’t have an adequate understanding how freedoms work. In other countries there would be so much opposition against something like this this from activists and organisations that the government would be forced to back down immediately. But here there are many who would justify this,” he said.

“We are not a rights-based society; that’s the problem. I was compelled to lodge the complaint because somebody had to do something,” he added. (Colombo/Dec27/2021)

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Sri Lanka single borrower limits cut to 25-pct of bank capital, SOEs also included

ECONOMYNEXT – Sri Lanka’s central bank has issued directions limiting loans to a singe borrower or a group of connected customers to 25 percent of Tier I capital, with state enterprises which turned out to be the biggest borrowers, also included.

In a 2007 direction, banks were allowed to give loans up to 30 percent of capital for a single customer and 33 percent for a group but the rules were widely violated in the case of state enterprises, which were used as off-budget vehicles to give energy and other subsidies.

Banks will have to limit exposures to 25 percent starting from January 2026.

According to transitional provisions published in the direction seems to indicate that some banks may have single borrower exposures of 85 percent or more.

They will be required to bring exposures down to 60 percent by 2027 and 25 percent by 2028.

Download the direction from here Sri-Lanka-single-borrow-limit-direction-2024

Energy utilities were made to borrow from state banks to run off-budget subsidies under plan avoid a price formula during the Rajapaksa regimes.

Sri Lanka’s state banks ended up with large debts to Ceylon Petroleum Corporation partly due to flexible inflation targeting (printing money to cut rates as soon as inflation fall triggering forex shortages) even when fuel was market priced in 2018, analysts have shown.

When rates were cut with inflationary open market operations, triggering forex shortages, CPC was barred from buying dollars and forced to get suppliers’ credit denominated in dollars.

The suppliers’ credits were later converted to dollar loans from state bank loans, usually after the currency collapsed from the inflationary rate cuts or inflationary open market operations to sterilize interventions or both, analysts have shown.

The CPC loans have since been taken over by the government.

Banks have also funded roads and other state projects.

“Licensed banks shall gradually reduce the exposures to Public Corporations to meet the maximum limit,” by December 2030 according to the direction.

“Public corporation shall mean any corporation, board or other body which was or is established by or under any written law other than the Companies Act, with funds or capital wholly or partly provided by the Government.”

Many of the newer state enterprises however have been suddenly set up under the Companies Act, unlike earlier where a specific act was passed by the parliament to set up corporation or a statutory authority.

Borrowings of CPC and CEB eventually hit the financial stability of state banks while actual bad loans were under-reported. Now the bad loans are being covered with a state capital injection.

Under an International Monetary Fund and World Bank backed program, the so-called ‘sovereign bank nexus’ is being severed to protect the banking system.

Government securities, central bank sterilization securities, loans guaranteed by multilateral lenders or high rated foreign banks are excluded. (Colombo/Apr23/2024)

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Sri Lanka exceeds tax revenue target by 6% in first quarter

ECONOMYNEXT – Sri Lanka’s revenue collecting bodies have outperformed and exceeded tax revenue target by 6 percent for the first quarter ended on March 31, State Revenue Minister Ranjith Siyambalapitiya said.

“After many years of difficult challenges, it has been possible to exceed the expected state revenue in the first quarter of 2024,” he said in a statement.

The government expects a revenue collection of 4,106 billion rupees in 2024.

“The reason for the economic crisis in the past period was the reduction in the level of government revenue. Considering the achievement of higher than the target in the first quarter of this year and the revenue pattern, the 2024 will become a year in which the revenue targets can be achieved,” he said.

The three tax revenue collecting bodies – Sri Lankan Customs, Excise Department, and Inland Revenue Department have collected 834 billion Sri Lanka rupees in the first quarter.

“It is a 6% higher than the expected revenue target of 787 billion rupees,” Siyambalapitiya said.

He said the Inland Revenue Department exceeded its target by 13 percent to 430 billion rupees compared to the target of 381 billion rupees in the first quarter of 2024.

He also said Customs Department has managed to reach the target of 353 billion rupees and the Excise Department has also achieved 96% of the revenue requests and earned 51 billion rupees in the first quarter.

The island nation has raised Value Added Tax (VAT), imposed new taxes, and increased personal income taxes to boost the revenue under an International Monetary Fund-backed reforms in return of a $3 billion External Fund Facility.

People have started to grumble over the government’s higher taxes without reducing some of the state expenditures. The government has been in the process to privatize some key state-owned enterprises. However, that process faced delays amid gradually rising protests against the move. (Colombo/April 22/2024)

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Sri Lanka rupee closes stronger at 300.50/301.00 to US dollar

ECONOMYNEXT – Sri Lanka’s rupee closed stronger at 300.50/301.00 to the US dollar with the spot market becoming active in the second half of Monday, dealers said.

The rupee closed at 302.00/50 to the US dollar on Friday amid moral suasion.

On Monday a foreign bank sold dollars to the central bank around 302 levels, following by more sales, dealers said after trading started without proper spot market quotes.

On Friday a 302 level was indicated by some dollar sales, dealers said.

Sri Lanka’s rupee came under pressure over the last week, despite broadly deflationary policy, after the central bank collected large volumes of dollars in March.

Bond yields were flat as buyers awaited the next development in sovereign bond re-structuring, market participants said. There were both positive and negative sentiments among bond investors, dealers said.

A bond maturing on 15.12.2026 closed flat at 11.30/40 percent

A bond maturing on 15.09.2027 closed flat at 11.95/05 percent.

A bond maturing on 15.12.2028 closed flat at 12.15/25 percent.

A bond maturing on 15.09.2029 closed marginally higher at 12.25/35 percent from 12.30/40 percent.

A bond maturing on 01.10.2032 also closed flat at 12.40.50 percent. (Colombo/Apr19/2024)

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