Business Registration in Sri Lanka: A Strategic Move for Indian Entrepreneurs

Expanding your business across borders? Sri Lanka might be your next big leap. With a growing economy, investor-friendly policies, and close proximity to India, registering your business in Sri Lanka can open new doors. In this blog, we’ll explore the entire process of business registration in Sri Lanka – especially geared toward Indian businesses looking to make a mark.

Why Sri Lanka?

For Indian entrepreneurs, Sri Lanka presents multiple strategic advantages:

• Proximity to India: Just a short flight away, reducing operational and logistics costs.
• Favorable bilateral ties: Strong diplomatic and trade relations.
• English-speaking workforce: Makes communication smooth and efficient.
• Growing economy: Emerging sectors like tourism, IT, agriculture, and renewable energy are booming.
• Digital governance: The business registration process is now streamlined via the e-ROC portal.

Companies like Scop International specialize in helping foreign businesses, particularly Indian entrepreneurs, navigate this space with ease.

Choosing the Right Business Structure

Before diving into paperwork, you need to choose the right business entity. Here are the common types available in Sri Lanka:

Private Limited Company is the most preferred choice for Indian businesses because it offers 100% foreign ownership, limited liability, and credibility.

Step-by-Step Guide to Registering Your Business

1. Name Reservation

Head over to the e-ROC portal and:

• Check for name availability.
• Reserve your preferred name by paying a nominal fee (LKR 2,000 + VAT).
• Avoid restricted words like “Sri Lanka,” “National,” etc., unless you have special approval.

The name is reserved for 3 months.

2. Prepare Incorporation Documents

You’ll need:

• Form 1: Company registration application
• Form 18: Consent of director(s)
• Form 19: Consent of secretary
• Articles of Association: Governing rules of the company

Ensure all documents are signed, scanned properly, and uploaded in A4-size PDFs.

3. Submit and Pay Online

After preparing the forms:

• Log into e-ROC.
• Upload documents.
• Pay fees online (expect to pay around LKR 14,000 in total).
• Receive a Certificate of Incorporation within 3-5 working days.

Scop International helps businesses prepare compliant documents and ensures fast-track approvals.

4. Post-Incorporation Essentials

Once registered, you’ll need to:

• Obtain a Tax Identification Number (TIN) from the Inland Revenue Department.
• Open a corporate bank account.
• Register for VAT, if your annual turnover exceeds LKR 3 million.
• Enroll employees with EPF/ETF (employee benefits).

These steps ensure your business is operationally and legally ready to function.

Regulatory & Compliance Considerations for Indian Businesses

Minimum Capital Requirements

For sole proprietorships and partnerships owned by foreigners, a minimum investment of USD 2 million is required. This must be remitted through a Securities Investment Account (SIA).

Sectoral Restrictions

Some industries – like defence, gaming, or telecommunications – may require special approvals. It’s advisable to check the current regulations or consult with Scop International for tailored advice.

BOI Registration

If you’re looking at manufacturing or export-oriented operations, registering with Sri Lanka’s Board of Investment (BOI) offers perks like:

• Tax holidays
• Import duty exemptions
• Easier repatriation of profits

Data Protection Laws

Sri Lanka has implemented the Personal Data Protection Act (PDPA) in 2023. If your business handles customer data, compliance is crucial. This is similar to India’s DPDP Act and GDPR in Europe.

Embracing Digital Payments

As LankaQR and India’s UPI systems are becoming interoperable, make sure your business supports cashless payments. It’ll improve customer experience and build trust.

Cost Breakdown

Note: Add ~2,360 LKR for each additional director.

Common Challenges & How to Avoid Them

• Incorrect document formatting: Files must be A4, clear scans.
• Company name rejections: Too similar to existing names or contains banned terms.
• Missing local secretary: A Sri Lankan resident must be appointed.
• Currency remittance issues: Use an SIA account for capital remittance.

Scop International provides end-to-end support, ensuring no step is missed.

A Quick Timeline

• Day 1: Name reservation
• Day 2-4: Document preparation
• Day 5-7: Submission & approval
• Day 8-10: Post-incorporation setup

Your business can be fully functional in under two weeks with the right support.

FAQs: Business Registration in Sri Lanka

Can a foreigner own 100% of a business?
Yes, particularly for Private and Public Limited Companies.

How long does the process take?
Roughly 7–10 working days.

Do I need to be physically present?
Not necessarily. With a local representative and Scop International’s support, you can register remotely.

Is Sri Lanka good for IT/tech businesses?
Absolutely. The tech sector is growing rapidly and is actively supported by the government.

Can I open a bank account as a non-resident?
Yes, but you’ll need proper documentation and approvals. Scop International helps facilitate this process.

Final Thoughts: Your Gateway to Global Expansion

Business registration in Sri Lanka is a strategic and achievable step for Indian businesses seeking to expand internationally. With transparent systems, reasonable costs, and regional access, the island nation offers a compelling proposition.

To ensure a smooth journey, work with partners like Scop International – who specialize in Sri Lankan registrations, compliance, and market-entry consulting.

🚀 Ready to Register Your Business in Sri Lanka?

Visit Scop International today to:

• Get a customized consultation
• Fast-track your registration
• Stay compliant with Sri Lankan laws

Make your international expansion a success story – with the right guidance, Sri Lanka is closer than you think.