RESTRICTED  
  
WT/TPR/S/420  
1 December 2021  
(21-9039) Page: 1/177 
Trade Policy Review Body   
 
TRADE POLICY REVIEW  
REPORT BY THE SECRETARIAT  
GEORGIA  
This report, prepared for the third Trade Policy Review of Georgia, has been drawn up by the 
WTO Secretariat on its own responsibility. The Secretariat has, as required by the Agreement 
establishing the Trade Policy Review Mechanism (Annex 3 of the Marrakesh Agreement Establishing 
the World Trade Organization), sought clarification from Georgia on its trade policies and practices.  
 
Any technical questions arising from this repor t may be addressed to Mark Koulen 
(tel. 022 739 5224), Denby Probst (tel. 022 739 5847), Ana Cristina Molina (tel. 022 739 6060) , 
and Takako Ikezuki (tel. 022 739 1156).  
 
Document WT/TPR/G/420 contains the policy statement submitted by Georgia.  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the 
first session of the meeting of the Trade Policy Review Body on Georgia. This report was drafted in 
English.  
  WT/TP R/S/420 • Georgia  
 
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  CONTENTS  
SUMMARY  ................................ ................................ ................................ ........................  8 
1   ECONOMIC ENVIRONMENT  ................................ ................................ ........................  13 
1.1   Main Features of the Economy  ................................ ................................ ..................... 13 
1.2   Recent Economic Developments  ................................ ................................ ................... 14 
1.2.1    Impact of COVID ‑19, mitigation measures by the Governmen t, and outlook  .................... 18 
1.2.2    Monetary policy  ................................ ................................ ................................ .......20 
1.2.3    Fiscal policy  ................................ ................................ ................................ ............ 20 
1.2.4    Current account and balance of payments ................................ ................................ ...21 
1.3   Developments in Trade and Investment  ................................ ................................ ........ 22 
1.3.1    Trends and patterns in merchandise and services trade  ................................ ................ 22 
1.3.1.1    Merchandise trade  ................................ ................................ ................................ .22 
1.3.1.2    Services trade  ................................ ................................ ................................ ......25 
1.3.2    Trends and patterns in FDI  ................................ ................................ ....................... 26 
2   TRADE AND INVESTMENT REGIMES ................................ ................................ ...........  29 
2.1   General Framework  ................................ ................................ ................................ ....29 
2.2   Trade Policy Formulation and Objectives  ................................ ................................ ........ 31 
2.3   Trade Agreements and Arrangements  ................................ ................................ ........... 32 
2.3.1    WTO ................................ ................................ ................................ ...................... 32 
2.3.2    Regional and preferential agreements  ................................ ................................ ........ 33 
2.3.2.1    European  Union  ................................ ................................ ................................ ....33 
2.3.2.2    Agreements  with other partners  ................................ ................................ .............. 34 
2.3.3    Other agreements and arrangements  ................................ ................................ ......... 36 
2.4   Investment Regime  ................................ ................................ ................................ ....36 
3   TRADE POLICIES AND PRACTICES BY MEASURE  ................................ ........................  39 
3.1   Measures Directly Affecting Imports  ................................ ................................ .............. 39 
3.1.1    Customs procedures, valuation, and requirements  ................................ ....................... 39 
3.1.1.1    Customs procedures and requirements  ................................ ................................ ....39 
3.1.1.2    Customs valuation  ................................ ................................ ................................ 41 
3.1.2    Rules of origin  ................................ ................................ ................................ ......... 42 
3.1.3    Tariffs  ................................ ................................ ................................ .................... 43 
3.1.3.1    Applied tariffs  ................................ ................................ ................................ .......44 
3.1.3.2    Bound tariffs  ................................ ................................ ................................ ........ 47 
3.1.3.3    Preferential tariffs  ................................ ................................ ................................ .48 
3.1.4   Tariff exemptions and reductions  ................................ ................................ ............... 48 
3.1.5    Other charges affecting imports  ................................ ................................ ................. 50 
3.1.5.1    Customs fees  ................................ ................................ ................................ .......51 
3.1.5.2    Value added tax  ................................ ................................ ................................ ....51 
3.1.5.3    Excise tax  ................................ ................................ ................................ ............ 53 
3.1.6    Import prohibitions, restrictions, and licensing  ................................ ............................ 54 WT/TPR/S/420 • Georgia  
 
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  3.1.6.1    Import prohibitions  ................................ ................................ ............................... 54 
3.1.6.2    Import restrictions and licensing  ................................ ................................ ............. 55 
3.1.7    Anti-dumping, countervailing, and safeguard measures  ................................ ................ 56 
3.1.8    Other measures affecting impor ts ................................ ................................ .............. 57 
3.2   Measures Directly Affecting Exports  ................................ ................................ .............. 58 
3.2.1    Customs procedures and requirements  ................................ ................................ .......58 
3.2.2    Taxes, charges, and levies  ................................ ................................ ........................ 59 
3.2.3    Export prohibitions, restrictions, and licensing  ................................ ............................. 59 
3.2.3.1    Export prohibitions  ................................ ................................ ................................ 59 
3.2.3.2   Export restrictions and licensing  ................................ ................................ ............. 60 
3.2.4    Export support and promotion  ................................ ................................ ................... 61 
3.2.4.1    Export promotion  ................................ ................................ ................................ ..61 
3.2.4.2    Free Industrial Zones  ................................ ................................ ............................ 62 
3.2.4.3    Other customs procedures promoting exports and re -exports  ................................ .....62 
3.2.5    Export finance, insurance, and guarantees  ................................ ................................ ..63 
3.3   Measures Affecting Production and Trade  ................................ ................................ .......63 
3.3.1    Incentives  ................................ ................................ ................................ ............... 63 
3.3.1.1    Subsidies and incentives  ................................ ................................ ........................ 63 
3.3.1.2    Rules on state aid  ................................ ................................ ................................ .68 
3.3.2   Standards and other technical requirements  ................................ ............................... 68 
3.3.2.1    Accreditation and conformity assessment  ................................ ................................ .71 
3.3.2.2    WTO and international cooperation  ................................ ................................ .......... 72 
3.3.3    Sanitary and phytosanitary requirements  ................................ ................................ ....73 
3.3.3.1    Framework  ................................ ................................ ................................ ........... 73 
3.3.3.2    Technical assistance, the WTO, and international cooperation  ................................ .....77 
3.3.4    Competition policy and price controls  ................................ ................................ ......... 77 
3.3.4.1    Competition policy  ................................ ................................ ................................ 77 
3.3.4.2    Price controls ................................ ................................ ................................ ........ 80 
3.3.5    State trading, state -owned enterprises, and privatization  ................................ ............. 81 
3.3.6    Government procurement  ................................ ................................ ......................... 84 
3.3.7    Intellectual property rights  ................................ ................................ ........................ 90 
3.3.7.1    Patents and utility models  ................................ ................................ ...................... 93 
3.3.7.2    Copyright  ................................ ................................ ................................ ............. 93 
3.3.7.3    Trademarks  ................................ ................................ ................................ .......... 94 
3.3.7.4    Designs  ................................ ................................ ................................ ............... 94 
3.3.7.5    New plant varieties and animal bre eds ................................ ................................ .....95 
3.3.7.6    Geographical indications (GIs) and appellations of origin (AOs)  ................................ ...95 
3.3.7.7    Enforcement  ................................ ................................ ................................ ......... 96 
4   TRADE POLICIES BY SECTOR  ................................ ................................ .....................  97 
4.1   Agriculture, Forestry, and Fisheries  ................................ ................................ ............... 97 WT/TP R/S/420 • Georgia  
 
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  4.1.1    Agriculture  ................................ ................................ ................................ .............. 97 
4.1.1.1    Production and trade  ................................ ................................ ............................. 98 
4.1.1.2    Laws and structure  ................................ ................................ ..............................  100 
4.1.1.3    Policy and support measures  ................................ ................................ ................  101 
4.1.1.4    Key subsectors  ................................ ................................ ................................ ... 106 
4.1.1.4.1    Wine ................................ ................................ ................................ ...............  106 
4.1.1.4.2    Mineral and fresh water  ................................ ................................ ....................  107 
4.1.2    Forestry  ................................ ................................ ................................ ................  107 
4.1.2.1    Struct ure, strategies, and reforms ................................ ................................ .........  108 
4.1.2.2    Production and trade  ................................ ................................ ...........................  109 
4.2   Mining and Energy  ................................ ................................ ................................ .... 111 
4.2.1    Mining  ................................ ................................ ................................ ..................  111 
4.2.2    Energy  ................................ ................................ ................................ .................  114 
4.2.2.1    Overview  ................................ ................................ ................................ ...........  114 
4.2.2.2    Institutional and legal framework  ................................ ................................ ..........  115 
4.2.2.3    Electricity  ................................ ................................ ................................ ...........  116 
4.2.2.4    Natural gas  ................................ ................................ ................................ ........  119 
4.2.2.5    Oil products ................................ ................................ ................................ ........  120 
4.3   Manufacturing  ................................ ................................ ................................ ..........  121 
4.4   Services  ................................ ................................ ................................ ..................  123 
4.4.1    Financial services  ................................ ................................ ................................ ... 123 
4.4.1.1    Banking  ................................ ................................ ................................ .............  123 
4.4.1.2    Other financial services  ................................ ................................ ........................  127 
4.4.2    Telecommunications  ................................ ................................ ...............................  128 
4.4.2.1    Framework and structure  ................................ ................................ .....................  130 
4.4.2.2    Strategies and initiatives  ................................ ................................ ......................  132 
4.4.2.3    Legal framework  ................................ ................................ ................................ . 133 
4.4.2.4    E-commerce  ................................ ................................ ................................ ....... 134 
4.4.2.5    International and regional initiatives  ................................ ................................ ...... 135 
4.4.3   Transportation  ................................ ................................ ................................ ....... 136 
4.4.3.1    Air ................................ ................................ ................................ ....................  139 
4.4.3.2    Roads  ................................ ................................ ................................ ................  139 
4.4.3.3    Maritime  ................................ ................................ ................................ ............  140 
4.4.3.4    Ports ................................ ................................ ................................ .................  141 
4.4.3.5    Rail ................................ ................................ ................................ ...................  141 
4.4.4    Tourism  ................................ ................................ ................................ ................  142 
5   APPENDIX TABLES  ................................ ................................ ................................ .. 145  
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  CHARTS  
 
Chart 1.1 Current account balance, 2014 -20 (% of GDP)  ................................ ........................ 22 
Chart 1.2 Direction of merchandise trade, 2015 and 2020  ................................ ....................... 23 
Chart 1.3 Product composition of merchandise trade, 2015 and 2020  ................................ .......24 
Chart 3.1 MFN applied tariff structure, 20 15 and 2021  ................................ ............................ 44 
Chart 3.2 Type of duties, by HS dutiable chapter, 2021  ................................ .......................... 45 
Chart 3.3 Structure of Georgia's tariff schedule, 2021  ................................ ............................. 46 
Chart 3.4 Average applied MFN and bound tariff rates, by HS dutiable chapter, 2015 and 2021  ...47 
Chart 3.5 Tax revenue, 2020 ................................ ................................ ............................... 50 
Chart 4.1 Total energy  supply, 2015 -19 ................................ ................................ ..............  115 
Chart 4.2 Mobile, 2016 -20 ................................ ................................ ................................  129 
Chart 4.3 Fixed broadband , 2016 -20 ................................ ................................ ..................  130 
 
TABLES  
 
Table 1.1 GDP by sectoral activity, 2015 -20 ................................ ................................ .......... 13 
Table 1.2 Selected macroeconomic indicators, 2015 -20 ................................ .......................... 15 
Table 1.3 Main measures budgeted  by the Anti-Crisis Plan due to COVID ‑19, 2020 ..................... 19 
Table 1.4 Trade in services, 2015 -20 ................................ ................................ .................... 25 
Table 1.5 FDI flows by selected partners, 2015 -20 ................................ ................................ .27 
Table 1.6 FDI stock in Georgia, 2015 -20 ................................ ................................ ............... 28 
Table 3.1 Main legal instruments governing Georgia's  customs regime, 2021  ............................ 39 
Table 3.2 Structure of MFN tariff in Georgia, 2021  ................................ ................................ ..45 
Table 3.3 Tariffs under preferential agreements, 2021  ................................ ............................ 48 
Table 3.4 Main customs fees and charges, 2021  ................................ ................................ ....51 
Table 3.5 Import prohibitions  ................................ ................................ .............................. 54 
Table 3.6 Export prohibitions  ................................ ................................ ............................... 60 
Table 3.7 Main areas of subsidization by the State in the economya, 2017 -20 ............................ 63 
Table 3.8 Main legal provisions  ................................ ................................ ............................ 69 
Table 3.9 Georgian standards adopted, 2015 -20 ................................ ................................ ....70 
Table 3.10 SPS legislative developments under the DCFTA, 2015-21 ................................ ........ 73 
Table 3.11 Legal framework, main laws on SPS, 2021  ................................ ............................ 74 
Table 3.12 Prohibited products, 2021  ................................ ................................ ................... 76 
Table 3.13 Competition legal framework, 2021  ................................ ................................ ......77 
Table 3.14 Georgian National Competition Agency statisticsa, 2016 -21 ................................ .....80 
Table 3.15 Price controls, 2021  ................................ ................................ ............................ 80 
Table 3.16 Revenues of selected SOEs under the NASP, by sector , 2015 -20 .............................. 83 
Table 3.17 Privatizations and nationalizations of state enterprises , 2015 -21 .............................. 83 
Table 3.18 Revenues from privatizations, 2016 -21 ................................ ................................ .83 
Table 3.19 Enterprises privatized, 2015 -21 ................................ ................................ ........... 84 WT/TP R/S/420 • Georgia  
 
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  Table 3.20 Government procurement annual spending, 2015 -20 ................................ .............. 85 
Table 3.21 Legal framework for procurement , main elements, 2 021 ................................ ......... 85 
Table 3.22 Procurement means and methods  ................................ ................................ ........ 86 
Table 3.23 Procurement by type, 2015 -20 ................................ ................................ ............ 88 
Table 3.24 E -procurement  from foreign suppliers, top 10, 2020  ................................ ............... 88 
Table 3.25 Monetary thresholds and timelines for e -tenders  ................................ .................... 89 
Table 3.26 E -procurement, 2015 -20 ................................ ................................ ..................... 89 
Table 3.27 Overview of disputes, 2015 -20 ................................ ................................ ............ 90 
Table 3.28 IPR protection, by type, 2015 -21 ................................ ................................ ......... 92 
Table 3.29 Overview of IPR enforcement, 2017-20 ................................ ................................ .96 
Table 4.1 Key agricultural indicators, 2016 -20 ................................ ................................ .......98 
Table 4.2 Production of selected agricultural products , 2015 -20 ................................ ............... 98 
Table 4.3 Trade in selected agricultural  products, 2015 -20a ................................ ..................... 99 
Table 4.4 Main laws in agriculture, 2015 -19 ................................ ................................ ........  101 
Table 4.5 Main agricultural support programmes , 2015-21 ................................ ....................  103 
Table 4.6 Wine exports, 2015 -20 ................................ ................................ .......................  107 
Table 4.7 Overview of the forestry sector, 2015 -20 ................................ ..............................  108 
Table 4.8 Forestry production and trad e, 2015 -20 ................................ ................................  110 
Table 4.9 Main legal instruments governing Georgia's mining sector , 2021  ..............................  111 
Table 4.10 Main legal instruments governing Georgia's  energy sector, 2021  ............................  116 
Table 4.11 Financial institutions, 2015 -20 ................................ ................................ ...........  123 
Table 4.12 Selected financial soundness indicators, banking  sector, 2015 -20 ..........................  124 
Table 4.13 Telecom and e -commerce main indicators , 2016 -20 ................................ .............  129 
Table 4.14 Main legislation in telecommunications, 2021 ................................ .......................  134 
Table 4.15 Membership in international or regional organizations , 2021  ................................ .. 136 
Table 4.16 Key transport statistics, 2015 -21 ................................ ................................ ....... 137 
Table 4.17 Main transport legislation, 2021  ................................ ................................ .........  137 
Table 4.18 Principal international  conventions in the transport sector, 2021  ............................  138 
 
BOXES  
 
Box 1.1 Economic reforms, 2015 -21 ................................ ................................ ..................... 16 
Box 1.2 Economy 2030 key points  ................................ ................................ ....................... 18 
Box 1.3 Main COVID ‑19-related plans and measures, 2020 -21 ................................ ................ 20 
Box 3.1 Duty exemptions under the Tax Code  ................................ ................................ .......49 
Box 3.2 VAT reform and its implications for cross -border trade  in services  ................................ 52 
Box 3.3 Special trading company  ................................ ................................ ......................... 63 
Box 3.4 Main 2020 reform elements of the Law on Competition  ................................ ............... 79 
Box 4.1 Main policy instruments, 2016 -21................................ ................................ ...........  102 
Box 4.2 Anti -Crisis Plan on agriculture, key provisions  ................................ ..........................  105 
Box 4.3 Electricity market structure, 2021  ................................ ................................ ..........  118 WT/TPR/S/420 • Georgia  
 
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  APPENDIX TABLES  
 
Table A1.1 Merchandise exports including re -exports by group of products, 2015 -20 ................  145 
Table A1.2 Merchandise domestic exports by group of products, 2015 -20 ...............................  146 
Table A1.3 Merchandise domestic exports by destination, 2015 -20 ................................ ........  147 
Table A1.4 Merchandise exports including re -exports by destination, 2015 -20 .........................  148 
Table A1.5 Merchandise imports by group of products, 2015 -20 ................................ ............  149 
Table A1.6 Merchandise i mports by origin, 2015 -20 ................................ .............................  150 
Table A1.7 Balance of payments, 2015 -20 ................................ ................................ ..........  151 
Table A2.1 Notifications, January 2016 -June 2021  ................................ ...............................  152 
Table A3.1 Georgia's applied MFN tariff summary, 2021  ................................ ........................  155 
Table A3.2 Revenue from taxation, 2015 -20 ................................ ................................ ........  157 
Table A3.3 List of excisable goods, by product heading ( HS four -digit level), 2021  ...................  158 
Table A3.4 Goods subject to a licence or permit requirement to import and/or export, 2021  ..... 160 
Table A3.5 New resolutions, rules, or changes to existing legislation concerning SPS measures  . 162 
Table A3.6 Selected state enterprises and areas of activity, 2021  ................................ ..........  166 
Table A3.7 Intellectual property fees  ................................ ................................ ..................  168 
Table A4.1 Structure of Georgia's manufacturing sector, 2015 -20 ................................ ..........  173 
Table A4.2 By -laws adopted by ComCom, 2015 -21 ................................ ..............................  174 
 
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  SUMMARY  
1. Over the last decade, Georgia's economic growth has been largely positive and there has been 
a demonstrated commitment to open markets and further integration into world and regi onal 
markets as illustrated by the country's  engagement in the WTO  and more recently through its 
commitments under the Deep and Comprehensive Free Trade Area  (DCFTA) with 
the European  Union . As a result of these developments and the increase in gross natio nal income 
per capita, Georgia reached the status of upper -middle income country in 2016.  
2. Georgia's recent economic performance has generally remained positive, and real  GDP 
continually expanded throughout 2015 -19, achieving an average growth rate of 4.1%,  although 
there was a significant downturn of - 6.2% in 2020 due to the COVID -19 pandemic. Georgia was 
particularly impacted by this external shock due to its high reliance on external trade, foreign 
investment, and tourism for economic growth. The COVID -19 pandemic hit the services sector 
particularly hard and affected mainly transport, accommodation, and food services. The downturn 
in economic growth in 2020 reversed previous gains in unemployment and poverty reduction.  
3. In response to the COVID ‑19 pandemi c, the Government undertook several mitigation 
measures with a view to alleviating the adverse economic and social impacts of the shock. In  2020, 
the Anti -Crisis Plan was put in place as the main overall economic recovery plan with an expected 
budget of GE L 3.6 billion. Several targeted sub -Plans were also initiated under the umbrella of the 
main Plan, covering agriculture, tourism, healthcare, development, and education in particular. A 
range of fiscal, monetary, and financial market policy measures were i mplemented through 
these  Plans in order to support businesses  and vulnerable groups, and to strengthen safety nets.  
4. Throughout most of the last decade, Georgia registered persistent current account deficits 
that began to decline in 2016 -17 and reached thei r lowest level in 2019. However, this trend was 
stopped in  2020 by the economic consequences of the COVID -19 pandemic that were particularly 
difficult for the tourism sector. The significant merchandise trade deficit was the largest negative 
component of G eorgia's current account balance. However, in 2020 imports declined more than 
exports, and therefore the trade deficit narrowed slightly.  
5. Georgia's merchandise exports grew steadily over the period by about 50% from 2015, while 
imports also grew, but at a much slower rate (10%). Georgia remained heavily reliant on imported 
manufactured goods, whereas exports were mainly primary products, i.e. food and minerals, a trend 
that intensified over the period. Due to its geographical location and transport connecti ons, Georgia 
is an important transit corridor, thus merchandise trade figures are amplified due to significant 
amounts of re -exports. In terms of markets, Georgia's main export destinations are 
the European  Union and the Commonwealth of Independent States (CIS), while the  CIS, 
the European  Union, and Turkey are the main sources of its merchandise imports.  
6. The broad objectives of Georgia's trade policy remain largely unchanged from the previous 
Review, including continued trade policy liberalization , facilitation of export and import procedures 
and streamlining of regulations on non -tariff barriers , and diversification of trade relations. 
In July 2021, the Government presented a 10 -year economic development strategy, Economy  2030. 
To ma intain a high rate of economic growth, the strategy aims to increase domestic production and 
exports. Specifically, the new strategy aims to double exports in the next five years and increase 
self-sufficiency by at least 20%. There were several constitutio nal amendments during the period 
under review.  
7. The Association Agreement concluded in 2014 between Georgia and the European  Union and 
its member States has as one of its objectives Georgia's gradual economic integration into the 
EU Internal Market, through  the establishment of the DCFTA, which aims to provide for far -reaching 
market access based on sustained and regulatory approximation. Most recent legislative changes in 
trade and trade -related matters resulted from Georgia's obligations under the DCFTA to  approximate 
the EU  acquis . In addition to the DCFTA, Georgia is a party to 15 other regional trade agreements. 
During the period under review, Georgia concluded free trade agreements with China; the 
European  Free Trade Association ; Hong  Kong,  China; and t he United Kingdom. All of these regional 
trade agreements have been notified to the WTO.  WT/TPR/S/420 • Georgia  
 
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  8. Recent studies of Georgia's experience with foreign direct investment ( FDI) have observed 
that the potential benefits of FDI for productivity and job creation have not  been realized sufficiently 
and that to improve its integration into the global economy Georgia needs to focus more on 
efficiency -enhancing  FDI. M ost FDI has gone to non -tradable sectors , while FDI in export -oriented 
sectors , including manufacturing and ag riculture , has stagnated and remained far below potential.  
The Government recently launched several new initiatives that prioritize certain sectors for 
investment promotion and incentives, based on criteria such as alignment with Georgia's overall 
economic  strategy, export orientation, and contribution to knowledge and know -how. 
9. Georgia adopted a new Customs Code in 2019, and related secondary legislation, to further 
simplify its customs procedures and ensure its approximation to the EU customs legislation as 
provided for in the DCFTA. The new code updates the provisions on customs valuation, which were 
previously contained in secondary legislation, and introduces, inter alia, an Authorized Economic 
Operator programme. Georgia ratified the WTO  Agreement  on Trade Facilitation in  2016, and 
completed the implementation of its commitments in September 2019. It also acceded to the 
Revised  Kyoto Agreement in 2018 and is planning to accede to the EU  Convention on a 
Common  Transit Procedure and the Convention on the Simplification of Formalities in Trade in 
Goods. Georgia maintains an eCustoms platform providing various customs electronic services.  
10. Georgia's tariff system remains simple and largely liberal. Tariffs are organized  according to 
three  bands: 0%, 5% , and 1 2%, with duty -free lines accounting for about 81% of the total number 
of lines in 2021. Only very few lines (2.5% of the total number of lines), namely motor vehicles, 
vinegars , and alcoholic beverages (except for beer ), were subject to non -ad valorem  duties  (specific 
or special duties ). The simple average applied MFN tariff remained unchanged, at 2%; the average 
tariff for non -agricultural goods was down from 0.8% in 2015 to 0.7% in  2021 (including  ad valorem  
equivalents), and that for agricultural pr oducts increased from 6.7% to 6.8% (WTO  definition). 
Georgia does not apply any seasonal tariffs, or tariff -rate quotas, either on an MFN or preferential 
basis.  
11. Georgia has bound all of its tariffs using mostly ad valorem  rates; only 17 lines corresponding  
to vinegars and all alcoholic beverages (except for beer) are bound at specific rates. Bound 
ad valorem  duties consist of 25 different rates ranging from 0% to 30%, with the most frequent 
rates being 0%, 5%, and 12%. Applied rates do not exceed bound rate s, except for one  line. 
12. Georgia continued to reform its indirect tax regime to harmonize it with that of 
the European  Union as provided for in their Association Agreement. It expanded the list of excisable 
goods and modified some of its rates based on heal th considerations. Goods that became excisable 
during the review period included raw tobacco, tobacco waste, fluids for e -cigarettes, and 
motorcycles. Georgia also amended its VAT rules, in particular the scope of VAT application for 
services transactions.  Both the VAT and excise tax apply equally to imported and locally produced 
goods (and services in the case of the VAT), except for certain agricultural goods for which the 
application of the VAT depends on the goods' origin. Both taxes are an important so urce of revenue. 
In 2020, together they accounted for about 60% of Georgia's total tax revenue. Of this amount , 
most came from VAT collected on imports.  
13. Georgia maintains import and export prohibitions and a system of licence and permit 
requirements based on health, security, and environmental considerations. During 2015 -21, the lists 
of prohibited and restricted imports and exports remained almost unchanged, except for 
a few additions, including temporary measures in response to the COVID ‑19 pandemic. Most  of the 
product categories subject to an import licence/permit are also subject to an export licence/permit.  
14. Georgia does not have legislation on the application of countervailing and safeguard measures , 
but during the review period it adopted its first le gislation on anti -dumping. The new law – the Law 
on the Introduction of Anti -Dumping Measures in Trade – was enacted in  July 2020 and became fully 
operational on 1  June 2021. The Law builds upon the  Anti-Dumping Agreement, and designates the 
National Compe tition Authority (NCA) as the investigative authority. As at September  2021, the 
NCA department for anti -dumping measures had not received any formal requests for an 
investigation.  WT/TP R/S/420 • Georgia  
 
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  15. Georgia does not apply any export duty and exempts all exports from customs  services fees, 
except for certain types of ferrous and non -ferrous scraps and residues. Exports are also exempted 
from VAT and the excise tax when applicable.  
16. Georgia supports exporters mainly through technical assistance and the organization of export 
events. It does not maintain any financial support programme designed exclusively for exporters, 
although it maintains such programmes for businesses in general to promote local 
production  – whether goods are exported or not.  
17. Government subsidies and support measures increased during the review period and 
amounted to GEL  837 million in 2020, about double the level from previous years due to significant 
additional spending in areas related to the COVID‑19 pandemic. New measures in 2020 included a 
utility subsidy, support for the hotel and construction sectors, and for promoting entrepreneurship . 
The Government also subsidized imports during the period, e.g. wheat to control the price of basic 
commodities. Significant increases in  the subsidies given to agriculture producers also occurred 
in 2020 compared to historical periods, in particular for viticulture, and preferential agricultural 
credits.  
18. As concerns TBT and SPS measures, much of the policy and developments during the perio d, 
including legislative changes, derive from the DCFTA as Georgia continues to move towards the 
EU acquis . In this respect, Georgia had already approximated 13 EU directives/regulations in 
the area of TBT and was in the process of adopting 8 more ; for SPS , about 162 legal acts had been 
approximated and another 100 or so were expected. Implementation of these reforms and the move 
to greater adherence to international norms have been positive development s and increase the 
potential for more agricultu ral exports, in particular to the EU market. Georgia's notification record 
of these measures to the WTO during the period has been noted as needing improvement , in 
particular concerning SPS, as only one notification has been received.  
19. There have been sever al developments in the area of competition policy since 2014 when 
Georgia's main Law on Competition was enacted. In 2020 , the most comprehensive amendments 
were approved regarding increasing accountability and enforcement powers of the Georgian National 
Competition Agency, improving procedural aspects, incorporating a new governing structure, and 
aligning the legal provisions with EU best practices. The two main areas of substantial legal change 
were new procedures for merger control and market investigatio ns. Georgia also adopted the 
"significant impediment to effective competition" (SIEC) test as part of the reforms.  
20. State -owned enterprises (SOEs) remained a significant part of the economy during the review 
period , with state majority ownership of thousand s of enterprises at the national and local levels. 
About 100  significant SOEs remain under the purview of National Agency of State Property  (NASP) , 
which provides oversight and management. About half of these enterprises are non -functioning and 
in a state of liquidation ; the remainder are concentrated in the transport and communication sectors. 
During the review period, more enterprises were nationalized than privatized.  
21. Georgia's government procurement rules have been established, according to the authorit ies, 
to ensure rational spending of public funds and promote effective competition in the sector. Several 
developments occurred during the review period , such as structural and procedural improvements 
that led to greater e -procurement and the adoption of E U procurement norms. Government 
procurement comprises a significant part of government spending, i.e. about 30%, and it 
represents  10% of GDP. Competitive tendering is generally low. Efforts to expand more open 
competitive tendering have been initiated thr ough limits on the use of the direct tendering method. 
Improvements in the dispute resolution process in this area have also occurred to ensure greater 
independence and accountability.  
22. In the area of intellectual property, most of Georgia 's advancements ov er the period involved 
implementation of DCFTA  commitments, mainly for patents, trademarks, copyright, design, 
appellations of origin ( AOs) and geographical indications ( GIs), and border measures. As regards 
patents, new legislation reintroduced compulsory  licensing in the Patent Law in 2018 , as well as 
added five years of protection on pharmaceutical and plant protection products. The length of 
protection for certain copyrighted materials was also amended , and provisions related to collective 
management or ganizations were subject to adjudication. In terms of enforcement, new  provisions 
for patents, integrated circuit topology, and breeders' exclusive rights were added to the scope of WT/TPR/S/420 • Georgia  
 
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  enforcement at the border and the new law also allows for proactive applic ation of IP  measures 
through an ex officio  process.  
23. Georgia 's agriculture sector remains important, accounting for 8.4% of GDP in 2020 and 
about  20% of its population is reliant on it for employment. Agriculture accounts for one  third of 
domestic exports o ver the period under review, with wine, nuts, and water the main exported 
products. The growth of wine exports outpaced that of all other export categories as their value 
more than doubled during the review period. Georgia is a significant net importer of agricultural 
products , with imports approximately double the value of exports. One of the significant 
developments during the period was land ownership reform measures that now prohibit foreign 
ownership of agricultural land, with limited exceptions. Sever al agricultural policy strategies were 
adopted during the review period to address rural development, agricultural extension services, and 
irrigation.  
24. Despite the natural abundance of Georgia 's forests, wood remained largely used to supply 
energy through f irewood to the local rural populations and contributed very little to trade  (1.2%) 
and GDP (0.4%). Efforts were undertaken during the review period to reform the sector through a 
National Forest Concept strategy and the adoption of the new Forest Code in 2 020. With the main 
aim of establishing sustainable silviculture, the Code is expected to introduce changes such as 
abolishing the long -term licen ces for harvesting, direct all commercial felling through the National 
Forest Agency, regulate non -timber resou rce extraction, and prohibit the long -standing practice of 
obtaining free firewood from forests by local populations.  
25. In mining, Georgia launched a reform process in 2018 to review and update its 1996 mining 
legislation. As a result, it adopted its first M ining Sector Strategy in 2019, and is planning to complete 
its new Mining Code in 2022.  
26. Georgia continues to be highly dependent on energy imports, mainly of natural gas, which is 
its main source of energy supply (45% of its total energy supply in  2019). O ther sources of energy 
are oil products and hydropower. During the review period, Georgia launched a vast reform of its 
energy sector , notably in the areas of electricity and gas , to approximate its legislation to the 
EU energy legislation. This reform led  to the adoption in 2019 of the Law on Energy and Water 
Supply , which paves the way for changes in the organization and structure of the electricity and 
natural gas markets, and their gradual opening, including the unbundling of transmission and 
distributi on activities and the creation of electricity and gas exchange markets. Implementation of 
this reform is ongoing and is advanced for the electricity sector. The electricity exchange market is 
currently in the testing phase and is expected to open in Januar y 2022. For the natural gas market, 
which is highly concentrated and is dominated by foreign -owned companies, changes in the market 
structure and completion of a natural gas trading platform are expected by 2023. Due to its location, 
Georgia serves as tran sit corridor for oil transportation.  
27. Manufacturing accounted on average for 10% of GDP during  2015-20. Georgia does not have 
an industrial policy per se , and policies in the sector are relatively liberal. Most manufactured 
products enter duty -free into the  Georgian market , with some exceptions  (including wood, plastic, 
iron and steel products, and vehicles ) accounting for about 5% of the total number of 
tariff lines (479 lines). Certain manufactured products require a licence or permit for their production 
and trade, in most cases based on security and health considerations. Georgia maintains support 
programmes for business, some of which have a sectoral component. Georgia has four  free industrial 
zones, which provide various types of tax benefits  to the enterprises located within them with a view 
to attracting investment and promoting exports and value chain activities.  
28. In financial services, an important objective of government policy in recent years has been to 
improve the efficiency of bank and  non-bank financial intermediation to increase and diversify access 
to finance for business development. The financial sector is dominated by a highly concentrated 
banking sector that continues to be marked by a high  degree of dollarization of assets and l iabilities. 
During the review period, Georgia continued to implement major reforms to the institutional and 
regulatory framework for financial sector oversight and financial stability, including with respect to 
capital adequacy and liquidity requirements, risk management, and governance and internal 
controls. It also adopted measures to reduce the extent of dollarization of the banking system. Many 
of these reforms involved the alignment of Georgia's regime with international standards, notably 
the Basel  III: International Regulatory Framework for Banks, and EU rules.  WT/TP R/S/420 • Georgia  
 
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  29. Significant developments have taken place in the telecommunications sector as a number of 
comprehensive reforms have been implemented or remain in progress. During the review period, 
penetratio n in mobile services remained high, the number of households with Internet access 
increased, and fixed broadband subscribers and penetration rates improved; however , the number 
of fixed telephone subscribers continued to decline. The telecommunications sec tor has undergone 
consolidation in recent years with fewer operators and thus concentration of dominance, and a 
low level of ported numbers. To address some of these imbalances, the telecom regulator ComCom 
launched new rules and procedures for Mobile Virt ual Network Operators in order to provide access 
to small and medium -sized operators. Also, the new Bulk SMS regulation and a draft Law on Sharing 
Telecommunication Infrastructure and Physical Infrastructure Used for Telecommunication Purposes 
were initiat ed during the period with a view to further open ing the market and improv ing 
competitiveness.  
30. The transportation sector makes a significant contribution to the Georgian  economy, as it 
contributed 6.2% to GDP, on average, during the review period. Georgia's  potential as a regional  hub 
has been recognized, and the Government has taken steps to develop the country's infrastructure, 
in particular for ports, road, and rail, which are increasingly interconnected. The Government is 
working towards modernization an d development of the transportation infrastructure in accordance 
with international standards, harmonizing its legislation with international laws, and integrating into 
the Trans -European Transport Network. It has also established a National Transport and Logistics 
Strategy (2021 -30) and its Action Plan (2021 -22). Georgia has adopted an open environment in the 
aviation sector since  2005; consequently, the bilateral agreements are based on the Open Skies 
policy. Georgia achieved significant progress in a wid e area of road transport -related activities during 
implementation of the DCFTA. Georgia regularly issues bilateral road transport permits, and is also 
involved in several multilateral systems of licences. As of mid -2021, work was ongoing to develop 
the Mar itime Transport Strategy document, which was expected to be adopted in late  2021. 
Fulfilment of the rail -related obligations of the DCFTA entails substantial changes to the railway 
sector in Georgia. In particular, the railway operations of freight and pas senger services and 
infrastructure are to be separated with their own respective new authorities for licensing and 
regulatory aspects.  
31. Travel and transport services accounted for more than 90% of services exports during most 
of the period  2015-20. The cons iderable loss of income from tourism in 2020 was one of the main 
factors contributing to the COVID ‑19 pandemic's severe impact on Georgia's economy. The top 
countries in terms of international visitors are Azerbaijan, the Russian  Federation, Armenia, and 
Turkey. Efforts to diversify the profile of foreign travellers have not yet been successful, as over  80% 
of tourists arrived overland from these four countries. It has been observed that to maximize the 
potential of its tourism sector, Georgia needs to make  improvements regarding accessibility and 
hospitality infrastructure and services.  
32. Georgia's current tourism policy is based on the Georgia Tourism Strategy 2025,  adopted 
in 2015. According to this Strategy, by 2025, Georgia is to be well known as a premie r, year -round, 
high-quality tourism destination, centred on its unique cultural and natural heritage, world -class 
customer service, and tradition of hospitality. The Strategy defines eight  strategic objectives, 
50 priority actions, and more than 100 activi ties to raise awareness in target markets about 
Georgia's tourism potential, assist the private sector in the creation of higher quality and niche 
tourism products, and improve service quality. Enterprise Georgia, the Government's economic 
development agen cy, administers several programmes to support the development of the tourism 
sector. New support programmes directed at the tourism sector were launched in 2020 as part of 
the measures taken to mitigate the economic impact of the COVID -19 pandemic . 
 WT/TPR/S/420 • Georgia  
 
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  1  ECONOMIC ENVIRONMENT  
1.1  Main Features of the Economy  
1.1.  Since its independence in 1991, Georgia has embarked on a series of reforms and liberalization 
initiatives. It has been committed to open markets and stable economic growth. Further integration 
in world and regional markets has also been a priority, as demonstrated by its accession to the 
WTO in 2000 and more recently by the implementation of the De ep and Comprehensive Free Trade 
Area (DCFTA) agreement requiring approximation or harmoni zation to EU  legislation and deep 
reforms to achieve EU  acquis . 
1.2.  Over the last decade, Georgia's economic growth has been largely positive, poverty has 
declined, trade as a percentage of GDP has increased, and unemployment has fallen. As a result of 
these positive developments and the increase in gross national income per capita, Georgia reached 
the status of upper -middle income country in 2016 , according to World Bank c riteria.  
1.3.  In terms of GDP, Georgia remained heavily reliant on the services sector as it continued to 
account for about two thirds of GDP output throughout the review period (Table 1.1). The other 
significant sectors that contributed the most to the economy  were manufacturing, construction, and 
agriculture. The impact of the COVID -19 pandemic was particularly hard in the services sector as 
the most  significant declines were in the transport, and accommodation and food service sectors. 
Agriculture remained im portant, especially in terms of employment, but it has been characterized 
as having low  productivity.1 Despite changes in the Tax Code, Georgia's informal sector remains 
significant especially in the foodstuffs, retail and wholesale, construction, and hot el and restaurant 
sectors where these firms often remain underproductive.2 
1.4.  Georgia continues to implement its structural reform agenda and focus on long -term 
development priorities, including a number of important infrastructure projects, e.g.  roads and 
communications networks. As part of its Country Partnership Framework with the World Bank during 
FYs 2019/22, Georgia is expected to focus on three key areas: enhancing inclusive growth and 
competitiveness, investing in human capital, and building resilienc e. 
1.5.  The COVID ‑19 pandemic and resulting shock have had a severe negative impact on the 
Georgian  economy, which depends largely on external drivers to sustain economic growth. Georgia 
has taken a number of steps to address the impact of COVID ‑19, including b y adopting several 
support and economic stimul us measures. According to the IMF, as of June  2021, the economy had 
impressive momentum for recovery and was expected to have a 7.7% rate of growth for  2021. 
However, these stimulus measures increased the fisca l deficit and a future fiscal consolidation is 
recommended, as anchored by the fiscal rule.3 
Table 1.1 GDP by sectoral activity, 2015 -20 
  2015  2016  2017  2018  2019  2020a 
Share of sectors in current GDP at basic prices (%)         
 Agriculture , forestry and fishing  8.8 8.3 7.2 7.8 7.4 8.4 
 Mining  and quarrying  1.2 1.2 1.2 1.2 1.4 2.0 
 Manufacturing  10.0 8.8 9.9 10.2 10.1 10.8 
 Electricity, gas, and water supply  2.8 3.0 3.1 3.3 3.2 2.9 
 Construction  7.6 8.8 9.1 8.3 8.5 8.9 
 Services, of which:  69.7 69.8 69.5 69.3 69.4 66.9 
 Wholesale and retail trade; repair of motor vehicles 
 and motorcycles  13.7 13.9 14.0 13.9 14.3 14.5 
 Transportation and storage  6.1 5.7 6.4 6.3 6.6 5.9 
 Accommodation and food service activities  3.4 3.3 4.1 4.6 5.2 3.1 
 Information and communication  3.1 2.9 2.8 2.8 3.1 3.1 
 Financial and insurance activities  5.8 5.7 5.9 6.1 5.1 4.9 
 Real estate activities  12.4 12.7 12.0 11.4 11.5 11.7 
 Public administration and defence; compulsory social 
 security  8.6 8.6 7.5 7.5 6.9 7.4 
 Education  4.8 4.7 4.6 4.5 4.4 4.6 
 Human health and social work activities  4.3 4.4 4.4 4.2 4.2 4.6 
 
1 World Bank (2018), Georgia: From Reformer to Performer .  
2 World Bank (2018), Georgia: From Reformer to Performer .  
3 IMF (2021), Georgia: Staff Concluding Statement of the 2021 Article  IV Mission . WT/TP R/S/420 • Georgia  
 
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    2015  2016  2017  2018  2019  2020a 
 Arts, entertainment and recreation  3.0 3.0 3.0 3.0 3.5 3.0 
GDP by economic activity (2015 prices, %  change)         
 Agriculture, forestry and fishing  -0.1 -2.8 -7.7 13.8 0.7 3.6 
 Mining and quarrying  34.9 4.8 2.8 3.4 8.2 1.5 
 Manufacturing  -12.6 3.7 1.7 4.1 1.3 0.0 
 Electricity, gas, and water supply  10.2 7.0 10.4 1.1 10.0 -8.6 
 Construction  23.0 10.7 5.8 -7.2 0.7 -4.7 
 Services, of which:  3.8 2.8 6.4 5.8 6.1 -7.4 
 Wholesale and retail trade; repair of motor vehicles 
 and motorcycles  -0.7 0.5 4.4 5.5 8.3 -5.6 
 Transportation and storage  5.5 -6.8 11.6 4.5 8.4 -22.3 
 Accommodation and food service activities  3.9 5.0 21.0 10.5 18.5 -37.9 
 Information and communication  6.4 -6.1 9.2 3.4 21.4 -0.7 
 Financial and insurance activities  8.5 9.0 15.5 11.6 -7.5 -5.0 
 Real estate activities  1.5 5.3 4.4 2.1 4.1 -0.1 
 Public administration and defence; compulsory social 
 security  2.1 2.8 -3.2 7.6 -1.6 1.8 
 Education  1.7 0.0 4.4 6.5 4.9 3.1 
 Human health and social work activities  18.6 4.9 8.3 2.5 6.8 7.9 
 Arts, entertainment  and recreation  13.1 3.0 5.7 7.6 22.1 -18.9 
a Preliminary data.  
Source:  National Statistics Office of Georgia, National Accounts . 
1.2  Recent Economic Developments  
1.6.  Georgia's economic  performance remained positive  and the economy continually expanded 
throughout 2015 -19, achieving an average growth rate of 4.1% in real GDP (Table  1.2). Strong 
policy measures and reforms coupled with liberal business and market access environments have 
been credited for this growth. But as in many other countries, Georgia's economic growth plummeted 
in 2020, declining by 6.2%, due to the COVID ‑19 pandemic. Georgia's situation was perhaps more 
severe compared to similar countries as it had more exposure to external shocks due to a high  
reliance on external trade, investment, and tourism for growth.  
1.7.  In addition to the high global uncertainty and challenging external environment, the COVID -19 
pandemic interrupted Georgia's positive economic growth and reversed other gains in reducing 
unem ployment and poverty. However, according to the authorities, the situation could have been 
more serious as Georgia managed to avoid significant losses by supporting economic activity and at 
the same time ensuring the health and safety of its citizens.  
1.8.  Despite Georgia's monetary policy keeping inflation in check at its target level of 3% 
(see Section 1.2.2), headline inflation remained much above 3% for about the last two -year period.4 
It generally remained between 3% and 7% but with higher levels reached i n the second  quarter  of 
2021. Recently, the IMF reported inflation accelerated to 11.9% in July 2021 based on the year -on-
year growth rate.5 According to the authorities, inflation has been largely driven by temporary 
factors, i.e.  global increases in foo d and fuel prices, higher international transportation costs, and 
higher utility fees in the local market. Inflation was expected to moderate as the one -off factors 
dissipated, along with a tightened policy stance.6 At the August 2021 Monetary Policy Comm ittee 
meeting, the National Bank of Georgia (NBG) further tightened monetary policy, by increasing the 
policy rate by 50  basis points to 10%, bringing the overall increase in 2021  to 2 percentage points 
in order to curb inflation expectations.  
 
