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    The Regional Logistics Hub

  • Commercial Hub Operations in Sri Lanka

    Regional and global distribution centre operations

    To reap the maximum benefit of Sri Lanka’s strategic location in the Indian Ocean and its increasing shipping volume, the Sri Lankan government has introduced a series of legislation facilitating commercial hub operations.

    View Commercial Hub Regulations

    The commercial hub regulations were introduced to facilitate entrepot trade, off-shore business, front end services, headquarter operations, and commercial hub operations. The regulations also declared free ports and bonded areas, which are legally excluded from Sri Lankan custom territory although geographically situated within.

    Establishment of commercial hubs in Sri Lanka allows global stakeholders to import various raw materials or finished goods excluding restricted items through green channels with minimum customs intervention enabling a smooth movement of products ranging from simple storage, and value-added solutions to managing complex supply chain operations in a regional or global scale.

    The designated free ports and bonded areas under commercial hub regulations include;

    • Colombo Port
    • Hambantota Port
    • Mattala Airport
    • Katunayake Export Processing Zone
    • Koggala Export Processing Zone
    • Mirijjawila Export Processing Zone

    Under the Commercial Hub Regulation No. 1818/ 30 issued in the year 2013, Sri Lanka offers a series of services including;

    • Regional and Global distribution centre operations.
    • Entrepot trade operations
    • E-commerce delivery and reexport operations
    • Multi-Country Consolidation (MCC) and Groupage services
    • Full range of value-added re-export services for a variety of industries
    • Regional and global quality assurance centres
    • Controlled atmosphere cold storage facility for large scale fishing operations
    • Canning and packing operations food and beverage industry operations
    • Assembly and manufacturing of automobiles and machinery in bonded areas in allocated commercial logistics hubs

    Why Choose Sri Lanka for Commercial Hub Operations?

    Sri Lanka’s Strategic Location

    Sri Lanka is the leading maritime hub of the South Asian region. The ports in Colombo and Hambantota conveniently connect cargo travelling to and fro Europe, East and South Asia, the Persian Gulf and East Africa. Moreover, The Indian Ocean is emerging as one of the busiest East-West trade corridors. A large portion of the global bulk shipping trade, including petroleum products and coal transit across this region, are transported through the Indian Ocean and Sri Lankan seaports are conveniently located on the centre of the Indian Ocean naval routes and in the path of the ‘One Belt One Road’ (OBOR) initiative launched by the China Merchants Group, a state-owned corporation. Conveniently positioned amidst the trade routes that connect Singapore, Dubai, and India, Sri Lankan ports are able to link Indian ports with the global trade routes.

    A leading Transhipment Hub

    The Colombo and Hambantota ports in Sri Lanka houses deepwater terminals capable of handling large vessels with more than 22,000 twenty-foot equivalent units (TEUs) capacity. The Colombo Port is one of the busiest container ports in the region and the deepest port in South Asia with the ability to handle large container vessels while also being the most efficient with a lead time clearance of one day. Sri Lanka’s Hambantota Port has a unique geographical advantage that most of its neighbouring ports lack, namely a deep-water coastline close to Indian Ocean Shipping Lanes, conducive to handle the world’s largest container ships and supertankers.

    Favourable Investment and Trading Regulation

    Sri Lanka is a signatory of economic Treaties and Free Trade Agreements (FTAs) that allows easy flow of trade and shipment. Sri Lanka is a participant of free trade agreements with South Asian countries under SAFTA, free trade agreements with Singapore, and the Generalized System of Preferences (GSP).

    Sri Lanka’s legal system follows the principles of British commercial law and has an independent judiciary. The country is a signatory to international treaties on intellectual property rights and the country has active regulations relating to electronic transactions and computer crimes. It is also a signatory to the UN’s e-contracting convention.

    In addition, The Finance Act - Commercial Hub Regulation No. 1 of 2013 exempts commercial hub transactions from

    • The Customs Ordinance (Chapter 235) - subjects to restrictions & prohibitions imposed in Schedule B
    • Exchange Control Act (Chapter 423 -Section 3(a) of Gazette 1232/14 dated 19 -04-2002 shall not apply and foreign ownership shall be permissible within bonded areas.
    • Imports & Exports (Control) Act, No. 1 of 1969

    Highly Skilled and Agile Workforce

    Highly Skilled Workforce

    A highly skilled and agile workforce that has experience and qualification in various fields of industries is Sri Lanka’s most advantageous to date. The country provides comprehensive tertiary education and vocational training through a network of public and private institutes, and the local workforce excels in providing services that are intricate, nimble and sophisticated like in the case of ICT, light engineering services and electronic services.

    Low Cost of Operation

    Although the country offers many conveniences and supportive finance and legal framework, the operational cost in Sri Lanka is low compared to other logistic hubs in the region with similar operational skills.

    • logistic service provides in Sri Lanka
    • ground logistic services
    • bonded areas in Sri Lanka
    • logistic service providers
    • commercial hub operators
    • warehousing facillities
    • re-export operations
    • value-added re-export services
    • Assembly and manufacturing facilities
    • warehouse facilities in Sri Lanka
    • Export processing facilities