Margin Requirements Against Imports

MONETARY BOARD CENTRAL BANK OF SRI LANKA

08 September 2021 BANKING ACT DIRECTIONS No. 12 of 2021

MARGIN REQUIREMENTS AGAINST IMPORTS

Issued in terms of the powers conferred by Sections 46(1) and 76(J)(1) of the Banking Act No. 30 of 1988, as amended.

The Central Bank of Sri Lanka, with a view to preserving the stability of the exchange rate and foreign currency liquidity in the banking system, requires licensed commercial banks (LCBs) and National Savings Bank (NSB) to adopt the following measures on imports of certain non-essential and non-urgent goods, with immediate effect until further notice.

1. A 100 per cent non-interest bearing cash margin shall be kept on the invoiced value of imports specified in Schedule A, made under Documents against Acceptance (DA) terms.
2. In the case of NSB, the margin requirements specified in Directions 1 above, shall be applicable for such imports made under Letter of Credit (LC) terms.
3. In the case of existing DAs covering the importation of goods covered by this Direction, no increase in the value of such DAs shall be permitted by LCBs and NSB unless such increase is covered by the cash margin deposits as required in Directions 1 above.
4. Such non-interest bearing cash margin shall be placed by the importer with the bank that releases documents, at the time of acceptance of documents by the importer.
5. Such non-interest bearing cash margin requirement shall be on the total value of the invoice, regardless that the same invoice includes goods that are not covered under this Directions.
6. LCBs and NSB shall endorse the invoice to the effect that the margin deposit has been obtained.
7. The margin deposit shall be released on providing documentary evidence on payments through the banking channels in Sri Lanka and customs documents relating to clearance of imports.
8. LCBs and NSB shall not grant any loan facilities to enable importers to place the margin deposits in respect of these imports.
9. The provisions of this Directions shall have effect in addition to any requirement in force for the time being and such other requirements that may be introduced in terms of any law in respect of importation of goods.

(Signed) Prof. W D Lakshman Chairman of the Monetary Board and Governor of the Central Bank of Sri Lanka

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Schedule A

No.	HS code		No.	HS code		No.	HS code		No.	HS code
1	030441		33	180620		65	220510		97	34011920
2	030449		34	180631		66	220820		98	34013020
3	030451		35	180632		67	220830		99	340600
4	030461		36	180690		68	22084010		100	40111010
5	030462		37	190211		69	220850		101	40111090
6	030469		38	190219		70	220860		102	40112011
7	030474		39	190220		71	220870		103	40112019
8	04029990		40	190230		72	240210		104	401130
9	040310		41	190240		73	24022050		105	401170
10	040390		42	190410		74	24022060		106	40118010
11	040510		43	190420		75	24031990		107	40118090
12	040620		44	20091190		76	24039990		108	40129010
13	040630		45	200971		77	33030010		109	40129090
14	040690		46	200979		78	33030021		110	401692
15	08041020		47	200990		79	33030022		111	420100
16	08051010		48	220210		80	33030029		112	420211
17	08052110		49	220291		81	330410		113	420212
18	080610		50	22029910		82	330420		114	420219
19	080620		51	22029930		83	330430		115	420221
20	080810		52	22029940		84	330491		116	420222
21	08109090		53	22029951		85	330499		117	420229
22	110412		54	22029959		86	330510		118	420231
23	110419		55	22029961		87	330520		119	420232
24	110422		56	22029969		88	330530		120	420239
25	110423		57	22029970		89	330590		121	420291
26	110429		58	22029991		90	330610		122	420292
27	110430		59	22029999		91	330690		123	420299
28	110510		60	22030010		92	330710		124	420310
29	110520		61	22030020		93	330720		125	420321
30	110710		62	22030090		94	330730		126	420329
31	110720		63	220410		95	330749		127	420330
32	110814		64	220421		96	33079090		128	420340

(Pages 3, 4, 5, and 6 contain further continuation of Schedule A in the same table format.)