4 NBG (2021), Current Macroeconomic Review: Analytical Tables and Charts , October.  
5 IMF (2021), Georgia: Staff Report for the 2021 Article  IV Consultation , IMF Country Report 
No. 21/215.  
6 Information provided by the authorities.  WT/TPR/S/420 • Georgia  
 
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  Table 1.2 Selected macroeconomic indicators, 2015 -20 
 2015  2016  2017  2018  2019  2020a 
Nominal GDP at market prices (GEL  billion)  33.9 35.8 40.8 44.6 49.3 49.4 
Nominal GDP at market prices (USD  billion)  14.9 15.1 16.2 17.6 17.5 15.9 
GDP per capita, USD  4,012.6  4,062.1  4,358.5  4,722.0  4,696.2  4,274.6  
Population (million)  3.7 3.7 3.7 3.7 3.7 3.7 
Unemployment rate (%)  21.9 21.7 21.6 19.2 17.6 18.5 
National accounts (% change at constant 2015 prices, unless otherwise indicated)  
GDP real growth rate  3.0 2.9 4.8 4.8 5.0 -6.2 
Final consumption expenditures  3.9 -3.1 6.3 5.1 7.0 5.4 
 Households and non-profit institutions 
serving households (NPISH)  3.8 -5.7 7.4 5.8 7.2 5.4 
 General government  4.4 10.9 1.1 1.6 5.7 5.7 
Gross capital formation  7.5 13.3 -2.3 6.5 -5.9 -3.4 
 Gross fixed capital formation  16.1 7.3 3.4 1.9 -0.1 -4.8 
Exports of goods and services  4.2 8.7 11.7 10.1 9.8 -38.2 
 Goods  0.0 7.9 10.7 16.5 15.6 -13.6 
 Services  9.6 9.5 12.6 4.3 4.0 -64.5 
Imports of goods and services  7.2 2.4 8.1 10.3 6.6 -17.4 
 Goods  7.6 1.7 7.2 8.4 4.3 -11.5 
 Services  5.2 5.3 11.6 17.2 15.4 -38.6 
General government finance (% of GDP)  
Revenue  26.4 27.0 26.8 26.5 26.2 25.1 
 Taxes, of which:  23.6 24.5 24.0 23.6 23.2 22.2 
 Income tax  6.6 6.7 7.2 7.3 7.1 6.7 
 Profit tax  3.0 2.9 1.9 1.7 1.8 1.9 
 VAT 10.3 9.2 10.1 9.9 10.6 9.8 
 Excise  2.6 3.0 3.6 3.3 3.1 3.3 
 Custom tax  0.2 0.2 0.2 0.2 0.2 0.2 
 Grants  0.9 0.8 0.7 0.8 0.9 0.8 
 Other revenue  1.9 1.7 2.1 2.2 2.2 2.1 
Total expenditure  27.4 28.3 27.6 27.2 28.9 34.4 
 Expense  24.1 25.5 23.7 21.5 22.0 27.1 
 Net acquisition of nonfinancial assets  3.3 2.9 3.9 5.7 7.0 7.2 
Net operating balance  2.3 1.5 3.1 5.0 4.2 -2.0 
Net lending (+) / borrowing ( -) -1.0 -1.3 -0.8 -0.7 -2.7 -9.3 
General government debt (end period)  38.6 42.1 41.0 40.4 41.8 59.9 
 Domestic debt  8.3 8.8 8.7 8.8 9.8 12.4 
 Foreign debt  30.3 33.3 32.4 31.6 32.0 47.5 
Money and interest rates  
Annual inflation (%)  4.0 2.2 6.0 2.6 4.9 5.2 
Monetary policy interest rate (end of period)  8.0 6.5 7.3 7.0 9.0 8.0 
Lending rate (%, end of period)  14.3 12.7 12.6 11.7 10.1 11.5 
 In foreign currency  10.3 8.7 7.9 7.6 6.3 6.9 
Deposit rate (%,  end of period)  5.7 4.5 4.4 5.7 6.4 6.3 
 In foreign currency  4.0 3.3 2.5 2.9 2.6 2.0 
Broad money (M3) (%  change)  17.3 21.1 14.6 13.9 17.6 24.6 
Loans to the national economy (% change)  29.3 14.7 23.5 17.9 19.7 19.7 
Dollarization ratio of deposits (included in 
broad money, %)  66.7 69.3 63.5 61.8 61.0 62.7 
External sector  
Current account (% of GDP)  -11.8 -12.5 -8.0 -6.8 -5.5 -12.4 
Trade (% of GDP)  98.8 96.9 104.0  111.8  118.2  93.7 
Workers net remittance (% of GDP)  3.9 3.8 4.6 4.9 5.2 7.4 
Workers net remittance (% change)  -22.8 -1.5 29.7 15.3 5.9 27.5 
International reserves, USD  billion  2.5 2.8 3.0 3.3 3.5 3.9 
 in months of goods and services imports  3.5 4.0 3.9 3.7 3.8 5.2 
GEL/USD  (period average)  2.3 2.4 2.5 2.5 2.8 3.1 
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   2015  2016  2017  2018  2019  2020a 
Nominal Effective Exchange Rate of GEL 
(% change: – depreciation)  -1.3 6.3 -2.4 3.7 -5.1 -4.2 
Real Exchange Rate Indices of GEL 
(% change: - depreciation)  -4.6 3.4 -2.2 1.0 -5.4 -2.9 
Gross external debt (% of GDP)  102.4  114.4  109.7  106.0  118.0  129.8  
FDI inward stock (% of GDP)  92.1 100.3  110.8  104.3  110.6  116.9  
FDI inward flows (% of GDP)  11.6 10.9 12.2 7.5 7.6 3.6 
a Preliminary data for figures related to GDP.  
Source:  NBG, Statistics ; and National Statistics Office of Georgia.  
1.9.  A number of  substantial economic reforms were adopted during the review period  (Box 1.1). 
By advancing new instruments for access to finance, implementing the new  insolvency framework, 
developing the local capital market, supporting energy security and independence, and promoting 
digitalization, Georgia hopes to further improve the business environment, increase private sector 
competitiveness, foster economic diversification, and boost economic growth and job  creation. The 
reform on dollarization was also seen as an i mportant step to stabilize the Georgian  economy as 
Georgia has traditionally had a high rate of dollarization that was considered a significant weakness. 
Thus, in 2017 Georgia enhanced the process of larization7, which is expected to increase monetary 
policy flexibilities as well as reduce the impact of external shocks.  
Box 1.1 Economic reforms, 2015 -21 
Capital market development  
The NBG and the Government continued efforts to support domestic capital market development, which has 
been a long -standing policy issue. In 2020, the "first generation" capital market regulatory framework was 
accomplished successfully. During the 2020 session of Parliament, Georgia adopted two  important laws: the 
Investment Fu nds Law (along with a corresponding tax framework) and amendments to the Securities Market 
Law. These changes together with new  supporting regulations streamline investment fund registration, asset 
management, and detailed prohibitions on market abuse and new definitions regarding qualified investors, as 
well as more robust transparency principles/requirements for issuers of publicly traded securities and code of 
ethics. Following these reforms, the NBG became a signatory to the International Organization o f Securities 
Commissions (IOSCO) MoU and a regular member in 2021. In 2021, continuation of the reform was expected 
to focus on more specialized areas, including a draft Law on Dematerialized Securities Holdings, a draft Law 
on Mortgage Covered Bonds, and an overhaul of the Private Pensions Law and the Securitization Law. As at 
September 2021, these had not yet been adopted.  
Insolvency reform  
The new Law on Rehabilitation and Collective Satisfaction of Creditors is expected to further improve the 
business and investment environment. Creation of an efficient insolvency framework has been a challenge for 
many years. In this regard, the Government, in close cooperation with international financial institutions, 
implemented an insolvency system reform,  which fundamentally changed the existing situation. In 
September  2020, Parliament approved a new insolvency law providing a resilient framework that would 
maximize recovery values, as well ensure adequate protection of creditor rights, timely and efficien t insolvency 
processes, and an effective rehabilitation framework in line with international best practices. The reform is 
expected to have important economic implications, including improvement of access to finance, development 
of capital and overall fina ncial markets, transparency and predictability of the business environment, 
protection of investors, increased productivity, and efficient utilization of economic assets.  
New Law on Entrepreneurs  
The new Law on Entrepreneurs, in line with international be st practices, aims to further improve the business 
and investment environment, provide an appropriate legal framework, increase transparency, and support an 
efficient regulatory framework for internal corporate relations and dispute resolution. The draft L aw on 
Entrepreneurs was submitted to Parliament and adopted on 13  August  2020; it entered into force 
in January  2021.  
Financial Collateral, Netting and Derivatives Law  
The purpose of the Law is to develop the derivatives market in Georgia, as well as esta blish the necessary 
regulatory legal framework for settlement, financial collateral, and derivatives. The Law allows Georgia to 
enter a new stage of development in capital markets, which are developing quite rapidly and successfully. By 
amending a number o f existing laws, it allows new enforcement mechanisms for derivatives transactions and 
also allows companies to hedge their risk exposure. The Law limits the use of derivatives to qualified market 
participants only. The provisions for netting are also an i mportant addition as they reduce capital requirements 
and give certain protections to foreign financial enterprises operating in Georgia.  
 
7 Larization is de -dollarization for the Georgian currency (lari).  WT/TPR/S/420 • Georgia  
 
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  PPP reform  
The new Public -Private Partnership (PPP) framework is expected to promote investment and enhance 
cooperati on between the State and the private sector, thus increasing efficiency and productivity of 
public  infrastructure and services. The Public -Private Partnership Law supports structural improvement of the 
economy through the development of an efficient framew ork for investments, as well as private sector 
participation in public infrastructure projects. Georgia has already developed a strong regulatory framework 
for implementing PPPs. In 2020, the Government made the PPP framework fully operational by approving  the 
Value -for-Money methodology following the recommendations of the IMF and incorporating it in the 
PPP Value -for-Money guidelines. The new PPP Law was enacted in May 2018.  
Development of alternative financing mechanisms  
Within the framework of Developm ent of Alternative Financing Mechanisms for MSMEs, the Government 
considers development of the Factoring and Leasing regulatory framework, in line with international  best 
practices, as an important tool to support private sector competitiveness.  
VAT refun ds 
The reform addresses flaws in the VAT refund system, under which a continued accumulation of new  VAT 
credits restricted business working capital. Since February 2019, the system has undergone gradual 
modification, and beginning in November 2020 a fully automatic refund system was implemented whereby 
excess VAT is automatically credited to taxpayers' bank accounts without sending a payment request. One of 
the recovery measures under the anti -crisis economic support package to address COVID -19-related 
challenges was the doubling of VAT refunds.  
Pension reform  
The pension reform that envisaged the defined contributory pension systems (II pillar) has been in effect since 
January  2019. Within the system, accumulation of contributions started in January  2019 a nd the number of 
participants exceed one  million. As at 2021, the total value of pension assets constituted GEL  1.3 billion. The 
capital market reform should provide greater investment opportunities for pension assets. The defined 
contributory pension syst em enjoys an exempt -exempt -exempt (EEE) tax regime, which means that 
contribution, accrued profit , and distributed pensions are exempt from taxes.  
Dollarization reform  
Since January 2017, effective steps have been taken to reduce dollarization in the coun try and, consequently, 
external vulnerability. A 10 -point Larization Plan has been developed, which includes a wide range of 
measures. It encourages savings in the country, reduces the vulnerability to exchange rate volatility, 
decreases over -indebtedness,  and supports monetary policy efficiency and resilience of the economy. The 
measures include the development of instruments to reduce dollarization, incentives to increase confidence in 
the national currency, adequate risk allocation, and prudential regula tions to increase the attractiveness of 
national currency.  
Profit tax reform  
Profit tax reform, enacted since 2017, follows the Estonian model of the profit tax, which means that 
undistributed profits are exempt from the profit tax. Reforms aim to promote access to financial resources, 
widen and modernize production, and increase liquidity for the private sector, thus boosting economic growth. 
Reforms allow the private sector to apply earned profits to new investments, expanding business activities,  
and creating additional jobs instead of paying taxes.  
Accounting and Audit reform  
The Government enacted the Law on Accounting, Reporting and Auditing as of June  2016. The Law brought 
some significant changes to the field and entities have been categoriz ed into four  classes according to their 
size, profitability, and number of employees. The reform aims to improve the auditing and accounting 
framework, and the transparency of enterprises.  
Source:  Information provided by the authorities.  
1.10.   In July 2021, Geo rgia's Ministry of the Economy and Sustainable Development announced its 
new 10 -year development strategy, Economy 2030, which had not been formally approved as at 
September 2021. It sets out a plan or a number of  priorities for Georgia during the next 10 -year 
period. The Government plans to provide financing, grants, or assistance to certain sectors in order 
to further propel development (Box  1.2). The agriculture, tourism, minerals, and energy sectors are 
the mai n focus areas.  WT/TP R/S/420 • Georgia  
 
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  Box 1.2 Economy 2030 key points  
- Economic growth should reach 5.2% in 2025 and 5% in 2030; with a decrease in the poverty rate to 14.9% 
in 2025 and 10.7% in 2030.  
- The number of countries cover ed by free trade agreements will increase, from 46 countries in 2020, 
51 by 2025, and 57 by 2030.  
- Plans for an increase in local production and exports and an increase in self -sufficiency rate by sector, 
e.g. the paint sector is expected to reach the hi ghest self -sufficiency at 69%, then pharmaceuticals at 57%.  
- Intensive support for priority sectors that have significant potential for export growth and import substitution 
by providing loan co -financing, loan guarantees, grants, and loans.  
- Programmes for agro - and eco -tourism development, including loans, co -financing, and loan guarantees.  
- Programme to promote housing for families through access to mortgages by co -financing the loan amount.  
- Promotion of the stable development of tour ism through new infrastructure projects.  
- The development of the transport infrastructure with a total investment of more than GEL  3 billion.  
- Promotion of an innovation -based and connected economy through intranet development and grants to 
start-ups. 
- Development of the energy sector with investment of USD  3.8 billion by 2030.  
- By 2030, about GEL  2 billion in state property will be privatized.  
- Due to the potential of the mineral sector, various extraction projects are planned.  
- Reforms are pla nned for capital markets, state -owned enterprises, and the energy and minerals sectors.  
Source:  Ministry of Economy and Sustainable Development  (MESD) , Economy 2030 . 
1.2.1   Impact of COVID ‑19, mitigation measures by the Government, and outlook  
1.11.   In April 2020 after the first lockdown due to the COVID‑19 pandemic , the Government 
implemented its six -stage re -opening plan, and due to favourable conditions, the economy was 
opened more quickly than planned. At the same time, economic support policy mea sures were 
introduced and significant recovery was observed during the period May -September 2020 as 
domestic demand and external trade improved. Thereafter, a rise in cases involved new measures 
that weakened the recovery. According to the IMF, Georgia too k appropriate steps to alleviate the 
adverse economic and social impact of the shock given the pronounced economic slowdown.8 
1.12.   Georgia devised a range of targeted fiscal, monetary, and financial market policy measures 
to support business sector competitive ness, aid the most vulnerable groups of society, and 
strengthen social safety nets. The initial support measures included postponement of property and 
income taxes for tourism and related sectors, delayed bank loan payments for entrepreneurs and 
citizens f or three months, and interest -rate subsidies to small and medium -sized hotels.9 In addition, 
the Government covered utility payments for vulnerable households for four months and subsidized 
some commodity imports so as to avoid price increases for basic c onsumption products.10 The 
Government also introduced a wheat subsidy that was discontinued recently, resulting in about a 
10% increase in the price of bread in July  2021.  
1.13.   Afterwards, a more targeted and comprehensive economic support package was introduce d 
as part of the efforts to aid the recovery, i.e. the Anti -Crisis Plan. This initiative involved more social 
support measures and various state subsidies to the business sector, including for example 
strengthened access to finance, processes to overcome l iquidity shortcomings, and several sectoral 
policy actions, in particular for the tourism, agriculture, and construction sectors. In 2020, 
GEL 3.6 billion was allocated through the Plan (Table 1.3). Approximately one third of the budgeted 
amount (GEL  1,040  million) was for a double tax refund by introducing a fully automated refund 
system, GEL  594 million for increasing the liquidity of banks, GEL  383 million for the utility tax 
subsidy, and GEL  316 million for the income tax credit. Several specific strate gies were devised as 
well, in particular for some of the sectors most severely impacted, such as tourism and 
 
8 IMF Country Report No.  21/215.  
9 NBG (2021), Monetary Policy Report : The NBG Forecast ; and information provided by the authorities.  
10 Utility payments were covered for the period November 2020 through February 2021. In addition, the 
Government subsidized an incremental part of the electricity fee for all of 2021 for most of the population.  WT/TPR/S/420 • Georgia  
 
- 19 - 
 
  agriculture  (Box 1.3). To provide this financial support for COVID ‑19 and the associated plans, 
Georgia received significant funding from internati onal and bilateral organizations, donors, and 
supporters. For example, USD  250 million was secured through the World Bank's COVID ‑19 
Response Project, the Asian Development Bank (ADB) supplied USD  400 million, and the IMF and 
the European  Union about USD  200 million each.11 
1.14.   According to the NBG, after the economic downturn as a result of the COVID ‑19 pandemic 
in 2020, the economy is expected to grow by  8.5% in 2021, driven mainly by domestic demand in 
lieu of the weak external sect or.12 In the medium term, growth is expected around 5%,  sustained 
mainly by infrastructure spending and structural reforms to increase productivity. As of 
first quarter  2021, recovery was underway and economic activity improved as domestic and external 
demand increased. The NBG expects export growth, both goods and services, to reach 20% in  2021 
and 13% for imports.  
Table 1.3 Main measures budgeted by the Anti -Crisis Plan due to COVID ‑19, 2020  
(GEL million)  
Measure Amount  
Healthcare  417.8  
Procurement of anti -virus materials  156.7  
Reimbursement of treatment costs  77.8 
Availability of COVID ‑19 vaccine  16.7 
Medical infrastructure improvements  68.7 
Quarantine services  97.9 
Social protections  918.0  
Public utility subsidies  382.7  
Cash compensation for socially vulnerable families  64.7 
Cash compensation for persons with disabilities  26.0 
Social assistance for children under 18  187.8  
Cash compensation for hired persons  131.2  
Cash compensation for entrepreneurs  110.8  
Social assistance financing for vulnerable students of higher education  14.8 
Business support  636.4  
Income tax credit  315.5  
Tax exemption for the tourism sector  48.7 
Measures to support the small, medium and family hotel/restaurant industry  51.2 
Credit  guarantee scheme  47.0 
Promoting the construction sector  9.0 
Promoting Micro and Small Entrepreneurship - Small Grants  2.5 
Agricultural support  162.4  
 -Including wine sector promotion  104.3  
Additional packages to support the economy  1,634.0  
Increasing the liquidity of commercial banks  594.0  
Refunds of tax (doubled)  1,040.0  
 Total  3,606.4  
Source:  Ministry of Finance , The Spread of the New Coronavirus COVID ‑19 in Georgia and the Response to 
Fiscal Policy. Viewed at: https://www.mof.ge/images/File/2020 -shesrulebis%20angarishebi/12 -
Tve/danartebi/9.COVID -is%20danarti.docx . 
 
11 StopCoV.ge, Measures Implemented by the Gover nment of Georgia Against COVID ‑19: Report . 
Viewed at: https://stopcov.ge/Content/files/COVID_RESPONSE_REPORT__ENG.pdf . 
12 Information provided by the authorities; and NBG (2021) , Monetary Policy Report: The NBG Forecast .  WT/TP R/S/420 • Georgia  
 
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  Box 1.3 Main COVID ‑19-related plans and measures, 2020 -21 
Anti-Crisis Plan  - Main overall economic recovery plan including provisions on imports, 
prevention against price spikes, utility subsidies, etc.  
Anti-Crisis Plan on Tourism 
Revival  - Four months of income and property tax deferral; small hotels receive 
subsidies for 80% of interest payments for six months; benefits for 
employees and self -employed persons; subsides for retained jobs; 
exemption from property tax and deferral of  income taxes; bank loan 
subsidies; subsidies for international tourism fairs, etc.  
Anti-Crisis Plan on Agriculture  - Up to 80% grants in the dairy sector; co -financing of loans and 
agricultural insurance; grants for introducing international standards; 
discounted fuel prices; supports for irrigation and drainage services; 
subsidizing seed, chemicals, and fertilizers of small farmers; co -financing 
of agricultural equipment and greenhouses; grants for cooperatives, etc.  
Anti-Crisis Plan on Healthcare  - Financial assistance provided to socially unprotected families, disabled 
persons, employees no longer receiving salaries, and self -employed 
persons.  
Anti-Crisis Plan on Education  - Provisions related to distance learning, "TV School" project, etc.  
Anti-Crisis Plan on the 
Development Sector  - State subsidies on mortgage loan interest; underwriting of mortgage 
loans; acquisition of residential units; temporary support for unfinished 
construction; escrow account for support of the development sector.  
Source:  StopCoV.ge, various reports. Viewed at: https://stopcov.ge/en/Gegma . 
1.2.2   Monetary policy  
1.15.   The NBG through its Monetary Policy Committee acts independently in making policy and 
implementing monetary policy deci sions for Georgia based on its main directions on monetary policy 
as approved by Parliament and as governed by the Organic Law of Georgia on the National Bank of 
Georgia . Ensuring long -term economic growth is at the core of Georgia's monetary policy. The N BG's 
key role of maintaining price stability implies a predictable rate of inflation. As such, Georgia has set 
its inflation target at 3% , which  is also envisaged as being its long -term target; 3% is formalized for 
2021-23 by the Main Directions of Monetary  Policy submitted to Parliament .13 Short -term 
movements outside this target are acceptable, especially in cases of shocks. Most recently, in the 
first half of 2021, headline inflation reached 12% in response to a strong recovery and mainly due 
to exchange rate depreciation and higher commodity and food prices.14 
1.16.   The NBG uses the refinancing rate as its main monetary policy instrument for ensuring price 
stability; it is set by the Monetary Policy Committee. Its specific instruments include, inter ali a, 
refinancing loans, one -month open market instruments, certificates of deposit, treasury bond 
auctions, overnight loans and overnight deposits, and minimum reserve requirements.  
1.17.   Georgia has operated a floating exchange rate regime since 2009, which has b een particularly 
important for its small economy to remain flexible and minimize market interventions. Foreign 
exchange auctions, along with rule -based interventions, are the main policy the NBG uses if it needs 
to intervene in the foreign exchange market.  However, in 2019, the NBG also used a new monetary 
policy instrument, currency options, in order to fill its international reserves.  
1.2.3   Fiscal policy  
1.18.   Georgia's overarching fiscal policy emphasizes fiscal discipline and the Government follows 
consistent reduc tion of the fiscal deficit. At the same time, its prudent fiscal management during 
most of the last decade has turned to an increase in spending more recently to improve its social 
safety net and improve infrastructure, e.g. roads. Since  2017, the Governme nt's mid -term 
budgetary plan has incorporated a fiscal policy that reduces administrative costs, creates a friendly 
tax system for economic growth, and increases the effectiveness of budget  programs and the 
investment in infrastructure projects.15 
 
13 In 2015 -16, it was set at 5%, then 4% in 2017.  
14 IMF Country Report No.  21/215.  
15 Ministry of Finance, Fiscal Risk Analysis, 2019 -2023. Viewed at: 
https://www.mof.ge/images/File/publications/FRS_2019_ENG.pdf . WT/TPR/S/420 • Georgia  
 
- 21 - 
 
  1.19.   Georgia' s fiscal revenues remained largely unchanged throughout the review period, and 
although falling slightly in 2020 remained stable (Table 1.2). Revenues from the major taxes, 
i.e. income, VAT, and excise, all remained stable and despite reforms to the income  tax regime 
during the period, these revenues also did not change significantly and slightly increased thereafter. 
During  most of the review period, government debt averaged 41% of GDP but then climbed to 
60% in 2020, reflecting increased spending due to t he many fiscal measures put in place related to 
the pandemic (Tables 1.2 and 1.3).  
1.20.   Georgia's fiscal policy is guided by its Law on Economic Freedom, which defines and 
sets macroeconomic threshold parameters. For example, it specifies that government debt s hould 
not exceed 60% of GDP and that the consolidated budget deficit ratio to GDP shall not exceed 3%. 
However, the COVID ‑19 pandemic resulted in certain parameters being outside these thresholds as 
Government debt to GDP reached 60% and the budget deficit  to GDP reached 9.3%16; therefore, 
the state of emergency provision in paragraph  7 of Article  2 of the Law was triggered for the 2020 -22 
budget with plans to return back to thresholds by 2023.  
1.21.   During the review period, the Government was in the process of strengthening surveillance 
and management of state-owned enterprises (SOEs) , which was acknowledged as a weakness and 
one of the largest sources of fiscal risk. The Economy 2030 initiative cont ains initiatives on SOEs 
and plans for further privatization during 2021 -30. In addition, the Ministry of Finance planned 
comprehensive SOE  reform with the help of partner organizations to address these matters and 
establish a unified register of SOEs.17 The Government adopted the Corporate Governance Code for 
Public Corporations in September 2021 that incorporates best practices of corporate governance as 
provided in OECD Guidelines and the Ministry of Finance has elaborated an SOE Reform Strategy 
document  that is expected to be publicly available in fourth quarter 2021. Reform of public -private 
partnerships (PPPs) was also being pursued due to similar concerns over potentially large fiscal 
liabilities.  
1.22.   The financing of various stimuli measures to aid the e conomy during the crisis caused by the 
pandemic is expected to have a significant impact on the 2020 and 2021 budgets. As Georgia turned 
to outside sources of finance, the external debt grew accordingly. However, the Government did 
undertake budgetary redu ctions from March 2020 to help mitigate the situation. For example, 
administrative, representation, and business trip expenses were limited; fuel costs were significantly 
reduced; and vacancies were left unfilled. Many programmes that were not implemented or 
postponed were reduced, often due to pandemic constraints, e.g. tourism infrastructure 
development projects have been curbed.  
1.2.4   Current account and balance of payments  
1.23.   Throughout most of the last decade, Georgia maintained persistent current account defic its 
that more recently started to decline (in absolute terms and as a percentage of GDP), thus reaching 
the lowest level since 2000 of 5.5% of GDP in 2019. This can be attributed to the significant growth 
in tourism, export revenues, and remittances that w ere higher than expected in  2019. However, this 
consistent progress was eroded in 2020 due to the economic consequences of the COVID ‑19 
pandemic that have been particularly devastating to the tourism sector. Thus, the current account 
deficit was back up to  its highest deficit level in the last decade in 2020 at 12. 4% of GDP or 
USD 1.9 billion (Chart 1.1, Tables 1.2 and A1.7).  
1.24.   During most of the period, the significant negative merchandise trade balance was the largest 
negative component of the current accou nt balance. There were significant surpluses in services 
trade that were partially, but increasingly offsetting, thus a narrowing of the current account deficit 
occurred. The primary income component of the current account remained in deficit throughout th e 
period and slightly increased in recent years due to an increase of distributed dividends and 
reinvested earnings from investments. An increase in private remittances was the main contributing 
factor to the growth of the secondary income component of the  current account. A  significant 
increase in private remittances occurred in 2020 and continued into 2021; it increased in the first  half 
of 2021, by 35% over the same period in  2020, mainly from the European  Union and 
 
16 Augmented deficit according to the IMF programme definition.  
17 Ministry of Finance, Fiscal Risks Statement: State Owned Enterprises, PPP Projects, Natural Disasters , 
December 20 20. Viewed at: https://www.mof.ge/images/File/publications/2021/22 -01-
2021/FRS_ENG_2020_Dec.pdf . WT/TP R/S/420 • Georgia  
 
- 22 - 
 
  Ukraine  (Chart  1.1). Throughout 2015 -19, the current account deficit was largely financed 
by FDI (Chart  1.1).18 
1.25.   In 2020, the merchandise trade deficit narrowed slightly due to decreases in both domestic 
and external demand. Although both imports and exports of goods declined as a result, the i mpact 
was greater on imports than exports, thus the decline in the balance. Despite the overall reduction 
in merchandise exports, domestic exports increased slightly. The services trade balance was only 
slightly positive in 2020 due to the lack of tourism receipts on account of pandemic -induced travel 
restrictions.  
Chart 1.1 Current account balance, 2014 -20 (% of GDP)  
 
Source:  NBG, Statistics . 
1.3  Developments in Trade and Investment  
1.3.1   Trends and patterns in merchandise and services trade  
1.3.1.1   Merchandise trade  
1.26.   Georgia's merchandise exports grew steadily over the period by about 50% from  2015 levels, 
while imports also grew, but at a much slower rate (10%). Nevertheless, there remained a significant 
merchandise tra de deficit of USD  4.7 billion in 2020, although it contracted slightly from 
USD 5.1 billion in 2015. Georgia remained heavily reliant on imported manufactured goods, whereas 
exports were increasingly of primary products, i.e. food and minerals. This trend intensified over the 
period, thus the movement towards less value -added product exports. The IMF and the World Bank 
noted that exports have remained rather resilient during the pandemic but are still rather 
unsophisticated.19 Due to its geographical locati on and transport connections, Georgia serves as an 
important transit corridor to several of its landlocked neighbours in particular. As such, merchandise 
trade figures are amplified due to significant amounts of re -exports, which increased over the period 
although there were significant yearly fluctuations, i.e.  accounting for between 31% -63% of 
domestic exports in any given year.  
1.27.   There were some shifts in the product composition of exports and destination countries. The 
export of mining or mineral products  significantly increased during the review period from 21% 
to 27% of merchandise exports (Chart 1.3 and Table A1.1). This is mainly attributed to the 
significant increase in copper ore and concentrate exports (Table A1.2).20 Exports of manufactured 
 
18 NBG, Annual Report 2019 . 
19 IMF Country Report No.  21/215; an d World Bank (2021), Macro Poverty Outlook: Georgia.  
20 Part of the exported copper ores and concentrates are produced in Georgia but a large part originated 
from other countries and were imported under the customs procedure of processing and thereafter exp orted.  
-14.0%-12.0%-10.0%-8.0%-6.0%-4.0%-2.0%0.0%
-40.0%-30.0%-20.0%-10.0%0.0%10.0%20.0%30.0%
2014 2015 2016 2017 2018 2019 2020Goods Services Primary income Secondary income Current account (right-scale)Chart 1. [GEO] Current account balance (% of GDP) 
Source: National Bank of Georgia, Statistics. Viewed at: https://www.nbg.gov.ge/.WT/TPR/S/420 • Georgia  
 
- 23 - 
 
  goods r emained overshadowed by primary product exports (food and mining) during the period.21 
Chemicals and iron and steel exports in particular faced a decline likely due to lower external demand 
during the pandemic. However, a gradual and significant increase i n transportation equipment 
exports occurred, but this was nearly entirely accounted for by re -exports. Re -exports of motor 
vehicles are substantial as Georgia has long served as the regional hub for vehicle imports due to 
its close geographic location to E urope, its sea ports, and its simplified customs procedures for 
vehicle imports (Table A1.1 and A1.2).22 In terms of markets, Georgia is most reliant on the EU and 
Commonwealth of Independent States (CIS)  regions for the majority of its exports, each accou nting 
for about one third of its total exports over the period. Georgia exported significantly fewer products 
to EU countries, Germany and Italy in particular, in 2020 compared to 2015, whereas exports grew 
mainly to China, the Russian  Federation, and Azer baijan over the same period (Chart  1.2, 
Tables  A1.3 and A1.4).  
Chart 1.2 Direction of merchandise trade, 2015 and 2020  
 
a Commonwealth of Independent States, including certain associate and former member States.  
Source:  WTO Secretariat calculations, based on National Statistics Office of Georgia, External Trade . 
 
21 Food exports remained the largest export category, but unchanged at 28% of total merchandise 
exports during the period. The exports of wine, hazelnuts, and water were most notable.  
22 Information provided by the authorities.  
CIS 
35.4%Middle East 3.7%
China 14.3%
Other 4.7%
United 
States 
2.4%
EU-27
20.8%
Switzerland 
3.2%Turkey 5.7%CIS 
38.6%
Azerbaijan
13.2%Russian 
Federation
13.2%
Ukraine 6.5%Armenia 5.6%Other CIS 
6.6%
Azerbaijan 7.4%Other CIS 
2.4%
Russian 
Federation
8.6%Armenia 2.4%Middle East 
2.2%
China 8.8%
United 
States 
6.9%
EU-27
23.0%Turkey 17.5%CIS 
25.1%Russian 
Federation
11.0%Azerbaijan 6.4%Armenia 5.2%
Ukraine 
4.8%Other CIS 
2.5%Chart 1.[GEO] Direction of merchandise trade, 2015 and 2020
2015 2020
Exports including re -exports (f.o.b.)
Other CIS 
8.9%
Imports (c.i.f.)
Middle East 4.6%
Ukraine 6.2%Total: USD 2,204.2 million Total: USD 3,343.2 million
Total:  USD 7,304.2 million Total: USD 8,052.9 millionOther 8.8%
Other
11.6%EU-27
28.3%
EU-27
27.3%Armenia 8.2%
Ukraine 2.7%
Other  
11.5%China 8.0%China 5.7%
United States 4.7%
Turkey 8.5%Russian 
Federation
7.4%
Azerbaijan
10.9%
United States 
3.5%
Turkey 18.2%CIS 
20.7%Middle East 4.4%
Switzerland 
1.4%
WTO Secretariat calculations, based on National Statistics of Georgia, External Trade. Viewed at:   
https://www.geostat.ge/en/modules/categories/35/external -trade.Source:a          Commonwealth of Independent States, including certain associate and former member states.a
a
aaWT/TP R/S/420 • Georgia  
 
- 24 - 
 
  1.28.   Imports remained stable over the review period, and there were few noticeable changes in 
the direction or composition of imports (Charts 1. 2 and 1.3, Tables A1.5 and A1.6). Manufactured 
goods remained the dominant import category during the period, accounting for 64% of 2020 
imports with nearly equal amounts of machinery, transport equipment, and chemicals imported 
(Chart  1.3). There were sig nificant imports of raw copper ores and concentrates from neighbouring 
countries that were processed or blended in Georgia and exported mainly to the EU market.23 In 
terms of primary products, the importation of food is significant, accounting for about 15 % of 
merchandise imports, and also fuels, accounting for 12%. Imports from the United  States increased 
slightly over the period, while imports from the European  Union, in particular Bulgaria and Romania, 
slightly declined.  
Chart 1.3 Product composition of merchandise trade, 2015 and 2020  
 
Note:  Based on SITC Rev. 3.  
Source:  WTO Secretariat calculations, based on National Statistics Office of Georgia, External Trade . 
 
