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Sri Lanka Foreign Company Registration

<img src="Sri-Lanka.jpg" alt="Sri Lanka Foreign Company Registration">
Sri Lanka Foreign Company Registration

Our guide line will give you detail indication of new company registration fee, service in Sri Lanka for foreigner. Our service on Sri Lanka foreign company registration/ company incorporation/ company registration in Sri Lanka  (LLC) requirements of Sri Lanka. We advise managing business license, process of registering a private limited company in Sri Lanka and information of how to register a company in Sri Lanka for foreigner?

Sri Lanka Foreign Company Registration, Formation

 Go through the steps of of Sri Lanka foreign company registration:-

Company registration process in Sri Lanka
  • As company registration process first task is to be ensured institution name approval from Department of Company Registrar, an address require for business correspondence;
  • Additional supporting papers are prepare and submit MOA and other forms and provided that all papers be attested by the person of government endorsed;
  • Further information some other license might require to register a private limited company, depend upon type of business;
Share Holder
  • As law of the country a private limited company is created by minimum two share members whereas maximum number of share members are fifty , in case of public corporation minimum share members are seven where at least two shall hold position of directors;
New Paper Advertisement
  • As Sri Lanka foreign company registration, formation process and law starting a new business after registration of a (LLC) company profile will be published in to three news papers;
Company Secretary
  • Company Secretary hire is one condition to establishment nonresident / foreign ownership company ;
Share Proportion being joint venture company
  • As law of Sri Lanka, foreign partners shall hold maximum 49 percent of shares and rest of shares will be owned by local share holder (s).
BOI required/ not required
  • Without BOI approval no such entity is permitted to begin operation, vary upon type of business and investment capital;
SEC permission not required
  • Fresh business can be incorporation without earlier approval of SEC, if the company is private limited and small number of capital;
Company Registration Time in Sri Lanka
  • Minimum 21 days are required to complete process of private limited company registration in Sri Lanka;
  • As our guide line of Sri Lanka foreign company registration there may need of time 3 weeks to 3 months to complete whole registration process in Sri Lanka, depend upon number of permissions;
Start a retail business in Sri Lanka
  • As guide of Sri Lanka foreign company registration retail business as foreigner is not allowed normally unless meets the condition of remittance of US$ millions;
100% foreign share holding
  • 100 percent foreign ownership company is allowed as law of Sri Lanka but most of the cases 51 percent holds by local partner and 49 percent by foreign partners in case of JV (joint Venturing) company.
Import business in Sri Lanka
  • As our guide line of Sri Lanka foreign company registration, to start Import business ( retail business) US$ 1Million may require to be remitted at bank account, if, it’s wholesale business then skip the figure;
Current FDI position in Sri Lanka
  • Further information as Sri Lanka foreign company registration and setting up business, current fdi position of Sri Lanka is US$ 925,280,499 (+/-). Offshore enterprise
Government Fee
  • Government annual fee is SLRs 60,000 Plus (-) to renew licensing and return filing.
Company registration Fee in Sri Lanka (Consultancy fee)
  • Fee to register a private limited company in Sri Lanka is not fixed but approximately SLR 180,000 to SLR 220,000 that vary upon types of business and investment capital;

At a glance of company registration in Sri Lanka

Company Act 2007 of no. 7
Name approval time 1-2 days, if no conflict occur
Required forms to be filled Form 1, 18 and form 19
What is form 1?  Company registration information
What is form 18?  Certificate of the directors
What is form 19?  Certificate of the Company Secretary
Memorandum & Article of Association As Company Act, 2007 under 7
Paper advertisement Placing information, contact number, parent company place and must publish in one English news paper including local language news paper.
Government Fees RS 15,000 (approximately)
Consultancy fees US $ 2000, 3000 and 7000 as category
Time line (company registration) 30 days max
Company registration From registrar office and/ or BOI
Corporate tax rate 35 percent

Company Registration in Sri Lanka

As process of company registration in Sri Lanka, name of proposed company has to be approved and must have office (physical office).

<img src="srilanka-company.jpg" alt="Company registration in Sri Lanka"/>
Company registration in Sri Lanka

