SRI LANKA STATE TRADING CORPORATIONS ACT

Arrangement of Sections

1. Short title.

PART I

ESTABLISHMENT OF CORPORATIONS AND THE POWERS AND DUTIES OF CORPORATIONS AND
THEIR BOARDS OF DIRECTORS

2. Establishment of corporations.

2A. Corporation to carry out any activity entrusted to it by the Cabinet of Ministers.

3. Objects of the Corporation.

4. Principal place of business of the Corporation.

5. General powers of the Corporation.

6. Powers of the Minister.

7. Seal of the Corporation.

8. General control of the Corporation and exercise of its powers.

9. Members of the corporation.

10. Board of Directors.

11. Remuneration of Directors.

12. Director to disclose interest in contract proposed to be made by the Corporation.

13. Quorum for any meeting of the Board of Directors.

14. Board of Directors may act despite vacancy.

15. Chairman of Board of Directors.

16. Presidency at meetings.

17. General Manager.

18. Appointment of public officers to the staff of the Corporation.

19. Officers and servants of the Corporation deemed to be public servants.

20. Corporation deemed to be a scheduled institution within the meaning of the Bribery Act.

PART II

FINANCE

21. Capital of the Corporation.

22. Borrowing powers of the Board of Directors.

23. General duties of the corporation in financial matters.

24. Application of the revenue of the Corporation.

25. Reserves.

26. Accounts.

27. Audit of accounts.

PART III

ACQUISITION REQUISITION AND USE OF PROPERTY FOR OR BY THE CORPORATION

28. Acquisition of immovable property under the Land Acquisition Act.

29. Notice of claim or disclaimer in respect of property required for purposes of the Corporation.

30. Compulsory transfer to the Corporation of certain property.

31. Requisitioning of notified property the purpose of the Corporation.

32. Compulsory acquisition of requisitioned property.

33. Revocation of vesting Orders.

34. Taking possession of property vested in or requisitioned for the Corporation.

35. Prevention of or obstruction to taking possession of property for and on behalf of Corporation.

36. Grants for leases of immovable property to the Corporation under the State Lands Ordinance.

37. Power to require information and to inspect.

38. Power of Corporation to make use of equipment and facilities of other persons.

39. Power of Minister by Order to vest in the Corporation the exclusive right to engage in or carry on any specified Business.

40. Power of Board of Directors to grant to persons, other Corporation, authority to engage in or carry on any Specified Business of Corporation.

PART IV

COMPENSATION

41. Compensation in respect of property vested in the Corporation.

42. Compensation in respect of property requisitioned for the Corporation.

43. No compensation for damage or loss incurred by reason of the fact that the exclusive right to engage in or carry on any Specified Business is vested in the Corporation.

44. Interest on compensation.

45. Date of commencement of accruement of compensation.

46. Mode of payment of compensation.

47. Determination of compensation.

48. Payment of compensation.

49. Provision for cases where compensation is not accepted.

50. Deductions from compensation.

PART V

GENERAL

51. Regulations.

52. Powers of companies to enter into contracts with the Corporation.

53. Offences.

54. Protection for action taken under this Act or on the direction of the Board of Directors.

55. No writ to issue against person or property of a member of Corporation.

56. This Act to prevail over other written laws.

57. Interpretation.

33 of 1970,

67 of 1981.

AN ACT to provide for the establishment of a Corporation or Corporations to carry on business as an importer, exporter, seller, supplier or distributor of goods, commodities, wares, merchandise and produce of any kind or description, to regulate the powers and duties of such Corporation or Corporations to enable the compulsory acquisition or requisition for such Corporation or Corporations of any immovable or movable property required for the purposes of the corporation or corporations, and to make provision for purposes connected therewith or incidental thereto.

[Date of Commencement: 24th December, 1970]

1. Short title.

This Act may be cited as the Sri Lanka State Trading Corporations Act.

