JKCG Denies Prior Knowledge of Vehicle Import Surcharge
John Keells CG Auto has rejected allegations that it had prior knowledge of the government’s recent surcharge on imported motor vehicles and had opened Letters of Credit (LCs) ahead of the official announcement.
The company issued the clarification following public claims that certain vehicle importers had established LCs immediately before Gazette Notification No. 2488/56 dated May 15, 2026, which introduced a temporary surcharge on imported vehicles.
JKCG stated that no Letters of Credit were opened for BYD vehicles on the day preceding the Gazette notification and that the company had no advance knowledge of the policy decision. The company further noted that its most recent orders relating to BYD vehicles were placed between March and April 30, 2026, and that no LCs had been established after that period, including during May 2026.
The clarification comes amid heightened scrutiny surrounding vehicle imports following the government’s decision to impose a temporary 50 percent surcharge on Customs Import Duty for selected vehicle categories. The measure was introduced as part of efforts to curb rising import expenditure and reduce pressure on the Sri Lankan Rupee.
Deputy Finance Minister Anil Jayantha recently stated that more than 9,400 Letters of Credit were opened for vehicle imports after the surcharge came into effect, attributing the surge largely to speculative market behaviour rather than insider information leaks.
JKCG emphasised that, as a major participant in Sri Lanka’s motor vehicle sector, vehicle orders are placed regularly as part of normal business operations. The company also reaffirmed its commitment to transparency, regulatory compliance, and good governance while continuing to operate within the prevailing legal framework.
The controversy has emerged at a time when Sri Lanka’s automotive sector is facing renewed uncertainty due to currency depreciation, higher import costs, and tighter policy measures aimed at protecting foreign reserves. Industry analysts note that recent fluctuations in vehicle import regulations and exchange rates have intensified pressure across the market, particularly for importers of electric and hybrid vehicles.
JKCG currently serves as the authorised distributor for Chinese electric vehicle manufacturer BYD in Sri Lanka, a segment that has experienced rapid growth in recent years amid increasing consumer demand for electric mobility solutions.