23 Information provided by the authorities.  
Chart 1.[GEO]  Product composition of merchandise trade, 2015 and 2020
20152020
Exports including re -exports (f.o.b.)
Other semi -
manufactures
2.7%Manufactures
48.0%
Mining 
27.2%Wine of fresh grapes 6.3%
Non-alcoholic 
beverages 4.4%
Spirits 4.0%
Edible nuts 
2.8%
Other agri. 
11.0%
Copper ores and 
concentrates
23.3%
Other mining
3.9%Iron and steel
8.3%Chemicals
8.2%Other semi -
manufactures
2.6%Machinery 
2.4%Transport 
equipment
14.0%Other manf.
5.9%
Agriculture 
28.5%
Total: USD 2,204.2 million Total: USD 3,343.4 million
Imports (c.i.f.)
Chemicals
11.5%Transport  
equipment
8.7%
Manufactures
63.0%Electrical 
machines  
9.3%
Non-electrical 
machinery  
8.2%Fuels
17.0%
Other mining 
4.1%Fuels
11.9%
Other 
mining 
8.5%
Iron & steel
3.2%Electrical
machines
7.3%
Other semi -
manufactures
10.2%Chemicals
13.0%Manufactures
64.2%
Total: USD 7,304.2 million Total: USD 8,052.9 millionOther manf.
6.4%
Other manf. 
10.6%Other manf. 
11.6%Edible nuts 
8.0%
Manufactures
41.3%
Iron and steel
11.1%
WTO Secretariat calculations, based on National Statistics of Georgia, External Trade. Viewed at:   
https://www.geostat.ge/en/modules/categories/35/external -trade.Mining 
21.1%
Other semi -
manufactures
9.7%Mining 
20.8%
Agriculture
15.2% Agriculture
15.5%
Transport 
equipment
13.3%Chemicals
14.4%Other 2.8%
Iron & steel
4.0%Non-electrical 
machinery
6.7%Other mining
8.5%
Mining 
20.3%Copper ores and 
concentrates
12.3%
Other 
0.2%Other 
0.3%Agriculture 
28.4%Wine of fresh grapes 4.4%
Non-alcoholic beverages 4.6%
Spirits 2.9%
Other agri. 
8.4%Transport 
equipment
10.4%
Machinery 3.0%Other 3.0%
Source:Note:      Based on SITC Rev. 3. WT/TPR/S/420 • Georgia  
 
- 25 - 
 
  1.3.1.2   Services trade  
1.29.   Georgia's services trade continued to generate significant trade surpluses throughout most of 
the period with exports approximately twice the value  of imports (Table 1.4). However, this changed 
significantly in 2020 as a result of the COVID ‑19 pandemic when travel receipts fell precipitously 
from USD  3.3 billion in 2019 to 0.5 billion in 2020. Despite this fall, the services trade balance stayed 
marginally positive at USD  130 million in 2020.  
1.30.   Georgia's services statistics over the period clearly demonstrate its heavy reliance on the 
tourism sector, as travel and transport services comprised over 90% of services exports during most 
of the period (Table  1.4). There were significant gains in travel service exports during  2015-19, 
i.e. from USD  1.9 billion to 3.3 billion or a 75% increase, before falling in 2020.24 Most tourists in 
Georgia are from regional neighbours, with Armenia, Azerbaijan, Turkey, and  the Russian  Federation 
the most prevalent during the review period; thus they accounted for a significant share of Georgia's 
services  receipts.25 Transport services were the second -largest category of exports during the period 
and while the transport of p ersons declined significantly in  2020, the transport sector was buoyed 
by freight, or merchandise transport, which was more resilient to the pandemic, thus underscoring 
the importance of Georgia as a transit corridor in the region.  
1.31.   By comparison, imports o f services were more stable as they grew more modestly over the 
early part of the period, i.e. 44%, and declined less steeply in 2020, i.e. by 40%. Imports were also 
dominated by the travel and transport sectors, although slightly more diversified as they accounted 
for about 70% -80% of services imports over the period. The transport of merchandise was the most 
significant subcategory of transport services. Insurance and pension services, as well as other 
business services, were the other significant categor ies for imports of services.  
Table 1.4 Trade in services, 2015 -20 
(USD million)  
  2015  2016  2017  2018  2019  2020  
Trade balance  1,404.1  1,571.8  2,024.3  2,243.8  2,175.8  124.2  
Exports  3,087.1  3,313.0  3,990.1  4,490.1  4,600.5  1,580.1  
 Manufacturing services on physical inputs 
 owned by others  18.8 17.3 13.0 7.0 14.1 2.8 
 Maintenance and repair services n.i.e.  2.6 0.2 1.5 0.7 0.1 0.0 
 Transport  952.1  919.9  959.7  973.9  1,006.7  698.0  
 Passenger  181.4  203.9  267.2  295.6  282.1  43.6 
 Freight  525.1  482.3  469.8  457.6  509.3  509.3  
 Other  241.8  229.2  217.7  215.2  209.2  139.2  
 Extended classification        
  Sea transport  169.0  159.8  134.7  126.8  121.4  107.3  
  Air transport  191.0  206.7  271.7  296.2  283.2  56.4 
  Other modes of transport  588.2  548.9  548.2  545.4  596.1  528.4  
 Rail transport  129.6  87.5 66.7 56.9 72.6 68.6 
 Road transport  131.9  142.6  170.5  184.7  206.0  134.3  
 Pipeline transport and electricity 
 transmission  326.8  318.8  311.0  303.8  317.5  325.5  
 Postal and courier services  3.8 4.4 5.0 5.4 6.1 5.9 
 Travel  1,868.5  2,110.7  2,704.3  3,222.1  3,268.7  541.7  
 Business  726.1  668.1  794.2  918.9  891.7  154.7  
 Personal  1,142.4  1,442.7  1,910.1  2,303.1  2,377.0  387.0  
 Construction  9.2 9.8 5.7 4.6 5.1 7.2 
 Insurance and pension services  18.2 13.5 11.8 11.3 12.0 12.6 
 Financial services  11.0 13.1 16.6 19.9 23.5 19.3 
 Charges for the use of intellectual property  
 n.i.e. 0.6 0.8 0.3 0.3 0.9 1.0 
 Telecommunications, computer, and 
 information services  45.0 56.2 89.9 84.6 113.8  113.8  
 Telecommunications services  39.6 29.6 28.2 35.3 46.3 39.7 
 Computer services  4.5 7.2 40.1 42.6 62.6 67.9 
 Information services  0.9 19.4 21.6 6.7 4.9 6.2 
 Other business services  58.5 61.5 70.5 50.3 49.9 82.3 
 Research and development services  1.5 2.1 0.5 0.6 1.0 2.9 
 Professional and management consulting 
 services  15.1 20.0 26.2 16.6 19.4 23.8 
 
24 According to the MESD, international visitors dropped by 80% in 2020 compared to 2019.  
25 National Statistics Office of Georgia, Inbound Tourism, Distribution by Country of Citizenship . WT/TP R/S/420 • Georgia  
 
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    2015  2016  2017  2018  2019  2020  
 Technical, trade -related, and other 
 business services  41.9 39.4 43.7 33.1 29.5 55.6 
 Personal, cultural, and recreational services  14.0 15.3 18.7 17.0 14.9 19.0 
 Government goods and services n.i.e.  88.7 94.6 98.3 98.4 90.8 82.4 
Imports  1,683.0  1,741.2  1,965.8  2,246.3  2,424.7  1,455.9  
 Manufacturing services on physical inputs 
 owned by others  0.4 0.3 0.6 1.7 1.1 1.0 
 Maintenance and repair services n.i.e.  7.2 4.6 3.6 3.5 5.9 6.4 
 Transport  956.9  957.0  1,082.0  1,257.9  1,276.4  809.8  
 Passenger  279.4  320.5  389.2  435.4  466.7  111.8  
 Freight  642.2  602.6  654.6  784.3  767.8  676.1  
 Other  34.3 32.7 36.6 36.4 40.1 19.9 
 Extended classification        
  Sea transport  305.1  257.2  271.9  309.5  321.2  274.4  
  Air transport  212.6  231.7  277.5  332.7  352.3  109.7  
  Other modes of transport  438.1  466.8  531.0  613.9  601.0  423.7  
  Rail transport  61.4 89.4 108.1  132.3  102.1  100.0  
  Road transport  376.7  377.5  422.9  481.6  498.9  323.7  
 Postal and courier services  1.1 1.3 1.5 1.9 1.9 2.0 
 Travel  329.6  386.3  463.6  524.7  657.2  180.5  
 Business  198.7  259.3  320.2  330.7  433.2  95.8 
 Personal  130.9  127.0  143.4  194.0  224.0  84.7 
 Construction  10.2 10.0 8.9 9.9 7.1 12.7 
 Insurance and pension services  127.0  121.7  121.9  133.3  117.3  97.0 
 Financial services  11.7 17.3 19.8 22.0 23.4 26.9 
 Charges for the use of intellectual property  
 n.i.e. 7.0 19.5 24.7 27.1 40.7 54.9 
 Telecommunications, computer, and 
 information services  39.9 50.4 59.6 83.2 85.1 80.1 
 Telecommunications services  24.1 28.0 30.9 44.5 35.4 33.2 
 Computer services  13.4 15.2 23.6 33.3 42.1 38.4 
 Information services  2.4 7.2 5.1 5.5 7.6 8.5 
 Other business services  109.9  87.2 102.6  93.6 131.8  123.9  
 Research and development services  0.4 1.8 0.8 0.5 1.8 0.9 
 Professional and management consulting 
 services  27.0 28.3 34.2 31.9 49.6 38.1 
 Technical, trade -related, and other 
 business services  82.5 57.2 67.6 61.2 80.4 84.9 
 Personal, cultural, and recreational services  11.3 9.8 10.5 14.3 14.3 8.3 
 Government goods and services n.i.e.  71.8 77.1 68.0 75.1 64.4 54.4 
Source:  NBG, Statistics . 
1.3.2   Trends and patterns in FDI  
1.32.   According to UNCTAD's World Investment Report 2021, global flows of FDI in 2020 were 
severely hit by the COVID ‑19 pandemic and they fell by about one third, with new infrastructure 
projects in developing countries being particularly impacted. The region of transition economies of 
South -East Europe, the CIS, and Georgia were hit harder than other regions a nd world averages due 
to certain vulnerabilities, thus inflows tended to fall by more than half.26 The situation in Georgia 
with respect to  FDI mirrored this trend and was perhaps even more dire. While FDI inflows averaged 
USD 1,595  million during 2015 -19, they fell to USD  617 million in 2020 or by 53% from the 
previous  year (Table 1.5). The main reasons for the decline were the COVID ‑19 pandemic, the 
transfer in ownership of several companies from non -residents to residents, and the completion of 
a pipeline project.27 Preliminarily figures from first quarter 2021 indicate this decline continued, to 
USD 125.4 million, or a 53% decrease compared to the same period in 2020.  
1.33.   The main sources of FDI during the period were the European  Union, in particular  
the Netherlands and the United Kingdom, followed by Turkey. Azerbaijan was also a significant 
source of FDI during the early part of the period, but this gradually decreased and turned negative 
in 2020, reflecting significant FDI outflows due to completio n of large infrastructure projects. 
FDI inflows from the United  States, albeit starting from a low base, increased steadily over most of 
the period before falling slightly to GEL  93 million in 2020, thus becoming the fourth -largest source 
of FDI. In terms of sectors, the transport, financial, and energy areas attracted the most 
 
26 UNCTAD (2021), World Investment Report 2021 . 
27 Civil.ge, 2020 FDI in Georgia USD  616.9 Mln, Down by 52.9% , 11 March 2021. Viewed at: 
https://civil.ge/archives/404941 . WT/TPR/S/420 • Georgia  
 
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  FDI during  2015-20, with 2020 being a particularly positive year for financial sector inflows while 
many other sectors had declining inflows (Table 1.5). The financial sector was res ilient during the 
pandemic and also benefited from reinvestments, thus its FDI position remained strong. The most 
negatively impacted sector in  2020, resulting in disinvestment due to the COVID ‑19 pandemic, was 
the hotel and restaurant sector, which demons trated outflows of USD  249 million in 2020.  
Table 1.5 FDI flows by selected partners, 2015 -20 
(USD million)  
 2015  2016  2017  2018  2019  2020  Average 
2015 -20 
FDI flows in Georgia  1,728.8  1,654.0  1,980.8  1,317.1  1,335.8  572.0  1,431.4  
By main origin         
 EU-27 417.2  327.8  558.5  416.8  426.9  333.1  413.4  
 Netherlands  164.9  77.3 355.3  211.6  88.1 200.7  183.0  
 Luxembourg  127.3  115.7  100.7  50.1 68.8 21.6 80.7 
 Czech  Republic  16.7 87.5 129.1  75.5 17.6 -7.0 53.2 
 Ireland  28.1 29.4 10.0 25.1 1.2 45.9 23.3 
 Malta  0.8 -0.4 0.2 3.2 133.2  0.7 23.0 
 Azerbaijan  581.7  555.1  460.5  246.7  38.9 -16.4 311.1  
 United Kingdom  399.3  87.8 249.0  182.9  236.9  303.0  243.2  
 Turkey  74.9 220.3  256.2  49.2 174.2  79.0 142.3  
 United  States  18.9 59.8 79.1 105.0  115.6  98.4 79.5 
 Russian  Federation  52.4 28.5 51.3 74.3 55.2 39.2 50.2 
 United Arab Emirates  36.6 55.3 147.1  33.9 26.3 -12.7 47.7 
 China  66.9 25.5 19.4 76.0 43.8 -35.5 32.7 
 Korea, Rep. of  29.9 29.7 36.2 32.7 22.4 2.0 25.5 
 Switzerland  0.7 7.1 35.7 49.4 -3.8 -8.3 13.5 
 Israel  37.7 2.5 6.7 -1.5 22.3 8.6 12.7 
 Other countries  12.6 254.4  81.0 51.7 177.2  -218.6  59.7 
By sector         
 Agriculture, fishing  18.6 9.6 14.1 -1.4 6.3 -1.8 7.6 
 Mining  88.0 49.7 51.8 61.4 52.4 98.8 67.0 
 Manufacturing  104.7  123.6  99.5 171.6  117.3  35.5 108.7  
 Energy sector  123.7  145.1  279.0  123.1  261.4  -7.8 154.1  
 Construction  144.4  176.6  177.3  175.2  46.0 33.3 125.5  
 Hotels and 
 restaurants  170.2  119.9  109.5  82.3 123.4  -249.5  59.3 
 Transports and 
 communications, of 
 which:  608.2  662.8  524.9  163.5  127.1  62.7 358.2  
 Transports  607.5  575.7  475.5  203.7  55.0 12.8 321.7  
 Communications  0.7 87.1 49.5 -40.3 72.1 49.9 36.5 
 Health and social 
 work 140.3  31.3 7.9 15.8 18.8 10.6 37.4 
 Real estatea 94.4 55.1 222.5  133.7  8.6 90.3 100.8  
 Financial sector  201.6  124.1  308.8  274.0  272.1  404.4  264.2  
 Other sectorsb 34.7 156.2  185.5  117.9  302.5  95.6 148.7  
a Real estate, renting, and business activities.  
b Trade; education; and other community, social and personal service activities.  
Source:  National Statistics Office of Georgia, Foreign Direct Investments .  
1.34.   Georgia's FDI stock, while gradually increasing throughout most of the period with 
positive  inflows, reversed that trend in 2020 and declined to USD  18.6 billion (Table 1.6). However, 
it did not fall precipitously and remained above the average level durin g the period due to the 
significant gains in the early part of the period, i.e. from USD  13.8 in 2015 to 19.3  billion in 2019.  
1.35.   In order to  help mitigate the recent trend in FDI, the Government launched a new programme 
in November  2020 to promote FDI in Georgia.28 The FDI grant programme through Enterprise 
Georgia offers cash back of up to GEL  1 million to enterprises in targeted sectors29 that invest at 
 
28 Enterprise Georgia, The State Grant Program – FDI Grant , 19 November 2020. Viewed at: 
http://www.enterprisegeorgia.gov.ge/en/News/the -state-program -fdi-grant . 
29 The sectors include production of electrical and electronic engineering products; manufacturing of 
aircraft parts and components; manufacture of vehicles and equipment, as well as their parts; export of 
business services/business process outsourcing (BPO) ; developing warehouses and logistic centres; and 
aircraft repair and maintenance (MRO).  WT/TP R/S/420 • Georgia  
 
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  least GEL  10 million and create a minimum of 150 jobs.30 It was expected that the programme would 
promote the growth of FDI and also create an inflow of technology. Beyond the direct support for 
investors, the FDI grant program me is also a too l to raise more awareness among investors about 
the potential of Georgia in the targeted sectors.  
Table 1.6 FDI stock in Georgia, 2015 -20 
(USD million)  
 2015  2016  2017  2018  2019  2020  Average  
2015 -20 
FDI stock in Georgia  13,771.7  15,188.4  17,995.6  18,344.7  19,325.5  18,566.5  17,198.7  
By main origin         
 EU-27 4,747.9  4,804.6  5,368.9  5,691.4  6,227.0  5,981.3  5,470.2  
 Netherlands  2,344.9  2,232.2  2,666.4  1,715.8  1,767.1  1,724.5  2,075.1  
 Luxembourg  697.4  780.0  894.6  930.5  976.2  959.0  872.9  
 Cyprus  365.4  393.9  292.7  1,269.7  1,227.0  1,033.3  763.7  
 Czech  Republic  244.5  303.9  429.2  489.5  479.6  434.6  396.9  
 Malta  177.6  202.4  215.6  291.4  609.9  569.1  344.3  
 Azerbaijan  2,733.4  3,293.3  3,760.0  4,003.4  4,035.2  4,008.3  3,638.9  
 United Kingdom  1,433.8  1,848.5  2,750.4  2,507.4  2,475.6  2,422.1  2,239.6  
 Turkey  715.2  883.5  1,142.0  1,093.9  1,210.8  1,208.4  1,042.3  
 United Arab Emirates  645.7  733.7  855.3  879.6  886.6  901.7  817.1  
 China  589.7  602.3  622.9  688.8  716.6  659.6  646.6  
 United  States  323.7  355.5  430.9  516.2  605.6  647.9  480.0  
 British Virgin Islands  431.0  476.0  468.3  393.4  277.3  190.9  372.8  
 Russian  Federation  213.2  241.7  300.0  347.0  390.0  399.5  315.2  
 Switzerland  169.7  187.5  224.8  256.9  237.3  239.4  219.2  
 Panama  132.4  195.7  217.6  281.1  330.3  83.9 206.8  
Source:  National Statistics Office of Georgia, Foreign Direct Investments . 
 
 
30 For companies operating in the field of BPO, the minimum amount of investment is GEL  5 million with 
a creation of at least 200 new jobs.  WT/TPR/S/420 • Georgia  
 
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  2  TRADE AND INVESTMENT REGIMES  
2.1  General Framework  
2.1.  Since the previous Review, amendments to Georgia's Constitution and Electoral Code have 
entailed several important changes. First, there was a change from a semi -presidential to a 
parliamentary system. Second, steps were taken to replace the mixed, majoritarian -proportional 
electoral method of electing Parliament with full proportional representation.  
2.2.  The period saw the culmination of  a process that was launched in the early 2010s to reduce 
the role of the President.1 Constitutional amendments adopted in 2017 -182 replaced the system of 
election of the President through direct election by popular vote with a system of indirect electio n 
by an Electoral College composed of 300 members, including members of Parliament and 
representatives of local and regional governments.3 The President will be elected without prior 
debate through open ballot and will serve for a term of five years, whic h can be renewed only once. 
The eligibility age for President was raised from 35 to 40.4 
2.3.  The amendments also reduce the scope of presidential powers. The President is the head of 
state, the guarantor of the country's unity and national independence, and the supreme commander 
in chief of the defence forces of Georgia, and represents Georgia in foreign relations.5 However, the 
President no longer ensures "the functioning of state bodies within the scope of his/her powers 
granted by the Co nstitution" and no longer has the right "to request particular matters to be 
discussed at the Government session and participate in the discussion". Furthermore, the National 
Security Council, led by the President under the previous Constitution, is replac ed by a National 
Defence Council, which will function only during martial law to coordinate the work of constitutional 
bodies and which will consist of the President, the Prime Minister, the Chairperson of Parliament, 
and the Head of the Armed Forces.6  
2.4.  The Government, led by the Prime Minister, is the supreme body of the executive branch and 
is accountable and responsible to Parliament. The 2017 constitutional changes provide that the Prime 
Minister organizes the activities of the Government and appoints and dismisses Ministers. The Prime 
Minister is accountable for the activities of the Government before the Parliament. S/he will present 
the annual report on the implementation of the government programme to Parliament.7 
2.5.  A second key aspect of constitutional change during the review period concerned the mode of 
election of Parliament. The existing system of mixed, majoritarian -proportional representation has 
been characterized as prejudicial to pluralism as it tended to lead to an overwhelming m ajority of a 
single party.8 The constitutional changes made in 2017 -18 provide that as from 2024  Parliament will 
be elected based on a system of fully proportional representation.9 Undistributed mandates will be 
allocated proportionately among the partie s that clear a 5% threshold. Electoral blocs will no  longer 
be allowed. Members of Parliament nominated by one political party can only form one political 
 
1 The Constitution of 1995 d efined Georgia as a presidential republic. As noted in the previous Review, 
constitutional amendments that entered into force in 2013 distributed the presidential powers between the 
Prime Minister and Parliament. The President remained head of state and co mmander -in-chief but could 
no longer initiate draft laws, suspend acts issued by the Government, or convene emergency sessions of 
Parliament. The amendments rolled back the concentration of powers granted to the presidency in  2004 and 
increased the role of  Parliament regarding the direction and execution of foreign and domestic policies. 
WTO document WT/TPR/S/328/Rev.1, 18 March 2016, para.  2.5. 
2 A process of constitutional reform was initiated in December 2016 with the creation of a 
State  Constitutional C ommission. Constitutional amendments adopted in October 2017 and March  2018 
entered into force in December  2018.  
3 The provisions regarding the indirect election of the President will apply as from 2024. The 
November  2018 presidential election was the last  election held under the previous direct system.  
4 Constitution, as amended, Article  50. Civil.ge, New Constitution Enters into Force , 17 December  2018. 
Viewed at: https://civil.ge/archives/271293 . 
5 Constit ution, as amended, Article  49. 
6 Civil.ge, New Constitution Enters into Force , 17 December 2018.  
7 Constitution, as amended, Articles 54 -55. Civil.ge, New Constitution Enters into Force , 
17 December  2018.  
8 European Commission for Democracy through Law (Ve nice Commission), Georgia – Opinion on the 
Draft Constitutional Amendments Adopted on 15 December 2017 at the Second Reading by the Parliament of 
Georgia , CDL -AD(2018)005, 19 March 2018, p. 4.  
9 Constitution, as amended, Article  37(2).  WT/TP R/S/420 • Georgia  
 
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  faction. The age requirement to be elected to Parliament was increased from 21 to 25  years.10 
However , these changes were subject to several transition rules stipulating that the 2020  
parliamentary election would be held using the mixed electoral system, with voters electing 
73 members of Parliament in majoritarian single -seat constituencies and the remai ning 77  seats 
distributed proportionally in the closed party contests. The threshold for entering Parliament would 
be reduced to 3%, and parties would be allowed to form electoral blocs.11 
2.6.  Further constitutional amendments adopted in June 2020, designed to  implement an 
agreement reached by Georgia's political parties in March 202012, changed the composition of 
Parliament for the 2020 election to 120 proportional and 30 majoritarian seats. The threshold for 
parties to enter Parliament was lowered to 1% and a  rule introduced providing that no party earning 
less than 40% of the votes may claim a majority. These rules will apply until 2024, when the electoral 
system will become fully proportional.13 Discussions on electoral reform continued in  2021 as part 
of efforts to overcome the political stalemate that arose after the October  2020 parliamentary 
elections.14 In June 2021, Parliament adopted a package of 20 electoral legislation reforms relating 
to the electoral system, electoral administration, pre -election c ampaigns, voting procedure, counting 
procedures, and election disputes.15 The reforms were based in part on the political agreement of 
19 April 2021.16 
2.7.  Parliament is responsible for ratification of international treaties, while the executive is 
responsible  for implementation. In the case of certain categories of international treaties, decisions 
by Parliament to ratify, or denounce and annul, the treaty must be adopted by a majority of at least 
three fourths of the total number of its members, whereas for o ther treaties such decisions are to 
be taken by a majority of the total number of its members.17 
2.8.  International agreements ratified by Parliament, including the WTO  Agreement , have 
precedence over domestic laws and other acts in Georgia apart from constitut ional law.  
2.9.  Following the adoption of the 1995 Constitution, a legal system was established with a 
constitutional court and a three -level system of common courts: district or first instance courts; 
appellate courts where decisions of first instance courts c an be appealed; and the Supreme Court, 
which is the final instance court for administering justice.18 The functioning of the judiciary has 
attracted criticism19 and is the subject of ongoing reform efforts, including the election of judges to 
the Supreme C ourt. 
 
10 Any citizen of Geo rgia having the electoral right, who has attained the age of 25, and who has lived in 
Georgia for at least 10 years may be elected as a Member of Parliament.  
11 Civil.ge, New Constitution Enters into Force , 17 December 2018.  
12 Council of Europe, Statement o f the Political Dialog Facilitators on Agreement , 8 March 2020. Viewed 
at: https://www.coe.int/en/web/tbilisi/ -/statement -of-the-political-dialog -facilitators -on-agreement -march -8-. 
13 Civil.ge, Georgian Parliament Passes Constitutional Changes on Electoral Reform , 29 June 2020. 
Viewed at: https://civil.ge/archives/357537 . 
14 See e.g. Venice Commission, Georgia – Joint Urgent Opinion on Draft Amendments to the Election 
Code, CDL -AD(2021)022, 5 July 2021; Venice Commission, Georgia – Urgent Joint Opinion on Revised Draft 
Amendments to the Elec tion Code,  CDL-PI(2021)011, 18 June 2021. Agenda.ge, Venice Commission, ODIHR 
Advise "More Holistic Approach", Stability of Changes in Georgian Election Code , 19 June 2021. Viewed at: 
https://agenda.ge/en /news/2021/1670 . 
15 Agenda.ge, Parliament Adopts Electoral Amendments, Two Opposition Factions Refuse to Vote , 
29 June 2021. Viewed at: https://agenda.ge/en/news/2021/1772 . 
16 A Way Ahead for Georgia , 19 April 2021. Viewed at: 
https://gd.ge/uploads/news_attachment/e2306079e2a55be27.pdf . The political agreement of 19  April 2021 
aims to, inter alia , "[e]nd the current political dispute  and advance Georgia's democratic and rule of law 
agenda through political, judicial and anti -corruption reforms". The agreement defines concrete measures to be 
taken regarding electoral reform, rule of law/judicial reform, power sharing in Parliament, and  future elections.  
17 Constitution, as amended, Article  47. The constitutional amendments made in 2017 -18 changed the 
special rule for certain categories of treaties from two thirds to a three fourths majority.  
18 It was noted in the last Review that "[t]he  inefficiency of the judicial system and weak capacity of the 
courts are factors in the feeble protection of property rights and poor settlement of commercial disputes" and 
that the Government recognized the need to reinforce the independence of the judici ary. WTO document 
WT/TPR/S/328/Rev.1, 18 March 2016, para.  2.8. 
19 European Commission and High Representative of the Union for Foreign Affairs and Security Policy, 
Association Implementation Report on Georgia , 5 February 2021, SWD(2021) 18 final, p. 7 (Not ing 
that "important challenges remain with regard to the independence and accountability of the WT/TPR/S/420 • Georgia  
 
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  2.10.   The constitutional amendments of 2017 -18 require that judges of the Supreme Court be 
nominated by the Higher Council of Justice, instead of by the President, and then be appointed until 
retirement by Parliament.20 While judges are to be selected base d on their competence and integrity, 
it has been observed that there are no clear qualification criteria or transparent procedure by which 
the Council must act, and the way the Council nominates candidates has generated controversy.21 
The political agreeme nt of 19  April 2021 provides for several steps to be taken to reform the Higher 
Council of Justice and change the rules for the appointments of judges to the Supreme Court.22 
2.11.   Another aspect of the judiciary that has given rise to concerns about lack of ind ependence is 
the role of the Prosecutor General.23 Pursuant to the political agreement of 19  April 2021, Parliament 
recently initiated constitutional changes to require a vote of a qualified majority for the appointment 
of the Prosecutor General.24 
2.12.   Georgia 's laws provide for the right to appeal administrative rulings on matters subject to 
WTO provisions to an independent tribunal, in conformity with WTO obligations. The Tbilisi Municipal 
Court has jurisdiction to hear such appeals.  
2.13.   There are a number of web  portals where all trade -related draft laws and regulations are 
published, e.g. http://www.parliament.ge/  and http://www.dcfta.gov.ge/ge/legislation . All adopted  
legal instruments are published in official sources, notably the official gazette, the Legislative Herald 
of Georgia ( http://www.matsne.gov.ge25), and the Governme nt's website ( http://www.gov.ge ). 
2.2  Trade Policy Formulation and Objectives  
2.14.   Georgia applies WTO provisions uniformly throughout the customs territory controlled by the 
Government, including in regions engaging in border trade or frontier traffic, special economic zones, 
and other areas where special regimes for tariffs, taxes, and  regulations are established. The parts 
of the country under central government control are divided into 10 regions headed by governors 
and the capital city of Tbilisi headed by a mayor. The Government continues to not have customs 
control over the region of Abkhazia and the Tskhinvali region/South  Ossetia, due to the existing 
situation in these regions.26 
2.15.   The Ministry of Economy and Sustainable Development (MESD) determines, implements, and 
coordinates trade policy through its Department for Foreign Trade Policy. The Department closely 
cooperates with several trade -related bodies under the Ministry, collaborates with other relevant 
entities27, including in the private sector, and is responsible for the submission of notifications to the 
WTO.  
2.16.   The Trade Advis ory Group, created in 2016, is an advisory body composed of the Deputy 
Minister of Economy and Sustainable Development and representatives of the private sector working 
on trade -related matters. It elaborates recommendations on Georgia's trade matters and presents 
the propositions and prospects of their implementation to the Minister of Economy and Sustainable 
Development. Within the Trade Advisory Group, a special Advisory Group was created on the Deep 
and Comprehensive Free Trade Area (DCFTA) agreement be tween Georgia and the 
 
judiciary").  OECD  (2020), OECD Investment Policy Reviews: Georgia , p. 11 (noting that "[s]ustained 
momentum is needed for systemic judicial reform to build inve stor confidence in the court system").  
20 Constitution, as amended, Article  61. 
21 Bertelsman Stiftung, BTI 2020 Country Report – Georgia, pp. 11-12. The Venice Commission recently 
issued several opinions on proposed amendments to the Law on Common Courts regarding the rules for the 
appointments of judges to the Supreme Court. See, for example, Venice Commission, Georgia -Urgent Opinion 
on the Ame ndments to the Organic Law on Common Courts , CDL -PI(2021)007, 28 April 2021.  
22 A Way Ahead for Georgia , 19 April 2021, p. 5.  
23 The 2017 -18 constitutional amendments stipulate that the Prosecutor General will perform separately 
from the Ministry of Justice and serve as an independent body accountable to Parliament and will be elected by 
Parliament, for a term of six years. Constitution, as amended, Article  65. 
24 Agenda.ge, Ruling Party, Opposition Agree on Electoral Constitutional Amendments Proposed by 
EU Mediation , 28 June 2021. Viewed at: https://agenda.ge/en/news/2021/1765 . 
25 Normative acts acquire legal effect once posted on matsne.gov.ge.  
26 See paragraph 3 of Section 1 and paragraph 11 of Section 2 of the Secretariat Report of the 
2009 Trade Policy Review of Georgia (WTO document WT/TPR/S/224/Rev.1, 19 January 2010).  
27 While there is no formal mechanism for inter -agency coordination, the MESD acts as a coordinator 
and ensures cooperation among other line agencies.  WT/TP R/S/420 • Georgia  
 
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  European  Union  (Section 2.3.2), composed of 10 members representing various business councils 
and associations, sectoral unions, trade chambers, and international organizations.28 Its purpose is 
to support the effective implementation  of the agreement and the full engagement of the civil sector, 
in particular by deliberating and consulting on current and planned reforms and legislative and 
institutional changes relating to this agreement.  
2.17.   The authorities indicate that the broad objecti ves of Georgia's trade policy remain largely 
unchanged from the previous Review: integration into the world economy, including implementation 
of WTO  membership obligations as well as obligations under other agreements, notably the 
Association Agreement wit h the European  Union; continued trade policy liberalization; facilitation of 
export and import procedures and streamlining of regulations on non -tariff barriers; and 
diversification of trade relations by establishing preferential regimes with the country's  main trading 
partners. The main objective of the Social -economic Development Strategy of Georgia: 
Georgia  2020, adopted in June 2014, is sustainable and inclusive economic growth that benefits 
most of the population, to be achieved through private sector growth, supported by an efficient and 
transparent government, respect for property rights, openness to trade, and integration with 
international financial markets. The Strategy emphasizes the need for growth and diversification of 
exports and Georgia's geo graphic potential as a trade and logistics hub to link Asia and Europe 
via the Caucasus. The objective of political and economic integration with the European  Union 
remains a cornerstone of Georgia's 2020 strategy, and, as a consequence, the implementation  of 
the reforms mandated by the DCFTA is considered an integral part of the policy agenda. During the 
review period, most legislative changes in the area of trade and trade -related matters resulted from 
Georgia's  obligations under the DCFTA to approximate the EU acquis . 
2.18.   In July 2021, the Government presented a 10 -year economic development strategy called 
Economy  2030 (Section 1.2, Box 1.2). To maintain a high rate of economic growth, the strategy 
aims to increase domestic production and exports. Specificall y, the new strategy aims to double 
exports in the next five years and increase self -sufficiency by at least 20%. As part of the Produce 
in Georgia State Program, the new Business Export and Import -Replacement Program identifies 
certain sectors that have th e potential for export growth and import replacement on the local market 
and that will benefit from certain support schemes. The sectors at issue are manufacture of 
pharmaceutical products; chemical production; manufacture of some building materials; produ ction 
of primary products of metal, plastic, rubber, and glass; textile industry and footwear 
manufacturing; manufacture of electrical installations and components; production of animal feed 
and feed mantles; manufacture of auto parts and other vehicles or  parts thereof; manufacture of 
medical instruments; furniture production; marine fishing; and software production.29 
2.3  Trade Agreements and Arrangements  
2.3.1   WTO  
2.19.   Georgia accepted the Trade Facilitation Agreement (TFA) on 4  January  201630, the 
Declaration on the Expansion of Trade in Information Technology on 22  June 2016, and the Protocol  
Amending the TRIPS  Agreement on 21  November  2018. Georgia has observer status in the 
Committee on Government Procurement.  
2.20.   Georgia closely follows recent discu ssions on WTO reform and has been actively engaged in 
the Joint Statement Initiatives on micro, small and medium -sized enterprises31, electronic 
 
28 MESD, DCFTA Coordination . Viewed at: https://dcfta.gov.ge /ge/coordination . 
29 Agenda.ge, Economy Minister Presents 10 -year Development Plan. What Does It Include? , 
6 July 2021. Viewed at: https://agenda.ge/en/news/2021/1864 . 
30 With respect to Georgia's notificat ions of its commitments under the TFA, see WTO documents 
WT/PCFT/N/GEO/1, 2 February 2016; and G/TFA/N/GEO/2, 31 July 2018. A National Trade Facilitation 
Committee was recently established to coordinate the implementation of the TFA and future related acti vities. 
Georgia's implementation of the TFA is reflected in recent policy initiatives and reforms with respect to customs 
infrastructure development, construction of customs clearance zones, increased border control in cooperation 
with other relevant entit ies, the establishment of risk -based management system, and the introduction of 
customs  data automation system (Section 3.1).  
31 The Government adopted a strategic document on the development of SMEs, which stipulates a 
detailed action plan and scope of act ivities. A number of agencies with particular focus on SME development 
were established to ensure their increased integration into global markets, thus contributing significantly to 
sustainable and inclusive growth.  WT/TPR/S/420 • Georgia  
 
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  commerce32, investment facilitation, and services domestic regulation. In the context of dispute 
settlement and  the impasse related to the Appellate  Body, Georgia has been very supportive in the 
endeavours towards the swift resolution of the matter. Georgia closely followed all the related 
developments, including the establishment of the Multi -Party Interim Appeal Arbitration 
Arrangement, which would serve as a temporary dispute settlement mechanism in the WTO.  
2.21.   During the period January 2016 -June 2021, Georgia submitted 53 notifications to WTO bodies 
covering agriculture, anti -dumping, import licensing, regional tra de agreements, rules of origin, 
sanitary and phytosanitary measures, services, state trading, subsidies and countervailing 
measures, technical barriers to trade, trade facilitation, and quantitative restrictions (Table A2.1). 
As at 30  June 2021, several no tifications were outstanding with respect to import licensing, customs 
valuation, and subsidies. The authorities inform that the outstanding notifications on import licensing 
will be submitted shortly.  
2.22.   Georgia was not involved in any WTO dispute during the  review period.  
2.3.2   Regional and preferential agreements  
2.23.   Georgia is a party to 16 regional trade agreements: Armenia -Georgia; Azerbaijan -Georgia; 
China -Georgia; Commonwealth of Independent States  (CIS); European Free Trade 
Association  (EFTA) -Georgia; European  Union -Georgia; Hong  Kong,  China -Georgia; GUAM 
participating States (Georgia, Ukraine, Azerbaijan, and the Republic of Moldova); Kazakhstan -
Georgia; the Republic of Moldova -Georgia; the Russian  Federation -Georgia; Turkey -Georgia33; 
Turkmenistan -Georgia; Ukraine-Georgia; the United Kingdom -Georgia; and Uzbekistan -Georgia.34 
The agreements with China; the EFTA; Hong  Kong,  China; and the United Kingdom were concluded, 
and entered into force, during the review period.  
2.3.2.1   European  Union  
2.24.   The Association Agreement con cluded in 2014 between Georgia and the European  Union and 
its member States35 has as one of its objectives Georgia's gradual economic integration into the 
EU Internal Market, in particular through the establishment of the DCFTA, which will provide for 
far-reaching market access on the basis of sustained and regulatory approximation in compliance 
with WTO rights and obligations.36 The DCFTA provides for tariff elimination on all goods immediately 
upon its entry into force, and for further opening of the serv ices markets and improvement of 
establishment conditions for investors.37 Title IV, which establishes a free trade area, contains 
chapters on national treatment and market access for goods; trade remedies; technical barriers to 
trade; sanitary and phytosanitary measures; customs and trade facilitation; establishment, trade in 
services, and electronic commerce; current payments and movement of capital; public procurement; 
intellectual property; competition; trade -related aspects of energy; transparency; trade and 
sustainable development; and dispute settlement.38 
2.25.   The DCFTA requir es Georgia to approximate its legislation to the EU acquis , and in some cases 
international rules and best practices, in the areas of technical regulations, standards, and 
conformity assessment; sanitary and phytosanitary measures; customs law; trade in se rvices; and 
public procurement.39 Annexes to the Association Agreement define in detail  the specific elements 
of the EU acquis  covered by Georgia's approximation obligations and the procedures, method, and 
 
32 Georgia recently elaborated a new draft law on e -commerce (Section 4.4.2.4).  
33 Negotiations were opened in 2016 with a view to amending the Turkey -Georgia FTA (2008) by further 
liberalizing trade in goods and covering trade in services.  
34 WTO Regional Trade Agreements Database. Viewed at: 
https://rtais.wto.org/UI/PublicSearchByMemberResult.aspx?membercode=268 . 
35 The Association Agreement was notified to the Committee on Regional Trade Agreements and to t he 
Council for Trade in Services in WTO document WT/REG354/N/1 and S/C/N/745, 3 July 2014. The text of the 
Association Agreement is available at: https://eur -lex.europa.eu/legal -
content/en/TXT/PDF/?uri=CELEX:22014A0830(02) . The Association Agreement ceased to apply to the 
United  Kingdom on 31 December 2020. WTO document WT/REG/GEN/N/10, 1 March 2021.  
36 Association Agreement, Article  1(h). 
37 WTO document WT/REG354/N/ 1 and S/C/N/745, 3 July 2014.  
38 See, for details, the WTO Secretariat's Factual Presentation on the DCFTA, circulated to the 
Committee on Regional Trade Agreements in WTO document WT/REG354/1, 13 April 2015.  
39 Association Agreement, Articles 47, 55, 75, 10 2, 113, 122, 126, and 146.  WT/TP R/S/420 • Georgia  
 
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  timetable for the approximation. The DCFTA provide s for regular discussions in the Association 
Committee in Trade Configuration to facilitate assessment of Georgia's approximation to the 
EU acquis , and for an assessment of approximation by the European  Union.40 According to the 
authorities, Georgian legis lation has already been approximated to 154 EU legal acts, which accounts 
for about 52% of total commitments. Georgia adopted several national action plans for the 
implementation of the DCFTA: Action Plan for the Implementation of the DCFTA 2014 -17; 
Georgi a's Action Plan for the Implementation of DCFTA 2018 -20; and Georgia's Action Plan for the 
Implementation of DCFTA  2021-23.41 
2.26.   Under the DCFTA, products (except for garlic under quota) originating in Georgia enjoy 
duty-free market access to the European  Union. According to the authorities, exports to the 
European  Union have increased by 31% since 2014, amounting USD  819.3 million in 2020, while 
the number of companies exporting to the European  Union has increased by 51% since 2014 and 
amounted to 849. In 201 4-20, awareness of Georgian products in the European  Union increased 
significantly, and new products such as kiwi, dried lemon, persimmon, black currant, apple, quince, 
fruit jam, honey, fish products, animal furniture, glass bottles, and plastic utensils were introduced. 
Several studies note that the DCFTA has not yet entailed a significantly more diversified structure 
of exports to the European  Union.42 
2.27.   As from 1  January  2017, the visa -free travel regime for Georgian visitors to the 
European  Union entered  into force and citizens of Georgia with a biometric passport no longer 
required visas for travel to the Schengen area for up to 90 days. This was the result of Georgia's 
implementation of the Visa Liberalization Action Plan pursuant to the Visa Liberaliza tion Dialogue 
launched between the European  Union and Georgia in 2012.43 
2.28.   According to the Government Program 2021-2024: Toward Building a European State 
document, adopted in December 2020, a key government task is "ensuring the readiness of the 
country's  economy for officially applying for EU membership by 2024".44 
2.3.2.2   Agreements with other partners  
2.29.   The Free Trade Agreement (FTA) between Georgia and EFTA States was concluded on 
27 June 2016 and entered into force between Georgia and Iceland and Norwa y (including Svalbard 
and Jan Mayen Islands) on 1  September  2017, and between Georgia and Switzerland and 
Liechtenstein on 1  May 2018.45 It establishes a free trade area between, on the one hand, the 
 
40 Association Agreement, Articles 273 and 275. See, for example, European Commission,  Joint Report 
on the Seventh EU -Georgia Association Committee in Trade Configuration , 3-4 February 2021. Viewed at: 
https://trade.ec.europa.eu/doclib/docs/2021/march/tradoc_159454.pdf ; and European Commission and High 
Representative of the Union for Foreign Affairs and Security Policy (2021), Association Implementa tion Report 
on Georgia . Viewed at: https://www.euneighbours.eu/en/east/stay -informed/publications/association -
implementation -report -georgia. 
41 These action plans are available at: http://www.dcfta.gov.ge/en/implementation . The dedicated web 
portal ( http://www.dcfta.gov.ge/en/home ) aims to provide complete and up -to-date practical and legal 
information about the DCFTA to customers, entrepreneurs, and other interested parties, in both Georgian and 
English. The website is administered by the MESD and ai ms to: (i)  support all interested parties in obtaining 
information about the benefits, opportunities, and advantages provided by the DCFTA; (ii)  provide information 
to interested parties about EU grants and other financial aid programmes that are carried o ut within the 
DCFTA; and (iii)  provide information to interested parties regarding implemented reforms and legislative 
initiatives. The website provides interested parties, including NGOs and the private sector, with an opportunity 
to submit their comments  or proposals to relevant competent authorities regarding the legislative acts and 
projects to be adopted under the framework of the DCFTA.  
42 For example, I.  Guruli (2020), Georgia -EU Integration – Progress Made so far and Steps to Move 
Forward.  Viewed at:  https://osgf.ge/en/publication/georgia -eu-integration -progress -made -so-far-and-steps -to-
move -forward/ ; and European Parliamentary Researc h Service (2020), Association Agreement between the 
EU and Georgia – European Implementation Assessment (update). Viewed at: 
https://www.europarl.europ a.eu/thinktank/en/document.html?reference=EPRS_STU(2020)642820 . 
43 European Commission, Visa Liberalisation with Moldova, Ukraine and Georgia . Viewed at: 
https://ec.europa.eu/home -affairs/what -we-do/policies/international -affairs/eastern -partnership/visa -
liberalisation -moldova -ukraine_en . 
44 Government of Georgia (2020), Government Program 2021 -2024: Toward Bui lding a 
European  State,  p. 18. Viewed at: http://extwprlegs1.fao.org/docs/pdf/geo199988.pdf . 
45 The Agreement was notified to the Committee on Regional Trade Agreements and to the Council for  
Trade in Services in WTO documents WT/REG386/N/1 and S/C/N/891, 30 August 2017. The text of the 
Agreement is available at: http://www.efta.int/free -trade/free -trade -agreements/ge orgia. WT/TPR/S/420 • Georgia  
 
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  individual EFTA States and, on the other, Georgia, and d oes not apply to trade relations between 
the individual EFTA States. The FTA consists of 13 chapters and 16 annexes, covering trade in goods, 
sanitary and phytosanitary measures, trade in services, establishment, protection of intellectual 
property, govern ment procurement, competition, trade and sustainable development, institutional 
provisions, and dispute settlement. The FTA aims to eliminate customs duties on imports and exports 
of all types of industrial goods, including fish and other marine products o riginating to or from any 
of the Parties. It provides tariff concessions on both basic and processed agricultural products 
covered by the bilateral Annexes to the Agreement. 46 With the entry into force of this FTA, 89% of 
Georgia's tariffs became duty -free for imports from Iceland, 94% of its tariffs became duty -free for 
imports from Norway, and 95.5% of its tariffs became duty -free for imports from Switzerland.47 
2.30.   The FTA between Georgia and China was concluded on 13  May 2017 and entered into force 
on 1 January  2018.48 It includes provisions on trade in goods, rules of origin, customs procedures 
and trade facilitation, sanitary and phytosanitary measures, technical barriers to trade, trade 
remedies, trade in services, environment and trade, competition, int ellectual property, investment, 
electronic commerce, transparency, institutional provisions, and dispute settlement.49 Each Party 
has undertaken to progressively reduce or eliminate customs duties on originating goods of the other 
party. The authorities no te that since the entry into force of this FTA, exports to China have increased 
significantly.50 The conclusion of an FTA with China was closely related to Georgia's participation in 
the Belt and Road Initiative, pursuant to a Memorandum of Understanding s igned in 2015.51 
2.31.   The FTA between Georgia and Hong  Kong,  China was concluded on 27  June 2018 and entered 
into force on 13  February  2019.52 It contains provisions on trade in goods, rules of origin, customs 
procedures and trade facilitation, technical barrie rs to trade, sanitary and phytosanitary measures, 
trade remedies, electronic commerce, establishment, intellectual property, competition, trade and 
environment, transparency, institutional provisions, and dispute settlement.53 Each Party undertakes 
to elim inate all customs duties on originating goods of the other party as from the date of entry into 
force of the FTA, except Georgia's elimination of customs duties will not apply to products listed in 
its Exclusion list, which mainly contains agricultural pro ducts.  
 
