Companies (Amendment) Act No. 12 of 2025: What it means for businesses

DELOITTE Sri Lanka views the Companies (Amendment) Act No. 12 of 2025, which was officially certified and passed into law on 4 August 2025, as a major milestone for the country’s corporate sector and a critical step in strengthening the governance framework.

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With 21 amendments introduced, the legislation improves the regulatory framework for business operations, enhances transparency, and aligns Sri Lanka with international standards such as those set by the Financial Action Task Force (FATF) and the Asia-Pacific Group on Anti-Money Laundering (AML). These reforms are not only about compliance, but also about building investor confidence and helping Sri Lanka position itself as a trusted and competitive business hub.

The most transformative update is the introduction of beneficial ownership disclosures under sections 130A to 130J. This requires companies, including offshore and overseas entities registered locally, to disclose and maintain up-to-date records of their beneficial owners. Deloitte observes this move strengthens accountability and aligns Sri Lanka with international anti-money laundering standards, creating a more transparent environment for investors.

Beneficial Ownership (BO) Disclosures

From a practical perspective, businesses will need to have a proactive approach. Deloitte highlights that companies must establish reliable systems to capture beneficiary data, manage records securely, and ensure compliance with reporting obligations under the Registrar of Companies. While these requirements may initially seem demanding, they ultimately support a healthier business climate and prepare Sri Lanka for the FATF mutual evaluation scheduled for 2026.

Among the other key changes are updates to longstanding ambiguities in the Companies Act No. 07 of 2007. Deloitte notes that these clarifications will bring more consistency to corporate law, giving companies a clearer framework to operate within.

Clarification and Resolution of Ambiguities in the

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