PART I

ESTABLISHMENT OF CORPORATIONS AND THE POWERS AND DUTIES OF CORPORATIONS AND THEIR BOARDS OF DIRECTORS

2. Establishment of corporations.

(1) Where the Minister considers it desirable that a Corporation should be established for the purpose of engaging in or carrying on any business of all or any of the following classes or descriptions, namely—

(a) the importation of articles of any class or description into Sri Lanka, including the purchase and stocking of such articles for the purpose of such importation;

(b) the exportation of articles of any class or description from Sri Lanka, including the purchase and stocking of such articles for the purpose of such exportation;

(c) the distribution and supply, by wholesale or where necessary by retail, of articles of any class or description in Sri Lanka, including the purchase and stocking of such articles for the purpose of such distribution or supply;

(d) the promotion and expansion of the demand for, and trade in, articles of any class or description manufactured or produced in Sri Lanka, and

(e) the conduct of market research in Sri Lanka and outside Sri Lanka,

the Minister may, by Order published in the Gazette

(i) specify any business of any such classes or descriptions (in this Act referred to as a "Specified Business”) to which the Order relates;

(ii) declare that a Corporation shall be established to engage in or carry on any Specified Business;

(iii) assign a corporate name to the Corporation;

(iv) specify the objects of such Corporation;

(v) determine the initial capital of such Corporation;

(vi) state the principal place of business of such Corporation;

(vii) fix the number of members of the Board of Directors of such Corporation, the number so fixed being not less than five and not more than seven;

(viii) appoint, in accordance with the provisions of section 10, the members of such Board; and

(ix) appoint one of the members of such Board as the Chairman of such Board in accordance with the provisions of that section.

(2) Upon the publication of an Order under subsection (1) in the Gazette, a Corporation (in this Act referred to as the "Corporation”) consisting of the persons who are for the time being members thereof by virtue of the provisions of section 9, with the corporate name specified in such Order, and with perpetual succession, shall be deemed to have been established.

(3) The Minister may, from time to time, by Order published in the Gazette, amend any Order made under subsection (1).

(4) An Order made under subsection (1) or, where such Order is subsequently amended under subsection (3), such Order as so amended, is in this Act referred to as the "Incorporation Order”.

(5) The Corporation may sue and be sued in its Corporate name.

2A. Corporation to carry out any activity entrusted to it by the Cabinet of Ministers.

Notwithstanding anything in section 2 of this Act, any Corporation established under this Act may engage in or carry out any business or trade or any commercial activity as may be approved by the Cabinet of Ministers.

[S 2A ins by s 2 of Act 67 of 1981.]

3. Objects of the Corporation.

The objects of the Corporation shall be those specified in the Incorporation Order.

4. Principal place of business of the Corporation.

The principal place of business of the Corporation shall be that specified in the Incorporation Order.

5. General powers of the Corporation.

(1) The Corporation shall have power to do anything necessary for or conducive or incidental to, the carrying out of its objects.

(2) Without Prejudice to the generality of the powers conferred by subsection (1), the Corporation shall have power—

(a) to acquire in any manner whatsoever and hold, take or give on lease or hire, mortgage, pledge, sell or otherwise dispose of, any immovable or movable property;

(b) to appoint, employ, remunerate and control its officers, servants and agents, and to direct and decide all matters connected with the administration of its affairs;

(c) to establish and maintain provident funds and pension funds and provide welfare and recreational facilities, houses, hostels and other like accommodation, for the persons employed by or serving the Corporation;

(d) to enter into and perform, either directly or indirectly, through any officer or agent of the Corporation all such contracts or agreements as may be necessary for the exercise of the powers of the Corporation and the carrying out of the objects of the Corporation;

(e) to make rules in respect of the administration of the affairs of the Corporation;

(f) to borrow money for the purposes of the Corporation in such manner and upon such security as the Corporation may with the approval of the Minister determine, and to invest the surplus funds of the Corporation;

