Sri Lanka on Tuesday said it would introduce criminal penalties for unauthorised foreign exchange transfers after the cabinet approved amendments to the country’s foreign exchange law.

The proposed amendment will affect the Foreign Exchange Act, No. 12 of 2017, which the government said contains gaps that limit criminal action against certain outward remittances.

According to the government, the amendment will cover advance payments made overseas for imported goods where the goods are not brought into Sri Lanka within a reasonable period.

It said such remittances could subsequently be classified as unauthorised foreign exchange transfers.

The government said that under the existing law, the Central Bank of Sri Lanka can impose a financial penalty equivalent to the value of an unauthorised remittance, calculated in Sri Lankan rupees.

However, the law does not currently classify such conduct as a criminal offence.

According to the government, the absence of criminal provisions has limited investigative and law-enforcement agencies’ ability to institute criminal proceedings over the unauthorised movement of funds out of the country.

The cabinet therefore approved a policy proposal to introduce specific criminal provisions into the law.

The president submitted the proposal in his capacity as minister of finance, planning and economic development.

(Xinhua/NAN)