Sri Lanka’s apparel industry has warned that the Protection of the State from Terrorism Bill, as currently drafted, puts at risk the European Union trade concession that underpins its largest export market.
The case is set out in a Lanka Business Online analysis published on Tuesday, drawing on the position of the Joint Apparel Association Forum (JAAF).
The conditionality
GSP+ gives Sri Lankan goods duty-free entry to the EU in exchange for compliance with 27 international conventions on human rights, labour and the environment. That list grows to 32 in 2027–28.
The UN and the EU have said for years that any replacement for the 1979 Prevention of Terrorism Act must meet those standards: narrow definitions of terrorism, protection for association, assembly and expression, and courts able to check the executive.
The timing is the problem. The current GSP+ cycle ends in 2027, and Sri Lanka — like every beneficiary — must reapply for the next one. A counter-terrorism statute that the EU reads as non-compliant would be on the books at the moment the application is assessed.
What the sector has to lose
| Measure | Figure |
|---|---|
| Apparel exports, annual | about US$5 billion |
| Share of merchandise exports | over 40% |
| Fabric and textiles | about US$522 million |
| EU share of the total | a little over 30% |
| Apparel exports to the EU, H1 2026 | US$705 million |
The sector is losing ground as it is. In the first half of 2026, Sri Lanka’s apparel exports to the EU fell 8% against 2025, while EU apparel imports from China grew 5% and from Vietnam 9%.
That is the force of the argument. A tariff shock would not land on a sector with room to absorb it; it would land on one already ceding market share in the market concerned.
The objections to the bill
Legal specialists who have followed four attempts at PTA reform since 2018 say the text improves on earlier drafts but still falls short, on five points:
- Elastic definitions. “Terrorism” extends to damaging public property and some forms of publishing — matters ordinary law already covers.
- Proscription. The President could ban any organisation on “reasonable grounds,” with no stated threshold and no court involved. The PTA itself contains no such power.
- Movement orders. These could run 72 hours before a judge sees them.
- Detention. Orders last two months, renewable up to a year, with magistrates largely expected to endorse police requests.
- Soldiers as police. The armed forces and coast guard would gain powers to stop, search, arrest and detain for 48 hours — and unlike emergency regulations, which Parliament must renew monthly, these powers would be permanent.
The common thread is the absence of judicial oversight. The proposed remedies are correspondingly narrow: let magistrates weigh evidence before approving detention, give courts a role in proscription, and leave arrests to the police.
JAAF’s position is not that Sri Lanka should have no counter-terrorism law. It is that a law this broad, with this little judicial supervision, risks trade access supporting hundreds of thousands of livelihoods.
The parliamentary clock
The bill had its first reading on 6 October. Petitions to the Supreme Court may be filed within 14 days of a bill reaching the order paper, and the court then has three weeks to rule — so a debate is unlikely before November. Twenty-two petitions are now before the court, and this desk is covering that hearing separately.
Campaigners say the government wants the bill passed before the Budget on 12 November. Because the court can rule on constitutionality but not on policy, committee-stage amendment is the realistic route to change — and the government accepted several suggestions on last November’s draft.
A note on this source
This is an analysis piece reflecting an industry association’s position, not a news report of an event, and it is labelled as such here. The export figures are attributable to it; the legal characterisations are the views of the specialists and the association it cites. No EU statement on the PSTA Bill is quoted in it, and none has been located by this desk.
