A recent report by Transparency International Sri Lanka reveals that, despite progress in developing anti-corruption laws and policies, the country struggles with weak implementation of key provisions under UNCAC Chapters II (Preventive Measures) and V (Asset Recovery). The report is intended as a contribution to the second cycle of the UNCAC implementation review process, produced with technical and financial support from the UNCAC Coalition. The reporting period covers developments up to 30 January 2025.

Sri Lanka has taken some notable steps toward implementing preventive anti-corruption measures under Chapter II of the UNCAC, most significantly with the Anti-Corruption Act of 2023. This legislation, along with clear campaign finance limits and a legal framework for access to information, reflects a growing alignment with international standards. Yet these advances are undermined by persistent structural weaknesses. Provisions around conflicts of interest remain vague, and enforcement mechanisms are ineffective. Campaign finance oversight is hindered by slow processes, and inefficient monitoring while the right to information is constrained by low public awareness, inadequate proactive disclosure, and systemic delays. Compounding these issues are the lack of a centralized electronic system for asset declarations and ongoing concerns over prosecutorial independence, both of which continue to challenge the integrity of Sri Lanka’s anti-corruption framework. 

Regarding implementation of Chapter V of the UNCAC, Sri Lanka has made progress, including through regular National Risk Assessments and allowing divisional police units to investigate money-laundering cases. However, developments are overshadowed by systemic shortcomings. The absence of a publicly accessible  Beneficial Ownership Registry and a comprehensive law on beneficial ownership leaves critical gaps in transparency. Inter-agency coordination is limited, and the police criminal records system has not been fully digitized. Meanwhile, the tax authority is not legally required to assist money-laundering investigations, and police officers lack proper training in this area. Oversight of the Financial Intelligence Unit is weak, with no peer review process or comparable body in place to assess its work.

Main Findings

Codes of Conduct, Conflicts of Interest in the Public Sector

Sri Lanka’s approach to codes of conduct and conflicts of interest in the public sector reveals serious gaps. 

While frameworks like the Establishments Code and Public Administration Rules exist, they fall short of providing a clear, legally binding standard for all public officials of all levels of governance. The result is systematic ambiguity, weak enforcement, and inconsistent application, creating space for conflicts of interest to go unchecked. Public officials often lack the training and awareness needed to recognize or properly manage these situations, which can lead to decisions driven by personal interest or patronage rather than the public good. 

Key recommendation: 

• Develop a comprehensive legal framework that explicitly addresses conflicts of interest that includes clear enforceable guidelines on how public officers should manage such situations through disclosure and recusal. 

Asset and Liabilities Declarations

The current mechanism for asset declarations suffers from flaws that weaken its role in preventing corruption. 

Although public officials, including judges, are required to declare their assets, the absence of a centralized and structured electronic system makes submissions inefficient and oversight limited. Arbitrary redactions of vital information included in the asset declarations, such as bank account balances and opening dates, by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) render monitoring efforts ineffective. Without regular audits or proper verification in the absence of a centralised electronic system, false declarations can easily go unchecked. 

Key recommendation:

• Swiftly establish a central electronic asset declaration system, mandating audits, ensuring real public access, and guaranteeing CIABOC’s independence to enforce the law in both letter and spirit.

Political Financing 

Sri Lanka’s 2023 Election Expenditure Act aims to improve transparency in political financing, but weak enforcement mechanisms and scope undermine its impact. 

One clear takeaway is that despite this introduction in 2023, Sri Lanka’s approach to campaign financing remains inadequate. While the law sets spending limits, and recent elections demonstrated some improvements, enforcement is weak. Campaign financing, by nature, requires strict, time-bound oversight, yet real-time monitoring and self-reporting are minimal, and the Election Commission lacks the mandate and resources to effectively deter abuse. This gap was especially visible during the 2024 presidential election, where serious misuse of state power, including bribery and undue influence, was flagged by the Centre for Monitoring Election Violence. Compounding this is the absence of a broader political financing framework, which allows for the persistent clientelism and anti-competitive practices in Sri Lankan politics that fuel corruption.

 Key recommendation:

• Enact and implement a robust political financing law to ensure continuous monitoring and regulation of funding, donations and contributions to political parties and politicians. 

Access to information

Sri Lanka’s Right to Information (RTI) Act stands as a cornerstone in efforts to promote transparency and public accountability, but implementation gaps hinder its efficiency. 

While the legal framework aligns with global standards and guarantees access to information as a constitutional right, it is weakened by low public awareness, an under-resourced RTI Commission, and compliance resistance from public authorities. 

