18th October 1998
The SEC has given the green light to the Colombo Stock Brokers Association and the Colombo Stock Exchange to increase the stock brokers minimum broker net capital.
This increase comes into effect at the time the stock brokers renew their license. The minimum net capital requirement will be Rs.7 million in 1999, Rs.11 million in 2000 and Rs.15 million in 2001. The brokers are required to maintain this minimum net capital requirement to operate in the stock market, the SEC said.
This requirement for the increase in capital comes with the expectation of increase in trade in the future. This would act as a guarantee, an SEC official told the Sunday Times Business.
The SEC has also approved investment of unit trust funds in licensed specialized banks. The banks are licensed by the Central Bank of Sri Lanka subject to prudential and other parameters set down in the trust deeds of the respective unit trusts and the unit trust code formulated by the SEC. This includes all commercial banks and the development banks licensed by the Central Bank of Sri Lanka, the SEC report said.
The SEC has considered the application made by Siedles TV Industry Limited and granted final approval for the delisting. The decision was made after considering the report of the Auditors stating that the company may not be a going concern. The submissions made by the company that it can no longer carry on its operations successfully since they are experiencing difficulties in obtaining components for the manufacture of black and white TVs, which is their sole business was also considered. The weighted average price at which shares have been trading during the three months prior to the suspension of dealing has been Rs. 5 per share. However the directors of the company have expressed willingness to arrange for the shares to be purchased at Rs. 12.82 per share.
The SEC and the CSE are considering the applications of Connaissance de Ceylon Ltd. and Mercantile Leasing Ltd. for a delisting of their rights issue. Trading of the two companies has been suspended until further notice.
Mahaweli Marine Cement Company Ltd. (MMCCL) has invested Rs.330 million for a new packing plant, the cement silos and the support equipment. The newly installed plant for the bagging of cement, packs 120 tonnes (2400 bags) of cement per hour. MD, Sjored Grueter, told the media last week that they believe this will be the fastest packing plant in Sri Lanka.
With the commissioning of the new plant, MMCCL's output which is presently 500,000 metric tonnes a year will grow to 700,000 metric tonnes and an additional 75 direct jobs. and over a 100 indirect jobs will be generated. MMCCL has 25 per cent market share, according to the company.
Inflation (as measured by the annual average percentage change in the Colombo Consumers Price Index -CCPI) has fallen from 10.3 per cent in August to 10.2 per cent in September 1998.
The CCPI has fallen by a sharper than expected 0.8 per cent month-on-month and point to point inflation, has also thus fallen to a 15 month low of 5.8 per cent, a recent Asia Securities report states.
Asia Securities, who had earlier projected an 11.5 per cent inflation rate, now expect inflation to average only around 10.5 per cent in 1998, Head of Research Asia Securities, Dushyanth Wijayasingha said.
"The impact of Goods and Services Tax (GST) on prices has also begun to ease off," he said.
Most prices appear to have adjusted for the inflationary impact of GST - and any further significant GST related price rises look unlikely.
Significantly lower food/vegetable prices following the good rains and relatively lower raw material import prices (in US$ terms) have played key roles in ending the recent ascent of the CCPI (food has a 62 per cent weighting in the index).
Despite relatively faster currency depreciation that is likely to contribute to higher import prices, given soft international raw material prices, low domestic food prices and subdued credit growth, is expected to keep inflation to average around 10.5 per cent in 1998.
With global deflationary condition likely to persist for much of 1999, good crop harvests should also thus result in CCPI inflation remaining little changed at around 11 per cent next year.
Delfationary condition in South East Asia has had an impact with around 60 per cent of imports coming from this region. Their prices are low and have come down. The impact of GST has begun to ease off. Vegetable prices which has a major weightage has decreased. They may rise twoards the end of the year. GST impact (which pushed prices on Q2) has begun to ease off. Food weightage 60 per cent on index greater supply. Inflation may be below the yearly target of 11.5 per cent.
HNB is constantly in touch with the changing aspirations of its customers and it has been observed that there is a growing demand for electronic household appliances, agricultural equipment, tractors, motor vehicles, trucks and similar products, particularly from the provincial sector, Uda Tharuwa seeks to satisfy this need.
