Court Shuts the Door: How Sri Lanka’s Central Bank (CBSL) Won the Battle to Keep EPF Investment Secrets Hidden

The Bombshell Ruling Nobody Saw Coming

Imagine you work hard every month. Your employer deducts money from your salary. That money flows into a massive national fund — the Employees’ Provident Fund (EPF) — worth hundreds of billions of rupees. You want to know exactly how that fund invests your savings. You ask. And the court tells you: No.

That is precisely what happened in Sri Lanka this week.

The Court of Appeal ruled in favour of the Central Bank of Sri Lanka (CBSL), setting aside a decision of the Right to Information (RTI) Commission that had directed the disclosure of detailed transaction-level information relating to the Employees’ Provident Fund.

This ruling sent shockwaves through Sri Lanka’s legal, financial, and civil society communities. It raises urgent questions: Does the public have a right to see how their retirement savings are being managed? Or does financial secrecy actually protect those savings? The answer, it turns out, is complicated — and it matters to every Sri Lankan worker.

Background: What Is the EPF, and Why Does It Matter?

Before we dive into the legal drama, let us understand what is actually at stake.

The Employees’ Provident Fund is Sri Lanka’s largest retirement savings scheme. It holds the contributions of millions of private sector workers across the country. Every month, employees and their employers contribute a percentage of wages into this fund. The Central Bank of Sri Lanka manages it. The fund invests heavily in government securities — bonds and treasury bills — to generate returns.

When those investments do well, workers’ retirement savings grow. When they do poorly — or when allegations of mismanagement arise — millions of ordinary Sri Lankans suffer. That is why watchdog organizations started asking hard questions.

The Case That Started It All: Verité Research Goes to Court

The case originated from requests filed by Verité Research (Pvt.) Ltd in May 2017, under Section 24 of the RTI Act, seeking a range of information from departments of the Central Bank, including the Employees’ Provident Fund Department and the Public Debt Department.

Verité Research is a respected Colombo-based think tank known for evidence-based policy analysis. They wanted specific EPF investment data — not vague summaries, but real transaction-level details. They asked for purchase dates of government securities, the yields earned, the prices paid, and the names of counterparties involved in each deal.

Why did they want this? Because understanding those details allows analysts to judge whether the EPF was getting good value for workers’ money, or whether politically connected dealers were benefiting at the fund’s expense.

While part of the request submitted to the Public Debt Department was resolved prior to adjudication, the EPF-related request remained disputed. In June 2017, the Central Bank, through its Information Officer, agreed to release certain information but declined to disclose other items, citing statutory exemptions. In particular, the Monetary Board stated that it could only provide a list of EPF investments as at December 31, 2016, noting that more recent data was provisional and subject to audit.

The Central Bank drew a clear line. General information? Fine. Transaction-by-transaction details? Absolutely not.

The RTI Commission Steps In — And Sides With Transparency

Verité Research did not give up. They appealed internally to the Central Bank’s Governor under Section 31 of the RTI Act. The Governor rejected the appeal in September 2017. Verité then escalated to Sri Lanka’s independent RTI Commission under Section 32 of the Act.

In November 2018, the RTI Commission delivered what many transparency advocates celebrated as a landmark win. The RTI Commission held that several exemptions cited by the Monetary Board — including Sections 5(1)(a), 5(1)(d), 5(1)(h), and 5(1)(i) — were not applicable, and directed the disclosure of specified details relating to Item No. 6, particularly for the years 2015 and 2016.

The Commission essentially told the Central Bank: your secrecy claims do not hold water. The public interest in knowing how public funds are invested outweighs your concerns. Hand over the data.

For a brief moment, it looked like transparency had won.

The Central Bank Fights Back — And Wins Big

The Central Bank did not accept the Commission’s ruling quietly. It took the case to the Court of Appeal, arguing that the RTI Commission had overstepped its legal authority.

Years passed. Then, this week, the Court of Appeal delivered its answer — and it was decisive.

A bench comprising Justice R. Gurusinghe and Justice M.C.B.S. Morais held that the Commission erred in concluding that the public interest in disclosure outweighed the potential harm arising from releasing the requested information. The bench emphasised that the information sought in this case fell squarely within the exemption provided under Section 5(1)(d) and therefore could not be ordered to be disclosed.

Section 5(1)(d) of the RTI Act protects commercially confidential information where disclosure would harm a third party. The court decided that EPF transaction data clearly falls into this protected category.

Why Did the Court Say No? The Three Core Reasons

The court’s reasoning went beyond simply citing a legal section. The judges explained why protecting this specific information serves a legitimate purpose.

Reason One: Market Manipulation Risk

The Court observed that releasing EPF transaction details could expose the fund’s investment strategies, enabling market participants to anticipate and outmanoeuvre its bids in Government securities auctions.

