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* Sri Lanka SEC directs all listed companies to adopt best practices code on party transactions
Thu, Dec 12, 2013, 10:52 pm SL Time, ColomboPage News Desk, Sri Lanka.

Dec 12, Colombo: Sri Lanka share market regulator, Securities and Exchange Commission has decided to adopt the "Code of Best Practices on Related Party Transactions" from next year and requests all firms listed in the Colombo Stock Exchange (CSE) to voluntarily adopt the code.

According to the SEC directive sent to the CSE, all Public Listed Companies are required to adopt the Code with effect from 1st January 2014 on a voluntary basis for an initial period of two years from the effective date.

Thereafter, from 1st January 2016, it will be mandatory for the public companies to adopt the Code of Best Practices.

The CSE is directed to amend its Listing Rules to adopt the Code with effect from 1st January 2014.

The full statement by the SEC is given below.

The Securities and Exchange Commission of Sri Lanka (SEC) at its 326th meeting held on 28th November 2013 decided to adopt the Code of Best Practices on Related Party Transactions attached hereto on identified timelines and terms of adoption as specified hereunder.

Therefore the Colombo Stock Exchange is hereby directed to adopt the Code of Best Practices on Related Party Transactions (referred to as the "Code" hereinafter) annexed hereto as Annexure 1 subject to the terms of adoption as specified in the following manner;

1. All Public Listed Companies are required to adopt the Code with effect from 1st January 2014 (referred to as the "effective date" hereinafter) on a voluntary basis for an initial period of two years from the effective date.

Provided that where any Public Listed Company decides to adhere to the Code during the initial period of two years from the effective date, such Public Listed Company shall be exempted from complying with the disclosure requirements stipulated in Rule 7.6 (xvi) and item 29 of Appendix 8A of the Listing Rules of the Colombo Stock Exchange in respect of related party transactions. Any Public Listed Company that does not adopt the Code on a voluntary basis during the initial period of 2 years shall continue to comply with Rule 7.6 (xvi) and item 29 of Appendix 8A of the Listing Rules of the Colombo Stock Exchange in respect of related party transactions.

2. All Public Listed Companies shall adopt the Code mandatorily with effect from 1st January 2016.

3. The Rule 7.6 (xvi) and item 29 in Appendix 8A of the Listing Rules of the Colombo Stock Exchange shall be repealed on 1st January 2016.

The Colombo Stock Exchange is further directed to amend the Listing Rules of the Colombo Stock Exchange to adopt the Code with effect from 1st January 2014 on the aforementioned terms of adoption.

Dhammika Perera
Officer-in-Charge/ Deputy Director General

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