At present, Uda Tharuwa is available only in respect of specific products marketed by Brown & Company. In principle, it is very similar to hire purchase. But, in terms of cost to the customer, it is much more attractive. Also, it is much more convenient, and quicker. The requirements have been kept to a minimum to enable the largest possible number to benefit.
The procedure itself is very simple and straightforward. The customer selects the item of his choice from any Browns Dealer in the Island. The Dealer then contacts the nearest Branch of HNB, and acts as the link between him and the Bank. Once the initial requirements are met the Bank pays the Dealer the cost of the item. The buyer pays back conveniently, over a period of time. This facility is not restricted to existing customers of the Bank, any member of the public can make use of it.
HNB is confident that with its islandwide branch network, Uda Tharuwa will make a meaningful contribution, towards upgrading the quality of life, particularly in the provincial sector.
Lakme, the Indian cosmetics giant has expanded the range of skin care products it markets in Sri Lanka, and unveiled the company's new international logo and image, Lakme's local distributor Hemas Marketing (Pte) Ltd., has announced.
Launched in Colombo earlier this month, the addition to the Lakme skin care range are the Lakme Nourishing Cold Cream, Nourishing Body Lotion, pH-Balanced Face Wash, Calamine Lotion, Sun Screen Lotion and Hair Remover.
Prior to the launch of these products, Hemas Marketing was responsible for the distribution of Lakme Maximum Moisturiser and Lakme Deep Pore Cleansing Milk, which the company will continue to market in new packaging.
The new products, which were launched in India last year, have been developed after extensive research using internationally tested technology and world class formulations, Hemas Marketing Brand Manager Harith Perera said.
All the new products including Calamine Lotion, Sun Screen Lotion, and Hair Remover are recommended for any skin type and are available in a variety of sizes in bottles, tubes and packs, Perera explained.
The launch of the new products follows the unveiling of the new Lakme logo and brand statement "Source of radiant beauty", by Hemas Marketing to its Sales and Marketing Personnel on September 1, this year.
ANZ Grindlays Bank which has established in Sri Lanka in1881, has just announced its new Regional Head. The ANZ Banking Group has appointed Arun Nangia as its Regional General Manager Middle East and South Asia for its Corporate and Business Bank. Mr Nangia come to the region from the Bank's Head Office in Melbourne and will be based at a new regional office in Dubai, United Arab Emirates.
Mr Nangia has a career spanning 21 years with ANZ. Most recently he was Chief Manager Corporate Banking for Victoria and Tasmania, Australia and before that, Assistant General Manager Asia responsible for ANZ's operations in Korea, Malaysia, Philippines, Taiwan and Thailand. Previous appointments have included roles in London, India and Melbourne.
Mr Nangia's focus will be to deliver a superior service proposition that adds value to ANZ's customers' businesses. His prime objective is to further strengthen ANZ Grindlays position as a leading corporate and business bank in the region.
ANZ has been present in the Middle East and Asia, operating as ANZ Grindlays Bank, through its ancestry for over a century. It has 45 points of representation in the Middle East and 77 in South Asia.
Mr John Iossifidis is the General Manager of ANZ Grindlays, Sri Lanka. For any inquiries on the services offered in Sri Lanka or the Asian Region, the bank can be contacted on Tel: 446150-7. Its Head Office is at 37, York Street, Colombo 1 and it has 8 branches.
Ceylon Biscuits Limited in its commitment to lend a helping hand to children in their studies, organized the Munchee Tikiri Marie Shishyadara Tharangaya - a student assistance scheme for the second successive year. The required funds to organize this competition was provided from the sales of Company's flagship brand Tikiri Marie a nutritious tasty biscuit which is very popular among children.
Tikiri Marie Shishyadara Tharangaya was run for a period of four months with the participation of students under 18 years of age. The response received for the competition was very impressive. There were over 150,000 entries islandwide. Out of these entries 100 winners were selected from a draw held in the presence of Home Ministry Officials.
