How to Register a Company in Sri Lanka as a Foreigner

Are you eyeing the vibrant opportunities in the South Asian market, particularly in Sri Lanka? Setting up a business in this promising land is an exciting prospect, but it’s essential to navigate through the registration process with precision.As a foreign entrepreneur, understanding the rules, restrictions, and necessary steps for company registration is crucial. In this comprehensive guide, we’ll walk you through the process step-by-step, ensuring a smooth journey towards establishing your presence in Sri Lanka’s business landscape.

Must-Know Facts

Before delving into the intricacies of company registration, there are a few essential facts every foreign entrepreneur should be aware of:

• Company Secretary: Appointing a local company secretary is a must. They’ll guide you through the process and ensure compliance. Look for experienced firms like us, offering comprehensive and cost-effective services.

Rules and Restrictions

Here are some critical rules and restrictions to keep in mind

1. Reserved only for Sri Lankan shareholders

• Certain industries in Sri Lanka are reserved exclusively for local individuals, including money lending, pawnbroking, coastal fishing, and Security Provision services.
• Retail trade is restricted if the investment is less than $5 million.

2. Foreign Ownership Limitations to 40% or less

• Shipping
• Travel & Tourism
• Mass Communication
• Freight Forwarding
• Tea, Rubber, Cocoa, Spice, Rice, and Sugar processing industries
• Mining and primary processing of Non-Renewable Natural Resources
• Timber based industries
• Education
• Deep Sea Fishing

3. Foreign Ownership for 100%

• Software Company
• Hotel
• BPO Services
• Business Consultation services

4. Approval Requirements:

• Special approvals from the Line Ministry may be necessary for specific sectors like large-scale mining, lottery, and manufacturing of certain substances.
• The level of approval required depends on the discretion of the ministry personnel.

5. Permission from the Board of Investment (BOI):

• Some businesses require approval from the Board of Investment (BOI), especially those involving manufacturing, retail, or branch offices.

Registration Process

Now that you’re familiar with the prerequisites and regulations, let’s dive into the registration process

Step 1: Secure Your Unique Company Name

• Search and Verify: Begin by checking the Department of Registrar of Companies website to ensure your chosen name isn’t already registered.
• Prepare Alternatives: Have at least four unique names ready, as similar names to existing companies are likely to be rejected.

Step 2: Complete the Essential Forms

• Gather Information: Prepare the following forms with accurate details:
  • Form 1: Company name, registered address, number of directors, their information, and share details.
  • Form 18: Director details, and appointment date.
  • Form 19: Company and secretary details.

Step 3: Understand the Articles of Association

• Governing Regulations: These documents outline your company’s operational rules as per the Company Act No. 7 of 2007.
• Expert Guidance: Need help navigating the complexities? BeeHoney Solutions offers expert advice on the Company Act, ensuring compliance and addressing administrative concerns.

Step 4: Public Notice and Bank Account

• Your registration is complete! Now, establish your company’s local presence by publishing a public notice in at least three Sri Lankan newspapers. Clearly mention your company name, address, and registration number.
• Open a Corporate Account: Open a dedicated bank account under your company name. This will provide you with a cheque book and internet banking facilities, essential for conducting business operations.

BeeHoney Solutions: Your Sri Lankan Registration Ally

Navigating BOI approvals, articles of association, and share certificates can be complex. But worry not! BeeHoney Solutions’ expert team is here to guide you through every step. We excel in managing these processes, ensuring a smooth and stress-free registration experience.

Ready to Set Sail?

With this guide and the support of BeeHoney Solutions, you’re well-equipped to embark on your Sri Lankan business adventure. Remember, research is key. Explore the official government websites and consult with legal professionals for industry-specific guidance. Bon voyage!