Institutional responses to Transparency International Sri Lanka’s RTI filings highlight ongoing issues. The Ministry of Justice and Legal Draftsman’s Department consistently withholds draft laws, including the expected Public Procurement Law, offering vague legal justifications. The RTI Commission handles appeals in response to RTI applications. However, penalties under the RTI Act for non-compliance are rarely enforced, stripping the law of its deterrent power and allowing public authorities to ignore requests with impunity.

Key recommendation: 

• Strengthen enforcement of the Right to Information Act by ensuring imposition of penalties for Public Authority’s non-compliance of the Act. 

Participation of civil society

Sri Lanka’s framework for public participation in governance, particularly in anti-corruption efforts, fiscal transparency, and policymaking, reflects a stark contrast between legal provisions and actual implementation.

​​While legislative measures such as the Anti-Corruption Act explicitly mandate the engagement of civil society in combating corruption, there is little evidence to suggest that the state has taken meaningful steps to institutionalize this participation. Language accessibility further compounds these barriers, as government institutions overwhelmingly prioritize English over Sinhala and Tamil.

Sri Lanka’s lawmaking process remains largely opaque, with no formal avenues for public or civil society input on draft legislation. Efforts to access key draft Bills through RTI requests have been repeatedly denied by key state institutions. Compounding this lack of transparency is the absence of a post-enactment judicial review mechanism, leaving no way to challenge laws once passed. These practices not only heighten corruption risks and weaken the quality of legislation but also undermine Constitutional commitments to public participation in governance.

Read about how the Online Safety Act swiftly passed in 2024, further limiting people’s freedom of expression.

Key recommendation: 

• Develop a centralised mechanism to publish draft laws and upcoming policy changes, invite public input with adequate time, and collect feedback through a standardized, accessible process. 

Judiciary and Prosecution Services

Despite constitutional protections, judicial independence in Sri Lanka remains under threat. 

Political interference, including the former Executive’s disregard for Supreme Court rulings and the country’s long history of politicized appointments to key legal positions are areas of great concern. The Attorney General’s dual role as both the chief legal adviser to the government and the primary prosecutor creates an inherent conflict of interest that undermines the integrity of public prosecutorial service  and fuels perceptions of political bias in the administration of justice.

The controversial appointments of the Inspector General of Police and the Director General of CIABOC have led to legal challenges. Both cases sparked calls for more transparency in the appointment process and clearer guidelines for future appointments.

Key recommendation:

• Create an independent prosecutor’s office, separate from the Attorney General’s Department, to ensure impartiality especially in prosecuting grand corruption and political misconduct, particularly in cases involving state officials and institutions.   

Measures to Prevent Money Laundering

Sri Lanka has a solid legal framework to tackle money laundering, with laws like the Prevention of Money Laundering Act and the Financial Transactions Reporting Act aligned with FATF standards, but key gaps remain. 

The lack of a centralized beneficial ownership registry and a comprehensive law on beneficial ownership seriously weakens the country’s ability to trace illicit funds and enforce its AML measures effectively. 

Sri Lanka’s capacity to investigate money laundering is severely hampered by weak inter-agency coordination and outdated systems. The Financial Intelligence Unit only recently gained access to police criminal records, but the data remains non-digitized, limiting its ability to cross-reference suspicious transaction reports (STRs). Frontline police officers often lack the training needed to handle complex financial crimes and the Inland Revenue Department lacks the mandate for effective information sharing.

Key recommendation:

• Amend the Inland Revenue Act No. 24 of 2017 to mandate the Inland Revenue Department (IRD) to share information to assist money-laundering investigations. 

Prevention and detection of transfers of proceeds of crime

Sri Lanka’s Financial Intelligence Unit (FIU), housed within the Central Bank, is key to enforcing anti-money laundering/counter-financing of terrorism rules, including due diligence, record-keeping, and reporting suspicious transactions, but there is a need for more effective monitoring. This is demonstrated by the long-awaited Proceeds of Crime Law which were demanded during the 2022 Aragalaya protests and remain stalled, leaving critical gaps in Sri Lanka’s asset recovery regime.

Upcoming reviews, such as Sri Lanka’s 3rd FATF Evaluation in 2026, for which the FIU is already consulting stakeholders, present an opportunity to close these gaps and bring Sri Lanka’s AML efforts into line with global standards.

Key recommendation:

• Digitize and integrate the police criminal record database into a secure, centralized system accessible to the FIU and other law enforcement authorities, to enhance the FIU’s ability to effectively cross-reference STRs.