The Company will pay Rs.750/- per month as student assistance to each of these winning students for a period of twelve months. To further enhance this benefit, arrangements have been made with the National Savings Bank to issue the recipients with Savings Books.
The Company has allocated over one million rupees for providing student assistance for these 100 students.
The Ceylon Chamber of Commerce has established affiliations world-wide through 18 Bilateral Business Councils which are already in operation. The Sri Lanka-Italy Business Council is the 19th Business Council formed under the aegis of the Ceylon Chamber of Commerce.
The foundation for the formation of this Council was laid in 1997, on a proposal made to the Ceylon Chamber of Commerce by the Ambassador of Italy in Sri Lanka, Maurizio Teucci. The Ambassador had informed the Chamber that an Italy - Sri Lanka Business Council had been formed under the patronage of the Italian Minister of Trade in Rome. This will be the counterpart organization of the Sri Lanka-Italy Business Council.
Trade between Italy and Sri Lanka, during 1997 accounted for Rs. 4,372,844,414 million for exports and Rs. 4,842,514,559 million for imports. During 1996 it accounted for Rs. 3,213 million for exports and Rs. 4,769.00 for imports.
With the recent rouble devaluation, Indian tea exports were expected to have an edge over other producer countries due to the operation of the rupee-rouble agreement. However, recent reports indicate that the prices in auction centres in India have also declined over the past few weeks, an Asia Siyaka special report says.
The rupee-rouble agreement dates back to 1990, when India was a significant importer of Russian arms and oil. After the USSR's collapse, Russia took over India's entire debt. This period also saw the collapse of the Russian currency - from US$ parity the rouble fell to 572 rouble/US$ (and subsequently to 6000 rouble/US$, before the three zeros were removed to make it 6 rouble/US$). The fall in the rouble meant that India's debt would have also been lower by a few billion dollars. This led to bickering between the two trading partners over the debt's value in the changed currency scenario. This impacted Indo-Russian trade - it plummeted from abut US$ 5bn in 1990 to US$1.6bn in 1993.
The need to revive trade between the two countries led to the February 92 'rupee-rouble' trade agreement. It was decided that India would repay the debt in rupees. The debt was re-calculated at Rs. 314bn, using the exchange rate Rs. 20/rouble (this was a one-time rate for debt calcuation), and was payable over 12 years.
Every year, the Reserve Bank of India credits the Russian Central Bank with Rs. 30bn, which is then purchased by Russian importers to buy Indian goods. Initially, the Russsian buyers could buy these rupees by paying in roubles, but lately the Russian Central Bank has insisted on US$ payment. This leaves Russian buyers with little incentive to buy from India. To offset this problem, the Central Bank auctions the rupees every Monday at a discount to the prevailing US$ rupee exchange rate. For instance, if the going exchange rate is Rs. 42/US$, the rupee would be auctioned for about Rs. 50/US$.
Thus, there is no peg to fix the rupee-rouble exchange rate; it changes with the dollar-rupee exchange rate.
By Ruvini Jayasinghe
Seven out of ten is not a bad score. In fact it deserves a cheer.
But when the winning formula is sheer grit, hard work and enthusiasm the applause should bring the house down.
While the government's grand plans for the south airports, harbours, highways and heavy industries have been scheduled for somewhere in the distant future, young (and not -so -young men) have won recognition for simple, solid, straightforward entrepreneurship, coupled with a generous dose of honest, hard work.
When one of Lanka's leading development lending agencies set up in the south, they were not targetting these grand schemes still on the drawing boards, but the backbone of the south, the small and medium businessmen who had difficulty financing their businesses for working capital and expansion.
Without collateral or guarantees but with sound judgement/assessment the DFCC bank first put their faith in the sons of the south and then encouraged them to participate in the Entrepreneur of the South contest. DFCC was right on both counts.
Business flourished for their customers in the south and seven of them took away the ten gold, silver and bronze awards on offer at the recent Entrepreneur of the South awards ceremony.
Each of the winners has a distinguished history of success. 'The Sunday Times Business' met three of them - gold, silver bronze winners in Colombo after their most recent success.
