Sri Lanka lacks campaign finance legislation. While elections have traditionally required relatively small budgets, the costs have been increasing and television advertising is now used extensively in national elections. As a result, access to financial resources has become a requirement in parliamentary elections.
The Parliament Elections Act, No 1 of 1981 prohibits vote buying both directly and indirectly, by himself or by another person on his behalf to give, lend, agree to give or lend or offer, promise any money or valuable consideration to or for any elector or to or for any person on behalf of any other person in order to induce any voter to vote or refrain from voting.
Reporting on finance
Every recognized party should submit a copy of the annual statement of accounts, audited by a registered auditor, to the Commission. If any party fails to meet the requirements, such party may cease to be recognized.
Campaign practice
The present regulations significantly limit candidates’ ability to post signs and posters or conduct mobile vehicle campaigns, candidates are left primarily with door-to-door campaigning or more expensive methods such as buying mass media advertisements to advance the candidacy. However, the misuse of state-owned property by parties and candidates during election periods is a significant problem as it creates unequal conditions and thereby lessens the fairness of the contest.
Furthermore, it may be symptomatic of a deeper problem where incumbents are unable to distinguish between ‘the party’, which is temporarily in office, and ‘the state’, which exists as a continuous and separate entity. The Constitution of Sri Lanka specifically obliges citizens to “preserve public property and combat misuse of public resources”. However, in practice it is almost impossible for individuals to discharge this duty and regrettably, Sri Lankan elections have always been marred by the misuse of publicly owned resources by candidates and public officials during the campaign. Some civil society organizations felt that action was required to tackle the misuse of publicly owned resources and set out systematically monitoring the phenomenon.
In 2015 Elections, political analysts have said a successful candidate spends as much as Rs. 300 million on his or her campaign under current campaign regulations. A foreign election observer noted that some candidates had spent as much as 500,000 euros — or more than Rs. 74 million – on their campaign. Only a handful of politicians are capable of self-financing their campaigns. This has raised question from the public about where the politicians get their money from. But most politicians may have mortgaged their property to find this amount of money or got it from unscrupulous businesspeople in the form or a loan or donation. Once in office, the politician is preoccupied with the thought of how to earn the money to redeem his or her property or pay back the loan or return the favour in some way to those who donated funds for the campaign.
The media environment surrounding the election appeared to be, on the whole, fair to all those contesting. State media was reported as having some, but not considerable bias toward the incumbent political alliance. The media guidelines issued by the Commissioner of Elections, which established the ground rules for fair media reporting, were largely adhered to.
Source
https://freedomhouse.org/report/countries-crossroads/2012/sri-lanka
http://www.idea.int/political-finance/country.cfm?id=131
The Work of Domestic Election Observer Groups Around the World, Needs Project
http://eeas.europa.eu/eueom/pdf/promoting-and-defending-democracy_en.pdf
http://www.dailymirror.lk/84217/for-a-new-lanka-regulate-campaign-funding#sthash.PtShKwaI.dpuf