46 For details, see the WTO Secretariat's Factual Presentation in WTO document WT/REG386/1, 
15 January 2019.  
47 WTO document WT/REG386/1, 15 January 2019.  
48 The FTA was notified to the Committee on Regional Trade Agreements and to the Council for Trade in 
Services in WTO document WT/REG391/N/1 and S/C/N/900, 5 April 2018. Its text is available at 
http://fta.mofcom.gov.cn/georgia/georgia special.shml  and 
https://matsne.gov.ge/en/document/view/3897182 . 
49 For details, see the WTO Secretariat's Factual Presentation in WTO document WT/REG391/1/Rev.1, 
8 April 2019.  
50 Exports to China in 2020 increased by 136% compared to 2017, amounting to USD  476.27 million, 
and accounting for 14.3% of Georgia's total export s (7.3% in 2017). Trade turnover in 2020 increased by 27% 
compared to 2017, amounting to USD  1,185  million and accounting for 10.4% of Georgia's total trade 
turnover  (8.6% in 2017). Information provided by the authorities.  
51 Three Silk Road Forums were hel d in Tbilisi in 2015, 2017, and 2019. The potential impact of the Belt 
and Road Initiative on the economy of Georgia has been analy zed in World Bank (2020), South Caucasus and 
Central Asia – The Belt and Road Initiative: Georgia Country Case Study . 
52 The F TA was notified to the Committee on Regional Trade Agreements and the Council for Trade in 
Services in WTO document WT/REG397/N/1 and S/C/N/923, 12  February  2019. The text of the FTA can be 
consulted at: https://www.tid.gov.hk/english/ita/fta/hkgefta/index.html  and 
http://www.ec onomy.ge/uploads/files/2017/foreign_trade/georgia_hong_kong/eng_1/georgia_hong_kong_chi
na_free_trade_agreement_main_agreement.pdf . 
53 For details, see the WTO Secretariat's Factual Presentation in WTO document WT/REG397/1, 
27 January 2020.  WT/TP R/S/420 • Georgia  
 
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  2.32.   Georgia and the United Kingdom concluded an agreement on Strategic Partnership and 
Cooperation  on 21  October  2019, which entered into force on 1  January  2021.54 The Agreement is 
based on the European  Union -Georgia Association Agreement and aims to m aintain continuity of the 
effects of the European  Union -Georgia Agreement in a bilateral context. Thus, it replicates all 
sections of the existing European  Union -Georgia Agreement relevant for a bilateral agreement 
between the United Kingdom and Georgia. I t does not contain the provisions of the DCFTA on 
approximation towards EU legislation, as these provisions no longer apply to a bilateral agreement 
between the United Kingdom and Georgia.55 
2.33.   In 2009, Georgia terminated its membership in the CIS organization, while maintaining its 
right to remain a party to the CIS free trade area arrangements and the bilateral agreements.  The 
bilateral FTAs with Armenia, Azerbaijan, Kazakhstan, the Republic of Moldova, 
the Russian  Federation, Turkmenistan, Ukrain e, and Uzbekistan provide for duty -free trade in 
industrial and agricultural goods, but do not cover trade in services, investment, or government 
procurement.  
2.34.   The launch of FTA negotiations with India, Israel, and the Republic of Korea is currently being 
considered.  
2.35.   Georgia has GSP arrangements with the United  States, Japan, and Canada.  
2.3.3   Other agreements and arrangements  
2.36.   Georgia became a contracting party to the Energy Community Treaty on 1  July 2017. The 
Energy Community was created in 2005 to extend the EU  internal market energy rules to 
South  East Europe and the Black Sea to create an integrated energy (electricity and gas) market. 
By adopting the Energy Community Treaty, the Contracting Parties made legally binding 
commitments to adopt core EU energy legi slation56 (Section 4 .2.2). 
2.4  Investment Regime  
2.37.   The Law on Promotion and Guarantees of Investment Activity (1996) sets out the basic legal 
framework governing domestic and foreign investment. It defines rights and duties of investors, 
provides for national tr eatment of foreign investors, contains provisions on legal protection of 
investment, including with respect to expropriation and compensation, and provides for dispute 
settlement through arbitration. The Law does not require screening or prior approval of foreign 
investment but provides for a registration requirement for statistical purposes. Based on a 
comparison with the OECD FDI Regulatory Restrictiveness Index, Georgia has been characterized as 
"one of the most open economies to foreign investment"57, with a relatively small number of sectoral 
limitations in agriculture and forestry, transport, media, and real estate investment.58 
 
54 The FTA was not ified to the Committee on Regional Trade Agreements and to the Council for Trade in 
Services in WTO document WT/REG440/N/1 and S/C/N/1035, 7 January 2021. The text of the Agreement is 
available at: 
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/844167/C
S_Georgia_ 1.2019_UK_Georgia_Strategic_Partnership_and_Cooperation_Agreement.pdf .  
55 UK Government (2019), Explanatory Memorandum on the Strategic Partnership and Cooperation 
Agreement between the United Kingdom of Great Britain and Northern Ireland and Georgia. Viewed at:  
https://www.gov.uk/government/publications/ukgeorgia -strategic -partnership -and-cooperation -agreement -cs-
georgia -no12019 .  
56 The key objectives of the Energy Community are to: (i)  establish a stable regulatory and market 
framework capable of attracting investment in power generation and networks; (ii)  create an integrated energy 
market allowing for cross -border energy  trade and integration with the EU market; (iii)  enhance the security of 
supply to ensure stable and continuous energy supply that is essential for economic development and social 
stability; (iv)  improve the environmental situation in relation with energy supply in the region and foster the 
use of renewable energy and energy efficiency; and (v)  develop competition at regional level and exploit 
economies of scale. Energy Community, Who We Are . Viewed at: https://www.energy -
community.org/aboutus/whoweare.html . 
57 OECD (2020), OECD Investment Policy Reviews: Georgia , p. 54.  
58 OECD (2020), OECD Investment Policy Reviews: Georgia , p. 55. Georgia is particularly restrictive in 
agriculture and forestry because of the ban on foreign ownership of agricultural land.  WT/TPR/S/420 • Georgia  
 
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  2.38.   While the Georgia 2020 Strategy highlighted the need for reform of foreign investment 
legislation as a component of the improvement of the investment and business environment59, it 
appears that no steps were taken during the review period to amend the foreign investment 
legislation. In its Government Program 2021 -2024: Toward Building a European State, adopted in 
December  2020, the Government announced that the "country's investment policy will be planned 
anew, based on an aggressive campaign designed both to attract regional offices of international 
companies and to encourage investments in the real sector (production)".60 
2.39.   The Georgia 2020 Strategy, adopted in June 2014, identified weak private sector 
competitiveness as one of the three most critical problems facing the Georgian economy (along with 
insufficiently developed human capital and limited access to financial resour ces).61 To enhance the 
productivity and competitiveness of the private sector, it proposed a series of measures designed to 
improve the investment and business environment, raise the level of innovation and technological 
development, facilitate the growth of exports, and develop infrastructure and realize the country's 
transit potential. In addition to reform of investment legislation, the measures proposed in the 
Strategy to improve the investment and business climate included creating a more attractive an d 
stable fiscal environment for the private sector and foreign investment, strengthening 
of (intellectual) property rights, supporting the development of entrepreneurship, strengthening 
mechanisms for the resolution of commercial disputes, improving legisl ative and institutional 
mechanisms for free market competition, improving mechanisms for the regulation of bankruptcy 
and the closing of businesses, improving public services and enhancing the transparency of public 
administration, and ensuring flexible re gulation. Significant reforms were adopted during the review 
period in a number of these areas (Section 1.2, Box 1.1).  
2.40.   In 2017, Georgia's investment promotion agency, Invest in Georgia, was integrated into 
Enterprise Georgia, which was created in 2014 unde r the MESD as the main agency responsible for 
the implementation of the Produce in Georgia State P rogram. Enterprise Georgia now consists of 
three divisions: Business Development62, Export Support, and Invest in Georgia. Aside from foreign 
investment promo tion, the main functions of Enterprise Georgia are export promotion, domestic 
investment promotion, regional development promotion, and granting of financial incentives. The 
aim of the Invest in Georgia division is to attract, promote, and develop FDI in G eorgia. It serves as 
a one -stop shop for investors to support companies before, during, and after the investment 
process.63 
2.41.   In December 2019, Enterprise Georgia presented an Investment Promotion Strategy and 
Action Plan for 2020 -2021.64 Based on criteria s uch as alignment with Georgia's overall economic 
strategy, export orientation, and contribution to knowledge and know -how, the Strategy defines 
sectors that will receive priority attention in investment promotion: hospitality and real estate, 
business proc ess outsourcing, apparel and footwear, electronic equipment components, and 
automotive and aerospace components. Agro -business was added to this list, in view of the global 
impact of COVID ‑19 pandemic. Enterprise Georgia's aim with th e Strategy and Action Plan is to 
attract/support investment projects worth USD  225 million, creating over 3,500 jobs.65 
 
59 In this respect, it was noted that "Georgia's current investment legislation is outdated and 
disconnected from reality; moreover, the existing norms are scattered amon g several normative acts and they 
fail to properly reflect investors' rights and guarantees as well as activities that are needed for encouraging 
investments. The Government will therefore ensure replacement of the existing investment legislation with a 
new legislation which will correspond with international norms and best practices". Government of 
Georgia  (2014), Social -economic Development Strategy of Georgia: Georgia 2020 , p. 22.  
60 Government of Georgia (2020), Government Program 2021 -24: Toward Buildin g a European 
State,  p. 21. 
61 Government of Georgia (2014), Social -economic Development Strategy of Georgia: 
Georgia  2020,  p. 11. 
62 The Business Development division of Enterprise Georgia implements various mechanisms to support 
entrepreneurship, including the Industrial Component, the Credit Guarantee mechanism, Host in Georgia, and 
Film in Georgia (Section 3.3.1).  
63 According to the OECD, Georgia's framework for investment promotion and facilitation suffers from 
fragmentation and would benefit from adoptio n of a comprehensive investment strategy. OECD (2020), 
OECD  Investment Policy Reviews: Georgia,  pp. 130 -133. 
64 Due to the COVID ‑19 pandemic, the Strategy was updated in 2020 to reflect substantial changes on 
the global level in terms of FDI and the timelin e of the Strategy was also extended until 2022.  
65 Agenda.ge, Enterprise Georgia Presents Strategy to Attract Foreign Direct Investments in Georgia , 
16 December  2019. Viewed at: https://agenda.ge/en/news/2 019/3434 . WT/TP R/S/420 • Georgia  
 
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  2.42.   In November 2020, the Government launched a new programme, implemented by Enterprise 
Georgia, to provide incentives to attract FDI in certain sectors66 (Secti on 1).  
2.43.   An important theme in recent studies of Georgia's experience with FDI67 is that the potential 
benefits of FDI for productivity and job creation have not been realized sufficiently and that to 
improve its integration into the global economy Georgia n eeds to focus more on 
efficiency -enhancing  FDI. 
2.44.   As pointed out in the OECD Investment Policy Review of Georgia , the role of FDI in Georgia 
has been limited, as most FDI has gone to non -tradable sectors (finance, real estate, trade and 
tourism, transport, a nd energy)68 that do not contribute enough to advanced job creation and 
productivity growth, while FDI in export -oriented sectors including manufacturing and agriculture 
has stagnated and remained far below potential.69 The Review argues that attracting such 
efficienc y-seeking, export -oriented FDI requires going beyond the Doing Business reforms 
successfully undertaken by Georgia in recent years, and that "[w]ith the vast majority of de jure  
barriers to FDI now removed, the government's investment policy challenge lies  in improving the 
overall climate for investment".70 The Review addresses the following as the main elements of a 
comprehensive reform of the investment and business climate: competition policy; consumer 
protection; investment protection; protection and en forcement of intellectual property rights; 
independence, accountability, and capacity of the judiciary; arbitration procedures; land reform; 
data protection and cybersecurity; promotion of investment in the agri -food sector; investment 
promotion; and respo nsible business conduct.71 Similarly, a World Bank study argues that Georgia's 
"[i]nvestment policy needs to be refined and refocused on attracting efficiency -seeking investments 
in high value added tradable sectors".72 It identifies as the main "horizontal productivity constraints" 
gaps in transport and ICT infrastructure, capacity gaps in public administration, limited access to 
credit, and skill bottlenecks.73 The need for this wider approach has been acknowledged by the 
Government. The authorities indicate that attracting export -oriented FDI and multinational 
corporations has become an integral part of Georgia's modern industrial policy.  
2.45.   Georgia has bilateral investment treaties in force with 32 countries.74 During th e review 
period, bilateral investment treaties entered into force with Switzerland, Estonia, and Belarus. 
Georgia signed bilateral investment treaties with Turkey, the Kyrgyz  Republic, the 
United  Arab Emirates, and Japan, but these treaties have not yet en tered into force. The DCFTA and 
the recent FTAs with the United Kingdom, China, and the EFTA also include certain provisions on 
investment. At the multilateral level, Georgia is a party to the Energy Charter Treaty.75 
Between  2005 and 2020, Georgia was a r espondent in 16 investor -state arbitration proceedings 
based on investment treaties.  
 
66 Enterprise Georgia, The State Program – FDI Grant , 19 November  2020. Viewed at: 
http://www.enterprisegeorgia.gov.ge/en/News/the -state-program -fdi-grant . 
67 See Section 1 of this Report for statistics on the recent evolution of FDI in Georgia.  
68 Section 1, Table 1.5.  
69 OECD (2020), OECD Investment Policy Reviews: Georgia , pp. 14, 22, 42.  
70 OECD (2020), OECD Investment Policy Reviews: Georgia , p. 25.  
71 OECD (202 0), OECD Investment Policy Reviews: Georgia , pp. 24 -34. 
72 World Bank (2018), Georgia: From Reformer to Performer , p. 29.  
73 World Bank (2018), Georgia: From Reformer to Performer , p. xvi.  
74 Belarus, Switzerland, Estonia, the State of Kuwait, the Czech  Repub lic, Sweden, Finland, Lithuania, 
Latvia, Austria, the Republic of Moldova, the Netherlands, Romania, the Kyrgyz  Republic, France, Kazakhstan, 
Armenia, Turkmenistan, Azerbaijan, the Islamic Republic of Iran, Uzbekistan, Israel, the United Kingdom, 
Bulgaria,  Ukraine, Greece, the United  States, Germany, Belgium/Luxembourg, China, Turkey, and Spain. 
UNCTAD, Investment Policy Hub. Viewed at: https://investmentpolicy.unctad.org/international -investment -
agreements/countries/77/georgia . 
75 There is significant overlap between the Energy Chart er Treaty and Georgia's bilateral investment 
treaties insofar as 28 of the countries with which Georgia has a bilateral investment treaty are also parties to 
the Energy Charter Treaty. OECD (2020), OECD Investment Policy Reviews: Georgia , p. 83.  WT/TPR/S/420 • Georgia  
 
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  3  TRADE POLICIES AND PRACTICES BY MEASURE  
3.1  Measures Directly Affecting Imports  
3.1.1   Customs procedures, valuation, and requirements  
3.1.1.1   Customs procedures and requirements  
3.1.  During the review period, Georgia continued its efforts to digitize customs procedures and 
made various adjustments to its legal framework to further simplify them and ensure the 
approximation of its customs  legislation to that of the European  Union as provided in their 
Association Agreement.1 
3.2.  In 2019, Georgia adopted the two main legal instruments that currently govern customs 
procedures: (i)  the new  Customs  Code; and (ii)  Ministerial Order No.  257 of 29  August 2019 on 
Approval of Instructions on the Movement and Registration of Goods on the Customs Territory.2 Both 
entered into force on 1  September  2019. These legal instruments are complemented by other 
customs -related laws (Table  3.1), including the new L aw on Border Measures Related to Intellectual 
Property, which entered into force in February 2018. The new Law seeks to protect and enforce 
intellectual property rights at the border by preventing the importation or exportation of 
counterfeited goods.  
Table 3.1 Main legal instruments governing Georgia's customs regime, 2021  
Law Entry into force  Latest amendment  
Customs Code  1 September  2019a 30 September  2020 
Tax Code  1 January  2011 2 August  2021 
Law on Free Industrial Zones  1 January 2008a 15 July 2020 
Law on Border Measures Related to Intellectual Property  7 February  2018 28 June 2019 
Law on the Revenue Service  9 March 2010a 28 June 2019 
Ministerial Order No.  257 on Approval of Instructions for 
Movement and Clearance of Goods on the Customs 
Territory of Georgia  1 September 2019a 1 January  2020 
a The entry into force of some provisions was deferred to a later date.  
Source:  Compiled by the WTO Secretariat based on information from the Revenue Service.  
3.3.  The new Customs Code seeks to promote the modernization of customs infrastructure, the 
simplification of procedures, and the digitalization of customs services.3 Since 2011 and until the 
adoption of the new Code, Geor gia has not had a Custom Code per se , and customs provisions were 
contained in the Tax  Code (Articles 207 -237).4 With the adoption of the new Customs Code, the 
customs provisions in the Tax Code were deleted. The new Customs Code was elaborated in 
accorda nce with Georgia's obligations for the creation of a Deep and Comprehensive Free Trade 
Area (DCFTA) under its Association Agreement with the European  Union and builds upon the Union 
Customs Code and other related EU legislation. It includes several new  provisions, e.g. the 
implementation of an authorized economic operator programme, customs disputes, and summary 
declarations.5 It also provides for the use of online  platforms to submit customs declarations.6 
3.4.  Ministerial Order No.  257 details all aspects of  the customs procedures necessary for the 
implementation of the Customs Code, and replaces Ministerial Order No.  290 of 26  July 2012 on 
Instruction on Movement and Clearance of Goods across the Customs Territory of Georgia. It 
 
1 Georgia -European  Union Association Agreement, Article  75 and Annex XIII.  
2 According to the authorities, another 80 subordinate regulatory acts were also approved to support the 
implementation of the Customs Code.  
3 Agenda.ge, Gov't Presents Draft of New Customs Code , 10 September 2018. Viewed at: 
https://agenda.ge/en/news/2018/1876 . 
4 In 2010, the former Customs Code was repealed, and customs provisions became part of the 
Tax Code. That version of the Ta x Code went into force on 1 January 2011, but is no longer in force.  
5 Customs Code, Articles 6, 25, 33, and 160; and information provided by the authorities. In line with 
EU customs legislation, a summary declaration is defined as a document whereby a per son informs the 
customs authorities, in the prescribed form and manner and within a specific time limit, that goods are being 
imported to or exported from Georgia.  
6 Customs Code, Article  84. WT/TP R/S/420 • Georgia  
 
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  comprises 19  Annexes, each de scribing the instructions for a different custom formality, 
e.g. customs control and supervision, the declaration and registration of goods, and the procedures 
under Georgia's different customs regimes.  
3.5.  The Revenue Service under the Ministry of Finance rem ains Georgia's tax and customs 
authority, and as such it is responsible for implementing the Customs Code and Tax Code and for 
carrying out customs operations. The Revenue Service administers nine types of customs 
regimes  – known as "procedures" under the Customs Code – classified according to 
three  categories: import (or release into free circulation), export, and special import procedures. 
Special import procedures comprise: (i)  transit; (ii)  customs warehouse; (iii)  free zone; 
(iv) temporary admission; ( v) end-use; (vi) internal processing; and (vii) outward processing, which 
may provide duty and tax  benefits to their users under certain conditions (Section 3.1.4 and 
Box 3.2).7 Under the new Customs Code, re -export is no longer considered as a customs pr ocedure  
per se in line with EU legislation , whereby the re -export of foreign goods from a free industrial 
zone (FIZ) or temporary storage benefits from a further simplified notification procedure.8 
3.6.  The requirements to import goods into Georgia have essent ially remained the same since the 
last Review. Importers for commercial purposes must submit the following documents: (i)  customs 
declaration; (ii)  commercial invoice; and (iii)  a transport document (bill of lading or waybill). These 
documents are submitte d along with the payment of the relevant import duty and taxes (VAT, and 
excise  tax if applicable), and any other additional document when applicable, e.g. a sanitary and 
phytosanitary (SPS) certificate, import licence/permit, or certificate of origin (if seeking the 
application of a preferential regime).9 Importers may choose to fill the customs declaration 
themselves (acting on their own behalf) or engage the services of a professional customs broker, 
but there is no obligation in this regard. Customs br okers must be persons established in Georgia 
(i.e. citizens of Georgia and/or persons registered in Georgia as taxpayers). This requirement shall 
be waived if the customs broker is hired to conduct procedures related to the transit or temporary 
admission o f goods.10 In 2019, it took on average 2.5 hours to complete customs clearance (latest 
data available).11 
3.7.  Importers are not subject to any specific registration requirement, except being registered as 
taxpayers in the case of foreign nationals and companie s, and may, depending on their activities, 
participate in the Authorized Economic Operator or Golden List Program to benefit from simplified 
customs procedures (paragraph 3.12).  
3.8.  Customs declarations can be submitted either on paper or electronically throug h two  online 
platforms: (i)  eCustoms ( http://asycuda.rs.ge/ )12; or ii)  eServices Taxpayers Portal 
(https://eservices.rs.ge/Login.aspx ). Both are managed by the Revenue Service.13 The eServices 
Portal is a single window for authorized taxpayers where all tax and customs electronic services are 
accessible, while eCustoms enables submission of customs declarations and supporting documents 
by authorized users.14 To obtain supporting documents, such as permits, licences, or certificates, 
traders must submit their application, in most cases online, directly to the ministry or agency in 
charge. Currently, there are eight institutions responsible for issuing supporting do cuments, which 
once issued, are uploaded into an internal interagency database known as the Unified Electronic 
System of Licences, Permits and Certificates.15 The database stores the documents and is accessible 
to customs authorities for consultation.  
 
7 Customs Code, Articles 110 and 118 -154. 
8 Customs Code, Articl e 160. Re -export allows traders to export foreign goods from Georgia that were 
initially imported into the customs territory of Georgia. During re -export, goods shall remain in an unaltered 
condition.  
9 Ministerial Order No.  257 of 29  August  2019, Annex 5,  Article  3. 
10 Customs Code, Articles 6 and 14.  
11 Revenue Service (2019), Measurement of Time Spent on Customs Procedures . 
12 The eCustoms platform is based on ASYCUDA World and other in -house -developed software. The 
latest update of the ASYCUDA system was c arried out in 2020.  
13 Georgia also operates an automated database through the Ministry of Internal Affairs for the 
clearance of vehicles (Ministerial Order 257 of 29  August  2019, Annex 8, Article  3). 
14 Registration for the eCustoms platform is not subject to any specific requirements and the application 
may be lodged online.  
15 According to the authorities, 38 trade -related licences/permits/certificates are shared electronically 
between participating agencies.  WT/TPR/S/420 • Georgia  
 
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  3.9.  In 2019, Georgia began implementing a single window for maritime cargo only, to support 
Georgia's transit activities; the first phase of implementation has been completed and the second is 
underway, according to the authorities.16 
3.10.   During the review period, Geo rgia became a party to various customs and trade -related 
agreements and conventions with the aim of facilitating trade. It ratified the WTO  Agreement on 
Trade Facilitation (TFA) in 2016 (Section 2). At the time of ratification, about 92% of the 
TFA obligat ions had already been implemented. Only the implementation of provisions on customs 
fees and charges, transit procedures, and the Authorized Economic Operator scheme were 
pending.17 According to the authorities, full implementation of TFA commitments was c ompleted 
in September 2019 in line with the time -frame set out in Georgia's latest notification received 
in 2018. In May 2019, Georgia established the National Trade Facilitation Committee to oversee the 
TFA's  implementation and advise the Government.  
3.11.   In November 2018, Georgia also acceded to the Revised Kyoto Convention on the 
Simplification and Harmonization of Customs Procedures. Georgia is also planning to accede to the 
EU Convention on a Common Transit Procedure and the Convention on the Simplification  of 
Formalities in Trade in Goods. These two conventions (from  20 May 1987) describe the measures to 
simplify and harmonize customs procedures, and thus facilitate the movement of goods between its 
Parties, namely the European  Union, the European  Free Trad e Association (EFTA)  countries (Iceland, 
Liechtenstein, Norway, and Switzerland), Turkey, the Republic of North  Macedonia, and Serbia.  
3.12.   Other initiatives to streamline customs procedures and facilitate trade include the application 
of simplified customs pro cedures to authorized (and trusted) traders through two  different 
programmes:  the Authorized Economic Operator (AEO) Program and the Golden List Program. The 
AEO scheme was introduced in 2019, and is based on the EU model, and on the Golden List Program 
(in force since  2008).18 Compared to the Golden List Program, the AEO Program has a broader 
coverage as it applies to any company or individual involved in international trade, regardless of the 
size of its operations provided certain criteria are met.19 Additionally, the AEO Program covers not 
only customs but also security and safety procedures. The Golden List Program applies only to large 
traders (importers and exporters) (i.e. companies importing or exporting at least GEL  5 million, and 
paying at least G EL 900,000 in import duties, or submitting more than 100  customs declarations), 
and is expected to be discontinued on 1  January  2022, according to the authorities. As of  2021, 
176 operators are on  the Golden List.20 
3.13.   In the area of customs control, the Reve nue Service conducts controls over declared goods 
based on an automated risk management system implemented through the eCustoms and eServices 
platforms. Goods declared through these platforms are dispatched according to four different 
corridors – green (go ods are immediately released without examination),  blue (goods are released 
but are subject to a post examination), yellow (goods are subject to documentation control but are 
not physically examined), and red (goods are physically examined and go through d ocumentation 
control) – depending on their risk profile. Customs declarations that are not submitted electronically 
are automatically assigned to the red  corridor , thus giving an incentive to traders to use the 
electronic platforms to submit their declarat ions.21 In 2020, 85% of total declarations qualified for 
the green corridor, 11% for yellow, 3% for red, and 1% for blue.  
3.1.1.2   Customs valuation  
3.14.   During the review period, Georgia modified the legal format and some of the wording of the 
customs valuation legisla tion but maintained the essence of its content, which largely mirrors the 
WTO Customs Valuation Agreement. The rules on customs valuation are set out in the new Customs 
Code ( Articles 37 -46) but prior to its adoption in 2019, they were contained in Ministe rial Order 
 
16 Maritime Transport Agency, Ministry of Economy  and Sustainable Development (MESD), Annual 
Report 2020 . 
17 WTO documents WT/PCTF/N/GEO/1, 2 February 2016; and G/TFA/N/GEO/1, 20 February 2018.  
18 Customs Code, Articles 25 -26; and Ministerial Order 257 of 29  August  2019, Annex 1, Articles 20 -25. 
19 Minister ial Order No.  257 of 29  August  2019, Annex 1, Articles 20 -25 (Authorized Economic Operator) 
and 26 -34 (Golden List).  
20 Information provided by the authorities.  
21 Ministerial Order No.  257 of 29  August  2019, Annex 2, Article  5. WT/TP R/S/420 • Georgia  
 
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  No. 290 of 26  July 201222, which was repealed in 2019. As at September 2021, the corresponding 
WTO notification was pending.  
3.15.   The Customs Code lists transaction value as the main method to determine the value of 
imported goods. This methodology is followed in hierarchical order by five other methods based on 
the: (i)  transaction value of identical goods; (ii)  transaction value of similar  goods; (iii)  unit price of 
goods; (iv)  computed value; and (v)  the reserve method. When the reserv e method is to be applied, 
the customs value of the goods shall be determined in accordance with WTO rules and the general 
principles of the Customs Code. Georgia shall not use minimum customs values for goods valuation. 
The Customs Code also provides for the right of appeal for decisions taken by the customs authorities 
based on a customs declaration .23  
3.16.   According to the authorities, during 2015 -20 between 80% and 85% of the customs 
valuations carried out annually used the transaction value ; the remaining cases were processed by 
other valuation methods.  
3.1.2   Rules of origin  
3.17.   Georgia uses preferential and non -preferential rules of origin. Preferential rules of origin are 
governed by Georgia's FTAs while non -preferential rules of origin are regulated by the Customs  
Code (Article  36). In addition, customs procedures for both types of rules of origin, including the 
issuance of certificates of origin are described in Resolution No.  420 of 29  December  2010 (on 
Approval of Criteria for the Originating Country, Form of Or igin Certificate and Rules for Issuance 
and Filling in of Certificate), which in 2019 was repealed and replaced by Resolution No.  453 of 
16 September  2019 (on Approval of the Criteria for Determining the Country of Origin of Goods, the 
Form of the Certific ate of Origin, Its Completion and Issuance Procedure). The new Resolution 
updated some of the existing provisions, e.g. the requirements to obtain the status of an approved 
exporter (Section 3.2.1)24 and the procedures regarding the certificates of origin under the FTAs 
signed with China and Hong  Kong,  China in 2017 and 2018, respectively.  
3.18.   Non-preferential rules of origin are used to determine the origin of a good for the purpose of: 
(i) applying MFN import duties; or (ii)  implementing non -tariff measures s uch as anti -dumping, and 
quantitative restrictions provided for under Georgia's legislation. A good is deemed to be originating 
from a given country if it:  
• was wholly obtained there; or  
• underwent substantial transformation in that country when more than one country was 
involved in its production.25 Substantial transformation requirements can take the form of 
a change in tariff classification (at the four -digit level), value -share rule (51% of the price 
of the product), and/or specific production or t echnological requirements.  
3.19.   Preferential rules of origin follow the same principles as those under non -preferential rules, 
namely that an originating good is a good: (i)  wholly obtained in the territory of the Parties; or 
(ii) that has undergone sufficient working or processing when using non -originating inputs with 
sufficient transformation requirements taking the form of a change in tariff classification, regional 
content value (RCV) (40% of the ex -works price under the FTAs with China, and Hong Kong,  China26, 
and between 10% and 60% of the ex -works price under the FTAs with the EFTA States and the 
United  Kingdom), or specific rules of origin.27 
 
22 Customs valuation procedure s were detailed in Articles 24 -32 of Ministerial Order No.  290. 
23 Customs Code, Article  16. 
24 Approved Exporters (AE) benefit from simplified export formalities regarding goods' origin 
certification. The status of "approved exporter" was introduced in  2016 in accordance with the Association 
Agreement between Georgia and the European  Union and the Regional Convention on Pan -Euro-Mediterranean 
Preferential Rules of Origin. Resolution No.  507 of 14 November 2016; Protocol I of the Association Agreement 
between Georgia and the European  Union, Article  22; and the Regional Convention on Pan -Euro-Mediterr anean 
Preferential Rules of Origin, Article  22. 
25 Customs Code, Article  36. 
26 Except for a few cases where an RCV of 50% or 60% applies.  
27 For both FTAs, the RVC varies between 10% and 60% of the ex -works price.  WT/TPR/S/420 • Georgia  
 
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  3.20.   During 2015 -21, Georgia notified the preferential rules of origin under the four FTAs it signed 
during this perio d (Section 2)28, as well as those under the Organization for Democracy and Economic 
Development (GUAM) (year of entry into force: 2003), which pending their negotiation, are those 
under the Commonwealth of Independent States ( CIS) FTA (1994). In this regar d, the authorities 
indicate that negotiations of the GUAM rules of origin are ongoing. As of September  2021, all 
preferential rules of origin had been notified except for those under its FTAs with the Republic of 
Moldova and Uzbekistan, which have been in force since 2007 and 2010, respectively.  
3.21.   The rules of origin under the four FTAs signed during the review period followed to a large 
extent those negotiated in previous years, in particular those connected directly or indirectly to the 
EU market. Similar t o Georgia's FTAs with Turkey and with the European  Union, the rules of origin 
under the Georgia -EFTA and the Georgia -United Kingdom FTAs are regulated by the corresponding 
FTA and the Regional Convention on Pan -Euro-Mediterranean Preferential Rules of Orig in, which 
allow them to participate in a diagonal cumulation scheme.  
3.22.   Under the DCFTA, diagonal cumulation may be permitted with signatories of the Regional 
Convention on Pan -Euro-Mediterranean Preferential Rules of Origin, provided the following 
conditions  are met: (i)  the parties involved in the acquisition of the originating status of the good 
must have FTAs with each other and with the destination party; (ii)  rules of origin under these 
agreements must be identical to those of the Convention; and (iii)  notices indicating the fulfilment 
of the necessary requirements to apply cumulation have been published in official gazettes of the 
countries involved.29 Signatories to the Convention include the European  Union, the EFTA  States, 
and Turkey. Georgia became a  party to the Convention on 1  July 2017. In accordance with the 
Convention's conditions for diagonal cumulation, Georgia and the European  Union signed in 
March  2018 the decision to replace the DCFTA rules of origin by the Convention rules of origin. 
Georgi a and Turkey have also ratified a similar amendment to their agreement, and diagonal 
cumulation has been in force since April 2021. Notification procedures were also completed with 
Ukraine in 2020 and consultations have started with the Republic of Moldova , with whom Georgia 
has an FTA; both Ukraine and the Republic of Moldova are also parties to the Convention. Diagonal 
cumulation does not apply to agricultural products.  
3.23.   All of Georgia's new FTAs include a de minimis  provision (or value of tolerance) that allows a 
degree of flexibility in the use of non -originating inputs (and that is not accumulative with the value -
added rule). According to this clause, a good is considered to be originating if the value of all the 
non-originating inputs used to produce it  but that do not comply with the relevant rules of origin 
does not exceed a certain percentage of the product's value. This percentage is 10% in all 
four FTAs.30 In the Turkey -Georgia and Georgia -European  Union FTAs, the de minimis  provision has 
a threshol d of 20% and 10%, respectively, of the ex -works price.31 The CIS FTA (1994) does not 
include a de minimis provision.  
3.1.3   Tariffs  
3.24.   During the review period, Georgia did not make any major change to its tariff system, which 
remains largely liberal and simple.32 According to WTO statistics, in 2020 Georgia had the fourth -
lowest MFN applied tariff among WTO Members and the seventh -largest share of duty -free lines.33 
Its tariff schedule is described in Section VIII of the Tax Code, and follows the Foreign Economic 
 
28 Notifications submitted to the Committee o f Rules of Origin between 2017 and 2019: WTO documents 
G/RO/N/160, 21  July 2017 (GUAM: Georgia, Ukraine, Azerbaijan, and the Republic of Moldova); G/RO/N/166, 
24 May 2018 (EFTA States); G/RO/N/171, 24 May 2018 (China); and G/RO/N/185, 15 April 2019 
(Hong  Kong, China). For the FTA between Georgia and the United Kingdom, signed in 2019, the notification 
was submitted to the Committee on Regional Trade Agreements in 2020.  
29 Regional Convention on Pan -Euro-Mediterranean Preferential Rules of Origin, Article  3. 
30 The Regional Convention on Pan -Euro-Mediterranean Preferential Rules of Origin sets a tolerance rule 
of 10%, which does not apply to HS Chapters 50 to 63.  
31 Rules of origin are the same for all members of the CIS FTAs except for the Russian  Federation 
(regulated in accordance with the Diplomatic Note exchanged between the Government of Georgia and the 
Government of the Russian  Federation in March 2010 (WTO document WT/ TPR/S/328/Rev.1, 18  March 2016)).  
32 Between 2015 and May 2021, there were five amendments affecting Georgia's tariff: one in 2017, 
three in 2019, and one in 2020. The last one was published in Georgia's Official Journal on 22 July 2020. One 
of the changes included the introduction in 2019 of a duty exemption on the importation of baby food and of 
goods intended for the medical purposes (Amendments of the Tax Code No.  5444, 13  December  2019) 
(Section 3.1.4).  
33 WTO, World Tariff Profiles 2021 . WT/TP R/S/420 • Georgia  
 
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  Activity Commodity Nomenclature, which was based on the 2012 version of the Harmonized System 
(HS12). At the time of finalizing this report, Georgia had adopted the 2017 HS nomenclature. Georgia 
does not apply any seasonal tariffs, or tariff -rate quotas, eit her on an MFN or preferential basis. Its 
reliance on tariffs for tax revenue is minimal, given its tax structure, but instead it strongly relies on 
the collection of the excise tax and VAT at the border.  
3.1.3.1   Applied tariffs  
3.25.   In 2021, Georgia's tariff s consisted  of 10,028 lines at the 11 -digit level and had almost the 
same structure as the one in place at the time of the previous Review (Chart 3.1). The tariff s are 
organized according to three bands (0%, 5%, and 12%), except for a minority of lines subject to 
non-ad valorem  duties. M ost lines are duty -free, with their number accounting for about 81% of the 
total number of lines in 2021 (8,153 lines) . The share of du tiable lines at 5% or 12% was 16.3% 
(or 1,627 lines), and that for non-ad valorem  duties was 2.5% (or 248 lines). Changes in the tariff 
structure, in particular for non -ad valorem  duties, which in 2015 accounted for 4.5%  (or 464 lines), 
were due mainly to a consolidation process in the number of lines (see below).  
Chart 3.1 MFN applied tariff structure, 2015 and 2021  
(Number of tariff lines)  
 
Note:  Figures denote the share of total lines. Non -ad valorem rates consist of specific rates on beverages 
and vinegar products and special duties on motor vehicles. In 2021, structural changes 
(i.e. mergers)  in the tariff schedule reduced the number of lines subject to special duties on motor 
vehicles but  duty rates remain unchanged. At the same time, the number of lines subject to specific 
duties increased between 2015 and 2021 from 185 lines to 211 lines (207 lines related to alcoholic 
beverages and four lines to vinegar products), which also resulted fr om structural changes 
(i.e. splitting of lines) in the tariff schedule; duties remain unchanged.  
Source:  WTO Secretariat calculations, based on data provided by the authorities.  
3.26.   Of the non -ad valorem  lines in 2021, 211 lines had specific duties and 37 had special duties. 
Special duties apply to motor vehicles for the transport of persons (HS 8703) (Chart  3.2), and  their 
formula is a function of the age and engine capacity of the vehicle .34 This formula has not changed 
since the last Review. Products subject  to specific duties comprise all vinegars (HS 2209) and 
alcoholic beverages, except for beers (HS 2204 -2208).35 Ad valorem  equivalents (AVEs) for these 
products were calculated using the unit value method, and based on trade data for 2019 , where 
 
34 The formula t o compute this special duty is the sum of GEL  0.05 per cubic centimetre of the engine 
capacity and 5% of the amount of the customs duty per each additional year for used cars. E lectric vehicles for 
the transport of persons benefit from a duty exemption und er the Tax Code (Section 3.1.4).  
35 Beers are classified under product code HS 2203.  
79.6%81.3%2.2% 2.3%13.7% 14.0%4.5%2.5%
02 0004 0006 0008 00010 00012 000
Non-Adv duties:
-specifi c: 185 lines
-special: 279 linesNon-Adv duties:
-specifi c: 211 lines
-special: 37 linesChart 3.[GEO]  Frequency distribution of MFN tariff rates, 2015 and 2021
Number of tariff lines
MFN2015
Total number of lines: 10,255MFN 2021
Total number of lines: 10,028
Duty-free 5% 12% Non-ad valorem duties
Note: Figures denote the share of total lines. Non -ad valorem rates consist of specific rates on beverages and vinegar products and special 
duties on motor vehicles. Structural changes (i.e. merger) in the 2021 tariff schedule reduced a number of  specific tariff l ines on 
motor vehicles although duty rates remain no change.  (Table 3.1 -Summary Table)
Source:  WTO calculations, based on data provided by the authorities.WT/TPR/S/420 • Georgia  
 
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  available .36 Estimated AVEs ranged from  0.1% to 56.8%, with the highest rate applying to wine 
vinegar.  
Chart 3.2 Type of duties, by HS dutiable chapter, 2021  
(Number of tariff lines)  
 
Note:  The chart presents only chapters (HS 2 -digit level) whose tariff averages are more than zero 
in 2021. Bar labels are displayed only for  dutiable lines . 
Source:  WTO Secretariat calculations, based on data provided by the authorities, and WTO CTS database.  
3.27.   Although the tariff s and their structure have remained largely the same since the last Review, 
there were a few changes. Compared to the 2015 tariff, t he 2021 tariff has slightly fewer 
lines (10,028  lines down from 10,255 lines), which mirrors a decrease in the number of lines subject 
to special duties from 279 in 2015 to 37 in 2021 that resulted from a consolidation process in the 
tariff structure of mo tor vehicles (i.e. splitting and merging of tariff lines) and not from a 
simplification of their rates. Georgia also increased the duties for 12 tariff lines referring mostly to 
waters, including natural or artificial mineral waters, from 0% to 12%.37 
3.28.   These changes slightly affected some of the tariff indicators shown in Chart 3.1 and Table  3.2. 
The average tariff of non -agricultural goods was down from 0.8% in 2015 to 0.7% in 2021 
(including  AVEs), while the simple average tariff of agricultural products i ncreased from 6.7% 
to 6.8% (WTO definition). Overall, the simple average of applied MFN tariffs remained unchanged, 
at 2%. 
Table 3.2 Structure of MFN tariff in Georgia, 2021  
(%, unless otherwise indicated)  
 MFN applied  Final  
bounda 2015  2021  
Bound tariff lines (% of all tariff lines)  n.a. n.a. 100.0  
Simple average rate  2.0 2.0 7.4 
 WTO agricultural products  6.7 6.8 12.5 
 WTO non-agricultural products  0.8 0.7 6.1 
 HS 01 -24 6.1 6.2 10.9 
 HS 25 -97 0.8 0.8 6.4 
Duty-free tariff lines (% of all tariff lines)  79.6 81.3 25.7 
 
36 AVEs for 38 tariff lines were provided by the authorities.  
37 Only in one case, the new rate was a specific rate.  
2245
1111
1211726
13172
68
103118
4401
35
45 51234
29
238
3487
933
105
66513105
37
211
0100200300400500600700
01020407080911151617181920212223242533343944686971738587Chart 3.[GEO]  Average applied MFN by HS chapters (dutiable), 2021  -PLEASE CHANGE TITLE 
01   Live animals 
02   Meat & edible meat offal
04   Dairy produce
07   Edible vegetables
08   Edible fruit & nuts
09   Coffee, tea, maté & spices
11   Products of the milling industry15  Animal or vegetable fats & oils
16  Meat, fish or crustaceans prod.
17  Sugars & sugar confectionery
18  Cocoa & cocoa prod.
19  Cereals, flour, milk prod.
20  Vegetables, fruit, nuts prod.
21  Misc. edible preparations22  Beverages, spirits & vinegar
23  Food industry residues & waste
24  Tobacco
25  Salt; sulphur; earths & stone
33  Essential oils & resinoids
34  Soap, etc.
39  Plastics & articles thereof44   Wood & articles of wood
68   Articles of stone, cement 
69   Ceramic products
71   Natural or cultured pearls
73   Articles of iron or steel
85   Electrical machinery & parts 
87   Vehicles & parts 5% 12%
The chart presents only chapters (HS -2digit level) whose tariff averages are more than zero in2021. Duty-free
Note:
Source: WTO calculations, based on data provided by the authorities, and WTO CTS database.Special duties Specific duties(No. of tariff lines)WT/TP R/S/420 • Georgia  
 