Have you ever used Nippolac paint? It is good to know that it is made by an enterprising son of the soil who did not lean on any internationally acclaimed brand name for support. He toiled for over a decade to reach his commanding position of market leader for paints in the south.
Managing Director Nippolac Paints, Silicone Coating Pvt. Ltd. and Resinoplastics, Raja Hewabowala is a gold winner four times over. From 1994 everything he touched turned silver and then to gold, giving him his fourth gold award in four consecutive years. He began with a sliver and has won an Indian goldstar award.
Qualified in polymer and rubber chemistry, Hewabowala began business with a Rs. 8000 loan from BoC in 1978.
Running neck -and -neck with international brand names in the south, Hewabowala retained his southern market with a slight price advantage of Rs. 30 per litre and high quality, which, matched international paint.
Only now Hewabowala is teaming up with a foreign partner for an automotive paint plant. He is also planning exports to The Maldives and wants to set up a joint venture with a Thai firm for export.
His Matara factory, supplemented by another in Ekala Industrial Park produces 90,000 litres a month. After expansion, capacity will be 90,000 litres a day!
Hewabowala's association with the DFCC goes back to 1993 when the bank supported him with a Rs. 5 million credit line for expansion - a relationship that has matured and prospered.
Yoghurt to Colombo's upper class has to be Highland or better still Newdale. Nothing wrong with that if you can afford Rs. 15per cup, each time you feel like one.
The leading supplier in the south whose network reaches right up to Kalutara is Lal Keerthi Gunawardena, a silver medallist is the Entrepreneur of the South.
From a backyard operations in Kamburupitiya, Matara, the yoghurt maker now has a 15,000-cup per day, 75-worker operation.
"Yoghurt is a highly competitive business and banks were reluctant to lend, "Gunawardena said. But the DFCC has backed the Lucky brand of yoghurt with vanilla, chocolate, and mixed fruit flavors all the way. Manager Matara branch DFCC, Lakshman Silva said, " We did not look at his industry as yet another yoghurt maker. We financed him without collateral."
After a Rs. 4.5 million expansion for a factory with large cold rooms etc. the young entrepreneur is now planning to purchase his own farm from the NLDB. Buying milk from the market and depending on farmgate prices affects his cost of production. To sell a tub of yoghurt at Rs. 8/- and a one litre clay pot of yoghurt at Rs. 45, Gunawardena now needs to run his own farm, a project for which he can surely bank on DFCC. The only fresh goat's milk available in commercial quantities sits on supermarket freezer shelves at Rs. 20 per bottle. Bronze medallist Mr. Samith Gunasekera of Samll Farmers Pvt. Ltd. does not have to advertise his product. It is snapped up from the shelves no sooner it reaches Colombo, he says.
His 350 Israel Saanan goat farm bought from a southern NGO, has proved a remarkable success, leaving him to enter the second stage of his sterilised goat milk project,with an automated filling and sealing machine.
An average of 6000 bottles a month is made with a shelf life of six months. Now bottling is semi -automated. Gunasekera shifted from his earlier production of frozen packeted goat's milk because of refrigeration and transportation problems. Goat's milk is seasonal and production is high during the kidding season, he says. Goats are trained to walk up to the four milkers when their numbers are called out making the entire process much easier and orderly.
Without increasing the number of goats on his farm, Gunasekera has increased production by hiring goats on contract, i.e. caring for them during the high milking season, and returning them to the owner. He also wants to increase production by improving the feed.
Buying a 11/2 acre farm for expansion is a longer term plan.
Sterilised goat's milk is an alternative health drink, said to be good for asthma, and dissolving cholesterol and not a fast food (or drink), says Gunasekera.
For the first time in their 8 years of operations in the South, the DFCC fielded 30 of their customers as potential winners of the Southern Entrepreneur of the Year awards. DFCC customers won seven of the ten awards. A pat on the back for DFCC Bank's picking of winners.
Q1: An employee in our company was suspended for a fraud and after a show cause notice an inquiry was fixed. However, he failed to appear before the inquiry as instructed. Can we sack him without holding the inquiry?
