Company incorporation for buying property in Sri Lanka
Owning property here as a foreigner is entirely possible—through the right legal structure, handled properly. We support foreign clients with company incorporation and setup as part of a considered, compliant path to owning and operating property in Sri Lanka, with an in-house team who ensures your company is set up legally, transparently, and fit for purpose.
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The legal framework
Under Sri Lankan law (Act 38), foreign nationals cannot directly own freehold land. The law restricts land transfers to a foreign individual, a foreign company, or a Sri Lankan company with 50% or more foreign ownership. The one exception is condominium property, including parcels defined under the Apartment Ownership Law (Act 21).
To buy land, foreign investors most commonly use a dual-company structure—the standard, compliant approach used by boutique hotels, luxury villas, and foreign-owned developments across Sri Lanka, and one recognised by banks and legal firms—consisting of a Property Holding Company (held 51% locally and 49% foreign), and an Operating/Management Company (which may be wholly foreign-owned). The Operating Company leases the land from the Property Holding Company, providing operational and commercial control of the asset.*
We coordinate the entire company setup end-to-end, including incorporation, shareholder arrangements, lease agreements, and the legal protections required to safeguard your interests.
When required, the local 51% shareholding may be held by our nominee company as your Sri Lankan shareholder. Comprehensive shareholder, management, and commercial agreements are put in place to provide the foreign investor with authority, economic rights, and protections over the investment, while remaining compliant with applicable Sri Lankan law.
Our company incorporation services are available independently, regardless of whether you purchase a property through us or not. If you are considering property in Sri Lanka and would like to understand the most suitable structure before moving forward, we would be happy to discuss your options.
email us incorporation@ahangama.co
whatsapp us +94 (0) 760358518
*Where a company has held land continuously for a period of 20 years, current legislation permits changes to the shareholding structure that may allow the foreign investor to increase their ownership stake, subject to the applicable legal requirements at the time.