By: Staff Writer
October 27, Colombo (LNW): Sri Lanka Customs, following a directive from the Court of Appeal, is set to expedite the release of a large number of vehicles imported under cross-border Letters of Credit (LCs) that have been held up for months due to ongoing legal and procedural issues. The decision, reached earlier this week, aims to resolve a growing backlog of imported vehicles stranded at ports, many deteriorating due to prolonged exposure to the elements.
The matter was heard before Court of Appeal President Justice Rohantha Abeysuriya and Justice Priyantha Fernando in case number CA Writ 847/25. During proceedings, Additional Solicitor General (ASG) Sumathi Dharmawardena, appearing for the State, informed the court that directives had been issued to the Director General of Customs and other authorities to expedite the release process. This would be done under strict conditions importers must provide personal guarantees and undertakings to the Court and Sri Lanka Customs to ensure payment of any applicable surcharges or duties once determined.
Counsel Nishan Sydney Premathiratne, representing a personal vehicle importer, told the court that his client was prepared to provide such a guarantee to facilitate the release of his vehicle. He argued that the vehicle had been exposed to weather and risk of damage for months, raising serious security and financial concerns. The Court recorded his client’s undertaking to submit a personal guarantee for any surcharge sum stipulated by Customs, without prejudice to his client’s ongoing legal rights.
Premathiratne further undertook that his client would refrain from registering the vehicle until a court order or settlement is reached. Following this, the Court of Appeal permitted other petitioners with similar cases to file corresponding undertakings, enabling authorities to begin processing their Customs Declarations (CUSDECs) for release.
ASG Dharmawardena also revealed that a Gazette notification related to the issue and applicable surcharges would be published by October 24, signaling the government’s move to regularize these cross-border LC transactions and prevent future disputes. Most related cases have been fixed for hearing on November 12.
The petitioners were represented by President’s Counsels Ikram Mohamed, Sanjeewa Jayawardene, and Faizer Mustapha, among others, while the State was represented by ASG Dharmawardena, Deputy Solicitor General Chaya Sri Nammuni, and State Counsel Rajika Aluwihare.
The case has broader implications for Sri Lanka’s import sector, which continues to face turbulence following years of restrictions on vehicle imports due to foreign exchange shortages. Customs has also been tightening scrutiny on cross-border transactions and discrepancies in vehicle declarations to curb potential fraud. The expeditious resolution of these disputes could provide temporary relief for importers, while the upcoming Gazette is expected to define clearer procedures for future imports under non-traditional LCs.
