• Recently-released draft policy paper envisages development of world-class Maintenance, Repair and Overhaul facilities in SL with tax concessions, concessionary land

By Chandani Kirinde

Tax incentives and land at concessionary rates will be among measures the Government will put in place for the establishment and operation of world-class aircraft Maintenance, Repair and Overhaul (MRO) facilities for all modern commercial aircraft types in the country, according to a recently-released policy paper on the National Civil Aviation Policy for Sri Lanka.

The implementation strategy of the policy focuses, amongst other aviation activities, on establishment and operation of world-class aircraft MRO facilities for all modern commercial aircraft types, state-of-the-art aviation training facilities, aerospace engineering services and manufacturing industries as well as enterprises engaged in aviation commerce (insurance companies, aircraft brokers, etc.), which will be promoted through legislation, where necessary, simplification of rules and procedures and by providing the required infrastructure facilities and services.

The policy paper says the following measures will be taken by the Government in respect of the establishment and operation of MRO facilities in Sri Lanka:

The tools and toolkits used by the MRO will be exempted from Customs Duty. The exemption shall be given based on the certification of the list of tools and toolkits certified by quality managers of aircraft maintenance organisations which have been approved by the Directorate General of Civil Aviation (DGCA)

The requirements of MRO such as parts or orders from their client airlines will be facilitated through a similar process as in the case of toolkits based on one-time approval by DGCA based on the certification by approved quality managers

To promote economies-of-scale, all parts imported for aircraft maintenance, repair or overhaul will be freed from duty

Approval will be granted for MRO to import unserviceable parts including aircraft components like engines and landing gears by MROs in advance of the commencement of the planned work

Foreign aircraft brought to Sri Lanka for MRO work will be allowed to stay for the entire period of maintenance or up to 12 months, whichever is lesser, provided it undertakes no commercial flights during that period. The aircraft may, however, carry passengers and/or cargo on their arrival and departure from Sri Lanka after maintenance/repair work

VAT on MRO activities will be zero rated

Adequate land at concessionary rates will be provided for MRO service providers at all airports where potential for such MRO services exists

Airport royalty and additional charges will not be levied on MRO service providers for a period of five years from the date of approval of the policy

The National Civil Aviation Policy identifies that air transport is a force for good economic and social development and the role of regulatory oversight is key to quality assurance safeguards that ensure adherence to national legislation and global standards.

The final drafting committee of the National Policy consisted of the Ministry of Transport and Civil Aviation, Civil Aviation Authority of Sri Lanka (CAASL), Airport and Aviation Services (Sri Lanka) Ltd. (AASL), Attorney General’s Department, SriLankan Airlines, Sri Lanka Air Force, Board of Airline Representatives (BAR), Sri Lanka Association of Airline Representatives (SLAAR) and Domestic Aviation Representatives.

The policy paper has been published in the Gazette by Minister of Tourism Prasanna Ranatunga.

Parallel runway at BIA in the offing

Private airstrips, heliports, helipads to be permitted to develop domestic air services