Repatriation of Export Proceeds

Bringing/Repatriation of export proceeds/ income to Sri Lanka

1. Export proceeds

Export proceeds refer to the revenue or income generated by residents from selling goods or services to non-residents. This include proceeds of export bills purchases (bill discounting), payments received through local agents /intermediaries for the goods and /or services exported by manufacturers/service providers and payments received in foreign exchange by a person resident in Sri Lanka for the services provided including professional, vocational, occupational or business services.

2. Requirement to repatriate export proceeds

Every exporter of goods and /or services shall mandatorily bring back the export proceeds to Sri Lanka, in respect of all goods exported and /or services provided outside Sri Lanka, within 180 days from the date of shipment or provisioning of services.

3. Requirements to convert export proceeds

  1. Exporters shall mandatorily convert export proceeds received to Sri Lanka, into Sri Lanka Rupees upon utilizing such proceeds only for the authorized payments, on or before the 10th day of the month after expiration of 03 calendar months including the month of receipt, from the date of receipt of export proceeds.

E.g.: If the date of receipt of export proceeds is 11.09.2024, deadline for conversion of the residual (after utilizing for authorized payments) is 10.12.2024.

  1. Above requirement also applies to payments received to indirect exporters from exporters out of export proceeds received by such exporter..
  2. Exporters who are not in compliance with these requirements may be subject to regulatory actions and shall convert the export proceeds repatriated to Sri Lanka with immediate effect.

4. Authorized Payments

Exporters are allowed to utilize export proceeds for the following payments before conversion of same to Sri Lanka Rupees.

  1. Payments in respect of current transactions related to the export business
  2. Debt servicing expenses and repayment of foreign currency loans and accommodations obtained by the exporter of goods, where such foreign currency loan/ accommodation is a permitted borrowing in terms of the Regulations, Orders and Directions issued under the Foreign Exchange Act or Banking Act
  3. Payments of dividends declared to non-resident investors and/or payments of salaries to expatriate employees who are foreign nationals or dual citizens as permitted under the Directions issued under the Foreign Exchange Act
  4. Withdrawal in foreign currency notes or transfer of funds for travel purposes related to export business.
  5. Payments in respect of making investments in Sri Lanka Development Bonds in foreign currency up to ten per-centum (10%) of the export proceeds.
  6. Payments to indirect exporters of goods and services who have commitments in foreign currency as permitted under the Directions issued under the Foreign Exchange Act.

5. Other requirements

  1. Exporters shall immediately submit all related documentary evidence on each receipt of export proceeds upon receipt of each export of goods and /or services, to the respective bank in Sri Lanka.
  2. Exporters who are permitted to access the Export Proceeds Monitoring System of the Central Bank of Sri Lanka shall ensure to submit all necessary information to the system.

6. References

  1. Regulations No. 4 of 2021 on Miscellaneous Capital transactions published in the Government Gazette (Extraordinary) Notifications No. 2213/37 dated 03.02.2021.
  2. Repatriation of Export Proceeds into Sri Lanka Rules No. 01 of 2024 published in the Government Gazette (Extraordinary) Notifications No. 2391/02 dated 01.07.2024.