Nearly eight months after Sri Lanka’s Gambling Regulatory Authority became operational under law, the institution responsible for regulating one of the country’s fastest-growing industries remains unable to fully perform its mandate.
The latest admission before the Committee on Public Finance has exposed continuing delays that lawmakers warn are undermining Government revenue, investor confidence and financial oversight.
Officials from the Gambling Regulatory Authority informed Parliament’s finance watchdog that draft regulations required to activate the Authority’s full powers remain under review by a Cabinet-appointed expert committee, despite earlier assurances that they would be published by the end of June.
The postponement has revived concerns that Sri Lanka’s gambling sector continues expanding faster than the Government’s ability to regulate it.
Committee Chairman Harsha de Silva expressed visible frustration, noting that Parliament had repeatedly received similar assurances over the past several years.
His criticism reflects a wider concern that bureaucratic delays are allowing economic opportunities to slip away.
The Gambling Regulatory Authority Act was expected to modernise Sri Lanka’s fragmented gambling laws, creating a single regulator capable of licensing operators, supervising online gambling, enforcing anti-money laundering safeguards and collecting revenue more efficiently.
However without the necessary subsidiary regulations, these objectives remain largely unrealised.
Economists point out that the delay extends beyond regulatory housekeeping. Gambling represents a high-value service industry with considerable taxation potential. Proper licensing systems could generate consistent Government income through licence fees, regulatory charges and improved tax compliance while creating a more predictable investment climate.
Instead, uncertainty continues to surround operators awaiting clarity on future licensing requirements and compliance obligations.
The uncertainty also affects foreign investors evaluating opportunities in integrated resorts and regulated gaming projects linked to tourism development.
Investors generally seek stable regulatory environments before committing substantial capital. Continued postponements risk portraying Sri Lanka as a jurisdiction where policy implementation struggles to keep pace with legislation.
Another issue highlighted during the Committee proceedings was the Authority’s failure to consult industry participants before drafting regulations.
Officials acknowledged that neither the Board nor management had formally sought views from local gambling operators.
Members warned that introducing regulations without adequate consultation could force revisions after publication, creating yet another cycle of delays.
The absence of anti-money laundering regulations also remains a significant concern.
As online gambling expands rapidly across Asia, regulators worldwide are strengthening oversight to prevent illegal financial transactions and organised criminal activity. Sri Lanka’s delayed framework leaves authorities with fewer regulatory tools to address these emerging risks.
Compounding concerns, de Silva referred to international reports suggesting Sri Lanka is increasingly attracting online scam operations, warning that delayed regulation could inadvertently create opportunities for criminal exploitation.
The challenge now extends beyond completing a legal review.
The Government must demonstrate that it can operationalise legislation within reasonable timeframes, engage stakeholders effectively and establish a regulatory environment capable of supporting economic growth while protecting public finances.
Until that happens, the country risks continuing to lose revenue, investment opportunities and regulatory credibility in an industry whose economic importance continues to grow.
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