From 1640 onwards, the VOC maintained a presence in Galle, the main port in southern Ceylon. Ships needed a pilot to reach the harbour here because the entrance to the bay was full of treacherous rocks.
The VOC extended and strengthened the fort at Galle, which the Portuguese had abandoned. Every year on December 25 the great homeward-bound fleet set sail from Galle laden with merchandise for the Dutch Republic. These ships met the VOC fleet from Batavia at the Cape of Good Hope from whence they embarked on the Atlantic crossing together.
Galle was one of the big transhipment ports where Asian products were collected and shipped out to the Dutch Republic. In 1771 the cargo of one ship bound for Holland comprised pepper, coffee, cardamom, sappan wood, myrrh, catechu (a remedy), and cinnamon from Ceylon. It also carried pepper, coffee, textiles, cowrie shells, saltpetre and figs from other regions. The cowrie shells were used as currency in the slave trade in Africa. Rice was imported into Galle.
The Company forged an alliance with the king of Kandy to drive the Portuguese out of Ceylon. But once the Portuguese hold was broken the Company and the king became adversaries. As the Sinhalese monarch, the king continued to have great influence over the VOC's new subjects. Relations improved after 1687 when the new king of Kandy recognised the Company's sovereignty over Ceylon in addition to its trading interests.
From 1640 onwards Galle functioned as the VOC's administrative centre on Ceylon, until Colombo was captured from the Portuguese in 1656. Galle subsequently became one of the two departments, or 'commandements', into which the government of Ceylon was divided, falling under the jurisdiction of the governor in Colombo.