18 February 2019 12:00 am
Attempts are said to be underway to thwart a move to establish Sri Lanka’s first shipping and logistics industry chamber under the name National Chamber of Shipping of Sri Lanka, Mirror Business learns.
Advertisements in this regard were published on November 14, 2018 in national newspapers by Julius & Creasy.
However, it has now come to light that two already established shipping industry associations and a business chamber have opposed the move and that they have made their objections formally to the Registrar of Companies.
The three parties that have objected the move are Ceylon Association of Shipping Agents (CASA), Sri Lanka Logistics Freight Forwarding Association (SLLFFA) and the National Chamber of Commerce of Sri Lanka (NCCSL).
According to sources familiar with the matter, letters sent by them to the Registrar of Companies basically highlight that having a large membership, they remain the core representatives of the shipping and logistics industry and no one else should be allowed to register new entities bearing the words ‘national’ or ‘Sri Lanka’ in their names.
Interestingly, this is unfolding at a time when attempts are being made towards liberalizing the country’s shipping and logistics industry.
A case filed by Parliamentarian Vasudewa Nanayakkara against the alleged shipping industry monopolization is currently being heard at the country’s Court of Appeal.
Sources further said the objections made against the registering of a new chamber is aimed at preventing the move to establish a body that would broadly represents the industry, which will also include shipping and logistics service users such as exporters and importers.
A number of experts, policy makers and economists have pointed out that liberalizing Sri Lanka’s ship agency sector will attract foreign investment, improve efficiencies and reduce costs.
At present, foreign parties can hold only up to 40 percent of equity in shipping agency companies.
The liberalisation of shipping agency business is widely regarded as the key stepping stone for Sri Lanka to establish its position as a maritime and trading hub in the Indian Ocean region.
Finance and Mass Media Minister Mangala Samaraweera in the 2018 budget proposed to remove foreign ownership restrictions on shipping agencies and logistics firms, saying that such a move would encourage foreign investments and enhance competition, reducing costs.
However, the final draft of the National Policy for Maritime and Logistics Sectors recently presented to Ports and Shipping Minister Sagala Ratnayake advocated continuing with the status-quo of minimum 60 percent equity holding for locals in shipping agency companies.