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   MFN applied  Final  
bounda 2015  2021  
Tariff quotas (% of all tariff lines)  0.0 0.0 0.0 
Non-ad valorem  tariffs (% of all tariff lines)  4.5 2.5 2.1 
Non-ad valorem tariffs with no AVEs (% of all tariff lines)  0.1 1.0 0.9 
Domestic tariff "peaks" (% of all tariff lines)b 14.7 14.8 1.4 
International tariff "peaks" (% of all tariff lines)c 0.1 0.3 3.5 
Standard deviation  4.3 4.6 5.9 
Nuisance applied rates (% of all tariff lines)d 2.7 0.3 0.1 
n.a. Not applicable.  
a Final bound rates  are based on the 2021 tariff schedule in HS12 nomenclature.  
b Domestic tariff peaks are defined as those exceeding three times the overall simple average applied 
rate. 
c International tariff peaks are defined as those exceeding 15%.  
d Nuisance rates are t hose greater than zero, but less than or equal to 2%.  
Note:  The 2015 and 2021 tariff schedules are based on HS12 nomenclature.  
 Calculations for averages are based on national tariff line level (11 -digit), including AVEs.  
 AVEs for the 2015 tariff schedule  were provided by the authorities.  
 AVEs for the 2021 tariff schedule were estimated based on 2019 import data (IDB submission) at 
the 11 -digit level; AVEs for 38 tariff lines were provided by the authorities.  
Source:  WTO Secretariat calculations, based on data provided by the authorities, and WTO CTS database.  
3.29.   Of the dutiable lines (i.e. 1,875 lines or 18.7% of the total) in 2021, a little more than 
two thirds (i.e.  1,267 lines) refer to agricultural products (HS Chapters 01 -24) (Char t 3.3) and show 
tariffs ranging from 12% to 56.8% when using AVE estimates (Table A3.1). The highest rates, 
above  12%, continue to apply to alcoholic beverages and vinegars, with wine vinegar subject to the 
highest (56.8%), for which the applied and bound rates are the same specific duty. The 
three  agricultural HS chapters with the largest number of dutiable lines are vegetables, fruit and nut 
products; beverages, spirits, and vinegars; and meat and edible meat offals, together accounting 
for about half of agricultural dutiable lines. For non -agricultural products (HS  Chapters  25-97), the 
HS sections with the largest number of dutiable lines are plastics, wood, and iron and steel products.  
Chart 3.3 Structure of Georgia's tariff schedule, 2021  
 
Note:  Percentages denote the share of total tariff lines (10,028 tariff lines).  
Source:  WTO Secretariat calculations, based on data provided by the authorities.  
3.30.   At the HS chapter  level, products with the highest average tariff are beverages, spirits and 
vinegars (12.5% – HS 22). This was also the only HS chapter for which the average rate increased 
during the review period, from 9.2% in 2015 to 12.5% in 2021. They were followed by  cereals, flour, 
starch and milk products (12% – HS 19); tobacco (12% – HS 24); salts, sulphurs, earths and stone 
(12% – HS 25); and vegetables, fruit and nut preparations (11.7% – HS 20). In one case, 
HS 87 (vehicles and their parts and accessories), the average tariff declined, from 1% 
to 0.1%  (Chart 3.4).  
HS 20 (2.3% )
HS 22 (2.3% )
HS 02 (1.9% )
Other (4.9% )
HS 39 (1.5% )
HS 73 (1.1% )
HS 44 (1.0% )
Other (2.5% )HS 01 -24
(1,267 lines )
Duty-free lines 
(81.3%)
HS 25 -97
(608 lines)Chat 3. [GEO] Tariff ....
WTO calculations, based on data provided by the authorities. Source:Note:Percentages denote the share of total tariff lines (10,028 tariff lines).Dutiable lines
(18.7%)-Vegetables, fruit, nuts products
-Plastics & articles thereof-Edible fruit & nuts-Beverages, spirits & vinegar
-Meat & edible meat offal
-Articles of iron or steel
-Wood & articles of woodHS 08 (1.2%)WT/TPR/S/420 • Georgia  
 
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  Chart 3.4 Average applied MFN and bound tariff rates, by HS dutiable chapter, 2015 and 
2021  
 
Note:  The chart presents only chapters (HS 2 -digit level) wh ose tariff averages were more than zero 
in 2015 and 2021 (i.e. contained at least one dutiable line). The 2015 and 2021 tariff schedules are 
based on HS12 nomenclature, and final bound rates are based on the 2021 tariff schedule in HS12 
nomenclature. Calcu lations include AVEs for non -ad valorem  rates, where available.  
Source:  WTO Secretariat calculations, based on data provided by the authorities, and WTO CTS database.  
3.31.   With the large majority of tariff lines being duty -free, it is not surprising that Georg ia's reliance 
on revenue from customs duties is minimal, with their contribution accounting for 0.7%  in 2020, 
just slightly below its share in 2015 (0.9%) (Table A3.2).38 The shortfall from duties revenue is, 
however, offset by the revenue generated by ind irect taxes (i.e. VAT and excise taxes) on imports. 
Georgia remains highly dependent on the collection of VAT and excise taxes from imported goods, 
in particular VAT, which in 2020 accounted for 30.7% of the total tax revenue (Section 3.1.5).  
3.1.3.2   Bound tariffs  
3.32.   Georgia has bound all of its tariffs using mostly ad valorem  duties; only 17 lines corresponding 
to vinegars and all alcoholic beverages (except for beers) are bound at specific rates.39 Bound 
ad valorem  duties range from 0% to 30% and consist of 25 diffe rent rates, of which the most 
frequent are 0%, 5%, and 12%. Together these three rates account for about 74% tariff lines.40 
In 2021, the average bound rate was 7.4%, only slightly lower than in 2015 (7.6%), which mainly 
reflects the change in the total nu mber of lines (i.e. both splitting and merging lines).  
 
38 Between 2015 and 2020, revenue collection from tariffs  increased from GEL 69.3  million to 
GEL 74.4 million, but its share in total revenue declined as revenue from other sources grew more quickly.  
39 Beers (HS 2203) are bound at a rate of 12%. For the 17 lines corresponding to vinegars and all 
alcoholic bevera ges, the bound and applied duties are the same.  
40 Lines subject to a rate of 0%, 5%, and 12% account, respectively, for 27%, 12%, and 35% of the 
total number of tariff lines.  
0%5%10%15%20%25%
01020407080911151617181920212223242533343944686971738587Chart 3.[GEO]  Average applied MFN and bound tariff rates, by HS chapters, 2015 and 2021
01   Live animals 
02   Meat & edible meat offal
04   Dairy produce
07   Edible vegetables
08   Edible fruit & nuts
09   Coffee, tea, maté & spices
11   Products of the milling industry15  Animal or vegetable fats & oils
16  Meat, fish or crustaceans prod.
17  Sugars & sugar confectionery
18  Cocoa & cocoa prod.
19  Cereals, flour, milk prod.
20  Vegetables, fruit, nuts prod.
21  Misc. edible preparations22  Beverages, spirits & vinegar
23  Food industry residues & waste
24  Tobacco
25  Salt; sulphur; earths & stone
33  Essential oils & resinoids
34  Soap, etc.
39  Plastics & articles thereof44   Wood & articles of wood
68   Articles of stone, cement 
69   Ceramic products
71   Natural or cultured pearls
73   Articles of iron or steel
85   Electrical machinery & parts 
87   Vehicles & parts MFN 2021 Final bound
The chart presents only chapters (HS -2digit level) whose tariff averages are more than zero in 2015 and 2021 (i.e. contained at 
least one dutiable line). The 2015 and 2021 tariff schedules are based on HS 12 nomenclature; and final bound rates are based on
the 2021 tariff schedule in HS 2012 nomenclature. Calculations include AVEs for non -ad valorem rates, where available.MFN 2015Bound average: 7.4%MFN average 2021: 2.0%
2015: 2.0%
Note:
Source:WTO calculations, based on data provided by the authorities, and WTO CTS database.HS 01 -24 HS 25 -97WT/TP R/S/420 • Georgia  
 
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  3.33.   Applied rates, including those based on an AVE, do not exceed bound rates, except for one 
line referring to plastic boxes, cases, and similar articles for packing goods.41 At the HS chapter 
level, the gap between bound and MFN rates was on average most pronounced for coffee, tea, maté 
and spices (HS  09), ceramic products (HS 69), and live animals (HS 01) (Chart 3.4).  
3.1.3.3   Preferential tariffs  
3.34.   Georgia grants preferential treatment to imports from 18 partners (counting the 
European  Union as one) in accordance with its trade agreements and their preferential rules of origin 
(Sections 2 and 3.1.2). As Georgia's average applied rate is already low (2%), the scope for 
preferences is relatively limited, with most of  the benefits coming from the preferences applied to 
agricultural products. The average preferential tariff under Georgia's FTAs varies across agreements 
from 0% (European  Union, United Kingdom, and members of CIS FTAs) to 1.2% (Iceland), while for 
agricul tural products the average varies between 0% to 6%, compared to 6.7% at the MFN level. 
For non -agricultural products, the average duty is virtually 0% under all of these FTAs, compared to 
0.7% at the MFN  level (Table 3.3).  
Table 3.3 Tariffs under preferential agreements, 2021  
 Simple average (%)  Duty -free tariff lines (% of total)  
Overall  WTO 
agriculture  WTO non -
agriculture  Overall  WTO 
agriculture  WTO 
non-agriculture  
MFN 2.0 6.8 0.7 81.3 39.6 92.3 
China  0.4 2.1 0.002  96.1 81.5 99.97  
CIS FTAs, 
members of  0.0 0.0 0.0 100.0  100.0  100.0  
European  Union  0.0 0.0 0.0 100.0  100.0  100.0  
Hong Kong,  China  0.4 1.8 0.03 96.4 84.4 99.6 
Turkey  0.2 0.8 0.0 98.6 93.4 100.0  
United Kingdom  0.0 0.0 0.0 100.0  100.0 100.0  
Iceland  1.2 6.2 0.0 88.8 46.3 100.0  
Norway  0.6 2.9 0.0 94.3 72.9 100.0  
Switzerland  0.5 2.6 0.0 95.4 77.8 100.0  
Note:  All tariff calculations include AVEs, where available. If no preferential rate is applied, the 
corresponding MFN rate is used for the calculations.  
Source:  WTO Secretariat calculations, based on data provided by the authorities.  
3.35.   Aside from the European  Union, the United Kingdom, and members of CIS FTAs whose 
exporters face no duties when entering Georgia's market, the percen tage of duty -free lines for the 
other FTAs varies between 88.8% (Iceland) and 98.6%  (Turkey) of the total number of tariff lines.  
3.1.4   Tariff exemptions and reductions  
3.36.   Georgia continues to grant duty exemptions for social and economic purposes, notably for the 
promotion of exports and investment. These exemptions are described under the Tax Code and the 
Customs Code. The number of exemptions remains largely the same as at the time of the previous 
Review, except for a few additions made primarily to the list of exemptions under the Tax Code.  
3.37.   The Tax Code provides for a list of duty exemptions in Article  199 (Box 3.1), which is 
complemented by the duty exemptions described in Articles 181 -212 of the Customs Code. The list 
under Article  199 of the Tax Code compr ises specific products, as well as products intended for a 
certain use or for a given sector, e.g. baby food, diabetic food, certain minerals, certain sugar pastes, 
electric cars, tobacco, goods imported for humanitarian reasons, fuel for the use of domest ic 
aircrafts, and equipment and machinery for use of the oil and gas sector. The list also includes goods 
exempted from VAT, goods originating in countries party to the CIS FTA (1994), and goods whose 
value does not exceed GEL  300, except for alcoholic pro ducts, perfume, toilet water, and tobacco 
and tobacco products.42 Georgia also exempts from duties the imports of seed materials, fertilizers, 
and other products by manufacturers of agricultural products of neighbouring countries for their use 
 
41 This line (HS 39231000000) has an applied MFN rate of 12%, but some of its comp onents are 
bound  at 0%. A comparison between the applied and bound rate was not possible for about 0.1% of the total 
number of tariff lines.  
42 Tax Code, Article  199; and Customs Code, Article  185. WT/TPR/S/420 • Georgia  
 
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  in farms located in Georgia's border areas.43 In 2020, imported goods intende d for medical purposes 
of tobacco addictions were added to the list.  
3.38.   Additionally, the list in Article  199 also references the goods exempted from duties under the 
Customs Code, including those placed under certain customs regimes: (i)  transit; (ii)  custom s 
warehouse; (iii)  free zone (e.g. FIZ) (Section 3.2.4); (iv) end-use; (v)  inward processing; and 
(vi) outward processing. Goods imported under any of these special customs regimes are not subject 
to the payment of import duties, and in the case of FIZs, e nd-use, inward processing, and outward 
processing, the benefits for importers go beyond duty exemptions to include other tax exemptions 
and simplified procedures.  
Box 3.1 Duty exemptions under the Tax Code  
a. import of goods meant for natural disaster response measures, as well as for humanitarian purposes;  
b. import of goods provided for by grant agreements, in the manner determined by an ordinance of the 
Government;  
c. import of goods financed with grants or  with a concessional loan granted by the state authority of a foreign 
country and/or an international organization, of which at least 25% accounts for a grant element. The Ministry 
of Finance shall calculate the grant element in accordance with a resolutio n of Parliament;  
d. imports of goods (except for mineral products – HS Chapters 25, 26, 27) not intended for economic activities 
by natural persons in accordance with certain conditions (e.g.  mode of transport, value, quantity, and 
frequency);  
e. import of infant food products and diabetic food products labelled as such for wholesale or retail supply; 
import of X -ray films, insulin syringes (needles), glucometers, and diagnostic test systems;  and import of 
goods intended for medical purposes of tobacco addiction (effective as of January 2020);  
f. import of goods intended for supply on board performance of international flights and international voyages, 
and import of fuel, lubricants, and oth er auxiliary means intended to be supplied on board for performance of 
civil flights and aviation works within the state border of Georgia;  
g. import of equipment and machinery, vehicles, spare parts, and materials for performing oil and gas 
operations provided for by the Law on Oil and Gas;  
h. goods seized, confiscated, abandoned, and transferred to state ownership and/or a vehicle transferred to 
the State's disposal or ownership in the manner provided for by the legislation of Georgia;  
i. import of raw tobacco carried out before 1  January  2023;  
j. import of goods in accordance with the requirements of sub -paragraphs "w" and "c" to "j" of Article  173 
(VAT Exemptions) of the Tax Code (effective as of July 2020), which include imports by diplomatic and 
consular missions, paper, radiopharmaceuticals, and medical X -ray films;  
k. goods placed under the customs procedures described under the Tax Code and the Customs Code (except 
for temporary admission and import – release into free circulati on), as well as placing goods in a duty -free 
shop;  
l. imports of goods entirely manufactured in an FIZ from an FIZ;  
m. import of goods returned in accordance with Article  107 (Returned Goods) of the Customs Code;  
n. import, by parcel post (other than those provided in (d) of goods under HS Chapters 28 -97 (except for 
certain chemical goods falling under Code 3824 90 980 01) ) that are not intended for the economic activity 
and that are valued at up to GEL 300 with th e total weight of up to 30  kg; imports of tobacco products in 
accordance with certain conditions (i.e. quantity, weight, and value); imports of 50  ml of chemical goods 
falling under 3824 90 980 01; and imports of 4 litres of all alcoholic beverage types;  
o. import of goods under product headings 1704 90 510 00 (sugar pastes), 2207 10 000 00 (undenatured 
ethyl alcohol), 2501 00 310 00 (salt for chemical transformation), 2501 00 510 00 (salt for industrial use), 
2506 (quartz and quartzite), 2507 (kaolin), 25 08 (certain clays), 2509 (chalk), 2511 (barium), 2522 (lime), 
2524 (asbestos), 2525 (mica), 2526 (not crushed or powdered steatite), 6805 20 000 00 and 6805 30 800  00 
(natural or artificial abrasive powder or grain on a base of paper or other materials);  
 
43 Tax Code, Article  199; and Customs Code, Article  189. WT/TP R/S/420 • Georgia  
 
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  p. electric engine vehicles under product heading 8703;  
q. import of goods originating in the territory of a State being a party to the International Agreement on 
Creation of a Free Trade Area of 15  April 1994 from such a State (i.e. CIS FTA (1994)), irrespective of the 
itinerary of such goods (irrespective of passing by such goods of the territory of a State not being a party to 
the Agreement, during their movement from the territory of the country of export);  
r. goods exempted from the customs oblig ation provided for by the Customs Code in accordance with the 
conditions defined by the same Code (effective as of September 2020), including the importation of seed 
materials and fertilizers for improving soil and crops; goods worth less than GEL 300; per sonal property by a 
natural person; educational, scientific or cultural material, or scientific equipment; pharmaceutical products 
to be used at an international sports event; supporting material to be used for packing or protecting goods 
during their tran sportation (Articles 181 -212 of the Customs Code).  
Source:  Tax Code, Article  199, last amended on 2  August  2021.  
3.39.   Goods under customs warehouse are not taxable from customs duty and so by extension are 
goods imported by companies with the status of special trading companies, which are warehouses 
that have confirmed their status with the tax authorities. Such companies can import foreign goods 
duty-free to re -export them and are exempted from profit tax on income received from these 
re-exports (Box 3. 3). 
3.1.5   Other charges affecting imports  
3.40.   Besides duties, imports are subject to fees for customs operations, a VAT of 18%, and where 
applicable an excise tax.  
3.41.   During the review period, Georgia continued to reform its indirect tax policy to harmonize it 
with tha t of the European  Union as provided for in their Association Agreement. It increased the 
number of excisable goods as well as some of their rates, and amended its VAT rules, in particular 
the scope of VAT application for services transactions. Fees for the  most frequent customs operations 
remained unchanged.  
3.42.   Both the VAT and excise tax apply equally to imported and locally produced goods (and 
services in the case of the VAT), except for certain agricultural goods for which the application of 
the VAT depends  on the goods' origin. Both taxes are an important source of revenue for Georgia. 
In 2020, together they generated GEL  6.5 billion in revenue, accounting for about 60% of 
Georgia's  total tax revenue (Chart 3.5). Of this amount most came from imports: VAT a nd excise 
tax on imported goods generated 30.7% and 13.3%, respectively, of total tax revenue.  
Chart 3.5 Tax revenue, 2020a 
 
a Percentages denote the share of total tax revenue . 
Source:  Compiled by WTO Secretariat, based on data provided by the authorities and Ministry of Finance. 
Viewed at: http://treasury.ge/5539 . 
Indirect tax
59.6%Import 
duties 
0.7%
VAT
44.1%Imports
30.7%
Excise
14.8%Domestic
13.4%
Imports
13.3%
Domestic
1.5%Direct tax
42.7%Total tax revenue 
GEL 10,964.4 millionChat 3. [GEO] Tax revenue, 2020
Compiled by WTO Secretariat, based on data provided by the authorities and Ministry of Finance of Georgia. Viewed at: 
http://treasury.ge/5539.Source:a
a Percentages denote the share of total tax revenue.WT/TPR/S/420 • Georgia  
 
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  3.1.5.1   Customs fees  
3.43.   Fees for customs -related operations are listed in Resolution No.  96 of 30 March  2010 on 
Approval of Fees and their Rates for the Provision of Services by the Revenue Service, last amended 
in 2021. The list includes a customs declaration and clearance fee applying in general to all imports. 
This fee has not changed since the l ast Review, and ranges between GEL  100 and GEL  400, 
depending on the value of the goods (Table 3.4). Importers can benefit from a cheaper fee for 
imports worth more than GEL  3,000 if they submit their declarations in advance through the 
eCustoms platform.44 Registration on the eCustoms system costs GEL  200. Other customs fees 
include  fees for verifying the documentation and identity of goods subject to phytosanitary or 
veterinary control.  
Table 3.4 Main customs  fees and charges, 2021  
Description of service  Fee 
(GEL)  
Import declaration processing fee for declarations submitted in paper or electronically in a 
customs clearance zone (i.e.  customs facility centre) where the goods have arrived or are 
about to arrive (i.e. distant declarations), or in a designated agreed location  
- for goods with a value exceeding GEL 15,000  
- for goods with a value between GEL 3,000 and GEL 15,000  
- for good s with a value below GEL 3,000   
 
 
400 
300 
100 
Import declaration processing fee for declarations submitted through e -customs by a 
registered person (advance declarations)  
- for goods with a value exceeding GEL 15,000  
- for goods with a value between GEL 3,000 and GEL 15,000  
- for goods with a value below GEL 3,000   
 
300 
200 
100 
Initial access to the eCustoms automated data system  200 
Carrying out customs processing operations on declarations and accompanying documents 
submitted by a person to a non -border customs authority from 16h00 to 19h00 on a working 
day 50 
Preliminary decision on the determination of the commodity code in accordance with the 
National Commodity Nomenclature of Foreign Economic Activity for Goods  
- 30 working days  
- 10 working days  
- 5 working days   
 
Free 
250 
500 
Preliminary decision on determining the country of origin of goods  
- 30 working days  
- 10 working days  
- 5 working days   
Free 
250 
500 
Re-export declaration processing fee (of declared goods)  50 
Documentary  inspection of goods subject to phytosanitary control  30 
Documentary  inspection of goods subject to veterinary control  30 
Verification of the identity of goods subject to phytosanitary control  30 
Verification of the identity of goods subject to veterinary control  30 
Source:  Resolution No.  96 of 30  March  2010 on Approval of Fees and their Rates for the Provision of Services 
by the Revenue Service, last amended on 8  October  2021.  
3.1.5.2   Value added tax  
3.44.   Georgia applies a VAT o f 18% to the sale of all goods and services, both imported and locally 
produced, with some exceptions including certain imports and agricultural products originating in 
Georgia. During the review period, Georgia reformed its VAT rules to bring them closer to those of 
the European  Union as provided under their Association Agreement (Article  285 and Annex XXII). 
The amendments resulted in an increase in the number of exemptions for goods but primarily for 
services and included, for example, the elimination of  VAT on temporary imports and all cross -border 
services transactions (Box 3.2 ). In 2020, Georgia also introduced a temporary VAT exemption for 
imports of certain medical products (e.g.  test kits, protective gear, and thermometers) in response 
 
44 The authorities indicate that such submission could also be made through the eServices platform.  WT/TP R/S/420 • Georgia  
 
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  to the COVID ‑19 pandemic. The measure, in place since April 2020, was initially going to be removed 
in October of the same year but has been extended until January 2022.45 
Box 3.2 VAT reform and its implications for cross -border trade in services  
During the review period, Georgia reformed its VAT rules in the Tax Code to align them with the EU  practice 
as provided under the DCFTA and facilitate,  inter alia, cross-border trade in services with the European  Union. 
The amendment s, which were adopted in July 2020, entered into force in January 202146 and resulted in an 
increase in the number of exemptions for goods but more so for services. The reform included, for example, 
the elimination of the VAT on temporary imports, and on a ll cross -border services transactions, including 
electronically rendered services47, between two companies (i.e. B2B transactions) when the services provider 
is located in Georgia and the customer is abroad.48 In other words, Georgian businesses are exempt ed from 
charging VAT on any services (or products) supplied to customers (businesses) located in other countries. 
Prior to the reform, only selected cross -border B2B transactions were exempted from the payment of VAT. In 
2019, Georgia amended its VAT rules to align them w ith those of the European  Union, which are described in 
EU Council  Directive 2006/112/EC.49 The reform included, inter alia, change in the definition of "place of 
supply of services" to facilitate cross -border services trade between Georgia and the European  Union, including 
e-commerce. The "place of supply of services" is key to determine where the VAT must be declared and by 
whom. The new rules provide that for cross -border services transactions between two companies 
(B2B transactions) the place where the customer is established is the place of supply. This implies that all 
services transactions involving a supplier located in Georgia and a customer abroad are not subject to VAT, 
so that Georgian businesses do not need to invo ice VAT to their customers. Prior to the reform, this was the 
case only for a selected number of cross -border services transactions. Based on this definition, customers 
located in Georgia and participating in a B2B services cross -border transaction will be  subject to a reverse -VAT 
mechanism, under which the customer (and not the supplier) must declare the amount of VAT it would have 
paid on that service if it had bought it in Georgia instead of from abroad. If the customer is not registered for 
VAT purposes , then it must declare and pay the reverse -VAT. If it is registered, it must declare all reverse -
VAT transactions, but can simultaneously claim them back, thus giving companies an incentive to register. 
The new rules also provide that for cross -border serv ices transactions between a company and a private 
consumer (B2C), the place of supply is the place where the provider is established, so that Georgian businesses 
need to invoice the VAT to their foreign customers, and declare it. Prior to the reform, not a ll B2C transactions 
were subject to this obligation.  
Source:  Tax Code of August 2021, Articles 1621, 171, and 172.  
3.45.   The list of goods exempted from VAT includes unprocessed agricultural goods produced in 
Georgia (except for eggs and poultry)50, as well as certain meat products and cheeses51 made from 
local inputs and animals living in Georgia.  
3.46.   Certain imported goods are also exempted from VAT, including magazines, newspapers, 
notebooks, chemicals, and goods intended for pharmaceutical or medical purposes, i ndustrial or 
medicinal plants, baby food, animal or vegetable fats and oils, natural gas for electricity production, 
agricultural pesticides and agrochemicals, vehicles, and fuel for aircrafts.52 Goods (and services) 
imported into Georgia under its trade a greements are exempted from VAT. Since 2016, a VAT 
exemption has also applied to shell -less nuts produced in Georgia (HS 0802 22 000 00) and to the 
temporary importation of goods that have been fully exempted from customs duties since 2019.53 
The full list s of exemptions are provided in Articles 171, 172, and 173 of the Tax  Code. The list of 
exemptions in Article  173 contains mainly imported goods, while the lists in Article  171 and 
172 include both goods and services, imported or not. Services exempted fro m the payment of the 
 
45 Joint Ministerial Orders No.  01-36/No.  89 of 1 April 2020 on the Determination of the List of Goods 
Intended for Medical Purposes, the Delivery and/or Imports  of which are Exempt from the VAT; and 
No. 01-132/No.  322 of 29 December 2020 on Approval of the List of Goods, the Supply and/or Import of which 
is Exempt from Value Added Tax by the Minister of IDPs from the Occupied Territories of Georgia, Labour, 
Health and Social Affairs and the Minister of Finance; and their amendments.  
46 Tax Code Amendment of 14 July 2020.  
47 Services electronically rendered defined as services provided via the Internet or electronic 
network  (Tax Code, Article  157).  
48 Former Tax Code (prior the reform of 2019), Articles 158 and 162.  
49 EU Council Directive 2006/112/EC of 28  November  2006 on the Common System of Value Added Tax.  
50 Tax Code (latest version of August 2021), Article  172, para.  4. Exceptions fall in HS 0207 11 (eggs) 
and HS 0407 11 000 00 and HS 0407 21 000 00 (poultry meat).  
51 These goods fall in HS 0201, HS 0203 11 – HS 0203 19, HS 0204 10 000 00 – HS 0204 23 000 00, and 
HS 0204  50 110 00 –HS 0204 50 390 00.  
52 Tax Code, Article  173. 
53 Tax Code, Article  172, para.  4, and Amendments No.  4680 of 18  December  2015 and No.  4906 of 
28 June 2019; and information provided by the authorities.  WT/TPR/S/420 • Georgia  
 
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  VAT include financial operations/financial services, medical and dental services, educational services, 
and gambling.  
3.47.   VAT registration with the Revenue Service is compulsory for businesses whose annual 
VAT-taxable transactions exceed G EL 100,000.54 VAT registration is also required for businesses 
involved in the production or import of excisable goods prior conducting the transaction, and 
regardless of its amount (Section 3.1.5.3).55 VAT on imported goods is calculated on the sum of the  
CIF (cost, insurance, freight) value plus import duties, excise tax (or any other tax where applicable), 
and customs fees and charges. VAT is one of the main contributors to Georgia's revenue, accounting 
for 44.1% in 2020. This share remained relatively s teady during the review period but in terms of 
value it increased from GEL  3.5 billion in 2015 to GEL  4.8 billion in 2020 (Table A3.2).  
3.1.5.3   Excise tax  
3.48.   During the review period, Georgia expanded the list of excisable goods and modified some its 
rates based on h ealth considerations and as part of a broad tax reform seeking to align its tax rules 
with those of the European  Union. The number of excisable goods went from 251 in 2015 
to 289 (at the 11 -digit level), grouped in 11 product categories (Table A3.3) includ ing alcoholic 
beverages (e.g. beer and spirits/liquors), tobacco products, cars, petroleum products, petroleum 
gas and natural gas, biodiesel, and lubricants. Goods that became excisable during the review period 
included raw tobacco, tobacco waste, fluids for e-cigarettes, and motorcycles. All excise rates are 
non-ad valorem . 
3.49.   In 2015 and 2016, Georgia also increased its excise tax on alcoholic beverages and tobacco, 
and adopted a retail tax of 5% for cigarettes in addition to the existing excise tax. The ex cise tax 
applies to all alcoholic beverages except for wine (HS 2204), thus providing some additional support 
to this sector, which already benefits from some tariff protection. The rates on alcoholic beverages 
depend on the volume of an alcoholic beverage , the volume of pure alcohol in an alcoholic beverage, 
or by percentage of alcohol content. During the review period, the rate for alcoholic beverages 
doubled or more than doubled in most cases (Table  A3.3). For example, for spirits such as whiskies, 
rum, and gin, the excise rate went from GEL  10 per litre of pure alcohol in  2015 to GEL  22.5 per litre 
of pure alcohol in 2021. The excise rates for cars (new and used) also increased during the review 
period.  
3.50.   Georgian producers and importers of excisable goods  (except where the import of excisable 
goods into Georgia is exempt from VAT) must be registered as VAT payers before supplying the 
excisable goods.56 
3.51.   Georgia also requires the mandatory affixing of excise stamps to the following goods, whether 
imported or locally produced: (i)  excisable alcoholic beverages; (ii)  tobacco products (including raw 
tobacco or tobacco waste); and (iii)  liquids containing nicotine or not containing nicotine, intended 
to be used in electronic cigarettes. Exceptions include domesti cally manufactured goods intended 
for export, and imported raw tobacco and certain tobacco products.57 The excise stamps must be 
affixed to the product before being sold or imported.  
3.52.   International calls are also subject to an excise tax, which amounts to G EL 0.15 per minute 
for calls received on a mobile phone and GEL  0.8 per minute for those received on a fixed network 
in Georgia.58 
 
54 Tax Code, Article  157. The threshold for registration of GEL 100,000 does not apply to foreign 
businesses with fixed establishment in Georg ia that are obliged to pay VAT from the moment they provide the 
service or deliver the goods. For VAT purposes, fixed establishment refers to foreign businesses capable of 
providing a service independently by having a proper structure in terms of human and  technical resources, 
e.g. a branch.  
55 Information provided by the authorities.  
56 Tax Code, Article  165. 
57 Tax Code, Article  192. 
58 Tax Code, Article  188. WT/TP R/S/420 • Georgia  
 
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  3.1.6   Import prohibitions, restrictions, and licensing  
3.53.   Georgia maintains imports controls for certain goods, mostly for health, security, and 
environmental reasons. During 2015 -21, the lists of prohibited and restricted imports remained 
almost unchanged, except for a few additions, one of which was temporary. Georgia imposed a 
licence requirement on the imports of hazardous  waste and of electronic communications 
interception systems in 2017 and 2019, respectively. In 2020, it also banned all imports of 
live animals from China in response to the COVID -19 pandemic, but this measure was removed 
in June the same year.  
3.54.   The latest WTO notifications by Georgia in this area were made in 2018 and 2020. In  2018, 
it submitted its (annual) notification on import licensing procedures59, and in 2020, it submitted 
its (biennial) notification on import prohibitions and controls (i.e. q uantitative restrictions) for the 
period 2016 -20; its next (biennial) notification will be due in 2022.60 The 2020 notification does not 
include the additional measures imposed in 2017, 2019, and 2020 (mentioned above), which are 
thus pending. In this rega rd, the authorities indicate that they will include them in their 
next notification.  
3.1.6.1   Import prohibitions  
3.55.   Regulations on import prohibitions are scattered across various legal instruments dealing with, 
inter alia, waste, air protection, nuclear and radiatio n safety, hazardous chemicals, pesticides, and 
drugs. The list of import prohibitions comprises seven type of products, all of which are implemented 
based on health considerations (Table 3.5). The prohibitions are administered by three  different 
institutio ns – the Revenue Service, the Ministry of Environmental Protection and Agriculture, and the 
Ministry of Internally Displaced Persons (IDP) from the Occupied Territories, Labour, Health and 
Social Affairs. From February to June 2020, Georgia added live anim als imported from China to this 
list with a view to combating the spread of COVID -19 in the country.61 This was the only amendment 
reported affecting the list of import prohibitions during the review period.  
3.56.   Of the seven types of products subject to an imp ort prohibition, ozone -depleting substances, 
hazardous chemicals and pesticides, and narcotic drugs are also subject to an export prohibition 
(Section 3.2.3).  
Table 3.5 Import prohibitions  
Prohibited imports b y managing Ministry/Agency  Main legal instrument  
Ministry of Environmental Protection and Agriculture   
▪ Hazardous waste  Law on Imports, Exports and Transit of 
Waste  
▪ Non-hazardous waste for the purpose of its disposal  Law on Imports, Exports and Transit of 
Waste  
▪ Ozone -depleting substances  Law on Ambient Air Protection  
▪ Radioactive waste  Law on Nuclear and Radiation Safety  
▪ Certain hazardous chemicals and pesticides (except for 
chemicals imported or exported for the purpose of 
research or analysis and in quantities not exceeding 
2 kg in single shipment)  Decree No.  263 of 13  June 2016 on the 
Procedure of Export -Import and the Prior 
Informed Consent for Certain Hazardous 
Chemicals and Pesticides  
Ministry of IDP from the Occupied Territories,  Labour, 
Health and Social Affairs   
▪ Narcotics drugs included in List I of the Law on Narcotic 
Drugs, Psychotropic Substances and Precursors, and 
Narcological Assistance (except when used for 
educational, scientific research, expert examination, 
and criminalistic purposes in Georgia)  Law on Narcotic Drugs, Psychotropic 
Substances and Precursors, and 
Narcological Assistance  
 
59 WTO document G/LIC/N/3/GEO/8, 19 November 2018.  
60 WTO document G/MA/QR/N/GEO/2, 10  February  2020.  
61 Resolution No.  164 of 28  January  2020 on Approval of Measures to Prevent the Possible Spread of the 
Novel Coronavirus in Georgia and the Emergency Response Plan for the Cases of Novel Coronavirus Disease, 
and its amendments. The measure was removed by Ordinance No.  34934 of 8 June 2020.  WT/TPR/S/420 • Georgia  
 
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  Prohibited imports b y managing Ministry/Agency  Main legal instrument  
Revenue Service   
▪ Live animals imported from China (COVID ‑19-related 
measure) (in place from February to June 2020)  Resolution No.  164 of 28  January  2020 on 
Approval of Measures to Prevent the 
Possible Spread of the Novel Coronavirus in 
Georgia and the Emergency Response Plan 
for the Cases of Novel Coronavirus Disease, 
and its amendments  
Source:  Information provided by the authorities.  
3.1.6.2   Import restrictions and licensing  
3.57.   Georgia restricts the imports of a selected number of products through a system of 
(non-automatic) licences and permits based on health, security, and environmental considerations. 
The legal fr amework governing the issuance of licences and permits is described in the Law on 
Licences and Permits of 2005, the Law on Licence and Permit Fees of 2003, and their amendments. 
These laws include a list of activities and goods subject to a licence or perm it, which intends to 
capture and consolidate all licence and permit requirements contained in various issue -specific laws, 
resolutions, or other legal instruments.62 According to the Law on Licences and Permits, Georgia 
may impose a licence or permit on any activity or action that may pose a major hazard to human 
life or health, or affect national or public interest, provided that this measure reduces these risks or 
deals with these concerns. The Law distinguishes between licences and permits based on the actions 
and activities to be undertaken. A licence grants the right to a person to carry out a specific type of 
activity or use resources if the person meets the cond itions laid out by the Law, while a permit gives 
the right to carry out an action for a definite or indefinite period, and relates to an object.63 
3.58.   The list of goods subject to an import licence or permit consists of 17  product 
categories  (Table A3.4).64 This list has remained almost the same since the last Review, with a few 
additions, one in  2019 and another in 2017. In  2019, Georgia imposed a licence requirement to 
import (as well as to produce and export) electronic communications interception systems fo r 
security reasons65, and in 2017, it introduced an import licence for hazardous waste and removed 
the import licence for materials of limited circulation.66 These changes have not been yet notified to 
the WTO Secretariat.67 
3.59.   Other product categories includ ed in this list are non -hazardous waste, radioactive and 
nuclear materials, pharmaceuticals products subject to special control, non -iodized salt, and 
dual-use goods (Table A3.4). Most of the product categories subject to an import licence/permit are 
also subject to an export licence/permit (Section 3.2.3).68 
3.60.   Importers willing to apply for one of these licences or permits must submit their application 
to the corresponding ministry or agency. Currently, there are six institutions responsible for issuing 
licences/permits: (i)  Ministry of Environmental Protection and Agriculture (MEPA); (ii)  Ministry of 
Defence; (iii)  Ministry of Internal Affairs; (iv)  Ministry of IDP from the Occupied Territories, Labour, 
Health and Social Affairs; (v)  Revenue Service; and (vi ) National Communications Commission. All 
applications for permits issued by the Revenue Service and the National Food Agency (under  
the MEPA) may be submitted electronically. The fees for issuing a permit or licence are fixed and 
 
62 As of September 2021, the last amendments (in Georgian only) of the Law on Licences and Permits 
and the Law on Licences and Permits Fees had been published in Georgia's Ga zette on 29 July 2020 and 
2 July 2020, respectively. The last consolidated version of these laws in English goes back to 2017.  
63 Law on Licences and Permits, Articles 2 and 3.  
64 Of these product categories, 2 are subject to an import licence (i.e. electron ic communications 
interception systems, and surveillance equipment), and the rest to an import permit.  
65 Resolution No.  490 of 27 March 2017 on the Amendments to the Law on Licence and Permit Fees. The 
change became effective in March 2019.  
66 Resolution No . 4954 of 26 April 2016 on the Amendments to Law on Licence and Permit Fees. The 
change became effective in July 2016. The authorities further indicate that the import licence for hazardous 
waste was introduced in accordance with the Basel Convention on th e Control of Transboundary Movements of 
Hazardous Wastes (Basel Convention).  
67 The most recent WTO notification on quantitative restrictions was submitted in February 2020.  
68 Of the 17 product categories that are subject to an import licence/permit, 13 are  also subject to a 
permit to export and import, except for 2 for which a licence applies (i.e. electronic communications 
interception systems, and surveillance equipment).  WT/TP R/S/420 • Georgia  
 
- 56 - 
 
  vary from GEL  8 to GEL  200, with some exceptions where the procedure is free (e.g.  permit for 
non-iodized  salt) or depends on the value of the transaction (e.g. permit for military weapons).  
3.61.   The existing public online platforms (i.e. eCustoms and eServices) do not host all 
licence /permit procedures, but the Government maintains a Unified Electronic System of Licences, 
Permits and Certificates for internal use. Once a permit is issued, it is uploaded and stored in this 
unified platform, which is accessible to all relevant institutio ns. Currently, the system hosts 
38 different licences, permits, and certificates, according to the authorities. Moreover, this system 
is connected to the eCustoms platform so that traders do not need to resubmit their permits and 
licences to the Revenue Se rvice during the declaration process as the Revenue Service (and traders) 
has access to this information.69 
3.62.   In addition to this licensing/permit scheme, the importation of certain goods may be also 
subject to registration requirements or other forms of cer tification under certain conditions, 
e.g. in the case of pharmaceuticals, pesticides, agrochemicals, veterinary preparations, and 
iodized  salt.70 
3.63.   Finally, Georgia maintains quotas for imports of ozone -depleting substances that are allocated 
according to th e Montreal Protocol on Substances that Deplete the Ozone Layer.71 
3.1.7   Anti-dumping, countervailing, and safeguard measures  
3.64.   Georgia still does not have legislation on the application of countervailing and safeguard 
measures but during the review period adopted its first piece of legislation on anti -dumping.72 
3.65.   The new law – the Law on the Introduction of Anti -Dumping Measures in Trade – was enacted 
in July 2020 and partially entered into force on 1  January  2021, pending the adoption of Article  20 
on the condition s for launching and conducting an investigation, and of three resolutions for the 
effective implementation of the Law.73 The Law became fully operational on 1  June 2021 with the 
entry into force of Article  20 and these resolutions.74 The new resolutions regulate the procedures 
regarding the launching and execution of an investigation, and the introduction of preliminary and 
definitive anti -dumping measures.  
3.66.   The Law establishes the conditions and rules for the application of anti -dumpi ng measures 
when dumped goods are imported into Georgia's territory (excluding its FIZs ). It builds upon 
the Anti-Dumping Agreement, while adding some new provisions, e.g. on the consideration of public 
interest when deciding on the application of an anti -dumping measure.75 It also designates the 
National Competition Authority (NCA) as the investigative authority and defines its responsibilities. 
Following its designation, the NCA created a  department for anti -dumping measures in March 2021. 
The NCA is in c harge of investigating anti -dumping cases, assessing consequences for the local 
industry, and submitting its conclusions to the Government, which will take a final decision on the 
imposition of anti -dumping measures. The Revenue Service shall be responsibl e for administering 
 