There is no legal requirement to hold an inquiry before dismissing an employee. However to justify your dismissal before a LT it is always better to hold a disciplinary inquiry before dismissal. If the accused employee is not appearing before the inquiry, you can hold it ex-parte (without him). However, to justify your action it is better that you inform him in writing that the inquiry will be held ex-parte.
Q2: After twenty-four (24) years of permanent and pensionable service, I resigned from my permanent and pensionable post in 1979 in order to accept a job abroad. At that time there was no provision for Government Servants to retire until they reach the optional age of retirement, which was 55 years. However, a year later, they allowed government servants to retire after they complete 20 years of service. I made an appeal to allow me to retire under the new provision but I was informed that this rule couldn't be applied to those who resigned earlier.
There was a provision at the time for employees to retire even though they did not reach 55 years provided they did not accept the Bonus of 500/= which was paid to those who passed the Sinhala Proficiency Examination. Unfortunately, I have accepted this bonus and as a result, I could not retire under that clause.
I feel it is unfair to let an employee go without a penny after serving 24 year in an establishment. If I was in the private sector, I could claim my EPF benefits at least.
I made an appeal to the PSC through my former Department and the reply I received was that the PSC couldn't intervene in this matter.
Is there any possibility to take up this matter in Courts in order to claim a pension for the period I served the Government? Can you please advise me a way I can get any relief?
The government is entitled to introduce rules and reductions for state employees from time to time. You have resigned in 1979 and at that time there is no provision to pay you a pension. You can go before the Supreme Court only on a fundamental rights issue if you are not treated equally. However in your case all state employees who resigned in 1979 have been treated equally.
Q3: I am an executive in a private firm with more than 10 years experience. The firm sent me on compulsory leave with full pay & all other benefits until a domestic inquiry is completed. This is a case of personal vendetta on frivolous charges. After 8 months still I am not informed of the results of the inquiry although I am being paid all dues every month. I am suffering mentally due to non-provision of work. Is there any remedy for me?
As you are paid your salaries during the period of compulsory leave and still you continue to be in employment in the company, you cannot go before a labour Tribunal for relief. If you are not paid any salary, you can go before a L.T on the ground of constructive termination, as there is a long delay in taking a decision on the findings of the Inquiry.
Q4: 1. Is it compulsory to give increments on an annual basis and if compulsory how do you calculate the rate of increment?
2. Is it compulsory to give bonus on an annual basis and if compulsory how do you calculate the bonus payment?
3. Can an employer reduce the salary of an employee and if possible in what instances?
1. Normally increments are compulsory for Wages Board employees as decided by the Wages board, but it can be stopped or deferred for misconduct. Rate of increment is given in the Wages Board Decision.
2. Bonus is paid at the discretion of the management and is not a compulsory payment.
3. If the salary is reduced without the consent of the employee it amounts to constructive termination making it possible for the employee to go before a L.T. It is possible if such provision is provided in the contract of employment.
Q5: Please clarify the following:
1) Whether Sunday Pay / Off Day Pay attracts EPF/ETF for employees covered under the Shop & Office Employees Act?
2) Whether the management has the right to stop Sunday Pay/ Off Day included to compute EPF/ETF in the past?
Under EPF/ETF Acts payment in respect of holidays is included in the "Earnings" for which contribution should be made. If a payment is made in lieu of the off day or Sunday (excluding overtime payment) it attracts EPF/ETF.
Q6: I worked in a leading mercantile sector for a monthly salary of Rs.12,000/= for a period of fourteen months.(from October 1st 1995 to November 16th, 1996)
I discovered that up to now, the company has not remitted EPF/ETF in my favor, although I was promised all these benefits at the interview. I have been given a letter of appointment.
(a) Please let me know the total amount of ETF and EPF with surcharge accrued up to now to which I am entitled?.
(b) Is it possible to recover the money, without involving the department from the company because I have reached the withdrawal age?