(g) to delegate to any member, officer or agent of the Corporation any such function of the Corporation as the Corporation may consider necessary so to delegate for the efficient transaction of business;

(h) to do anything necessary for the purpose of advancing the skill of persons employed by the Corporation, or the efficiency of the equipment of the Corporation, or the manner in which that equipment is operated, including the provision by the Corporation, and the assistance of the provision by others of facilities for training persons required to carry out the work of the Corporation;

(i) to formulate schemes to give effect to the objects of the Corporation;

(j) to receive and disburse moneys for the accomplishment of the objects for which it is established;

(k) to invest in, or purchase or compulsorily acquire any interest in, or hold shares or stock, in any body corporate or unincorporate, carrying on or engaged in, or about to carry on or engage in, any business, being a body corporate or unincorporate having objects similar or substantially similar to the objects of the Corporation;

(l) to purchase or compulsorily acquire any interest in any business carried on by any individual, being a business having objects similar or substantially similar to the objects of the Corporation;

(m) to enter into any arrangement for co-operation with any body corporate, firm or individual carrying on or proposing to carry on any business which is similar or substantially similar to any Specified Business of the Corporation;

(n) to amalgamate with any other body, corporate or unincorporate whose objects are or include objects similar or substantially similar to those of the Corporation, whether by sale, purchase or compulsory acquisition of the undertaking of such body corporate or unincorporate, subject to the liabilities of such body corporate or unincorporate, or by sale, purchase, or compulsory acquisition, of all, or a controlling interest in, the shares or stock of such body corporate or unincorporate;

(o) to amalgamate with any individual carrying on any undertaking the objects of which are or include objects similar or substantially similar to those of the Corporation, whether by sale, purchase or compulsory acquisition of the undertaking, subject to the liabilities incurred by such individual in carrying on the undertaking.

6. Powers of the Minister.

(1) The Minister may, after consultation with the Board of Directors, give such Board general or special directions in writing as to the exercise of the powers of the Corporation, and the Board shall give effect to such directions.

(2) The Minister may, from time to time, direct, in writing the Board of Directors to furnish to him, in such form as he may require, returns, accounts and other information with respect to the property and business of the Corporation, and such Board shall carry out every such direction.

(3) The Minister may, from time to time, order all or any of the activities of the Corporation to be investigated and reported upon by such person or persons as he may specify, and upon such order being made, the Board of Directors shall afford all such facilities, and furnish all such information, to such person or persons as may be necessary to carry out the order.

7. Seal of the Corporation.

(1) The Corporation shall have a common seal which shall be in the custody of such person as the Board of Directors may, from time to time, determine.

(2) The seal of the Corporation shall not be affixed to any instrument or document except in the presence of two members of the Board of Directors, both of whom shall sign the instrument or document in token of their presence.

(3) The Board of Directors shall maintain a register of the instruments or documents to which the seal of the Corporation is affixed.

(4) The seal of the Corporation may be altered in such manner as may be determined by the Board of Directors.

8. General control of the Corporation and exercise of its powers.

(1) Subject to the provisions of this Act—

(a) the general supervision, control and administration of the affairs and business of the Corporation shall be vested in the Board of Directors; and

(b) such Board may exercise all the powers and perform all the duties and functions of the Corporation for the purpose of carrying out the objects of the Corporation.

(2) The Board of Directors may delegate to any Director, or to any officer or servant of the Corporation, any of the powers, duties or functions of such Board, and such delegate shall exercise or perform such powers, duties or functions, subject to the special or general directions of such Board.

9. Members of the corporation.

The persons holding office for the time being as members of the Board of Directors shall be the members of the Corporation.

10. Board of Directors.

(1) The Corporation shall have a Board of Directors consisting of such number of persons as is fixed by the Incorporation Order and appointed by the Minister.

(2) The Minister shall appoint one of the Directors as Chairman of the Board of Directors.

(3) A person shall be disqualified from being appointed or being a member of the Board of Directors if he is a Member of Parliament.

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