69 Information provided by the authorities.  
70 Information provided by the authorities ; and Revenue Service, Pharmaceutical Items . Viewed at: 
https://www.rs.ge/LegalEntityNonTariffControl -en?cat=4&tab=1 . 
71 Law on Atmospheric Air Protection, Article  381; and Resolut ion No.  266 of 17 June 2016 on Issuance 
of Permits for Import, Export, Re -export and Transit of Ozone Depleting Substances and on the Approval of the 
Technical Regulation on the Distribution of the Annual Import Quota. The last order by the Minister of 
Environmental Protection and Agriculture approving the quota was Order No.  2-1172 of 16 December 2020 
on Approval of the 2021 Annual Import Quota of Ozone Depleting Substances. This measure has been notified 
to the WTO (WTO document G/MA/QR/N/GEO/2, 10  Februa ry 2020).  
72 WTO document G/ADP/N/1/GEO/2, 15 October 2020.  
73 Law on the Introduction of Anti -Dumping Measures in Trade, Article  26, issued on 13 July 2020.  
74 The three government resolutions (in Georgian only) were adopted on 1  June 2021: Resolution 
No. 251 on the P reliminary Anti -Dumping Measure and the Rule of Administration of the Special Anti -Dumping 
Tariff; Resolution No. 249 on Approval of the Rules and Procedures for Conducting Anti -Dumping Measures in 
Trade; and Resolution No. 250 on the Rule of Dec ision on the Introduction of Anti -Dumping Measures in Trade.  
75 Under Article  23 of the Law on the Introduction of Anti -dumping Measures in Trade, Georgia may 
decide not to apply an anti -dumping measure, on the basis of the information made available during  the 
investigation, if it can clearly be concluded that it is not in Georgia's economic or consumers' interest to apply 
such measures.  WT/TPR/S/420 • Georgia  
 
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  such measures. As at September 2021, the NCA department for anti -dumping measures had 
received requests for pre -lodgement advice but no official requests for an investigation.76 
3.67.   Investigations shall be initiated based on a written reque st submitted to the NCA by or 
on behalf of a domestic industry provided that the request has the support of domestic producers 
whose output accounts for at least 25% of total production of the like product. The Law establishes 
a minimum threshold for condu cting the investigation, which shall not be launched or shall be 
terminated if the volume of imports is negligible (i.e. less than 3% of the gross import of like 
products) or the margin of dumping is de minimis  (i.e. less than 2% , expressed as a percentage  of 
the export price ). The NCA cannot initiate an ex officio  investigation. Investigations should be 
completed within 1 year, and in no case more than 18 months, after initiation (Article  20 of the 
Law). After completion of the investigation and based on i ts findings, the NCA shall submit to the 
Government an opinion on the suitability of introducing, revising, or eliminating an anti -dumping 
tariff. The amount of the anti -dumping duty shall be the same or less than the margin of dumping. 
A preliminary anti -dumping measure (i.e.  duty or cash deposit) may also be imposed, provided that 
60 days have elapsed since the beginning of the investigation. The application of a preliminary or 
definitive anti -dumping measure shall be approved and published as a Governmen t Resolution. The 
Law also includes a sunset clause under which if the investigation leads to the imposition of definitive 
measures such measures should be terminated no later than five years after their imposition, unless 
a review (repeated investigation ) is initiated prior to their expiration and concludes that removing 
the special anti -dumping duty would inflict damage on local industry . In this case, a measure can 
be renewed for a maximum period of another five years.77 The decision by the Government to  
introduce (or not), revise, or abolish the preliminary or definitive anti -dumping tariff may be 
appealed. The Law also includes provisions on its WTO notifications in accordance with its obligations 
under the Anti -Dumping Agreement.78 
3.68.   As of August 2021, Georgia had not initiated any investigation or applied any anti -dumping 
measures (or any other contingency measure) but had been the object of two anti -dumping 
investigations, one led by India and another by the European  Union. The latter was initiat ed 
in December  2015 against certain manganese oxides imported from Georgia, but the investigation 
was terminated without the imposition of any measure following the withdrawal of the complaint in 
December  2016. India also initiated an anti -dumping investig ation in 2016 against the imports of 
ammonium nitrate, which led to the imposition of anti -dumping duties in 2017.79 
3.1.8   Other measures affecting imports  
3.69.   During the review period, Georgia launched two temporary programmes to subsidize the 
imports of wheat and seven other products considered as of primary consumption (rice, pasta, 
buckwheat, sunflower oil, sugar, milk powder, and beans) with a view to stopping price rises in the 
country and dealing with international food price fluctuations triggered by the intr oduction of food 
export restrictions around the world amid the COVID -19 pandemic. Both programmes were 
administered by the Revenue Service and the Agricultural and Rural Development Agency (under 
the M EPA), and neither was notified to the WTO.  
3.70.   In April 202 0, Georgia launched the State Program for Subsidizing Wheat Imports to ensure 
the stability of the retail price of wheat and wheat flour80, and promote the creation of stocks for 
these products.81 The Program's beneficiaries were natural or legal persons r egistered in Georgia, 
who have purchased and/or imported at least 5,000 tonnes of wheat within one calendar year before 
submitting an application to enter the Program, and with whom a subsidy agreement laying out the 
parties' obligations has been concluded. Beneficiaries received a subsidy in Georgian lari equivalent 
to USD  40 per tonne of imported wheat, provided they sell the flour obtained from processing the 
 
76 Information provided by the authorities.  
77 Law on the Introduction of Anti -dumping Measures in Trade, Articles 1, 4 -5, 15, 18 -21, and 24 -25. 
78 Under Article  25 of the Law on the Introduction of Anti -dumping Measures in Trade, Georgia shall 
notify the WTO on the commencement of inspection, the intr oduction of preliminary or special anti -dumping 
measures, and once every two years a review of anti -dumping measures implemented during previous 
six months.  
79 WTO documents G/ADP/N/350/IND/Rev.1, 26 April 2021; and G/ADP/N/294/EU, 11 April 2017.  
80 Resoluti on No.  254 of 17  April 2020 on Approval of the State Program for Subsidizing Wheat Imports.  
81 According to the FAO, Georgia's imports of wheat account for about 90% of domestic consumption, 
with the Russian  Federation being its main wheat supplier. FAO, Georgia Introduces Subsidies on Wheat Flour , 
14 December 2020. Viewed at: http://www.fao.org/giews/food -prices/food -policies/detail/en/c/1364623/ . WT/TP R/S/420 • Georgia  
 
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  imported wheat at a maximum price set by the authorities.82 This price was set at GEL  51 per 3 kg 
of wheat flour. Any beneficiary infringing on this condition was liable for a fine of at least GEL  50,000. 
The Program was allocated GEL 5.2 million to subsidize a maximum of 40,000 tonnes of wheat. 
Subsidies were granted from 17  April 2020 to 2 0 May 2020. As of December  2020, six companies 
had benefited from the Program, and the amount disbursed was about GEL  4.5 million for 
40,000  tonnes of subsidized wheat.83 
3.71.   In March 2020, Georgia also launched the State Program for the Maintenance of Prices for 
Primary Food Products with a view to stopping the price increase of seven basic food products (rice, 
pasta, buckwheat, sunflower oil, sugar, milk powder, and beans) and increasing their stocks in the 
country. The Program was allocated GEL 10 million to  subsidize the customs value of the import of 
these products. The Program subsidized imports made between 15  March and 15  May 2020.84 The 
amount of the subsidies was the difference between the customs value of the product imported 
during this period and th at of its last import as of March 2020 in accordance with the conditions set 
by the authorities. Beneficiaries were any natural or legal person registered in Georgia, who imports 
to Georgia any of the products covered by this programme and with whom a subs idy agreement 
setting the parties' obligations could be concluded. As at December  2020, nine companies had 
benefited from the Program, and the amount disbursed was about GEL  1.1 million for 3,180  tonnes 
of subsidized imports.85 Neither programme has been r enewed, according to the authorities.  
3.72.   In addition to these import support programmes, Georgia approved in November  2020 a 
programme to support wheat flour sellers: the State Program for Subsidizing Wheat  Flour. Under 
the Program, a subsidy was granted to w heat flour sellers provided they sell wheat flour at a 
maximum price fixed by the authorities. In January 2021, this price was set at GEL  53, and the 
subsidy was of GEL  15 per 50  kg bag of flour wheat. Subsidies were to be granted from 
December  2020 until March  2021, but their grant was subsequently extended to June  2021.86 The 
authorities indicate that this programme was not renewed.  
3.2  Measures Directly Affecting Exports  
3.2.1   Customs procedures and requirements  
3.73.   Export procedures and requirements are governed by t he same legal instruments regulating 
those for imports. During the review period, Georgia updated its customs legal framework to 
continue with its process of simplification and digitalization of customs procedures and to ensure the 
approximation of its cus toms legislation to that of the European  Union as provided for in the 
DCFTA  (Section 3.1.1). These adjustments, which included the adoption of a Customs Code, 
simplified the procedures related to re -export but did not bring any major change to export 
proce dures and requirements.  
3.74.   Exporters for commercial purposes must submit their export declaration in  paper or 
electronically to the customs authorities along with the transportation document, goods invoice, and 
when applicable the corresponding licence, permi t, and/or certificate. The latter must be submitted 
in the form of certified hard copies.87 For goods that are to be re -exported, traders must submit a 
re-export declaration, or a re -export notification for goods placed under an FIZ procedure or under 
temporary storage.88 In certain cases, transport documentation may also be required. No specific 
registration is needed, except for the tax registration for foreign nationals and companies.  
3.75.   Exporters may apply to the AEO and Golden List Programs allowing appro ved exporters to 
benefit from simplified customs procedures, as well as simplified security and safety procedures in 
 
82 Sales shall be carrie d out within three months.  
83 Ministry of Environmental Protection and Agriculture, Annual Report 2020 . 
84 Resolution No.  185 of 23 March 2020 on Approval of the State Program for the Maintenance of Prices 
for Primary Food Products, and its amendments.  
85 Ministry of Environmental Protection and Agriculture, Annual Report 2020 . 
86 Resolution No.  716 of 30  November  2020 on Approval of the State Program for Subsidizing Wheat 
Flour, and its amendments.  
87 Ministerial Order No.  257 of 29  August  2019, Annex 8, Articles 3 and 6; and Annex 15.  
88 Ministerial Order No.  257 of 29  August  2019, Annex 16, Article  2. WT/TPR/S/420 • Georgia  
 
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  the case of the AEO Program (Section 3.1.1). The Golden List Program will be dismantled on 
1 January  2022, according to the authorities.  
3.76.   Exporters willing to benefit from a preferential regime for their products must apply for a 
preferential certificate of origin. There are currently five  certificates, each corresponding to one of 
the following export markets: (i)  the European  Union, the EFTA , and Turkey (certificate EUR.1); 
(ii) members of CIS FTAs (certificate CT -1); (iii)  China; (iv)  Hong Kong,  China; and (v)  countries 
granting Georgia a preference under the Generalized System of Preferences (certificate A). All 
certificates are issued by t he Revenue Service, except for certificate CT -1, which is issued by the 
Georgian Chamber of Commerce and Industry (a business union). Both agencies maintain a system 
of electronic applications. Exporters may apply for the status of Approved Exporter (AE), which 
allows them to certify the preferential origin of their goods by drawing up a specific 
declaration  – a Declaration of Origin – when exporting to the European  Union, the EFTA, Turkey, 
and Ukraine.  
3.2.2   Taxes, charges, and levies  
3.77.   Exports (and re -exports) ar e not subject to any duties, and are exempted from VAT, the 
excise tax when applicable, and in most cases customs fees.89 
3.78.   Only the exports of certain types of ferrous and non -ferrous scraps and residues are subject 
to a customs service fee, which varies between GEL  10 per tonne and GEL  160 per tonne depending 
of the good. These products were (fee in parentheses): (i)  scrap an d residues of ferrous and 
non-ferrous metals (GEL  160/tonne); (ii)  residues of production of ferrous metal (GEL  40/tonne); 
(iii) untreated alloy of non -ferrous metal (GEL  50/tonne); and since 2015 (iv)  certain processed 
scrap of ferrous metal (GEL  10/tonne ).90 
3.2.3   Export prohibitions, restrictions, and licensing  
3.79.   Georgia continues to prohibit and impose permit (or licence) requirements to certain exports 
mainly for health, security, and environmental reasons in accordance with international standards. 
The lists of prohibited and restricted goods have remained largely unchanged since the last Review, 
except for a few additions made in response to the COVID ‑19 pandemic.  
3.80.   As is the case with import controls, the legal framework for export controls is scattered across  
various legal instruments, very often the same ones governing import controls (Section 3.1.6), with 
the Law on Licences and Permits of 2005 and the Law on Licence and Permit Fees of 2003 (and their 
amendments) being the main references for export permit ( or licence) requirements.  
3.2.3.1   Export prohibitions  
3.81.   The list of prohibitions comprises six product categories, including certain hazardous 
chemicals and pesticides, and narcotic drugs (Table 3.6). Some of these categories are also subject 
to import prohibition ( Section 3.1.6). During the review period, the list was not subject to any 
significant change except for the temporary inclusion of an export ban of  certain medical products 
aiming at combating the COVID ‑19 pandemic.  Georgia introduced this measure in April  2020 with a 
view to preventing shortages of essential medical products and protecting human health. The 
measure  applied to 11 tariff lines at the 11 -digit level  covering, inter alia , personal protective 
equipment (PPE), pharmaceutical products, and medica l devices.91 In July 2020, the export ban was 
lifted for PPE (i.e. six tariff lines), and in July 2021 the measure was removed for all remaining 
lines.92 Both the introduction and the partial elimination of these measures have been notified to the 
WTO Secr etariat.  
 
89 Tax Code, Articles 172 and 194; and Resolution No.  96 of 30  March  2010 on Approval of Fees and 
their Rates for the Provision of Services by the Revenue Service, Article  17, and its amendments.  
90 Resolution No.  96 of 30  March  2010, and its amendments.  
91 The tariff lines covered by the temporary export ban were 3822 00 000 00, 3926 20 000 00, 
4015 11 000 00, 4015 19 900 00, 6210 10 900 00, 6307 90 990 00, 6506 99 909 00, 9025 19 200 00, 
9019 20 000 00, and 3808 94 (3808 94 100 00, 3808 94 200 00, and 3808 94 900 00).  
92 WTO documents G/MA/QR/N/GEO/2/Add.1, 15  April 2020; and G/MA/QR/N/GEO/2/Add.2, 
28 July 2020; and Ordinance No.  1141 of 7 July 2021 amending Resolution No.  164 of 28  January  2020 on WT/TP R/S/420 • Georgia  
 
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  Table 3.6 Export prohibitions  
Prohibited exports by managing Ministry  Main legal instrument  
Ministry of Environmental Protection and Agriculture   
▪ Ozone -depleting substances  Law on Ambient Air Protection  
▪ Certain hazardous chemicals and pesticides (except for 
chemicals imported or exported for the purpose of research 
or analysis and in quantities not exceeding 2  kg in single 
shipment)  Decree No.  263 of 13  June 2016 on 
the Procedure of Export -Import and 
the Prior Informed Consent for Certain 
Hazardous Chemicals and Pesticides  
Ministry of IDP from the Occupied Territories, Labour, 
Health and Social Affairs   
▪ Narcotic drugs included in List I of the Law on Narcotic 
Drugs, Psychotropic Substances and Precursors, and 
Narcological Assistance (except when used for educational, 
scientific research, expert examination, and criminalistic 
purposes)  
▪ Narcotic drugs (re -export prohibition) included in Lists  I and 
II of the Law on Narcotic Drugs, Psychotropic Substances 
and Precursors, and Narcological Assistance  
▪ Substances under special control sent by post (except for 
expert examination purposes and the cases defined by  the 
low) Law on Narcotic Drugs, Psychotropic 
Substances and Precursors, and 
Narcological Assistance  
▪ Medical devices (COVID ‑19-related measure) (in place from 
April 2020 to July 2021)  Resolution No.  164 of 
28 January  2020 on Approval of 
Measures to Preven t the Possible 
Spread of the Novel Coronavirus in 
Georgia and the Emergency Response 
Plan for the Cases of Novel 
Coronavirus Disease, and its 
amendments  
Source:  WTO documents G/MA/QR/N/GEO/2, 10  February  2020; G/MA/QR/N/GEO/2/Add.1, 15 April 2020; 
and G/MA/QR/N/GEO/2/Add.2, 28  July 2020.  
3.2.3.2   Export restrictions and licensing  
3.82.   The list of goods subject to a non -automatic export licence or permit has remained almost 
the same since the last Review, with two additions made in 2016 and 2019 for  health and security 
reasons. In 2016, Georgia amended the list and added hazardous waste to the products subject to 
an export licence or permit93 in accordance with the Basel Convention, while removing the permit  
for materials of limited circulation,  which had broader coverage.  Since  2019, Georgia has also started 
requiring a licence to export (and to produce and import) electronic communications interception 
systems for security reasons .94 Both also require an import permit and have not been notified yet to 
the WTO  Secretariat (Section 3.1.6 and Table  A3.4).95 
3.83.   The list of goods subject to an export licence or permit comprises 16 product categories and 
is based mostly on human health, security, or environmental concerns (Table  A3.4). Most of these 
product c ategories require both an import and export permit, except for three that require only an 
export permit. The three categories are: (i)  radioactive waste; (ii)  Georgian cultural valuables; and 
(ii) fir cones, snowdrop bulbs and cyclamen tubers that are list ed in the Appendices to the CITES. 
Other products in the list are radioactive materials, electronic means of surveillance, and dual -use 
products.96 
 
Approval of Measures to Prevent the Possible Spread of the Novel Coronavirus in Georgia and the Emergency 
Response Plan for the Cases of Novel Coronavirus Disease.  
93 Resolution No.  4954 of 26 April 2016 on Amendments to the Law on Licence and Permit Fees. The 
change became effective in July 2016.  
94 Resolution No.  490 of 27 March 2017 on Amendments to the Law on Licence and Permit Fees. 
The change became effective in  March 2019.  
95 The last WTO notification on trade controls was submitted in February 2020 and does not contain 
these two items.  
96 Dual-use goods refer to software and technology that can be used for both civilian and military 
applications.  WT/TPR/S/420 • Georgia  
 
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  3.2.4   Export support and promotion  
3.84.   During the review period, Georgia continued to support exporters, mainly through technical 
assistance and the organization of export events. According to its WTO notification, Georgia did not 
grant any export subsidies to agricultural products during 2017 -2097 or any subsidy as defined in 
Article  1.1 of the Agreement on Subsidi es and Countervailing Measures (SCM  Agreement), which is 
specific within the meaning of Article  2 of the SCM  Agreement, or which operates directly or indirectly 
to increase exports from or reduce imports into its territory within the meaning of Article  XVI:1 of 
the GATT  1994.98 
3.85.   Georgia also maintains FIZs and certain customs procedures with a view to attracting 
investments and promoting exports and value chain activities.99 
3.2.4.1   Export promotion  
3.86.   Georgia supports exporters mainly through its investment and export  promotion 
agency  – Enterprise Georgia – known until 2019 as the Enterprise Development Agency.100 
Enterprise Georgia has three divisions: Business Development, Export Support, and since 2017 
Invest in Georgia, which was until then a separate entity (Section 2).  
3.87.   Under the Trade with Georgia Program, the Export Support division coordinates, organizes, 
and co -finances the participation of Georgian companies at international trade fairs, exhibitions, and 
showrooms with a view to helping them make new business connections and identify new export 
opportunities. To benefit from financial support for internati onal trade fairs and exhibitions, 
applicants are scored according to the selection criteria established by Enterprise Georgia and 
classified according to four categories depending on their size. Financial support varies between  50% 
and 90% depending on the  company's score and size and shall not exceed USD  15,000 for 
one beneficiary per event. For showrooms, financial support varies between 50% and 
35% depending on the company's score and shall not exceed USD  5,000 for one beneficiary 
per event. In both case s, the amount of the beneficiary's co -participation increases by 5% for each 
subsequent participation in an international event during one calendar year.101 
3.88.   On the Trade with Georgia website, Enterprise Georgia has also developed an online  exporters 
databas e (www.tradewithgeorgia.com ) to promote its products and services.  To register, export 
companies should be established in Georgia and provide certain information, such as a logo.  The 
online platform also prov ides market information on foreign markets, including customs procedures, 
as well as trainings and workshops.  
3.89.   In addition to these initiatives, the Business Development division supports businesses and 
entrepreneurs in general through the Produce in Georgi a State Program102, from which exporters 
may also benefit (Sections 3.2.5 and 4.3).  
 
97 WTO documents G/AG/N/GEO/26, 26 August 2021; G/AG/N/GEO/24, 31 July 2020; G/AG/N/GEO/17, 
15 January 2020; and G/AG/N/GEO/22, 29 July 2020.  
98 WTO notifications G/SCM/N/372/GEO, 12 October 2021; G/SCM/N/315/GEO and G/SCM/N/343/GEO, 
19 November 2019; and G/SCM/N/284/GEO, 2 1 April 2017.  
99 Law on Free Industrial Zones, Article  1; and Revenue Service, Customs Department, "Free Zones: 
Georgia's Experience", WCO News , 89, June  2019.  
100 The Enterprise Development Agency was created in 2014 under the MESD.  
101 Enterprise Georgia, Obtain Financing . Viewed at: http://tradewithgeorgia.com/financial -
considerations . 
102 The Produce in Georgia State Program is governed by Resolution No.  365 of 30  May 2014.  WT/TP R/S/420 • Georgia  
 
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  3.2.4.2   Free Industrial Zones  
3.90.   Georgia maintains FIZs to attract investment and increase trade by promoting exports and 
value -chain activities. The legal framework governing FIZs was  not subject to any major change 
during the review period. FIZs are governed by the law of the same name, the Customs Code, the 
Tax Code, and their amendments.103 As of September 2021, Georgia hosted four FIZs, the same 
number as at the time of the previous  Review.104 
3.91.   Under the Tax Code, an FIZ is a type of free zone with additional tax concessions effective 
within it. Companies located in FIZs are exempted from duties and VAT on their imports, as well as 
from corporate income, dividend, and property taxes. T ransactions within FIZs are also exempted 
from VAT. Goods exported from an FIZ to Georgia (i.e. outside the FIZ) are considered as an ordinary 
import and subject to import duty and VAT, except if the goods are entirely produced within the FIZ, 
in which cas e they are exempted from import duties. Additionally, all transactions between an 
FIZ company and a natural or legal person located in Georgia are subject to a 4% tax on the revenue 
generated from the supply of such goods.105 
3.92.   Companies willing to operate in  an FIZ are subject to a licence requirement for the following 
areas of activity: (i)  manufacturing; (ii)  special trading (i.e. certain import and export activities); 
(iii) general trading (i.e. import and export activities); (iv)  consulting services; (v)  warehousing; 
(vi) IT services; (vii) general services; (viii) financial service licence; and (ix) logistics.106 Within 
an FIZ, companies are exempted from the obligation to obtain certain licences and permits provided 
under Georgia's legislation, e.g. the l icences for the production and packaging of food products for 
babies and infants, and the permit for the production of pharmaceuticals (medicines, except 
drugs).107 Goods produced within an FIZ benefit from a certificate of Georgian origin of goods.  
3.93.   Prohibi ted activities within an FIZ are: (i)  manufacturing arms and ammunition, trading in 
arms and ammunition; (ii)  manufacturing nuclear and radioactive substances, trading in nuclear and 
radioactive substances; (iii)  bringing in, storing, manufacturing, and/or  selling narcotic and 
psychotropic substances; (iv)  bringing in, storing, manufacturing, and/or selling tobacco products 
and/or tobacco raw materials for export purposes.108 
3.2.4.3   Other customs procedures promoting exports and re -exports  
3.94.   In addition to FIZs, Geor gia maintains the scheme of special trading companies to promote 
trade transit (Box 3.3) and value chain activities through its inward or outward processing 
procedures.109 Under inward processing procedures, goods enter Georgia temporarily (exempted 
from du ties) to undergo specified manufacturing, processing, or repair and then are further 
re-exported. Under outward processing procedures, goods are temporarily exported for further 
processing, and then re -imported while benefitting from full or partial exempt ion.110 
 
103 The Law on Free Industrial Zones was adopted on 18 July 2007, and its last amendment was 
published on 28  July 2020.  
104 The FIZs (date of beginning of operations) are P oti (November 2010), Kutaisi (July 2009), Hualing 
(September  2015), and Tbilisi (November 2015). There is a fifth, Kulevi, which is not yet operational.  
105 Law on Free Industrial Zones, Articles 9 and 10.  
106 Tbilisi FIZ. Viewed at: https://www.tfz.ge/en/516/ . 
107 Other activities exempted from a licence/permit include: (i)  import of non -iodized salt; 
(ii) international shipments of products subject to international quotas; (iii)  distribution and transportation of 
natur al gas; and (iv)  transit of products subject to veterinary control. Resolution No.  131 of 3 June 2008 on 
Approval of the Rules for the Creation, Arrangement and Operation of a Free Industrial Zone, Article  5, last 
amended on 14 January 2020.  
108 Law on Free Industrial Zones, Article  12. 
109 World Customs Organization (2017), WCO Handbook on Inward and Outward Processing Procedures . 
110 Customs Code, Articles 142 -154. WT/TPR/S/420 • Georgia  
 
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  Box 3.3 Special trading company  
Special trading companies were introduced to encourage the development of the trade transit in  Georgia. 
Special trading companies are enterprises that have been granted this status for the purpose of exemption 
from profit tax under the Tax Code. A special trading company has, inter alia , the right to re -export foreign 
goods from the customs warehouse, sell foreign goods in a customs warehouse to both enterprises with and 
without the status of a special trading company, and purchase foreign goods from an ent erprise without the 
status of a special trading company for the purpose of further re -export, and/or selling to the customs 
warehouse. Special trading companies cannot import goods for their release in Georgia, except for capital 
assets for the company, an d they cannot sell  Georgian goods within the country.  
Source:  Tax Code, Article  241. 
3.2.5   Export finance, insurance, and guarantees  
3.95.   Georgia does not have a financial support programme designed exclusively for exporters but 
maintains such programmes for businesses in certain sectors with the view of promoting local 
production – whether goods are exported or not. These support mechanisms  are implemented by 
Enterprise Georgia under the Produce in Georgia programme. Under this programme, Enterprise 
Georgia co -finances the payments of interest rates and provides credit guarantees for commercial 
loans under certain conditions (Section 3.3.1.1 ). 
3.96.   While no exporter support programme is in place at the moment, this may change under the 
new framework of the Economic Development Strategy for the period 2020 -30. Future plans by the 
Government under this framework include the implementation of support  mechanisms for export -
oriented and import -substituting potential sectors, in the form of subsidized interest rates on loans 
and leases, credit guarantees, and grants.111 
3.3  Measures Affecting Production and Trade  
3.3.1   Incentives  
3.3.1.1   Subsidies and incentives  
3.97.   The Govern ment provides subsidies to many sectors of its economy, but in particular 
education, research, healthcare, cultural and religious activities, transportation infrastructure, 
energy, regional development, industry, and agriculture are the most prominent.112 The overall level 
of subsidization by the State in 2020 was GEL  837 million, including subsidies in the economic and 
social  spheres (Table  3.7). The level is almost double compared to previous years, 
i.e. GEL 419 million in 2018 and GEL  490 million in  2019 as a result of significant subsidization 
resulting from the COVID -19 pandemic. In 2020, about half (49%) of the total amount was used to 
subsidize economic, development, and infrastructure programmes, whereas 29% was for agriculture 
and the environment (Ta ble 3.7). The remainder, about  22%, was in the social sphere, e.g.  health, 
medical services, education, culture, and the like.  
Table 3.7 Main areas of subsidization by the State in the economya, 2017 -20 
(GEL ' 000) 
Ministry/programme  2017  2018  2019  2020  
Ministry of Economy and Sustainable Developmentb 49,788  61,361  62,890  335,716  
 Promoting tourism  12,990  12,484  12,493  50 
 State property management  3,800  640 3,000  6,993  
 Entrepreneurship development  30,180  28,277  31,894  294,823  
 - Promoting entrepreneurship  0 0 0 32,633  
 - Supporting the economy after COVID ‑19 0 0 0 262,190  
 - Supporting small, medium, and family hotel industry  0 0 0 51,250  
 - Credit  guarantee scheme  0 0 0 0 
 
111 Minister of Economy and Sustainable Development, Natia Turnava Introduced Georgia's Economic 
Development Long -term Vision – "Economy 2030",  6 July 2021. Viewed at: 
http://www.economy.ge/?page=ne ws&nw=1724&s=natia -turnavam -saqartvelos -ekonomikis -grdzelvadiani -
ganvitarebis -xedva -ekonomika -2030-warmoadgina . 
112 Ministry of Finance, State Budget Performance Reports , various editions 2015 -20. Viewed at: 
https://www.mof.ge/images/File/biuj2015/eng/chapter_VI.pdf , https://www.mof.ge/5411 , and 
https://www.mof.ge/5307 . WT/TP R/S/420 • Georgia  
 
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  Ministry/programme  2017  2018  2019  2020  
 - Promoting the construction sector  0 0 0 940 
 - Promoting micro and small enterprises  0 0 0 0 
 - Utility tax subsidies  0 0 0 210,000  
 Development of innovations and technologies  0 0 148 610 
 Subsidizing transport costs  0 4,900  5,864  3,036  
 Subsidy to offset cost of natural gas to highland villages  6,669  7,363  0 8,949  
 Georgian National Innovation Ecosystem Project (IBRD)  0 2,581  9,427  17,361  
 For improvements of electricity and natural gas supply  2,231  5,116  0 2,931  
 For quarantine and other measures related to COVID‑19 0 0 0 904 
Ministry of Regional Development and Infrastructure  128,139  43,141  81,486  75,956  
 Road infrastructure  101,163  26,978  13,337  19,143  
 Rehabilitation of regional and municipal infrastructure  24,602  14,395  26,073  8,068  
 Rehabilitation of water supply infrastructure  1,248  15 27,567  30,074  
 Solid waste management programme  1,120  1,754  14,362  18,356  
Ministry of Environmental Protection and Agriculture  92,304  90,535  110,776  243,579  
 Scientific research activities in the field of agriculture  0 0 0 12 
 Development of viticulture and winemaking  12,140  0 659 85,000  
 Preferential agriculture credits  48,465  60,160  71,257  74,763  
 Agricultural insurance  7,093  4,743  5,829  8,000  
 Plant the future  10,945  9,563  15,613  21,180  
 Georgian tea  661 795 157 23 
 Project technical support programme  0 0 65 234 
 Agricultural support measures for COVID ‑19 0 0 0 24,670  
 Apple crop sales promotion programme  0 0 0 4,998  
 Modernization of reclamation systems  13,000  14,500  17,000  24,700  
 Management system for protected areas  836 774 194 0 
a Excludes subsidies in the spheres of education, employee training, health, medical services, culture, 
sport, and religion.  
b According to the authorities, these are mainly industrial subsidies.  
Source:  Ministry of Finance, State Budget 2020, Chapter VI -Payments by Program Classification . Viewed at: 
https://www.mof.ge/5411  and https://www.mof.ge/images/File/2020 -
shesrulebis%20angarishebi/12 -Tve/tavebi/TAVI%20VI%202020%20wliuri.DOCX ; State 
Budget  2019, Chapter VI-Payments by Programme Classification . Viewed at: 
https://www.mof.ge/images/File/2019 -shesrulebis -angarishebi/12%E2%80 %93tve/21 -05-
2020/tavebi/6.TAVI%20VI%20ewliuri.DOCX ; State Budget 2018, Chapter VI -Payments by 
Programme Classification . Viewed at: https://www.mof.ge/images/File/biujeti -12tve-
2018/TAVI%20VI.DOCX ; State Budget 2017, Chapter VI -Payments by Programme Classification . 
Viewed at: https://www.mof.ge/images/File/biujeti%2022.03.2018/TAVI%20 VI%2022.03.2018.pdf . 
3.98.   According to the National Accounts of Georgia reported by the National Statistics Office of 
Georgia, in 2019 there were subsidies on production and imports of GEL  267.2  million, accounting 
for about 0.5% of GDP.113 Due to a different mo del-based approach, these figures are not directly 
comparable to the figures noted above.114 The majority of subsidies on products  (GEL 184 million) 
was in the agricultural, forestry and fishing sector, and GEL  33.8 million was on imports.  
3.99.   In terms of the state budget on subsidies, the main budgetary item encompassing industrial 
subsidies was the category for Entrepreneurship Development under the Ministry of Economy and 
Sustainable Development (MESD) during the period 2015 -20. There was a near 10 -fold incr ease 
during the period, from GEL 31.8 million in 2019 to GEL  294.8  million in 2020 due to new spending 
in several pandemic -related areas (Table 3.7). GEL  210 million was budgeted for utility tax subsidies 
and GEL  51 million for the hotel sector.115 About GE L 30 million was also spent on Enterprise 
Georgia's entrepreneurial activities.  
3.100.   The Government passed legislation in October 2020 to subsidize the utilities (electricity, 
natural  gas, drinking water, and sewage) of household customers in order to aid the p opulation 
during the COVID -19 pandemic.116 The State pays 100% of the utility costs from the state budget 
for all households whose consumption is below a certain threshold. The initial resolution was 
 
113 National Statistics Office of Georg ia (2021),  National Accounts of Georgia, 2019 . 
114 Information provided by the authorities.  
115 Ministry of Finance, State Budget Performance Reports 2015 -20. Viewed at: 
https://www.mof.ge/images/File/2020 -shesrulebis%20angarishebi/12 -
Tve/tavebi/TAVI%20VI%202020%20wliuri.DOCX . 
116 Resolution No.  655 of 30 October 2020 on Approval of the Rules and Conditions of Subsidizing 
Utility  Bills. WT/TPR/S/420 • Georgia  
 
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  applicable for utility costs incurred for a four -month pe riod between November  2020 and 
February  2021.  
3.101.   Also in response to the COVID ‑19 pandemic, Georgia passed legislation in June  2020 to 
support the construction sector in order to promote stability in the real estate sector due to stagnant 
or negative economic  activity.117 The Support to the Construction Sector Program provides a budget 
of GEL  200 million through 2024 for the purchase of multi -apartment buildings through an  auction 
or tendering process. The State will acquire no more than 30% of the living space  of the apartment 
complex through a competitive bidding process that prioritizes the lowest bid. Under Phase  I of the 
Program, 23 applications were received, and under Phase II, 10 applications, resulting in 
four winning bids. The Mortgage Support Mechanis m programme  was also approved in 2020 in 
response to the pandemic. It was enacted to stimulate demand for real estate through various 
components. Citizens of Georgia may apply for co -financing of an approved mortgage loan and/or a 
loan guarantee of up to 2 0% of the principal amount of the mortgage loan to buy an apartment from 
a development company. The maximum loan amount was GEL 200,000 and the government 
subsidizes the interest rate of the loan issued to the beneficiary for 60 months after the loan is 
granted. The programme ended in December 2020 and based on the data of 2020, 6,774  contracts 
were part of the programme, of which 1,806 clients used the credit guarantee scheme and the total 
loan amount was GEL 641.7 million.118 
3.102.   Enterprise Georgia, establishe d in 2014, is the Government's main body responsible for 
business support, export promotion, and investment activities. Its Produce in Georgia Program is 
the main programme supporting business entrepreneurship, both encouraging new start -up 
enterprises and  the expansion of existing enterprises (the agriculture component of Produce in 
Georgia is discussed in Section 4.1.1.3).119 Under the Program, various financial assistance or 
supports are available to businesses, including loan/lease interest rate co -financing, technical 
assistance, international brand licence fee co -financing.120 The recently added Business Universal 
component offers loan/lease interest rate co -financing, credit guarantees and grants.121 The support 
measures are limited to certain sectors th at as of  2021 included the broad categories of development 
of hotels, production of audiovisual products (films), development of balneological resorts, tourism 
services, real estate, and industry.122 Within the category of industry, there were over 100  specific 
industries or manufacturing production processes classified by NACE Rev. 2, e.g.  rubber and plastics 
products, paper and paperboard, textile manufacturing, computers and electronic components, 
vehicles, sporting goods, electrical equipment, metal prod ucts, and chemical manufacturing.123 Per 
the Program, the State's role is in co -financing the annual effective interest rate to the beneficiary, 
providing credit by backing the loans of the commercial banks, and providing real estate 
(see Section  3.3.5.). A s at 2020, about GEL  30.2 million was spent on the Produce in Georgia 
Program and some 12,000  businesses have benefited from its support measures.124 
3.103.   Due to the COVID ‑19 pandemic, Produce in Georgia introduced provisional changes in order 
to provide better conditions to the businesses affected. Modifications include the increase of the 
co-financing rate from 7% to the NBG refinancing rate plus 3 percentage points for loans and from 
9% to the NBG refinancing rate plus 5 percentage points for leases. As at Jul y 2021, the Government 
contribution amounted to 12.5% for the interest payments for loans by commercial banks and 
14.5%  for those by leasing companies. In addition, Produce in Georgia extended the co -financing 
period from  24 to 36  months, which may now be claimed for 41 months instead of  29; this applies 
 
117 Resolution No.  386 of 25 June 2020 on Approval of the State Program "Support to the 
Construction  Sector".  
118 Information provided by the authorities.  
119 Resolution No.  365 o f 30 May 2014 on Approval of the State Program "Produce in Georgia".  
120 Enterprise Georgia, About Us . Viewed at: http://www.enterprisegeorgia.gov.ge/en/home/about ; and 
information provided by  the authorities.  
121 There are also micro grants and cash rebates on film -making expenses.  
122 As outlined in the appendices of Resolution No.  365 of 30 May 2014 on Approval of the State 
Program "Produce in Georgia".  
123 The levels or amount of financial suppor t does not vary by sector. All the sectors are offered the 
same terms in programs, although practical distribution of the funds among them may vary depending on 
applications by the companies. Generally, the coverage of the various sectors expanded over the  review 
period. Resolution No.  626 of 20  December  2019 on Amendments to Resolution No.  365 of 30  May 2014 on 
Approval of the State Program "Produce in Georgia", as amended. See annexes for lists of specific industries, 
services, etc. covered.  
124 Enterprise Georgia, Produce in Georgia Program Changes , 27 August 2020. Viewed at: 
http://www.enterprisegeorgia.gov.ge/en/News/produce -in-georgia -program -cha. WT/TP R/S/420 • Georgia  
 
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  to the contracts signed during the provisional period and existing loans/leases that were 
refinanced/restructured. In regard to loan and lease values, the minimum amount decreased to 
GEL 50,000 from GEL  100,000 and the maximum rose from GEL  6 million to GEL  10 million. 
Beneficiaries taking advantage of the new terms have adjusted functional operating times as well.125 
3.104.   The Minister of Economy and Sustainable Development announced in July 2021 that the 
Governme nt was introducing changes in the Produce in Georgia Program.126 Starting from 
September 2021, a new addition/direction has been introduced to the Program, i.e.  the Universal 
Industrial Component. This new component combines loan/leasing co-financing, a credit guarantee 
scheme, and grants for the companies that operate in priority economic activities with export and 
import opportunities. From the beginning of 2022, it will replace the existing industrial component 
of Produce in Georgia; du ring September -December 2021, the two  components run concurrently.  
3.105.   As a result of the COVID -19 pandemic, several changes were adopted to strengthen support 
for businesses in 2020 that continued through a transitional period in 2021.127 These measures 
includ e the following.  
• Entrepreneurs are no longer required to own land to receive loan co -financing for 
construction in the hospitality and balneological resort sector.  
• The previous geographical restrictions for the tourism sector have been removed, thus 
projec ts in all locations may now receive support.  
• Six new priority economic activities have been added to the Produce in Georgia Program: 
production of computer games, hospital activities, general medical practice activities, 
specialized medical practice activi ties, dental practice activities, and the purchase and 
leasing of film production equipment.128 
3.106.   A number of  short-term support programmes were introduced by Enterprise Georgia 
in 2020, for a period of 12 months, for the most affected sectors by the COVID ‑19 pandemic. 
Programmes include a co -financing mechanism for the small, medium and family hotel industry; a 
loan subsidy scheme for event companies; a co -financing mechanism to support the restaurant 
industry; and a subsidy mechanism for sports facilities and kindergartens. These programmes 
provide loan interest subsidies in the range of 80% to 100% to the benef iciaries.  
3.107.   Enterprise Georgia also implements the Micro and Small Business Support Program129 that 
provides various support measures to Georgian citizens establishing or expanding their micro or 
small  business projects subject to a competition.130 The main ob jectives of the Program are to 
diversify regional goods and services, promote modern business practices, and increase income 
levels of the local population. It sets out priority areas – accommodation and tourism projects, 
women -owned businesses, developmen t of intellectual services, businesses in rural mountain 
regions, businesses by internally displaced persons, and projects oriented towards inclusive 
sectors  – for awarding its grants, but most economic activities are supported, only primary 
 
125 Beneficiaries a re required to start operating in the designated sector within: (i)  24 months, increased 
from 12  months, if the company is operational; or (ii)  36 months, increased from 24 months, if the company is 
newly established. The latter must remain functional for 36 months, increased from 24 months, after it starts 
operating and, for the former, 36 months commence when the loan/lease object was issued.  
126 Agenda.ge, Economy Minister Presents 10 -Year Development Plan: What Does It Include? , 
6 July 2021. Viewed at: https://agenda.ge/en/news/2021/1864.  
127 According to the authorities, these support measures will end in 2022.  
128 Enterprise Georgia, Produce in Georgia Program Changes , 27 August 2020.  
129 Micro business status can be granted to a natural person who simultaneou sly meets the following 
conditions: (i)  not registered as a VAT payer; (ii)  does not use hired labour (except family members); and 
(iii) conducts economic activities independently, the calendar -year gross receivable income from which does 
not exceed GEL  30,000. Taxable income of a person having the status of a small business shall be taxed 
at 1%, but taxable income of a person having the status of a small business shall be taxed at 3% if his/her 
gross income received from the economic activities exceeds GEL  500,000 during a calendar  year. Resolution 
No. 605 of 30 October 2014 as amended by Resolution No.  626 of 20 December 2019.  
130 However, the beneficiary has to contribute to the project as well, i.e. 10% of the total grant, unless 
the project is being imple mented in a mountainous region, in which case the contribution amounts to 5%. 
Existing beneficiaries may apply to participate in the competition again, although they have to contribute 
25% of the total grant, unless their project is being implemented in mo untainous regions, in which case the 
contribution is 15%.  WT/TPR/S/420 • Georgia  
 
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  agricultural p roduction as well as religious, political, and military activities are excluded. However, 
the priority areas receive an additional two  points at the business idea evaluation stage. The budget 
for the Program varies year -to-year but it amounted to GEL  15 million in 2020 with a maximum 
grant of GEL  30,000 per  business so long as the business also contributes at least 10% of the amount 
of the grant.131 The funds supplied by the State provide technical assistance and co -financing of 
interest rates on loans and l eased equipment approved by local commercial banks and leasing 
companies.  
3.108.   A credit guarantee mechanism programme has also existed since 2019 for small and 
medium -sized enterprises (SMEs) to improve access to finance, facilitate lending, and ensure 
inclusiv e economic growth. The programme is designed for those SMEs that do not meet the 
requirements of the loan collateral.132 In 2021, the credit guarantee provided for up to 90% of the 
principal amount for each new loan disbursed by commercial banks/microfinanc e organizations, and 
guarantees are issued to each participating bank for up to 35% of the amount of the loan portfolio 
under the programme.133 Due to the COVID‑19 pandemic, provisional changes to the programme 
were introduced that increased the guarantee p ercentage, after which it will revert to a lower level 
in 2022.  
3.109.   Another subsidy programme, Start -Georgia, operates under the Georgian Agency for 
Innovation and Technology.134 It was established to promote business development based on 
innovative ideas to en ter the international market. The funding provided by the Agency is for 
start-ups, up to a maximum of GEL  100,000, with the Agency retaining a 5% share of the 
joint venture. It also offers small funding grants, of up to GEL  5,000 for smaller projects.  
3.110.   In 2016 , the Government initiated a programme to help the tourism/accommodation sector, 
known as 50 Properties for Your Hotel. The project aimed to increase the tourism infrastructure, 
i.e. hotels and roadside resting facilities, by providing state  property to  hotel developers mainly 
through e -auctions. The programme was open to Georgian and foreign investors and expired at the 
end of 2019. Since its inception, the programme has privatized GEL  64.6 million  of state property 
and the Government has contributed GE L 115.5  million through investment liabilities/conditions.135 
3.111.   Georgia maintains a number of tax incentives, i.e. reduction or elimination of tax that would 
normally be payable by enterprises. Most of these incentives apply to certain sectors, but there are 
also certain tax reductions that are applicable for enterprises operating in certain zones, 
e.g. FIZs (see Section  3.1). 
3.112.   In October 2020, Georgia passed legislation to amend Article  23 of the Tax Code in order to 
provide new tax incentives to specially des ignated international companies in the IT and shipping 
sectors.136 In order to qualify as an international company, income must come from these services 
abroad or other income remains minimal, i.e. 2% or less. The incentives include a reduction 
from 15% to 5% for the corporate income tax rate, and a 5% tax on wages, compared to the 
usual  20%. The withholding tax on dividends was also eliminated for these enterprises, whereas for 
others it remains at 5%. There is also an exemption from the property tax. Certa in costs such as 
R&D and salaries of Georgian citizens can be used to reduce the tax on profits as well. Amendments 
were made to the legislation in February and April 2021 to make clarifications of eligibility, but the 
main elements remain unchanged.  
 