Name approval

  1. Need to be search the government portal to check availability of proposed name;
  2. Fill up name search form A16 collecting from counter of Registrar Office;
  3. Ensure Rs 1110 with VAT to be deposited to counter of Registrar Office for name booking;
  4. The Registrar is the supreme authority to be approved the name of the company;
  5. Those investors who wish to register their company in Sri Lanka must follow the Company Act No. 07 of 2007 which is necessary to get a business name reservation.
  6. Initially the investors should search the database of the registered companies through information portal of ROC or search manually the books kept on the information counter of ROC to check whether the same name or similar names have been registered or not in the similar industry in Sri Lanka.
  7. The next step is to fill the Name search form which is collected from the information counter of the ROC after verifying that the same name is not recorded in the business names registry and they should indicate what the initials stand for in case of the name includes initials.
  8. If the investors hand over the form A 16, it will be examined at the public information counter and more information may be requested which depends on the forms have been filled. Besides, if portal is used, this could be done through e-mail.
  9. They need to pay Rs. 581 (fees Rs. 500/= + 12% Value Added Tax (VAT) + Processing charges) (only Sampath e-Wallet, Master and Visa cards are accepted) in case of sending a Name search application using portal or another way they can follow which is submitting manually through paying Rs. 560 (Fees Rs. 500/= + 12% VAT) to the Shroff counter at the Department of ROC.
  10. There is a database administrator who will run a search for similar names which he will list and submit to the Registrar General of Companies and the verification document of company name should be sent in there.
  11. If the name is approved by the authority, the Approval Number can be collected over the information counter of ROC or if sent through the portal will be e-mailed the following day.
  12. The investors or applicants should bear in mind the reservation of company name will have the validity of only for a period of 3 months from the date of application in Sri Lanka.
  13. In case of limited liability company, investors need to maintain the following steps such as obtain a company name approval which has been mentioned already in details, fill out the forms which are no. 1, 18 and 19 (Form-1 contains registration of the company, Form-18 contains consent and certificate of director, Form-19 contains consent and certificate of secretary) together with two copies of Articles of Association and the most important thing is all forms should be printed or typewritten as hand written forms will not be accepted by the authority.
  14. Articles of association set out in the First Schedule except to the extent that the company adopts articles and a company limited by guarantee. The articles of a private company shall include provisions which are stated in the following,
  15. Prohibit the company from offering shares or other securities which are issued by the company to the public; and number of its shareholders is limited to fifty but such shareholders who are employees of the company, former employees of the company who became shareholders of the company while being employees of such company and who have continued to be shareholders after ceasing to be employees of the company will not be included under this criterion.
  16. After that, they should submit the documents which are mentioned above to the information counter to check whether they are in the correct format and submit it to the Shroff counter if it is found in order.
  17. The registration fees for the limited liability companies are Rs. 11,200 including VAT (Form 1 – Rs. 10,000/=, Form 18 – Rs. 500/=, Form 19 – Rs.500/=, Articles of Association – Rs. 500/= + 12% VAT) should be maintained in Sri Lanka.
  18. Investors provide public notice of its incorporation specifying the name and company number of the company and the address of the company’s registered office within thirty working days of its incorporation under this Act in Sri Lanka.
  19. At least one issue of the Gazette and one issue of a daily newspaper in the Sinhala, Tamiland English (three papers) languages, circulating in the area should be given in the public notice which represents the place of business of the company.

Register a private limited company

  1. After getting name approval Form no. 1, Form 18, Form 19 and Memorandum & Article of Association have to be printed;
  2. All documents have to submit to the counter of Registrar Office with registration fees of Rs nineteen thousand nine hundred eighty and VAT;
  3. Within 30 working days of incorporation a company shall publish in news papers as follows:
<img src="Image/Paper_advertisement.jpg" alt="Paper advertisement for new company incorporation in Sri Lanka"/>
Paper advertisement for new company incorporation in Sri Lanka

Note: As section 3 if companies do not violate limitation BOI approval will not come in picture otherwise BOI approval is required for the foreign investors.

Register a limited company

  • Required all above papers and/ or information to be registered except two major steps are such companies cannot offer public share
  • As membership limitation maximum fifty share holders are allowed as private limited company in Sri Lanka.

Company Registration Sri Lanka step by step

Starting business

Starting a business may be a dream in Sri Lanka but it could turn into a nightmare if the business doesn’t run properly and the investors lose their asset. On the other hand, they can be devastated for the company’s unforeseen financial loss. The investors who are interested to invest in Sri Lanka for starting a company, they should bear in mind that business assets and liabilities will be separated from each other through registering business.

Process of opening a company

In Sri Lanka, a specific company name will be required during incorporation which bears the identity of the company around the industry and the necessary thing is the investors will need to register for a “Doing Business As” name, also known as a DBA, trade name, or assumed name in Sri Lanka.  Another most important thing is when the investors or entrepreneurs form a business, its legal name always defaults to the name of the person or entity that owns the business in case of they don’t choose to rename and register it as a DBA name. A guarantee of protection for the unique business name which is initial task of company registration in Sri Lanka and obtaining Licenses and Permits, register with the Inland Revenue Department and Tax Authorities, opening a bank account or opting for bank facilities for business requirements are the further tasks of registering a company in Sri Lanka.

Eligibility for Registration

Any company which has already been registered outside Sri Lanka subject to the exclusions, limitations and conditions published in the Government Gazette No. 1681/10 of 22nd November 2010 has after the appointed date established a place of business within Sri Lanka and continues to have an established place of business within Sri Lanka on the appointed date, would be eligible to get registered in Sri Lanka.