Think of it like a poker game. If other players can see your cards, you lose every hand. The EPF participates in government securities auctions with hundreds of billions of rupees. If traders know in advance what prices and yields the EPF targets, they can adjust their bids to exploit the fund. Workers’ returns shrink. Dealers profit.

Reason Two: Harm to Millions of Contributors

The Court noted that this would place the EPF at a competitive disadvantage and potentially reduce returns, ultimately affecting millions of contributors to the Fund.

This is not abstract legal theory. It directly affects every private sector worker in Sri Lanka who depends on the EPF for retirement security.

Reason Three: Existing Oversight Is Already There

The court also noted something important: the EPF does not operate in complete darkness. Transparency in EPF operations is already ensured through statutory mechanisms, including annual reporting, audits by the Auditor General, and parliamentary oversight.

In other words, accountability exists — just not at the granular transaction level that Verité Research requested.

The RTI Commission Exceeded Its Powers — A Stunning Legal Finding

Perhaps the most legally significant part of the ruling was the court’s finding about the RTI Commission itself.

The court observed that while the RTI Commission is empowered to direct public authorities to disclose information, such authority is subject to the limitations set out in Section 5 of the RTI Act.

The court went further. It found that the Commission did not just make a wrong decision — it acted outside its legal boundaries entirely.

The Court held that the RTI Commission had exceeded its powers by ordering disclosure in circumstances where a valid statutory exemption applied. The Commission’s order dated 27th November 2018 was accordingly set aside, and the appeal was allowed.

This is a significant constitutional point. Independent commissions in Sri Lanka hold important powers, but those powers have limits. The court ruled that when Parliament creates a clear statutory exemption under the RTI Act, no commission — however well-intentioned — can simply override it in the name of public interest.

What Does This Mean for Sri Lanka’s Right to Information?

Here is where the ruling gets genuinely controversial — and where thoughtful Sri Lankans will disagree.

The RTI Act, passed in 2016, was hailed as a democratic milestone. It gave citizens the legal right to demand information from government bodies. It created an independent commission to enforce that right. Transparency advocates celebrated it as a tool to fight corruption, hold institutions accountable, and empower ordinary people.

The judgment affirms that while the RTI Act promotes transparency, commercially sensitive financial information held by public authorities may be lawfully withheld where disclosure would harm competitive interests and no overriding public interest is established.

Supporters of the ruling argue this is sensible. Not every piece of government data can be made public. A country’s central bank managing a national retirement fund needs operational secrecy to function effectively in financial markets, just as any professional investor does.

Critics, however, worry about a different outcome. They argue that secrecy around EPF investments has historically shielded mismanagement and corruption. They point to past allegations that EPF funds were invested in overpriced bonds benefiting politically connected dealers — allegations that detailed transaction data could have exposed or disproved. Without access to that data, accountability becomes nearly impossible.

The court did not resolve this tension. It simply drew a legal line and said: this data is protected by law.

The Bigger Picture: Transparency vs. Financial Security

This case sits at the heart of a debate every democracy faces. How much transparency is too much? And when does transparency itself create harm?

In financial markets, information is power. Public pension funds worldwide grapple with this question. In the United States, for example, state pension funds typically disclose investment holdings but often with a significant time delay — allowing them to complete transactions before revealing their positions. That balance protects both transparency and competitive advantage.

Sri Lanka’s court has now effectively told the Central Bank that it can operate more like a private fund manager when it comes to transaction-level secrecy — at least until Parliament decides otherwise.

Whether that protects millions of workers or shields the fund from legitimate public scrutiny remains an open and urgent question. Both things can be true simultaneously. The EPF needs some operational secrecy to function effectively. And Sri Lankan workers deserve robust independent oversight of how their savings are managed.

What Happens Next?

The ruling closes one chapter but opens others.

Verité Research and other transparency advocates may push for legislative reform — seeking amendments to the RTI Act that create clearer, time-bound disclosure requirements for public funds. Parliament could also strengthen the Auditor General’s mandate or create a dedicated independent EPF oversight body with full access to transaction data, even if that data remains confidential from the general public.

The Central Bank, for its part, should recognize that winning in court is not the same as winning public trust. Millions of Sri Lankan workers deserve confidence that their retirement savings are being managed with integrity. Proactive, meaningful disclosure — even if not at the granular level Verité requested — would go a long way toward building that confidence.

The Bottom Line

The Court of Appeal has handed the Central Bank of Sri Lanka a clear legal victory. Transaction-level EPF investment data stays secret — for now. The RTI Commission overstepped its powers, and the law protects commercially sensitive financial information from forced disclosure when no overriding public interest is proven.

But this ruling is not the end of the conversation. It is a signal that Sri Lanka urgently needs a mature, nuanced framework for financial transparency — one that gives workers real assurance their savings are safe, without handing market competitors a roadmap to exploit the country’s largest pension fund.

The workers whose salaries feed the EPF deserve nothing less.