Sri Lankan Cabinet Approves Temporary Suspension of Parate Law

In a move aimed at alleviating the burden on small and medium-sized enterprises (SMEs), the Sri Lankan cabinet has approved the temporary suspension of the implementation of the parate law. The decision was announced following a cabinet paper presented by President Ranil Wickramasinghe, who also serves as the Minister of Finance.

The parate law allows banks and financial institutions to seize land and property from borrowers who default on loans. However, according to a statement released by the government, the law has created hardships for SMEs, with several businesses raising concerns to both the Justice Minister and the Industry and Health Minister.

The temporary suspension, which will last until December 15, 2024, is intended to provide relief to struggling SMEs and ease the difficulties they face in conducting operations. The government also plans to submit amendments related to the suspension to the Parliament for consideration.

Related: Sri Lankan Small Businesses Seek Breathing Room: Parate Law Suspension Talks Underway

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