Opposition parties opposed the legislation, saying it amounted to nationalization.

Economic Development Minister Basil Rajapaksa said the Revival of Underperforming Enterprises and Underutilized Assets Law seeks to regain government assets that had been leased out to the private sector under various conditions.

He said some had ended operations years ago while others had failed to meet agreed-upon conditions.

They include one enterprise and 36 assets which were given by the government to investors, either as an incentive or as a loss-making state enterprise to turn around.

The law says competent authorities will be appointed to administer the businesses and a tribunal will be set up to determine compensation for their shareholders.

Opposition parties said the move will discourage local and foreign investment.

Opposition lawmaker Dayasiri Jayasekara called the legislation politically motivated and said it violates free enterprise and economic freedom.

One of the assets, a large sugar plantation, is owned by a prominent opposition member.

Rajapaksa rejected the allegation, saying the government has a responsibility to protect public assets and institute laws to develop the country.

The government assured business leaders that the law was a one-time move and “would never harm other ventures in the future.”