Applicability of ordinary law of Sri Lanka in Foreign Direct Investment

Abstract

This study examines the practical application of ordinary law of Sri Lanka in FDI, with a particular focus on the Colombo Port City Project in Sri Lanka. The objective of this study is to critically examine the applicability of ordinary law in Sri Lanka's Port City Project, where the unique phase of foreign investment plays a major role to attract foreign investments to address Sri Lanka's balance of payment crisis and provide local job creation. The country’s approach to FDI has two key drivers: (I) the urgency of attracting FDI; and (II) greater politicization of foreign investment projects. The latter arose from geopolitical concerns, which affected several of the Executive branch's significant investment decisions. It should be noted that Sri Lanka is significant in this geopolitical war because of its advantageous location in the Indian Ocean. It has grown troublesome as China becomes more involved in important industries including ports, transportation, and energy. It is worthy to be noted that, whether Port City Project investments are subject to the ordinary law and which institutions have the authority to approve such projects in accordance with the concepts of transparency and public accountability for such decisions. The study, therefore, primarily concentrates on the Sri Lankan legal jurisprudence and how the investment law plays its role when it comes to the public-private partnership between the Government of Sri Lanka and a project company called CHEC Port City Colombo (local subsidiary) which is the arrangement to develop Sri Lanka’s first-ever Special Economic Zone(SEZ).