  • The company should follow the following steps which have already been discussed such as obtain a name approval, a certified copy of the charter, statutes or memorandum and Articles of Association (AOA) of the company or other instruments which helps to constitute or define constitution of the company and the most important thing is where that instrument is not in the official language of Sri Lanka or in English, a translation of that instrument in such language as may be specified by the Registrar.
  • A list of the directors of the company which contains such with respect to the directors as are by the Companies Act No. 7 of 2007 required to be contained with respect to directors in the register of directors of a company in the prescribed manner according to form 45.
  • According to Form 46, the names and addresses of one or more persons resident in Sri Lanka should be authorized to accept on behalf of the company. In the prescribed manner of the form, service of documents and of any notice required to be served on the company.
  • Therefore, according to Form 44, a statement containing the full address of the registered or principal office of the company in the country of origin and the principal place of business of the company within Sri Lanka.
  • A certified copy which should be certified of recent date and any document that affects or evidences the incorporation of the company, a valid Power of Attorney authenticated by the seal of the company authorizing the persons or person resident in Sri Lanka to act on behalf of the company will be eligible to register a company in Sri Lanka.
  • Where an overseas company has established a place of business within Sri Lanka before the appointed date according to the Companies Act No. 17 of nineteen eighty two in relation to the release of papers.
  • The Registrar may take appropriate steps in terms of the Act to issue notice on the company to register another name.
  • If the document is certified to be a true copy by an official of the government of such foreign country to whose custody the original is committed or a Notary Public of such country or some officer of the company before a person having authority to administer an oath in that country and by the signature or seal of the official, Notary Public or person who is authorized by an official of the Sri Lankan Embassy or High Commissioner in that country.
  • The signatures may be authenticated by the Trade Commissioner; or any representative of the government of Sri Lanka in that country; or any member of the judiciary of that country; or any other person acceptable to the Registrar of Companies if there is no Sri Lankan Embassy in that country.
  • Investors can purchase the prescribed from the department or download it from the website and Rs. 30,000/= will be required for the registration of an overseas company where Rs. 500/= will be required for registering any document. Besides, investors or applicants should bear in mind that 12% VAT is payable on all registration fees in Sri Lanka.

An Off-Shore Company in Sri Lanka

Any Off-Shore Company registration in Sri Lanka which wants to be incorporated or under the laws of any foreign country may make an application to the Registrar General of Companies. Winding up or liquidation of such company has not commenced, a receiver of the property has not been appointed, there is no scheme or order in force suspending the rights of creditors, in the case of a company incorporated abroad, there is no legal impediment in the country of incorporation to the company engaging in the business of an Off-shore company will be subject to the Registrar. The other important thing is the issue of the certificate of registration will not render defective any legal or other proceedings instituted or to be instituted by or against the company.

Grant of Certificate of Registration

The issue of a certificate of registration will be subject of such criteria what have been stated above. To grant the certificate of registration, investors should follow the following steps. Initially they should obtain a name approval, deliver a certified copy of the charter, statutes or memorandum and articles of association of the company or other instrument constituting or defining the constitution of the company. The most important thing is that instrument is not in the official language of Sri Lanka or in English, a translation of that instrument in such language as may be specified by the Registrar for the registration purpose. A list of the directors or those managing the affairs of the company, containing their full names, addresses, occupation sand the offices they hold in the company should be provided according to Form 45.

Branch Office open in Sri Lanka

  • The following information and documents are required as guide line of Sri Lanka foreign company registration (Branch Office of foreign LLC):
  • There are different approval papers of the mother corporation with attested by embassy;
  • Meeting decision from sponsors;
  • Power given a human , local agent, who shall proceed taking liabilities in favor of mother organization;
  • About more a month (4 weeks ) might needful to complete registration process;
  • Enclosed documents conversion in English;
 Representative office
  • Setup such office is like liaison office but exceptions are it is free from tax and cannot involve in trading;

Joint venture Company registration in Sri Lanka

  • Joint venture company registration in Sri Lanka is formed between parties upon agreement of trading with many terms and conditions and clauses as business and services;
Income Tax return of Sri Lanka
  • Entity dividend and royalty tax start from ten to fifteen percent as information of Sri Lanka Inland Revenue;
  • Corporate tax rate is thirty five percent;
  • Twelve point five percent tax is applicable on exporting goods;
  • Tax incentives facilities available on particular goods those entities are situated within area of free zone in Sri Lanka;
  • Corporation tax holiday enjoy for three to seven years;
  • You can find income tax return information in Sri Lanka (Personal & corporate)
New company registration fees in Sri Lanka

Company registration fees in Sri Lanka is given as chart

As Form 1 Rs. 15,000 (Government fees)
For, Form 18 Rs. 1000 (Government fees)
For, Form 19 Rs. 1000 (Government fees)
For, article of association Rs. 1000, (Government fees)
Note: Fifteen percent VAT will be applicable on all above fees. 
Consultancy fees category “A” US$ 1999 (for small size company).
Consultancy fees category “B” US$ 2999(for medium size company)
Consultancy fees category “C” US$ 6999 (for big size company)

 

<img src="Image/Fees_company.jpg" alt="Fees of new company incorporation in Sri Lanka"/>

Sri Lanka-S & F Consulting Firm Limited

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Sri Lanka
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