November 27, 2024
INCORPORATION OF COMPANY IN SRI LANKA
INTRODUCTION
Sri Lanka is an island country located in the Indian Ocean. Being culturally rich in nation, natural beauty and diverse in population. Amongst the South Asian Countries, Sri Lanka has the most liberal trade market, and it allows up to 100% Foreign Investment in the Private Sector with some restrictions in certain business areas. High employment rate amongst the working class. Recently Sri Lanka has achieved high Gross Domestic Product (“GDP”) growth, and its per capita now stands at $4,310 which is substantially higher than many other countries.
REGISTER COMPANY IN SRI LANKA
Incorporating a company in Sri Lanka is very hassle free and investor friendly compared to most countries of the world. The first and foremost factor is that it not essential to be a resident of Sri Lanka for 100% foreign ownership is allowed with restrictions in some sector for foreign entrepreneurs.
There are many other reasons to register company in Sri Lanka like it has good market structure and corporate friendly atmosphere, high employment rate and social stability amongst the resident.
THINGS CONSIDER BEFORE INCORPORATING A COMPANY IN SRI LANKA
Things consider before incorporating a business in Sri Lanka are as
- Target Audience and demographics of employees – For any successful business two things is foremost important first a customer base and the second is a good job satisfaction amongst their employees. Hence these factors are must before consider to register a company.
- Supply chain management- Supply Chain management includes Transportations, Storage, and delivery patterns, etc. There are different for every business set up for investor needs to think about whether company will suffice according to company operation.
- Taxes, Regulations and State and local news- Sri Lanka has a diverse discrimination culture across the state. Hence it is essential to have the knowledge about corporate taxes polices, employment rates.
- Local Competition- Local Competition are boon and bane for any new business setup. Boon because it is indirectly indicated that the product or service are taking to the market, has a customer base in the area, business is planning to establish. Nuisance because it might overshadow presence in the market, it is advised that the business knows about the local competition in the region.
NATURE OF BUSINESS
In Sri Lanka, it is essential to choose different type of companies the major types of the establishment are as following-
- Limited Liability Company (“LLC”)– This is the most popular for establishment in Sri Lanka. An LLC requires minimum one directors& one shareholder to run its business in the country. However, no minimum share capital is required to be deposited.
- Partnership- When two or more people come together to do business, it is called partnership. The liability is unlimited of the partner can be limited according to agreement between the partners.
- Sole Proprietorship – The most accessible form of business structure that may exist in any market is a sole proprietorship because it requires no capital and the owner liability is unlimited.
- Overseas Company – A foreign entity whose business is registered outside the country and it is governed by the norms set by the parent branch in home country. It operated as a branch of Parent branch company in Sri Lanka and have the obligation to publish its financial report in Sinhalese Language.
HOW WE CAN HELP?
- Our team can conduct risk assessments to identify potential threats and vulnerabilities within a business. They can then recommend risk mitigation strategies to safeguard against adverse events.
- Our team can investigate and identify any license, permissions or registrations required for the client’s specific area or industry. The business assists with application process and ensure that the organization complies with all legal criteria.
- Our experts can help set clear objectives, outline actionable steps, and identify opportunities for growth and expansion.
For more information or queries, please email us at
[email protected]
Key Contact
Surendra Singh Chandrawat
Managing Partner