131 An amount of 5% of the grant applies to those in the rural mountain regions. For entrepreneurs who 
have previously benefited from the Program, a contribution of 25% of the grant is expected, and 1 5% for those 
in the rural mountain regions.  
132 They do, however, need to meet certain conditions in terms of the income generated by the size of 
their enterprises, as defined in the Law on Accounting, Reporting and Auditing. Also, the total loan liabilities  
should not exceed GEL  12 million at the time of joining the Program.  
133 For refinanced/restructured loans, the guarantee amount was 30%. Information provided by the 
authorities; and Enterprise Georgia, Credit Guarantee Mechanism . Viewed at: 
http://www.enterprisegeorgia.gov.ge/en/business -development/Credit -guarantee -mechanism . 
134 Georgian Agency for Innovation and Technology, Funding . Viewed at: 
https://gita.gov.ge/geo/static/9 . 
135 National Agency of State Property, 2019 Report of the National Agency for State Property LEPL . 
Viewed at: https://drive.google.com/file/d/1N_1Ppg3Ir_EdWkfMCETCjU99yKkFxjxP/view?usp=sharing . 
136 Order No.  619 of 8 October 2020 on Determining the Status of an International Company, and 
Approving the List of Permitted Activities and Certain Expenses.  WT/TP R/S/420 • Georgia  
 
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  3.113.   For t he pharmaceutical sector, certain tax incentives apply to enterprises producing 
designated pharmaceutical and protective medial products, e.g. laboratory reagents, oxygen, plastic 
and rubber protective articles, masks, and medical clothing, in Georgia.137 These enterprises are 
exempt from  VAT. Furthermore, alcohol inputs for pharmaceutical production are exempt from 
excise taxes. Certain tourism enterprises, i.e. hotels, also have exemption from VAT. Exemptions 
from the profit tax and income tax may also app ly to the hotel enterprise for a period of up to 
60 calendar  days for services provided to hotel owners.138 International financial companies with 
source income from Georgia also have tax breaks, such as exemption from income taxes on profits 
from financial  operations/services and sale of securities.139 
3.114.   Agricultural cooperatives also maintain special tax treatment from the profit tax until 
1 January  2023. The cooperatives are exempt from the profit tax from the primary supply of 
agricultural products, i.e. th ose solely produced in Georgia, prior to industrial processing.140 
Enterprises producing in the occupied territories of Georgia also have certain tax incentives if they 
are designated as a "special enterprise". This requires production of goods inside those  territories 
and delivery of the goods outside the territory, or the supply or Georgian goods to these territories. 
Such designated enterprises are exempt from VAT, income tax, and profit tax.  
3.115.   Agricultural subsidies are discussed in Section 4.1.1.3 (includ ing Table 4.5).  
3.3.1.2   Rules on state aid  
3.116.   Georgia's rules on state aid or subsidies are contained in its Law on Competition and related 
Resolution on Approval of the Insignificant Amount of Individual State Aid and the General Rule of 
State Aid.141 The Law on Comp etition prohibits state aid for a specific type of activity if it hinders or 
endangers competition, but there are a number of exemptions where it is allowed, such as for 
individual social allowances, natural disasters and force majeure  events, and environm ental 
protection activities, if it fulfils obligations under Georgian law or international agreements, for an 
insignificant amount, or is intended to implement an important state project. State aid is also 
permissible if the Georgian National Competition A gency  determines it does not distort competition 
and is for the economic development of certain regions or to preserve culture or cultural heritage.  
3.117.   The Law defines state aid as "granting a selective economic advantage to an undertaking 
by transferring budget funds or state resources or imposing other benefits by the provider of 
state aid", and the types of state aid include tax exemptions, reductions, or deferrals; debt write -off 
or restructuring; issuance of a loan on favourable terms; transfer of operating assets; providing 
financial assistance; profit guarantees; benefits; and other (not further defined). The principles of 
non-discrimination and transparency are to be followed when providing state aid. In order for the 
Georgian Nationa l Competition Agency  to determine if the aid is permissible per the provisions noted 
above, the grantor of state aid must make an application to the Agency and after 14 days the Agency 
is expected to respond with its legal opinion on whether the aid is in compliance or not. The 
exemption allowing state aid of an insignificant amount is further defined in the Resolution as state 
aid that does not exceed GEL  400,000 in relation to one economic entity, for a total of 
three  consecutive fiscal  years. However, fo r entities operating in the land cargo transport or 
agriculture sectors, the maximum amount is GEL  200,000.142 Disputes relating to state aid may be 
considered by the applicable court for competition matters.  
3.3.2   Standards and other technical requirements  
3.118.   Georgia is committed to open markets and has acknowledged that technical regulations have 
a role in promoting free trade. Recent policy initiatives emphasize facilitating export development 
 
137 Joint Order of Ministry of Finance and Ministry of Health No.  1-132/N/322 of 29 December 2020. 
Products are in HS Chapters 28, 38, 39, 40, 62, 63, 65, and 90.  
138 Revenue Service, Special Tax Treatments/Statuses: Tourist Enterprise . Viewe d at: 
https://www.rs.ge/LegalEntityPreferentialTax -en?cat=6&tab=1 . 
139 Revenue Service, International Financial Company . Viewed at: https://old .rs.ge/4765 . 
140 Revenue Service, Tax Liabilities:  Exemption from Profit Tax . Viewed at: 
https://www.rs.ge/LegalEntityTaxes?cat=1&tab=1 . 
141 Law No.  2159 of 21 March 2014 on Competition; and Resolu tion No.  529 of 1 September 2014 on 
Approval of the Insignificant Amount of Individual State Aid and the General Rule of State Aid.  
142 Resolution No.  529 of 1 September 2014 on Approval of the Insignificant Amount of Individual State 
Aid and the General Ru le of State Aid.  WT/TPR/S/420 • Georgia  
 
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  and promoting integration with international and Euro pean markets. Georgia's rules on standards 
and technical regulations are put in place with the aim of ensuring product safety with uniform and 
non-discriminatory treatment. Georgian legislation on TBT follows international best practices and 
norms, and sig nificant steps have been taken to develop the technical regulation infrastructure and 
the national system of standardization to the level of the EU acquis . 
3.119.   Developments during the review period focused on implementing the provisions of the 
DCFTA in the cha pter on Technical Barriers to Trade, Standardization, Metrology, Accreditation and 
Conformity Assessment, thereby achieving greater integration in the EU market and improving 
adherence to regional and international standards. At the time of entry into forc e of the DCFTA, 
Georgia had already approximated national legislation to 13 EU directives/ regulations and, per the 
terms of the Agreement, committed to approximate the remaining eight directives listed in 
Annex  III-A within eight  years. As part of its 2021  Implementation Action Plan for the DCFTA, 
Georgia planned to: (i)  continue the adoption of standards and EU harmonized standards specified 
in Annex III -A; (ii)  start preparatory procedures for approximation of the Measuring 
Instruments  (MID) and Non -Autom atic Weighing Instruments (NAWI) Directives; and (iii)  adopt 
revisions to technical regulations already approximated in Georgia to ensure compatibility with 
updated or recast EU directives. Work is also underway to elaborate technical regulations on certai n 
medical devices in accordance with EU Regulations.143 In the medium term, 2021 -23, Georgia is 
expected to adopt seven technical regulations, update the equipment of reference laboratories in 
metrology, expand international recognition of priority referenc e laboratories in metrology, introduce 
a quality management system, establish a risk assessment system for market surveillance, 
strengthen the capacity for accreditation, and improve recognition of accredited bodies.  
3.120.   There were not any significant changes to Georgia's main laws or decrees in the TBT  domain 
during the review period. Chapters V (Technical Regulation), VI (Standardization), VII  (Uniformity 
of Measurements), VIII (Conformity Assessment), and IX (Accreditation) of the Law on the Code on 
Safety a nd Free Movement of Products have remained without significant changes since the Law's 
inception in 2012.144 Resolution No.  50 of 7  March  2013 continues to recognize the technical 
regulations and conformity assessment procedures of 37  OECD  member States lis ted in its Annex.145 
As such, Georgia recognizes conformity, i.e. the assessment of the accredited conformity assessment 
bodies in those countries, and allows the importation of goods with the documentation and requisite 
marking to be freely circulated in G eorgia. Another Decree has accepted the WTO  TBT Agreement's 
Code of Good Practice (Table 3.8).  
Table 3.8 Main legal provisions  
Law or Decree  
Law of 25 May 2012 on Code of Safety and Free Movement of Products  
Resolution No. 50 of 7 March 2013 on Information on the Entry into Force of Technical Regulations of Other 
Countries by Georgia, Recognition of Conformity Documents, Admission of a Product with Appropriate 
Markings in Georgia without Additional Conformity  Assessment Procedures, as well as Placing on the Market 
in the Georgian Market without Restrictions  
Decree No. 170 of 18 September 2009 on Acceptance of the Rule of Notification Sending and Communication 
on Standards, Technical Regulations and Conformity  Assessment Procedures on Applicable Documents and 
Their Drafts  
Decree of 16 April 2003 on the Geostandard on Acceptance of the Code of Good Practice for the Preparation, 
Adoption and Application of Standards, contained in Annex 3 to the WTO Agreement on Technical Barriers to 
Trade  
Source:  WTO document G/TBT/2/Add.81/Rev.3, 3  December  2020; and information provided by the 
authorities.  
 
143 MESD, DCFTA Implementation Action Plan for 2021 . 
144 Law on the Code on Safety and Free Movement of Products of 25  May 2012.  
145 Resolution No.  50 of 7  March  2013 on Information on the Entry into Force of Technical Regulations of 
Other Countries by Georgia, Recognition of Conformity Documents, Admission of a Product with Appropriate 
Markings in Georgia without Additional Conformity Assessment Proc edures, as well as Placing on the Market in 
the Georgian Market without Restrictions. The countries listed in the Annex are Australia, Austria, Belgium, 
Canada, Chile, Cyprus, Czech  Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, 
Ireland, Iceland, Israel, Italy, Japan, the Republic of Korea, Latvia, Lithuania, Luxembourg, Malta, Mexico, the 
Netherlands, New  Zealand, Norway, Poland, Portugal, the Slovak  Republic, Slovenia, Spain, Sweden, 
Switzerland, the United Kingdom, and the United  States.  WT/TP R/S/420 • Georgia  
 
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  3.121.   The Georgian National Agency for Standards and Metrology (GEOSTM) of the MESD is the 
principal agency tasked with oversight of standardization and metrology. Its main tasks include 
maintaining a register of standards and ensuring their availability; developing and maintaining a 
measuring standards base and ensuring traceability and type approval or recognition of type 
approval for measuring instruments; ensuring the exchange of information on standards and 
technical regulations registere d in Georgia with relevant international organizations; and 
representing Georgia in international and regional organizations.  
3.122.   During the review period, GEOSTM established an electronic platform (sst.geostm.gov.ge), 
which was created in 2020, to increase ac cess to Georgian standards and simplify the existing 
procedures, including the purchase of Georgian standards in electronic format. There were several 
other developments during the period, such as the establishment of an 8th Standardization Technical 
Commi ttee (TC) for Standardization "Road Traffic Safety" in  2020 by GEOSTM. The main role of TCs 
is to review drafts of Georgian standards in their areas of responsibility. The TCs shall not consider 
the development of a Georgian standard in the case of either of the following two conditions: (i)  in 
a field where there is an international standard; or (ii)  in a field where there is not a high demand 
for a standard. A standard registered by GEOSTM may be adopted on the basis of an international 
regional standard;  it may also be a Georgian standard developed according to defined rules. 
Standards are voluntary, although some Georgian technical regulations may contain a specific 
reference to the standard(s) that must be followed. On the other hand, mandatory technica l 
regulations are adopted only by law or by a resolution of the Government through a policy initiative 
from the various Ministries concerned.146 In order to have a recognized standard in Georgia, a draft 
standard can be developed by any interested person. T hey must apply to GEOSTM with the 
justification of significant demand for the standard unless the standard is intended to meet the 
requirements of a technical regulation. Thereafter, GEOSTM would need to agree to consider the 
issue by the relevant TC, whic h would decide by consensus on the appropriateness of the standard.  
3.123.   As of 2020, 18,500 standards were adopted as Georgian standards. Of these standards, 
36.79% are international, 63.08% European (including harmonized standards), and 0.13% national 
(Table 3 .9). There was a trend towards adopting more European standards in lieu of international 
standards in recent years as Georgia proceeded with DCFTA  implementation.  
3.124.   Also, during the reporting period, 22 technical regulations were adopted and notified to the 
WTO TBT Committee. Nearly all of these regulations were adopted in the framework of the DCFTA 
and are approximated with the EU  regulations or the requirements of the directives, i.e. the 
horizontal or sectoral directives. Many of the priority directives fo r earlier implementation contain 
elements that potentially impact trade insofar as there are specific provisions on 
importation/exportation for the products concerned; however, Resolution No.  50 on recognition of 
other countries' conformity is in support o f trade facilitation. Recent examples of TBT notifications 
are related to PPE. 
Table 3.9 Georgian standards adopted, 2015 -20 
Standards  2015  2016  2017  2018  2019  2020  
International 
Standards (ISO) (IEC)  754 656 48 128 340 567 
European Standards 
(EN, ETSI)  794 1,540  2,352  1,817  1,693  2,224  
National standards  1 0 4 0 1 0 
Other standards and 
standardization 
documents  12 0 0 1 0 2 
Total  1,561  2,196  2,404  1,946  2,034  2,793  
Source:  GEOSTM, Annual Report , various editions 2015 -20; and information provided by the authorities.  
3.125.   In terms of metrology, Georgia is in the process of undergoing reforms. One element is the 
work being undertaken to further develop national reference laboratories.147 With two other 
 
146 Within their responsibility, all ministries have rights to develop or initiate development of new 
technical regulations to be adopted by the Government . 
147 PTB, Strengthening the Quality Infrastructure in the Countries of the South Caucasus . Viewe d at: 
https://www.eastern -partnership.ptb.de/fileadmin/documents/eastern -
partnership/documents/PTB_pr oject_Southern_Caucasus_95333_EN_update.pdf . WT/TPR/S/420 • Georgia  
 
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  South Caucasus countries, Georgia is participating in a regional project to strengthen metrology and 
its quality infrastructure. The modernization of the GEOSTM measurement standards base and 
procurement of new metrology equipment have been undertaken within the framework of the 
EU Comprehensive Institution Building (CIB) Program. As of 2020, the GEOSTM Metrology Institute 
had published and recognized 61 Calibration and Measurement Capabilities  (CMC) entries/lines in 
the internationally recognized measurement fields of metrology: temperature, small volume, 
pressure, electrical measurements, and length.  
3.126.   In spite of limitations and challenges caused by the COVID ‑19 pandemic, Georgia's progress 
in the metrology field, such as a significant extension of internation al recognition of metrological 
services, was comprehensively explored and used by customers not only in Georgia but at the 
regional level, particularly before the pandemic. During 2018 -20, GEOSTM provided calibration 
services on a regular basis to clients from Azerbaijan and Armenia in fields such as temperature, 
mass, humidity, small volume, pressure, and length.  
3.127.   In 2020, equipment for liquid density and infrared calibration, so -called non -contact 
thermometry, was delivered in the framework of the Physikal isch-Technische Bundesanstalt  (PTB) 
regional project. This will allow GEOSTM to introduce new and higher demand services in the field 
of calibration of density meters, as well as infrared thermometers.  
3.3.2.1   Accreditation and conformity assessment  
3.128.   Accreditation and conformity assessment in Georgia is under the responsibility of the Unified 
National Accreditation Body, more commonly known as the Georgian Accreditation Center  (GAC), 
whose main work involves accrediting conformity assessment bodies. Si nce 2012, when the Code 
on Safety and Free Movement of Products was adopted, accreditations have been performed 
according to the Accreditation Rules and Procedures approved by the General Director of the GAC in 
accordance with the Code.148 The Accreditation  Rules and Procedures contain 10  parts.149 An 
Accreditation Board is also established by the Code and by Order N1 -1/403 of the Minister of 
Economy and Sustainable Development.150 It develops and submits recommendations on issues 
related to accreditation poli cy, initiates proposals related to the functioning of the accreditation 
system, and represents the interests of relevant parties in the accreditation process.  
3.129.   Before the latest changes, which were carried out in April 2020, the Rules and Procedures 
were mo dified two times, in 2018 and 2019, in order to incorporate modifications of international 
standard ISO/IEC 17011:2004. In 2017, a new version, ISO/IEC 17011:2017, entered into force, 
and the GAC, as a signatory to the Bilateral Recognition Agreement (BLA)  with the 
European  co-operation for Accreditation  (EA), was obliged to amend existing rules and procedures 
accordingly. It is noted that peer -evaluation by EA evaluators was carried out in 2015 with full 
evaluation in November 2016. As a result of a positi ve evaluation in April  2017, the  EA Multilateral 
Agreement Council (MAC) decided to sign a Bilateral Recognition Agreement (EA BLA) with the GAC. 
The Agreement extends the scope of the GAC to Testing and Calibration (ISO/IEC 17025), Product 
Certification ( ISO/IEC 17065), Certification of Personnel (ISO/IEC 17024), and 
Inspection  (ISO/IEC  17020). Later, in 2019, the EA  BLA was extended to cover medical 
examination  (ISO 15189). The latest changes in the Accreditation Rules and Procedures were made 
in 2020 in order to further align documentation to ISO/IEC 17011:2017. Thus, the current version 
 
148 GAC, Order of the General Director of the Accreditation Center No.  1-1 of 10 April 2020.  
149 GAC 1.1:2020 – General Rules and Procedures; GAC 1.2:2020 – Rules and Procedures for 
Accreditation of Testing and Calibration Laboratories in Accordance with SST ISO/IEC 17025:2017/2018 
Standard; GAC 1.3:2020 – Rules and Procedures for Accreditation of Me dical Laboratories in Accordance with 
SST ISO 15189:2012/2015 Standard; GAC 1.4:2020 – Rules and Procedures for Accreditation of the Bodies 
Certifying Products, Processes and Services in Accordance with SST ISO/IEC 17065:2012/2014 Standard; 
GAC 1.5:2020 – Rules and Procedures for Accreditation of Personnel Certification Bodies in Accordance with 
SST ISO/IEC 17024:2012/2014 Standard; GAC 1.6:2020 – Rules and Procedures for Accreditation of Audit and 
Management System Certification Bodies in Accordance with S ST ISO/IEC 17021 -1:2015/2016 Standard; 
GAC 1.7:2020 – Rules and Procedures for Accreditation of Inspection Bodies in Accordance with SST 
ISO/IEC  17020:2012/2013; GAC 1.8:2020 – Rules and Procedures for Proficiency Testing Providers for 
Accreditation in Acc ordance with SST ISO/IEC 17043:2010/2016; GAC 1.9:2020 – GAC Logo, Accreditation 
Symbol and Terms of Use; and GAC 1.10:2020 – Rule of Production of the Accredited CABs Registry. GAC, GAC 
Rules and Procedures . 
150 GAC, Order N1 -1/403 of 30 December 2014 of th e Minister of Economy and Sustainable 
Development on the Rules of Establishment and Activity of the National Accreditation Board.  WT/TP R/S/420 • Georgia  
 
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  of the Accreditation Rules and Procedures are in accordance with the requirements of the standard 
and relevant normative acts adopted by the EA, the International Laborat ory Accreditation 
Cooperation (ILAC), and the International Accreditation Forum (IAF).  
3.130.   The conformity assessment schemes used by the GAC were developed according to 
EU practices, all of which use relevant international standards. During the review period, there were 
not any significant changes in the accreditation schemes; there were only consequential changes 
introduced to adapt to the newer versions of the international standards used for the schemes 
(e.g. the conformity assessment scheme for testing and calibration laboratories was amended). 
Currently, the GAC is performing accreditation using the following conformity assessment schemes: 
scheme for accreditation of testing and calibration laboratories according to 
ISO/IEC  17025:2017/2018 standard; scheme for accreditation of Medical Laboratories 
ISO 15189:2012/2015 standard; scheme for accreditation of the Bodies Certifying Products, 
Processes and Services in accordance with ISO/IEC 17065:2012/2014 standard; scheme for 
accreditation of Personnel Certificat ion Bodies in Accordance with ISO/IEC 17024:2012/2014 
standard; scheme for accreditation of Audit and Management System Certification Bodies in 
accordance with ISO/IEC  17021 -1:2015/2016 standard; scheme for accreditation of inspection 
bodies in accordance with ISO/IEC 17020:2012/2013; and scheme for accreditation of Proficiency 
Testing Providers in accordance with ISO/IEC  17043:2010/2016.  
3.131.   During 2020, 43 accreditation certificates were issued by the GAC: 27 with respect to various 
inspection authorities, e. g. construction sector; 13 for laboratory examinations; two  for product 
certification bodies; and one for a testing provider.151 Periodic annual assessments were performed 
on 209 accredited facilities, mainly inspection bodies and examination laboratories. Also during the 
review period, accreditation was granted to 25 conformity assessors, partially suspended for 
19 others, and fully suspended for another 18.  
3.3.2.2   WTO and international cooperation  
3.132.   Since 2015, Georgia has made 27 notifications to the WTO TBT Commi ttee. Nearly all of 
these notifications concerned technical regulations pursuant to Articles  2.9 and 2.10 of the 
TBT Agreement. The notifications concern a wide range of products, such as wastes, buildings, 
construction, toys, poultry meat, liquid fuel, an d medical waste. Another notification, received 
in 2020 under the provisions of Article  15.2, provides the relevant laws and regulations, 
transparency measures for publication, and the WTO enquiry point, i.e. GEOSTM, for TBT matters.  
3.133.   According to the WTO's  TBT Information Management System, Georgia has not raised any 
specific trade concerns in the TBT Committee, nor has any other Member raised any concerns against 
Georgia.  
3.134.   Cooperation with the European  Union in the field of standardization and metrology was  
significant during the review period as it proceeds with implementation of the DCFTA. A Twinning 
Project has been established with the European  Union that aims to provide support for the effective 
and efficient implementation of the DCFTA, in particular t he provisions of Chapter 3 (Technical 
Barriers to Trade).152 During 2015 -19, the CIB was in place to build capacity through a number of 
events including training of staff, purchase of equipment, and outreach to business sectors. Support 
has also been given to GEOSTM to aid in the legal approximation of EU  Directives.  
3.135.   Georgia is a member of the main international and regional standards organizations: 
International Organization for Standardization  (ISO), European Committee for 
Standardization  (CEN), European C ommittee for Electrotechnical Standardization (CENELEC), 
International Electro -technical Committee  (IEC), International Organization of Legal 
Metrology  (OIML), International Bureau of Weights and Measures (BIPM), Euro -Asian Cooperation 
of National Metrolog ical Institutions  (COOMET), Inter -Regional Standardization Association (IRSA), 
and Euro -Asia Interstate Council for Standardization, Metrology and Certification.  
 
151 GAC, 2020 GAC Annual Report .  
152 Government of Italy, Ministry of Foreign Affairs and International Cooperation, Twinning Pro ject 
Fiche. Viewed at: 
https://www.esteri.it/mae/resource/garegemellaggi/2016/11/ge_13_enp_ec_02_16_ge25.pdf . WT/TPR/S/420 • Georgia  
 
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  3.3.3   Sanitary and phytosanitary requirements  
3.136.   As is the case in several other areas, policy and deve lopments in the field of SPS during the 
review period were largely driven by Georgia's obligations under the DCFTA. Nearly all new 
legislative developments derive from the DCFTA as Georgia continues to move towards 
EU SPS acquis . Georgia's overall policy g oal has been towards developing the legal and institutional 
framework in the food safety area to establish a food safety system in line with EU and international 
standards.  
3.137.   The SPS situation in Georgia can be described as having improved in recent years, a nd 
Georgia has been noted as one of the more advanced countries in the region in terms of 
SPS protections and adherence to international norms as its SPS -related legislation is more closely 
aligned with the WTO  Agreement.153 The partial implementation of th e DCFTA and related reform 
measures have increased the potential for more agricultural exports as Georgia can now access more 
of the EU  market, for example, for fish products and honey.154 
3.3.3.1   Framework  
3.138.   Legislative developments over the period were significant as Georgia works to approximate 
the EU legislation as outlined in Annex XI -B of the DCFTA. This Annex specifies 272  EU laws or 
directives for Georgia to adopt by certain dates during the period 2015 -27. Georgia already 
approximated its SPS legislation to 1 62 EU legal acts thus far (Table 3.10 and Table A3.5). Also, a 
number of EU acts were considered non -applicable for Georgia by the EU -Georgia Sanitary and 
Phytosanitary (SPS) Sub -Committee (indicated in parentheses in Table  3.10). As at September 
2021, thi s new legislation had not been notified to the WTO.  
Table 3.10 SPS legislative developments under the DCFTA, 2015 -21 
Year Legislation implemented  
Total  Food safety  Veterinary  Phytosanitary  
2021 16 (6)  7 (2) 5 (1) 4 (3) 
2020 26 (3)  9 (2) 7 10 (1)  
2019 22 (2)  7 7 (1) 8 (1) 
2018 24 (5)  6 (2) 9 (2) 9 (1) 
2015-17 74 (2)  37 (2)  27 10 
Note:  Numbers in parentheses indicate non -applicable EU acts.  
Source:  Reports of the EU -Georgia Sanitary and Phytosanitary (SPS) Sub -Committee meetings, 2017 -20; 
and information provided by the authorities.  
3.139.   During the review period, Georgia worked on the National Phytosanitary Strategy, but as at 
September 2021 it had not yet been approved. Furthermore, the Natio nal Food Safety Implementing 
Strategic Document was prepared during the review period; it was recently approved but not yet 
available for examination.  
3.140.   Georgia's main law for SPS remains its 2012 Law on Food/Feed Safety, Veterinary and Plant 
Protection Code , which underwent several amendments during the review period, mostly in response 
to DCFTA requirements or consequential changes resulting thereof.155 The Law applies to the 
production, processing, and distribution of food/feed, animals, plants, and product s of animal and 
plant origin in the territory of Georgia, and to food/feed safety and veterinary and phytosanitary 
controls related to import, export, re -export, and transit across the customs borders. The Law 
introduces the international norms in the SPS area by incorporating the requirements of the 
International Standards for Phytosanitary Measures (ISPM), International Plant Protection 
 
153 CAREC (2019), Modernizing Sanitary and Phy tosanitary Measures in CAREC: An Assessment and the 
Way Forward . 
154 Products of animal origin, including unprocessed wool, honey, and fishery products, are allowed to be 
exported to the European  Union. European Commission, Ensuring Further Progress of SPS a nd Food Safety 
System in Georgia . Viewed at: 
https://um.fi/documents/385176/0/Ensur ing+further+progress+of+SPS+and+food+safety+system+in+Georg
ia.pdf/8ca9813c -ed91-f467-6fdf-a1c3f37af3de?t=1579593450589 . 
155 Law of 8 May 2012 on Food/Feed Safety, Veterinary and Plant Protection Code.  WT/TP R/S/420 • Georgia  
 
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  Convention (IPPC), World Organization for Animal Health (OIE), Codex  Alimentarius, and the WTO. 
It contains provisions o n risk assessment, risk management, requirements related to the Hazard 
Analysis and Critical Control Points (HACCP) system, quarantine procedures, and a number of 
critical  ISPMs.156 
3.141.   Several legal acts, in particular as they relate to SPS border measures, co ntain other 
provisions that are relevant to the implementation of the SPS  Agreement or international norms. For 
example, Resolution No.  463 of 20  September  2019 on Approval of the Rule of Phytosanitary Border -
Quarantine and Veterinary Border -Quarantine Con trol and Resolution No.  430 on Models of 
Veterinary Certificates of Products Subject to Veterinary Control, Intended for Export incorporate 
some OIE norms. Other resolutions or rules as they relate to certificates, quarantine, or inspection 
at the border a re outlined in Table 3.11 (a more comprehensive list of all recent SPS  legislation is 
found in Table A3.5). In addition, a number of technical regulations (Section 3.3.2) have been issued 
that require certificates, inspection, or additional import procedur es for products that may contain 
certain pests, diseases, contaminants, or residues.157 
Table 3.11 Legal framework, main laws on SPS, 2021  
Law or resolution  Overview  
Law on Food/Feed Safety, Veterinary and Plant 
Protection Code  Main law with comprehensive coverage for food 
safety, and veterinary and phytosanitary measures  
Resolution No.  463 of 20  September  2019 on 
Approval of the Rule of Phytosanitary Border -
Quarantine and Veterinary Border -Quarantine 
Control  Covers inspection and quarantine measures for 
products crossing the border as listed in the Annex  
Resolution No.  567 of 23  December  2016 on 
Approval of the Rule on Border Control of 
Food/Animal Feed Safety  Provides rules for border contr ol of food/animal feed 
safety of non -animal origin, primarily for foods at 
risk of aflatoxin. Annex provides lists of products 
covered.  
Resolution No.  578 of 10  November  2015 on 
Approval of the Regulations on the Measures for 
Integration in the EU Rapid Alert System for Food 
and Feed (RASFF)  Aligns Georgia with the EU RASFF  
Resolution No.  759 on the Conditions of Safety, 
Labelling, Packaging and Identification during the 
Transportation of Live Genetically Modified 
Organisms in the Territory of Geor gia Ensures the safety and use of live genetically 
modified organisms in Georgia by establishing the 
conditions of safety, labelling, packaging, and 
identification during transport  
Resolution No.  430 on Models of Veterinary 
Certificates of Products Subject to Veterinary 
Control, Intended for Export  Explains the procedure for issuing a veterinary 
(health) certificate upon exportation  
Resolution No.  427 of 31  December  2010 on 
Approval of Rule on Granting the Phytosanitary 
Export and Re -export  Certificates and Models of 
Certificates  Defines the phytosanitary procedures related to the 
issuance of Phytosanitary Certificates and Re -Export 
Phytosanitary Certificates  
Resolution No.  147 of 2  April 2021 on Approval of 
the Procedure for Issuing Veteri nary (Health) 
Certificates to Be Used during the Export of Products 
Subject to Veterinary Control  Provides that the NFA issues veterinary health 
certificates for export following veterinary control 
procedures that involve submission of the necessary 
docume ntation, physical inspection, and sampling  
Resolution No.  426 of 31  December  2010 on 
Approval of the Rules, Conditions, and Forms of 
Permit Certificates by the National Food Agency  Outlines requirements for obtaining a permit from 
the NFA for the import o r transit of certain 
veterinary products, and the import of regulated 
plant products. It requires documentation and 
conditions to be met in order to obtain a permit.  
Source:  Information provided by the authorities; and Revenue Service, Legislation . Viewed  at: 
https://www.rs.ge/Legislation?cat=6&tab=1 . 
 
156 ISPMs 4, 5, 6, 7, 11, 12, 15, 23, 27, and 32. CAREC (20 19), Modernizing Sanitary and Phytosanitary 
Measures in CAREC: An Assessment and the Way Forward . 
157 For example, technical regulations on rules for combating Anoplophora chinensis (Forster) in 
Chinese  Citrus, on the traceability and labelling of geneticall y modified organisms and the approval of the 
traceability of food/animal feed produced from genetically modified organisms, and on the approval of 
sampling methods for the determination of the maximum level of pesticide residues in plant and animal 
product s during the state control. Approximately 300 EU technical regulations in the SPS area are expected to 
be adopted by Georgia.  WT/TPR/S/420 • Georgia  
 
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  3.142.   The National Food Agency (NFA) was established in 2010 and is a Legal Entity of Public Law 
under the MEPA. The NFA has been designated as the main agency of the Government in the field 
of food/feed safety, and veterinary and plant protection in the territo ry of Georgia. Some of its key 
roles are to provide food/feed safety and quality assurance; carry out official controls of food 
safety/hygiene, veterinary -sanitary, and phytosanitary requirements; register pesticides, 
agrochemicals, and veterinary drugs; a nd conduct risk management. The purpose of state oversight 
is to protect human life and the health of consumers through inspection, supervision, monitoring, 
and sampling. A significant part of the NFA's work is in domestic inspection activities, including both 
planned and unscheduled/surprise inspections. The NFA has seen a significant increase in its work 
and activities in recent years as it implements the DCFTA, especially in the scale of control operations 
as the number of inspections has substantially i ncreased and the number of registered food business 
operators has also grown. Veterinary medicinal products and agrochemicals are subject to state 
registration by the NFA  prior to import. Prior to being placed on the market, agrochemicals and 
pesticides sh ould be listed in the catalogue of authorized products.  
3.143.   At the border, Georgia requires certain control procedures for veterinary products, 
phytosanitary products, and food of non -animal origin; these border measures fall under the 
responsibility of the Re venue Service but also require a level of cooperation and coordination with 
the NFA, in particular with respect to the exchange of information and for monitoring programmes. 
The Revenue Service  is responsible for border control over food/feed safety, veter inary border 
control, and phytosanitary border control. A number of laws and resolutions provide the rules and 
procedures for these controls by the Revenue Service. While the Law on Food/Feed Safety, 
Veterinary and Plant Protection Code provides the overal l framework, the most pertinent rules are 
in Resolution No.  463 of 20  September  2019 on Approval of the Rule of Phytosanitary Border -
Quarantine and Veterinary Border -Quarantine Control.158 This new law replaced a similar resolution 
with the same name that w as in force for most of the review period, i.e. until 2019.159 The new 
resolution was put in place solely to accommodate the reference to the Customs Code when it was 
enacted and not the Tax  Code as it was previously; otherwise there were no changes.160 
3.144.   Resolution No.  463 is divided in two sections and contains specific rules for phytosanitary 
border -quarantine control and for veterinary border -quarantine control. Both sections have annexes 
that delineate which products (by HS code or heading) they apply to. For phytosanitary rules, they 
mainly apply to certain plants (06), vegetables (07), fruits (08), cereals  (10), oilseeds  (12), 
wood  (44), and fibres (53); and for veterinary rules, live animals (01), meat (02), fish  (03), 
dairy (04), products of animal orig in (05), cereals (10), fodder (12), fats (15), 
meat preparations  (16), forage  (23), animal preparations or veterinary drugs (30), and hides, skins 
and furs  (41, 43). Approximately 200  HS subheadings/tariff lines are covered.161 
3.145.   The Resolution provides that for those phytosanitary and veterinary control products listed, 
the measures apply to importation, transit, exportation, and re -export of goods. Products of plant 
origin, which are subject to phytosanitary control, can be imported if accompanied by a phyto sanitary 
certificate162, advance notice is given, and an inspection process is carried out at the border. 
Inspection procedures involve a documentary check, identity verification, plant health control, and 
sampling or laboratory analysis; the latter is done  on the basis of risk analysis. Importation of live 
animals and products of animal origin subject to veterinary control is similar to that for phytosanitary 
control but is subject to the following criteria: can be exported to Georgia; are produced at an 
enterprise that has the right to export the goods to Georgia; and are accompanied by a  veterinary 
certificate or a health certificate from the country of origin that corresponds to the  respective OIE 
health codes.  
3.146.   Furthermore, trade of live animals and produ cts of animal origin from establishments 
approved by the European Commission do not require a prior examination and audit of the food 
business operators; however, if the establishments are not listed by the European  Commission, the 
NFA shall carry out an o n-site inspection and thus confirm the compliance with the relevant Georgian 
 
158 Resolution No.  463 of 20  September  2019 on Approval of the Rule of Phytosanitary Border -
Quarantine and Veterinary Border -Quarant ine Control ; and information provided by the authorities.  
159 Resolution No.  429 of 31  December  2010 on Approval of the Rule of Phytosanitary Border -
Quarantine and Veterinary Border -Quarantine Control.  
160 Information provided by the authorities.  
161 See Annex N o. 1 of Section (a) and Annex N1 of Section (b) for the listing of all products concerned.  
162 Issued by the competent authority of exporting country, in compliance with the relevant ISPM 
standards.  WT/TP R/S/420 • Georgia  
 
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  requirements. Resolution No.  463 also prohibits the importation of certain products on SPS 
grounds  (Table 3.12).  
3.147.   Other legislation that imposes inspections or possible restriction s at the border is Resolution 
No. 567 of 23  December  2016 on Approval of the Rule on Border Control of Food/Animal Feed 
Safety. The legislation was put in place to ensure food/feed safety of imported products and to 
combat aflatoxin. It requires inspection , control, or issue of a health certificate for certain products 
listed in its two  annexes – Annex  2 is mainly fruits and vegetables of HS Chapters 7, 8, and 12, and 
Annex 3 is mainly spices,  nuts, and nut products of HS Chapters 9, 12, and 20.163 The Resol ution 
was elaborated in accordance with the EU regulation that contains similar measures, including the 
provisions in the Annexes. All products must enter Georgia at a border post that has a designated 
inspection point and then undergo an inspection, both documentary and physical examination with 
laboratory analysis and/or sampling. For products listed in Annex 3, the importation must also be 
accompanied by a health certificate issued and certified by the competent authority of the country 
of origin. Produc ts that fail the inspection are required to be returned, destroyed, or used for other 
purposes.  
3.148.   Resolution No.  426 of 31  December  2010 on Approval of the Rules, Conditions, and Forms 
of Permit  Certificates by the N FA also provides rules for certificates on  certain products for 
importation or transit.164 The import permit is given on the basis of the certificate issued and 
submitted; the certificate is examined during import procedures. The respective appendixes provide 
lists of products subject to veterinary  control during transit, products subject to veterinary control 
at importation, and products of plant origin subject to phytosanitary control at importation.165 
Table 3.12 Prohibited products, 2021  
Product  Country of origin  
Soil (except for small amounts that move with plants)  All countries  
Isolated bark of Castanea Mill.  Except the countries of the European continent  
Isolated bark of Populus L . North and South American countries  
Isolated bark of Acer saccharum  and Quercus L.  (other 
than Quercus suber ) Canada, United  States, and Mexico  
Live plants  Pinus spp., Picea, Abies, Tsuga, Pseudotsuga  
(conifers) round wood, wooden material, cut branches 
and planting mate rial (except fruits and seeds)  Canada, United  States, and Mexico  
Populus spp., Juglans  planting material, round wood, 
wooden products, other than seeds and fruits  Canada, United  States  
Malus spp., Prunus avium, Prunus persica, Prunus spp., 
Pyrus, Crataeg us, Corylus spp.  planting material other 
than dormant plants (without leaves, flowers, and fruits)  Canada, United  States  
Solanum L.  planting material, tubers  Brazil, Colombia, Costa Rica, Mexico, Paraguay, 
Peru, Bolivarian Republic of  Venezuela, 
Plurinational State of Bolivia, Ecuador  
Phoenix L., Washingtonia Wend., Trachycarpus Wend.  
planting material, live plants, other than seeds and fruits  All countries  
Source:  Resolution No.  463 of 20  September  2019 on Approval of the Rule of Ph ytosanitary Border -
quarantine and Veterinary Border -quarantine Control, Annex No.  8; and Revenue Service, 
Phytosanitary Control: Privileges/prohibitions . Viewed at: 
https://www.rs.ge/Le galEntitySafetyControl?cat=1&tab=1 . 
3.149.   The State Laboratory of Agriculture (SLA) operates under the umbrella of the MEPA and is 
responsible for testing samples provided by the NFA, business operators, and the private sector. The 
SLA has an international accreditation, i.e. by the G AC in 2017-18 pursuant to ISO/IEC  17025. 
Capacity is available for bacteriological analysis, and serological and molecular (PCR) testing and 
sequencing. In addition, the quality management system ISO 9001:2015 has been introduced and 
applied.  
 