The EPF contribution per month for a salary of the 12,000/= is Rs.2,400/=(Both from the employer and employee) per month and ETF contribution is Rs.360/= per month. Calculate the total on this basis.
The labour department will impose the surcharge on the employer up to 50% once a complaint is made to him regarding non-payment. The money has to be recovered from the employer through the Labour Department.
Q7: I am planning to open up a small nursing home to provide medical services in a selected city. I have made arrangements to recruit staff, including nurses and attendants. Please advice me how I should grant them leave after recruitment?
Your employees will come under the Nursing Home Trade Wages Board. Accordingly the leave entitlement of Nursing Home Trade employees is as follows
All employees should be allowed a maximum of 21 days of annual leave (No provision is made for any other leave) in the following manner.
a) First year of employment
A contract of employment arises when there is an offer of employment by employer and acceptance of employment by the employee. Rights and duties are cast on both parties in this contractual relationship.
Once the contractual relationship is established the Employee is entitled to certain rights which on the other hand can be considered to be duties or obligations of the Employer (i.e. payment for work).
Similarly Employer is also entitled to certain rights which on the other hand can be considered to be duties or obligations of the employee (i.e. good conduct).
Meanwhile social legislation has stepped up the benefits and privileges of the Employee and certain statutory duties are cast on the Employer as a result of such legislation.
Obligations / Duties of the Employer
The obligations / duties cast on the Employers are briefly as follows;
1. To pay a reasonable salary / wages
5. To treat the Employee with respect.
6. Acceptance of the rights of employee of which he is entitled under the contract of employment.
7. To observe fair labour practice such. as
8. To conform to statutory obligation (i.e. E & F act, shop and office Employee act, Wages Board Ordinance, Factory Ordinance, Workman's Compensation Ordinance etc.)
9. To carry out the terms and conditions of employment
Obligations / Duties of the Employee
1 . Obedience or cooperation;- The employee is obliged to follow lawful
and reasonable orders other than which expose the employee to danger.
2. To exercise duty of care in carrying out work.
3. Honesty - To act in good faith or carry out duty faithfully.
4. To give due respect to the employer
5. Adoption to new methods and techniques
6. To carry out the terms and conditions of employment.
In what was seen as an unprecedented and massive demonstration of trust, by investors, Seylan Bank's Debenture issue turned out to be an unqualified and outstanding success, in both the first and second phase of the issue.
On day one itself the issue of Rs. 300 million was over- subscribed and Seylan Bank exercised the option to further extend the issue for another Rs. 300 million making a total of Rs. 600 million.
Seylan Bank has achieved this target as well, doubling the issue subscription.
After spending his frail life in the shadows, six-year-old James Micky Walker had his first moment in the sun. Thanks to the space age technology that Courtaulds Performance Films a large manufacturer of window film in the world, had developed.
Micky who was earlier confined to his shuttered home and school classroom had the unique pleasure at the exposure to the simple joys and running around like any child of his age and size. Micky was diagnosed with a congenital erythropoietic porphyria or Gunther's disease, a rare condition that leaves the body defenceless against the harmful ultra violet rays of the sun.
It is said that only about 100 people worldwide share Micky's disorder. Exposure to the sun will cause the boy's skin to blister and get sores. It was said that if he had continued exposure to the sun he would have had cancer.
Thanks to Courtaulds, Micky was provided with a suit made out of a special film prepared to break the harmful rays of the sun. Today, Micky gets about in ultra violet protected suit without any fear, and the garment allows him the facility to play outside.
NASA was instrumental in getting Courtaulds to provide this special suit. The early prototypes fashioned something that looked like a space suite but Micky's suite could pass for the uniform of a power ranger. It costs around 2,000 dollars and it is made of stretchy material that leaves the body room to grow.
The local agent for Llumar, Courtaulds Performance Films over the last 12 years has been Wijaya Associates (Pvt) Ltd. Llumar is also used extensively to reflect heat from buildings, and effect savings on electricity costs in Sri Lanka. It also cuts off harmful ultra violet radiation.
Llumar film rendered yeoman service in saving lives as well, with their shatter proof film after the spate of bomb disasters in recent times
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