Regulations were promulgated under the Import and Export Control Act No. 01 of 1969 and published in Official Gazette No. 2278/21 of 6and May 2022 to regulate certain payment terms related to the importation of goods with a view to reducing the possibility of under-invoicing at the time of customs clearance of imported goods.
In accordance with this regulation,
- Operation of open account payment terms has been limited to exporters and indirect exporters
- The conditions of documents against payment (DP) and documents against acceptance (DA) have been regularized to be used on the basis of available currencies.
- The Director General of Sri Lanka Customs has been instructed to maintain a system in place to monitor and reconcile the import value declared at the time of customs declaration by importers and the settlement value of such import invoices in collaboration with the banks of the respective importers
These regulations will limit the opportunities for importers to under-invoice (declare a lower value than the actual value of the imported shipment) to benefit from less payment of duties at the time of customs clearance and use of the Gray Market Exchange (Undiyal / Hawala method) to settle the undeclared part of import invoices.
The regularization of documents against payment (DP) and documents against acceptance (DA) will help to discourage the import of non-essential and non-emergency goods and make foreign exchange available in the banking system for the import of essential products in the situation. current. .
It should also be noted that since Documents Against Acceptance (DA) terms, which operate similarly to open account payment terms, allow the importer to import goods on credit, they make an initial payment via the method Undiyal. Therefore, the terms of the AD must be stopped.
Shortly after the announcement made a few days ago on the regularization of open account payment terms, Undiyal’s rate on the gray market forex began to decline. With the implementation of the above measures, this trend is expected to continue and will also help increase the flow of foreign currency into the banking system, thereby increasing more funds available for essential imports and stabilizing the exchange rate.