The Court of Appeal yesterday issued interim orders in cases CA Writ 691/23 and CA Writ 695/23, suspending the enforcement of the Minimum Room Rate (MRR) imposed on corporate and free independent tourist hotel rooms within the Colombo Municipal Council area, as per Extraordinary Gazette No. 2349/02 dated 11 September 2023.
With the interim orders issued by the Court of Appeal, the MRR will not be in effect until a final determination is made in the case.
The Petitioner’s Sri Lanka Association of Inbound Tour Operators (SLAITO), Sri Lanka Association of Professional Conference and Exhibition Organisers (SLAPCEO) and Association of Small and Medium Enterprises in Tourism (ASMET) contended that the MRR was implemented without sufficient consultation with key stakeholders in the tourism industry.
They argued that the Sri Lanka Tourism Development Authority (SLTDA) failed to conduct a comprehensive study before enforcing the MRR, leading to a rate that lacked a rational basis.
Critics within the industry claimed that the MRR would disproportionately benefit certain hotel categories while negatively impacting the broader tourism sector.
The suspended notice had set the MRR at $ 100 for five-star hotels, $ 75 for four-star hotels, $ 50 for three-star hotels, $ 35 for two-star hotels, and $ 20 for one-star hotels.
The Hotels Association of Sri Lanka (THASL) argued that the SLTDA had power to impose the room rate and that such a minimum cap was to benefit the tourism industry and the hotel industry as a whole.
Delivering a majority decision the Court of Appeal issued the interim orders suspending the Gazette pending final determination.
Representing the Petitioners, were FaiszerMusthapha, PC along with Shaheeda Barrie, TharakaNanayakkara, AmilaPerera and Sierra Amarasiri.
In support of the MRR, Sanjeewa Jayawardena, PC, appeared for THASL.
Source: https://www.ft.lk/front-page/Court-of-Appeal-suspends-Minimum-Room-Rate-for-Colombo-hotels/44-762082
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