In an effort to streamline and regulate the rapidly growing construction industry in Sri Lanka, the Construction Industry Development Authority (CIDA) issued new regulations, requiring Contractors engaging in Identified Constructions Works to register with the Authority in terms of the Construction Industry Development Act No 33 of 2014 (CID Act)
Registration of Contractors
The Construction Industry Development (Registration of Contractors) Regulation No.1 of 2017 published on 5th April 2018 provides for the registration of contractors with CIDA.
The eligibility criteria for registration is as follows.
A company registered under the Companies Act No.7 of 2007, or a business registered with the Divisional Secretaries under Business Names Ordinance or Provincial business Name statutes.
The entity seeking registration should have a minimum of 51% Sri Lankan ownership
The Contractor should not be included in a current list of suspended or defaulted construction contractors maintained by the Department of Public Finance or any other state organization.
The Contractor should not be legally insolvent or declared bankrupt at the time of the application.
Public listed companies, upon registration under these Regulations are not required to maintain the 51% local ownership on renewal. However, the Board of Directors of such public listed company should have a local representation of more than 50%.
The Regulations also include grading of different categories of construction contractors- main construction contractors and specialist construction contractors. The Contractors are evaluated for their financial capacity, technical capacity, machinery & equipment and other considerations. The minimum point requirements for grading purposes are included for each category of contractors.
Temporary registration of Foreign Contractors
Under the Construction industry Development (Temporary Registration of Foreign Contractors) Regulations of 2018, any foreign contractor intending to carry out identified construction works under a construction contract as the main / lead party should obtain a Temporary Registration Certificate for Foreign Contractor by making an Application to CIDA. Upon payment of the registration fee the foreign contractor will be issued with the Certificate of Registration which is valid for a period as specified in such Certificate.
The registration can be renewed by making an application to CIDA and paying the renewal fee 14 days prior to the date of expiry.