163 For the full list of products covered, see Annexes 2 and 3 on the Revenue Service website.  
164 Resolution No.  426 of 31  December  2010 on Approval of the Rules, Conditions, and Forms of Permit 
Certificates by the National Food Agency.  
165 Appendixes 1, 2, and 3. Resolution No.  426 of 31  December  2010 on  Approval of the Rules, 
Conditions, and Forms of Permit Certificates by the National Food Agency.  WT/TPR/S/420 • Georgia  
 
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  3.3.3.2   Technical assistance, the WTO, and international cooperation  
3.150.   Cooperation and partnership initiatives with the European  Union increased over the period 
as Georgia implements the DCFTA. Six EU -Georgia Sanitary and Phytosanitary  (SPS) 
Sub-Committee meetings dedicated to implementation  issues were held. Georgia also benefited from 
a Twinning Project and numerous technical assistance and capacity -building initiatives, such as EU 
support to the NFA, including the training of staff.  
3.151.   Georgia is a member of the three standards -setting bodies  recognized by the WTO: the OIE, 
the Codex Alimentarius Commission, and the IPPC. Georgia is implementing a certification system 
for seed and planting material pursuant to the international standards of the OECD, ISTA, and EPPO 
and is publishing a National  Catalogue of agricultural crop varieties in Georgia using International 
Union for the Protection of New Varieties of Plants (UPOV) standards.  
3.152.   The MEPA has been notified to the  WTO as Georgia's National Notification Authority. Pursuant 
to WTO rules, Georgi a also maintains an SPS enquiry point, which is the head of the Food Safety 
Division at the MEPA.166 Georgia made only one SPS notification to the WTO SPS Committee during 
the review period, in  2015, with respect to Living Modified Organisms.167 The authorit ies indicate 
that capacity constraints prevented them from making notifications, and they are actively working 
to overcome the existing challenges in order to submit information to the WTO.  
3.153.   According to the WTO's SPS Information Management System, Georgia has not raised any 
specific trade concerns in the SPS Committee, nor has any other Member raised any concerns against 
Georgia.  
3.3.4   Competition policy and price controls  
3.3.4.1   Competition policy  
3.154.   Georgia's competition policy framework has undergone many developments in the 
seven  years since its main Law on Competition was enacted in 2014. Prior to that time, competition 
rules and structure were in their infancy. Thus, the reform of the competition area was a key 
government reform effort during the past de cade, in part driven also by the DCFTA.  
3.155.   Georgia has been guided by the Law on Competition as its main legislation in the area of 
competition since its entry into force in March 2014; it has been amended 11  times thereafter 
(Table  3.13).168 The Law is compre hensive in the antitrust sphere and contains provisions on abuse 
of dominant position, unfair competition, merger control, market monitoring, anti -competitive 
agreements, and distortion of competition by state authorities. It also contains provisions on 
state aid, e.g. state aid is prohibited if it hinders or obstructs competition, although certain 
exceptions may be applicable.  
Table 3.13 Competition legal framework, 2021  
Law or regulation  Reference  
Law on Com petition  Law No.  2159 of 21  March  2014  
Regulation on Exemption from Prohibition on 
Competition Restricting Agreements  Regulation No.  526 of 1  September  2014 
Regulation on Approving Small Amounts of 
Individual State Aid and General Procedure for 
Granting State Aid  Regulation No.  529 of 1  September  2014 
Order on the Approval the Procedure for Applying 
the Leniency Programme Towards a Person and Fully 
or Partially Exempting from Liability Imposed Due to 
Infringing Article  7 of the Law on Competitio n Order No.  33 of the Chairman of the Competition 
Agency of 22  October  2020 
Order on the Approval Methodological Guidelines of 
Market Analysis  Order No.  37 of the Chairman of the Competition 
Agency of 23  October  2020 
 
166 See WTO Sanitary and Phytosanitary Information Management System. Viewed at: 
http://spsims.wto.org/en/EnquiryPointsNotificationAuthorities/Search?countryCode=C268&filter= . 
167 WTO document G/SPS/N/GEO/23, 9  March 2015.  
168 Law No.  2159 of 21  March  2014 on Competition.  WT/TP R/S/420 • Georgia  
 
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  Law or regulation  Reference  
Order on the Approval of the Form of Complaint, 
Rule for its Submission and Procedures and 
Deadlines Related to the Admissibility of the 
Complaint  Order No.  38 of the Chairman of the Competition 
Agency of 23  October  2020 
Order on the Approval the Procedure on Submission 
and Consideration of Notification about 
Concentration  Order No.  39 of the Chairman of the Competition 
Agency of 26  October  2020 
Order on the Approval of the Rules and Procedures 
of Investigation  Order No.  40 of the Chairman of the Competition  
Agency of 28 October  2020 
Source:  Information provided by the authorities.  
3.156.   According to Article  1(4) of the Law, competition provisions do not apply to: (i)  labour 
relations; (ii)  relations connected with intellectual property rights, except for the cases where tho se 
rights are exercised for the restriction and elimination of competition; and (iii)  relations arising from 
the exercise of resolutions powers in accordance with the Organic Law of Georgia on the National 
Bank of Georgia and the Law of Georgia on Commerci al Bank Activities. Furthermore, the Law defines 
the regulated  sphere of the economy whereby certain other laws are also applicable with respect to 
free pricing, as competition is restricted and tariffs or price controls are imposed (Section  3.3.4.2). 
Thus, the Law on Competition is also enforced by the relevant regulatory bodies in specific 
circumstances.  
3.157.   The Georgian Competition Agency was created on the basis of the Law on Competition and 
in accordance with Resolution No.  288 of 14  April 2014.169 Its main  role is to implement competition 
policy, create and protect conditions for the promotion of competition in Georgia, and prevent all 
types of anti -competitive actions. Among its many functions, it monitors commodity and services 
markets for unfair competit ion, detects unfair competition of undertakings and acts accordingly, 
assesses compliance of planned mergers, cooperates with international organizations and 
competition bodies of other countries, and promotes awareness of competition rules to the public.170 
With the amendments to the Law on Competition in 2020, the Resolution was likewise amended and 
the Agency was renamed the Georgian National Competition Agency.171 
3.158.   In September 2020, Parliament approved amendments to the Law on Competition and 
related reso lutions as a legislative package. Most of the amendments entered into force 
on 4 November  2020, except for Article  17, relating to the governing body or Board, which was 
expected to enter into force in June  2021. However, according to the authorities, this  was extended 
to January 2023 due to the COVID ‑19 pandemic. These reforms were the most comprehensive 
revision of the Law on Competition  since its inception. In addition to the name change of the 
Georgian Competition Agency, the amendments involved giving more accountability and 
enforcement to the Agency, improving procedural aspects, incorporating a new governing structure, 
and aligning the legal provisions with EU  best practices (Box 3.4).  
3.159.   The two main areas of substantial legal change were new procedures  for merger control and 
market investigations. Regarding merger control, a two -phase concentration control system was 
established with different deadlines, thereby allowing the Agency more time for complex cases. On 
the other hand, measures were strengthen ed so that all mergers subject to assessment are notified 
and measures put in place to prevent them going ahead without approval, including by  imposing 
fines of up to 5% of the previous year's annual turnover of the parties concerned. Georgia also 
adopted the "significant impediment to effective competition" (SIEC) test in order to appraise the 
merger. Regarding market investigations, the amendments also gave certain enhanced powers to 
the Agency, specifically with respect to investigation methods and enfor cement. For example, new 
rules have been put in place that allow surprise inspections and their enhanced modalities, as well 
 
169 Resolution No.  288 of 14 April 2014 on Approval of the Statute of the Legal Entity of Public Law – 
Georgian National Competition Agency.  
170 In addition, the Agency has a role with respect to contingency measures, i.e. as the independent 
agency involved in investigating dumped imports per the Law on the I ntroduction of Anti -dumping Measures in 
Trade (see Section 3.1.7). It also has a role in the newly established Public Procurement Dispute Resolution 
Council in which financing is provided from its budget for the Board, and staff of the Board are a subdivis ion of 
the Agency.  
171 Resolution No.  671 of 9 November 2020 on Amendment to the Resolution No.  288 of the 
Government of Georgia of 14 April 2014 on Approval of the Statute of the Legal Entity of Public Law – 
Competition Agency.  WT/TPR/S/420 • Georgia  
 
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  as the imposition of fines, of up to  1% of annual turnover, for unfair competition cases. The 
investigation period was extended and  procedural rights of the parties were improved so that the 
Agency sends draft decisions in advance for comment, and so additional evidence can be presented.  
Box 3.4 Main 2020 reform elements of the Law on Competition  
Legal Entity of Public Law (LEPL) –Georgian Competition Agency was renamed LEPL –Georgian National 
Competition Agency.  
The Agency is authorized to request information from undertakings on every stage of investigation, merger, 
or market monitoring; and undertakings are obliged to provide the requested information to the Agency. 
Otherwise, the Agency has the power to impose fines on the undertaking if it fails to submit information 
within the estab lished timeframes.  
The Agency has the right to carry out unannounced on -site inspections on the basis of a court decision.  
Timelines of proceedings: For investigations, review of concentration notification and review of the 
compliance of state aid are in creased, which will give the Agency another opportunity to effectively enforce 
the Law on Competition.  
The Law has set the fine for infringing rules related to unfair competition up to 1% of the turnover of the 
infringing undertaking. Previously, there wa s no fine for this type of infringement.  
The Law introduced a two -phase merger procedure and will give the parties to the concentration an 
opportunity to modify the transaction through structural or behavioural remedies.  
The Law became stricter on gun ju mping; more precisely, the Agency will have the right to impose fines on 
the undertaking if it fails to submit the concentration notification to the Agency.  
The provider of de minimis  aid is obliged to submit to the Agency the information on the amount, t erm, and 
beneficiary undertaking(s) of the state aid, on an annual basis. The Agency will enter the information into 
the registry of de minimis  state aid.  
The Agency is authorized to make a commitment decision.  
The Law brought enforcement in the regulated sectors to a new level. Before amendment, the Agency had 
no authority to enforce the Law in the regulated sectors. Moreover, the sector regulators did not use the 
Law on Competition. Instead, they had their own laws, which to a minimum extent covered competition 
issues. This legal gap made enforcement of the Law in the regulated sectors very difficult. Since the 
amendments, the Law on Competition has been enforced in all sectors of the economy, mainly by the sect or 
regulators and, in certain cases and upon certain conditions, by the Agency.  
The Law introduced a Board consisting of five members as the governing body of the Agency. The Board 
members are elected and dismissed by Parliament for a term of five years. The Board will elect the 
Chairperson. Since the Board members will be elected by Parliament, the Agency will become accountable to 
both the Prime Minister and Parliament, whereas previously, the Agency was accountable only to the Prime 
Minister.  
Source:  Information provided by the authorities.  
3.160.   During the review period, the agency carried out examinations of wheat and bread, auto 
insurance, infant nutrition, retail, cigarettes, online hotel booking, passenger air transportation, Poti 
ports, technical inspec tion, pharmaceuticals, and fuel markets. Most examinations were completed 
in 2020, with the Poti ports assessment finished in 2021. As of September 2021, there were two 
ongoing market monitoring examinations in process for fuels and pharmaceuticals (Table 3.14).172 
3.161.   Of the 25 commodity/service market investigation cases173 conducted during 2014 -19, 
a majority, i.e. 14, revealed violations. Most of these involved restrictions by public authorities, 
mainly through public procurement. The cases were most often br ought by companies, but the 
Agency self -initiated five cases.174 One of the longest and most high -profile cases during the period 
involved the petroleum products market, in particular motor fuel, i.e. gas and diesel. The Agency 
found violations in price fix ing; restriction of production, markets, technological development or 
investment; and distribution of markets or supply sources. As a result, eight firms were fined a total 
 
172 Georgian National Competition Agency, Annual Report 2020 .  
173 Yearly data from Table 3.14 are not unique; the same ongoing/completed cases may be counted 
over several years.  
174 Transparency International Georgia,  Work of the Competition Agency of Georgia in 2014 -19: 
Competences and Case Studies . Viewed at: https://www.transparency.ge/en/blog/work -competition -agency -
georgia -2014-2019-competences -and-case-studies/?custom_searched_keyword=competition+price . WT/TP R/S/420 • Georgia  
 
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  of GEL  55 million. Most of the companies appealed through the court system up to th e appeals court, 
and the matter was then re -examined by the Georgian National Competition Agency for 
enforcement, whereby the fine was reduced to GEL  3 million.175 
3.162.   As regards litigation during the period 2015 -20, there were 19 court cases that involved the 
Agency. As of end -2020, 7 had been decided in favour of the Agency and 12 were ongoing.176 
Table 3.14 Georgian National Competition Agency statisticsa, 2016 -21 
 2016  2017  2018  2019  2020  2021b 
Investigation cases  9 6 6 2 6 6 
 -completed  5 5 5 1 3 3 
 -ongoing  4 1 1 1 3 3 
 -inadmissible  5 6 7 5 7 3 
Commodity/service market 
monitoring  5 5 7 8 7 3 
 -completed  1 .. 0 1 5 1 
 -ongoing  4 .. 7 7 2 2 
Notification about expected 
concentration  4 2 2 4 1 2 
Recommendations issued  25 10 4 1 4 3 
.. Not available.  
a Yearly data are not unique; the same ongoing/completed cases may be counted over several years.  
b Through September 2021.  
Source:  Georgian National Competition Agency, Annual Report , various editions 2016 -20; and information 
provided by the authorities.  
3.163.    As at September 2021, Georgia had initiat ed work on a new consumer rights protection law. 
The draft law has not yet been enacted, and is dependent upon actions to be taken by Parliament.  
3.164.   In terms of international cooperation, the Georgian National Competition Agency is a 
member of the Internation al Competition Network. Further, it has 14  MOUs for cooperation with 
competition authorities of other countries. The Agency has also benefited from a number of bilateral 
aid, capacity -building, and technical assistance initiatives in recent years in order revise its 
competition framework; in particular, this assistance has come from the European  Union in respect 
of work towards DCFTA  competition provisions.  
3.3.4.2   Price controls  
3.165.   According to the authorities, prices are determined by the market, except for the prices of 
communications, water and energy supply, and municipal services such as the subway and other 
public transport. These products and services are subject to price control and have not changed 
since the last Review.  
3.166.   Until it was abolished in 2005, Ge orgia's main law on price controls was its 1993 Law on 
Pricing and Pricing Basics. It was replaced by the Law on Free Trade and Competition, which was 
subsequently replaced by the Law on Competition in 2014.177 The Law essentially allows 
entrepreneurs to fr eely set prices, with the exception of certain state authorities that regulate prices 
in tariff -controlled sectors such as energy and transport. Tariffs are set by the pertinent regulator 
per specific tariff setting rules (Table 3.15).  
Table 3.15 Price controls, 2021  
Sector  Products/services 
controlled  Regulator  Legal reference  
Communications  Internet wholesale services, 
interconnection tariffs for 
mobile and landline networks  Georgian National 
Communication s 
Commission  Georgian National 
Communications Commission 
Resolution No.  4 of 18  May 2001 
 
175 Transparency International Georgia, Work of the Competition Agency of Georgia in 2014 -19: 
Competences and Case Studies . 
176 Georgia National Competition Agency, Annual Report 2020 . 
177 Law of 27  July 1993 on  Pricing and Pricing Basics; and information provided by the authorities.  WT/TPR/S/420 • Georgia  
 
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  Sector  Products/services 
controlled  Regulator  Legal reference  
on Regulation of Tariffs for 
Communication and Services 
through Communication and Mail 
Networks and Means  
Water  Water supply marginal tariffs 
for various consumer 
categories  Georgia National 
Energy and Water 
Supply 
Regulatory 
Commission 
(GNERC)  GNERC Resolution No.  21 of 
10 August  2017 
Electricity  Electricity tariffs are set for 
electricity generation, 
consumption, transmission, 
dispatch, distribution, and  
electricity system commercial 
operator services  GNERC  GNERC Resolution No.  33 of 
4 December  2008 
Natural gas  Distribution and transportation 
activities represent natural 
monopolies and are subject to 
tariff regulation  GNERC  GNERC Resolution No.  33 of 
25 December  2014 
Transportation  Certain transport tariffs, i.e. 
public transport and road 
transport  Georgian Ro ad 
Transport, 
Maritime 
Transport, 
Railway Transport 
and Civil Aviation 
authorities  Minister of Transport and 
Communications of Georgia 
Order No.  34 of 23  October  2000 
on Approval of the Rule of 
Passenger Services by Public 
Utility Transport (Bus, 
Trolleybu s, Tram)  
Source:  Georgia National Energy and Water Supply Regulatory Commission  (2020) , Report on Activities 
of 2019; and information provided by the authorities.  
3.3.5   State trading, state -owned enterprises, and privatization  
3.167.   Georgia has indicated that it does not maintain any state trading enterprise as defined by 
GATT  Article  XVII:4(a) and the Understanding on the Interpretation of Article  XVII of the 
GATT  1994. Furthermore, during the period 2015 -19, Georgia made biennial notifications to the 
Working Par ty on State Enterprises also noting it does not maintain any state trading enterprises 
falling within the meaning of the working definition.178 
3.168.   Georgia's Law on State Property of 2010 remains the main law governing state property, 
which includes movable and  immovable objects as well as intangible objects owned by the State.179 
The Law was established to regulate the management, administration, and transfer of state property. 
Since  its establishment, it has been amended 48 times, most recently in August 2021.180 The Law 
has provisions on acquiring state property, privatization by auction and other methods, privatization 
of certain state -owned agricultural lands and methods of privatization, privatization of state -owned 
real estate and methods of privatization, p rocedures for transferring property to state ownership, 
disposal of state -owned property, and administration and use of state -owned property, including 
intangible property. It also has provisions for state property not subject to privatization, such as 
water resources, national parks, certain designated state agricultural lands, and archives and 
collections.181 The section on privatization of state forests was removed by amendment in  2020. This 
was as a result of the new Forest Code of Georgia that entered into force in  2020 and necessitated 
these consequential amendments to the Law on State Property.182 Other si gnificant changes to the 
Law on State Property relate to modification of the conditions (e.g.  fees or timing of privatization, 
or transfer or change of ownership of state property during an emergency, pandemic, or epidemic); 
 
178 WTO documents G/STR/N/16/GEO, G/STR/N/17/GEO, 20  November 2018; and G/STR/N/18/GEO, 
18 September  2020.  
179 Law of 21 July 2010 on State Property.  
180 Law of 21 July 2010 on State Prope rty. 
181 See Article  4 of the Law for the full list of exemptions.  
182 Regarding privatization of state forests, it should be noted that this has always been prohibited 
except for the former collective agricultural forests located within the territorial bounda ries of settlements.  WT/TP R/S/420 • Georgia  
 
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  thus, the terms of such agreeme nt may be modified upon a substantiated request from the 
interested party.  
3.169.   The National Agency of State Property (NASP), a legal entity established in  2012 under the 
MESD , is the principal government entity responsible for administering and managing state 
property.183 Under Georgian law, the State may have ownership of entities under public law and also 
under private law whereby the State may own or maintain an ownership percentage or share. As 
of 2021, there were 101 state enterprises under the supervision of the NASP, 50 of which had 100% 
state ownership (Table A3.6), and the remainder had less than 100%  state ownership.184 The main 
role of the NASP is oversight and management of state -owned and state -supported enterprises; it 
is involved in privatization, m erger, insolvency, and bankruptcy matters in this respect. It also aims 
to decrease the number of enterprises under state ownership in order to stimulate economic growth 
and operates the e -auction website for the auctioning of state property.185 
3.170.   In 2020 the  Service Agency of the Ministry of Finance was merged with the NASP, and all 
functions of the Service Agency have been incorporated into the NASP.  
3.171.   The NASP also plays a role in the Produce in Georgia Program  (see Section  3.3.1). Since the 
Program's incepti on, the NASP has been responsible for the physical infrastructure transfer 
component of the Program, i.e. transferring state property free of charge to entrepreneurs under 
the Program. Since 2014, 123 properties have been transferred with a total value of 
GEL 181 million.186 The NASP is also involved in the privatization of agricultural lands under the  
Access to Agricultural Land Resources State Program (see Section  4.1.1).  
3.172.   In addition to the main state enterprises under the NASP, the business register recor ds 
5,822  registered entities of the State whereby at least 50% of the equity was owned by the State; 
of these, 2,858 were active as of 1  April 2021.187 According to the authorities, many of these 
enterprises were managed by municipalities and thus are not u nder the auspices of the NASP, and 
therefore no  information was available regarding them.  
3.173.   The Government also reports statistics on business entities, which are enterprises involved 
in economic activity that generally produce goods or deliver services. Thi s is another source of 
information about the number and activities of state -owned enterprises (SOEs) outside the NASP, 
in particular their relation to private business enterprises and their role in the economy. Business 
entities can be limited liability co mpanies, joint -stock companies, joint -liability companies, limited 
partnerships, cooperatives, or individual entrepreneurs. Most ownership is in the form of individual 
entrepreneurship (62%) followed thereafter by limited liability companies (36%). In 2019 , it was 
reported that 1,426 business entities were owned by the State, i.e. 0.2% of all business entities.188 
In terms of economic activity, SOEs accounted for a larger share, i.e.  2.6% of total turnover of all 
enterprises, and 4.1% of total output. The th ree main sectors were electricity and gas, water supply 
and sewage, and transport and storage. Thus, although state ownership is rather limited in terms of 
absolute numbers, state enterprises play a larger role in the economy, in particular for large -scale 
infrastructure enterprises, and also for employment, accounting for 7.5% of employed persons in 
business entities. Furthermore, state enterprises were in general not profitable and suffered an 
overall loss of GEL  188,000 in  2019, with the greatest losses occurring in the construction sector.189 
3.174.   In 2021 there were 101 state enterprises managed by the NASP, of which four were in a 
state of liquidation;  about half were operating but 46  were non -functioning.190 There are a significant 
number of non -functioning c ompanies due to accumulated debt, including wage, tax, credit and 
other types of debt, resulting in suspension of operations due to insolvency. In addition, the NASP 
has been carrying out a process of enterprise optimization since 2013, which has resulted in 
 
183 Resolution No.  391 of 17  September  2012 on Approval of the Statute of the Legal Entity of Public 
Law.  
184 Information provided by the authorities.  
185 See https://eauction.ge/ . 
186 Enterprise Georgia; and information provided by the authorities.  
187 National Statistics Office of Georgia, Business Register, by Ownership Type . 
188 National Statistics Office of Georgia, Business Sector in Georgia 2020 .  
189 Labour productivity also remained low, accounting for a bout half that compared to the private sector.  
190 National Agency of State Property, State Enterprises . Viewed at: 
http://nasp.gov.ge/pages/?%E1%83%A1%E1%83%90%E1%83%AC%E1%83%90%E1%83%A0%E1%83%9
B%E1%83%9D%E1%83%94%E1%83%91%E1%83%98=&page_id=22 . WT/TPR/S/420 • Georgia  
 
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  cancelling the registration of more than 100 non -functioning enterprises due to bankruptcy, 
rehabilitation, mergers, and liquidation. Also, the NASP is collecting data in order to identify SOEs 
and to exercise authority over them. In enterprises where t he state owns at least  50%, the NASP 
exercises its authority in accordance with the current legislation and the Charter of Enterprises, 
through general shareholder meetings of partners/owners.  
3.175.   The revenues of selected SOEs under the NASP gradually grew ove r the period, from 
GEL 219 million in 2015 to GEL  422 million in 2020 (Table 3.16). This growth can be attributed to 
certain foreign exchange gains by at least one SOE and the acquisition of certain profitable SOEs 
during 2017 -18. The largest sector concer ned, accounting for 71% of 2020 revenues, was the 
transport sector, followed by communications (23%). A number of enterprises may not generate 
revenues in a given reporting year.  
Table 3.16 Revenues of selecte d SOEs under the NASP, by sector, 2015 -20 
(GEL million)  
Sector  2015  2016  2017  2018  2019  2020  
Total  219.0  274.6  472.6  494.5  462.6  422.4  
Communication  68.6 78.8 94.5 109.3  96.0 95.4 
Construction  0a 0a 0a 44.0 2.0 0.5 
Finance  0a 0a 0a 7.0 7.4 9.0 
Health  25.0 26.3 27.6 29.9 27.6 10.0 
Leisure  4.9 7.2 28.2 7.1 26.4 4.3 
Manufacturing  17.3 8.3 1.4 0.5 9.5 2.5 
Technical and scientific  0.3 0.3 0.2 0.3 0.4 0a 
Transport  102.9  153.6  320.8  296.4  293.3  300.6  
a No reporting entities under the NASP in the sector during the reporting year.  
Source:  Information provided by the authorities.  
3.176.   During the review period, there were more enterprises nationalized than privatized 
(Table  3.17). Nevertheless, the privatization of state property continued to generate important 
income for the State, with over GEL  526,000 mobilized from the sale of state property 
during  2016-21 (Table 3.18). In general, there was a steady increase in revenues during the period, 
albeit with a small decline in  2017, and the largest amount (GEL 133,952) was achieved in the 
first nine months of 2021.  
Table 3.17 Privatizations and nationalizations of state enterprises, 2015 -21 
(Number)  
 2015  2016  2017  2018  2019  2020  2021  
Privatized enterprises  2 4 2 3 1 1 4 
Nationalized enterprises  13 13 12 3 8 9 4 
Source:  Information provided by the authorities.  
Table 3.18 Revenues from privatizations, 2016 -21 
Year Amount (GEL)  
2016 74,834  
2017 64,624  
2018 79,298  
2019 78,217  
2020 95,487  
2021a 133,952  
a Until 10  August  2021.  
Source:  Information provided by the authorities.  
3.177.   While strategic ownership is important to the State, privatizations are carried out by the 
NASP with the overall goal of minimizing the amount of state property as much as possible. There 
is a privatization plan set out and taken into consideration in the annual budget of the Ministry of 
Finance; however, the decision on privatization of a specific asset is made individually, within the 
NASP's discretion, based on factual circumstances, market demand, and in response to incoming WT/TP R/S/420 • Georgia  
 
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  applications.  During the rev iew period, 13 enterprises operating in diverse sectors were privatized; 
the main enterprises, in terms of value, were the Poti FIZ and JSC Resort Akhtala  (Table  3.19).  
Table 3.19 Enterprises privatized, 2015 -21a 
Enterprise  Sector  GEL 
Acad. B. Naneishvili National Center for Mental 
Health Ltd  Healthcare  800,000  
JSC Mina  Glass manufacturing  39,000  
JSC Excavation  Agriculture  4,400  
Boris Oil Ltd  Oil 668,000  
Poti FIZ  FIZ 24,589,000  
E. Pipia People's Clinical Hospital Ltd  Healthcare/hospital  430,000  
JSC Resort Akhtala  Leisure resort  3,760,000  
Skib Ltd  Football club  30,550  
JSC Matsivarkombinati  Warehouse  35,000  
Tbilisi N1 Dental Polyclinic Ltd  Healthcare/hospital  268,000  
Chiatura Bus Station Ltd  Transport  21,000  
Marine Texservice Ltd  Marine technical service  1,700,850  
JSC Mtskheta  Wine/vodka production  6,500  
a Until September 2021.  
Source:  NASP, Annual Reports , various editions 2016-20; and information provided by the authorities.  
3.3.6   Government procurement  
3.178.   Over the last decade, Georgia made many structural and procedural improvements to its 
government procurement process, including moving to e -procurement and further adopting and 
integrating the EU  procurement norms pursuant to the DCFTA, which have resulted in numerous 
changes to the legal framework. The emphasis of Georgia's state procurement rules is to ensure 
rational spending of public funds and promote effective competition in the sector. Georgia's public 
procurement covers procurement by state entities, i.e. financed by the state budget; the 
autonomous republics; local self -governing bodies; and SOEs191, with limited exceptions.192 
Provisions related to the exception of the posta l services were repealed as a result of a decision of 
the Constitutional Court in 2019.193 In terms of coverage, public procurement covers the 
procurement of goods, services, and construction works.  
3.179.    Annual spending by the Government through procurement was  relatively stable over the 
past six -year period (Table 3.20). There was a slight increase in the past few years, but in relation 
to GDP it remains stable and has averaged 10%  of GDP during the period. The slight decline in  2020 
has been attributed to the overall economic slowdown due to the COVID ‑19 pandemic, in particular, 
tendering in the months of April and May  was much below average.  
3.180.   According to a World Bank study, the impact of procurement on the government budget in 
Georgia is significant as it acco unted for 30% of total government spending, on average, during the 
period 2013 -16.194 Furthermore, competitive tendering participation is generally low and did not 
change significantly during the period, from an average of 2.02  bidders per tender in  2015 to  
2.27 in 2020.195 To achieve better use of funds and improve efficiencies, some studies recommended 
improvements to Georgia's procurement system by improving competition in large work contracts 
and reducing the number of small contracts.196 
 
191 In which more than 50% of the interest or shares is owned by the State.  
192 Exceptions include procurement related to state  secrets as defined in the Law on State Secrets and in 
respect of monetary and exchange rate policies of the NBG. Furthermore, several types of procurement as 
outlined in Article  1(31) of the Law on State Procurement, such as water, natural gas, and electr icity, are also 
excluded.  
193 Information provided by the authorities.  
194 World Bank Group (2018), Improving Efficiency in Public Procurement in Georgia . 
195 State Procurement Agency, 2020 Activity Report . 
196 World Bank Group (2018), Improving Efficiency in Public Procurement in Georgia . WT/TPR/S/420 • Georgia  
 
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  Table 3.20 Government procurement annual spending, 2015 -20 
 
Total amount (GEL)  % of GDP  
2015 3,203,258,125  9.4 
2016 4,018,097,958  11.2 
2017 3,643,642,294  8.9 
2018 4,087,214,400  9.2 
2019 5,332,804,815  10.6 
2020 5,158,143,556  10.4 
Source:  Information provided by the authorities.  
3.181.   Georgia's State Procurement Agency was established in 2001 as the Government's 
independent procurement entity under public law that coordinates and monitors public procurement 
activities in Georgia. It was established pursuant to the Law on State Procurement, and its operations 
are also guided by a number of separate legal acts. Its main goals are to promote healthy 
competition in the procurement of goods, service, and works for state need s, and ensure a fair and 
non-discriminatory process. The agency also develops policies for public procurement and monitors 
public procurement activities.  
3.182.   The 2005 Law of Georgia on State Procurement remains the main law governing 
procurement in Georgia, an d it has undergone regular updating with 79 sets of amendments since 
its inception, the most recent in May 2021. The Law sets out general provisions, procurement 
methods, electronic tendering procedures, terms and conditions of a procurement contract, 
monitoring and control procedures, and procedures for appeal and consideration of disputes. 
A number of other subsidiary legislation or Orders, mainly issued by the agency Chairman, provide 
additional rules and procedures for public procurement processes (Tabl e 3.21).  
3.183.   In 2015, Georgia implemented significant changes to the simplified or direct contracting 
method of procurement in order to reduce the use of this method and improve the use of open 
competitive procedures. As a result of these changes, contracting authorities were required to 
substantiate the need for the method before proceeding, as well as obtain the agency's approval in 
order to use the method. Changes to the legal framework in 2018 -19 required procuring entities to 
consolidate certain tenders, a nd the electronic tendering system was updated to facilitate this.  
3.184.   In 2020, Georgia undertook significant reforms to closer align its procurement processes to 
those of the EU directives and regulations. Among the most prevalent changes, Georgia amended 
the provisions on how complaints or disputes are addressed. In 2018, Georgia made amendments 
in relation to the reasoning of urgency for the direct contracting practice. In  2020, several changes 
were made regarding the publication of the contracting authority 's decision on choosing the direct 
contacting method. Moreover, a standstill mechanism, as it is regulated in the EU directives, was 
introduced in Georgian legislation.197 
3.185.   Part of these changes involved establishing a newly independent Public Procurement Dispute 
Resolution Council, tasked with dispute resolution. To ensure its independence and autonomy, its 
budget and staff are part of the Georgian National Competition Agenc y, and it now comprises five 
persons.198 The list of issues subject to appeal has increased, thus the Council's functions and duties 
increased accordingly. As a result of the changes, decisions related to the single source procedure 
(if the estimated value of the procurement is above the monetary thresholds set by the 
EU Directives), as well as to the termination of tender procedure, can be appealed in the Council.  
Table 3.21 Legal framework for procurement, mai n elements, 2021  
Law or regulation  Reference  
Law on State Procurement  Law of 20  April 2005 
Rules for Conducting Electronic Tenders  Order No.  12 of the Chairman of the State 
Procurement Agency of 14  June 2017 
Simplified Procurement Criteria and Simplified 
Procurement Rules  Order No.  13 of the Chairman of the State 
Procurement Agency on 17  August  2015 
 
197 Information provided by the authorities.  
198 See State Procurement Agency, Annual Report 2020 , Section 3; and Georgian National Competition 
Agency, Annual Report 2020 , Section 3.3.4.1.  WT/TP R/S/420 • Georgia  
 
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  Law or regulation  Reference  
Rule on Identification of Procurement Objects and 
Establishing Uniformity  Order No.  7 of the Chairman of the State 
Procurement Agency of 20  Septemb er 2010 
Regulation of the Public Procurement Dispute 
Resolution Council  Resolution No.  826 of 31  December  2020 
Rules and Conditions for Production of the Black List  Order No.  19 of the Chairman of the State 
Procurement Agency of 29  October  2015 
Rules an d Conditions for Production of the White List  Order No.  2 of the Chairman of the State 
Procurement Agency of 26  February  2016 
Rules and Conditions of State Procurement of Project 
Services through Design Contest  Order No.  7 of the Chairman of the State 
Procurement Agency of 22  May 2015 
Rules and Conditions for the Application of Monetary 
Thresholds Established by EU Directives in the Field 
of Public Procurement  Order No.  3 of the Chairman of the State 
Procurement Agency on 21  August  2019 
Order on the Registration of the User in the Unified 
Electronic Public Procurement System and the 
Approval of the Rules for the Use of the Unified 
Electronic Public Procurement System  Order No.  5 of the Chairman of the State 
Procurement Agency on 21  May 2015 
Reporting  Rules for Contracting Authorities  Order No.  2 of the Chairman of the State 
Procurement Agency on 10  February  2011 
Rules for Conducting Two -Stage Tender  Order No.  11 of the Chairman of the State 
Procurement Agency on 28  July 2016 
Rules for Conducting Con solidated Tender  Order No.  14 of the Chairman of the State 
Procurement Agency on 14  December  2018 
Source:  State Procurement Agency; and information provided by the authorities.  
3.186.   Georgia's procurement procedures set out that state purchases, except in exceptional cases, 
are to be made through an open tendering process. A simplified, or direct contracting, method is 
possible but is considered an exception and can be used only under certain conditions, such as in 
the case of urgent necessity or for the exclusive right of only one person when there is no reasonable 
alternative .199 The other methods are all open tendering conducted electronically  (Table  3.22). 
According to the latest statistics, the e -tender without auction, i.e.  sealed bid auction (NAT), and 
electronic tender (SPA) methods are the predominant electronic procuring m ethods used, 
with NAT accounting for 81.5% and SPA accounting for 13.7% of all e -procurement announcements 
in 2020.200 
Table 3.22 Procurement means and methods  
Procedure  Abbreviation  Grounds  Availability of 
electronic  service  
Simplified Procurement  
(Direct Contracting)  CMR - Procurement of homogeneous 
goods up to GEL  5,000  
- In cases of emergency permitted by 
law Not implemented 
electronically, though 
published in special 
module of 
E-procurement System.  
Operates from 
March  2012 
E-Tender: Open Tender  
Electronic Tender  SPA Procurement of homogeneous 
objects:  
- Goods and services from GEL  5,000 
up to GEL  150,000 or/and 
GEL 150,000 and over; and  
- Construction works from 
GEL 5,000  up to GEL  300,000 or/and 
GEL 300,000 and over.  Electronic Service.  
Operates from 
December  2010.  
Consolidated Tender  CON Procurement of certain homogeneous 
goods on the basis of  aggregated 
demand: fuel, computers, A4  papers, 
(mobile)  telephone communication, 
telecommunication services, 
computer hardware and 
uninterrupted power supply 
systems  (UPS), printers and Electronic Service.  
Operates from 
December  2012.  
 
199 For the full list of pos sibilities, see Article  101 of the Law on State Procurement.  
200 State Procurement Agency, 2020 Annual Report . WT/TPR/S/420 • Georgia  
 
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  Procedure  Abbreviation  Grounds  Availability of 
electronic  service  
cartridges, medical equipment and 
supplies, drugs, food products, 
vehicles, vehicle insurance services, 
transportation of school students, 
book printing services, etc.  
Design Contest  CNT Procurement of design -related 
objects/projects under the decision 
of contracting authori ty, such as 
architectural engineering, planning, 
design projects.  Electronic Service.  
Design contest 
procedure 
100%  electronic from 
1 July 2015.  
Two-Stage  
(Multi -criteria Tender)  MEP Procurement of goods, services and 
construction works on the basis of 
price and other quantitative criteria. 
The best bidder is identified on the 
basis of price -quality ratio, calculated 
via the unique algorithm incorporated 
into the system, the so -called 
MEAT  method.  Electronic Service.  
On 1 August  2016, the 
agency launched the 
so-called "two -stage" or 
named by the EU 
legislation  – 
"Economically most 
advantageous 
e-tender".  
E-Tender without 
Auction  
(Sealed Bid Auction)  NAT Type of tender, which operates l ike 
the so -called "sealed bid auction". All 
the procedures are the same as in 
the case of reserve auction, however, 
instead of three additional rounds, 
the proposal is submitted only once. 
All the proposals, except for the best 
one, remain sealed (and are not 
accessible to contracting authorities) 
until the tender is awarded the final 
status (except for "Tender 
terminated" status).  Electronic Service.  
On 1 July 2016, the 
agency launched the 
new procedure: 
"Electronic Tender 
without Reserve 
Auction".  
Different Acquisition 
Procedure for 
Construction Works  DAP The procedure is conducted 
according to the so -called 
prequalification procedure. The 
bidders submit tender proposals, 
qualification documents, and cost 
breakdown. After the evaluation of 
all the b idders, if tender terms and 
conditions are met, contracting 
authority will invite the bidder with 
the lowest proposal price, in 
accordance with the established 
procedure, for the execution of the 
contract.  Electronic Service.  
On 1 December  2016, 
different procedure for 
the procurement of 
construction works was 
launched.  
Electronic Tender with 
Prequalification 
(Restricted  Procedure)  TEP E-tender with prequalification, 
through reverse auction. After 
submission tender proposals and 
qualifications documents by bidders, 
contracting authority evaluates 
suppliers'  documentation and, if they 
are compliant, a reverse auction is 
held on the next stage and the 
winner is awarded according to the 
lowest price.  Electronic Service.  
In September  2017, the 
new procurement 
mechanism was 
introduced that applies 
to all procurement 
objects (goods, 
construction  works, 
services).  
Source:  Information provided by the authorities.  
3.187.   During the review period, direct procurement remained significant; it accoun ted for 34%  of 
total procurement in 2015, but its importance declined steadily and accounted for only 18% of 
procurement in 2019 (Table  3.23). This decline can be attributed to the legislative reforms in  2015 
aimed at decreasing its use. However, in 2020, Georgia had a significant need for urgent purchases 
related to combating the COVID ‑19 pandemic. With the passage of a Decree on the approval of 
measures to prevent the possible spread of the COVID -19 in Georgia and the plan of operative 
response to the cas es of the disease, Georgia specifically authorized the direct procurement method 
through the urgent necessity provisions of Article  101 of the procurement law for COVID -related WT/TP R/S/420 • Georgia  
 
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  purchases.201 Thus, there was the expected increased use of the direct method in 2020 that 
accounted for 21% of total procurement.  
Table 3.23 Procurement by type, 2015 -20 
 E-procurement (GEL)  % Direct procurement (GEL)  % Total amount (GEL)  
2015 2,124,163,190  66 1,079,094,935  34 3,203,258,125  
2016 2,532,805,944  63 1,485,292,014  37 4,018,097,958  
2017 2,762,441,150  76 881,201,144  24 3,643,642,294  
2018 3,308,643,197  81 778,571,203  19 4,087,214,400  
2019 4,395,339,249  82 937,465,566  18 5,332,804,815  
2020 4,088,057,239  79 1,070,086,317  21 5,158,143,556  
Source:  Information provided by the authorities.  
3.188.   Suppliers may be any natural or legal entity of Georgia or of a foreign country, i.e.  there are 
no restrictions on foreign suppliers; according to the authorities, there are no preferences given to 
local suppliers. However, as part of its procurement legis lation, Georgia maintains a so -called  "black 
list" of unscrupulous suppliers who are prohibited from participating in the procurement process for 
one year after being placed on the list. Contrary to the black list, Georgia also maintains a "white 
list" of confirmed suppliers who may have certain advantages during procurement procedures 
(e.g. suppliers registered in the "white list" provide smaller guaranties compared to those who are 
not registered in the list). As at the end of 2020, there were 44,173  registered suppliers in the 
e-procurement system and 4,464  procuring organizations.202 
3.189.   While data are limited to 2020, there is some information on foreign suppliers in Georgia's 
procurement market (Table 3.24). In  2020, 2,054  foreign firms were registered in G eorgia's 
e-procurement system with 18 foreign supplier countries awarded 45 contracts, amounting to 
GEL 73 million. Nearly half was from suppliers from France, where construction -related services were 
supplied for road infrastructure and pharmaceutical pro ducts were supplied to the healthcare sector. 
The GEL  73 million from foreign suppliers was relatively small contribution, amounting to only 
2% of e-procurement, thus domestic suppliers supplied 98%.203 Foreign firms also participated 
through the direct pro curement method, and they were awarded 134  contracts with a value of about 
GEL 12 million in 2020. Thus, the amount of foreign participation in Georgia's public procurement 
system is relatively small at GEL  95 million, or about 1.8% of total 2020 procureme nt spending. 
However, according to the authorities, these figures are likely underestimated as many foreign 
companies have official representatives registered in Georgia. According to the local regulations and 
for the public procurement statistical compila tion, these companies are considered as local suppliers. 
For statistical purposes, foreign companies are those that do not have the official representatives 
registered in Georgia and participate in the procurement from their home countries. Therefore, the 
real foreign participation in procurement is higher.  
Table 3.24 E-procurement from foreign suppliers, top 10, 2020  
Rank  Country  Total contracts 
awarded  
(GEL '000)  Main procuring entity 
sector  Main product or service 
supplied  
1 France  32,190  Road development 
infrastructure, National 
Health Center  Construction -related 
services, pharmaceutical 
products  
2 Hungary  9,617  Health and social services  Pharmaceutical products  
3 Lithuania  7,893  Broadcasting  TV and radio signal 
receivers  
4 Germany  6,898  Broadcasting  News systems and 
servers  
5 Denmark  3,969  Health and social services  Pharmaceutical products  
6 Switzerland  3,807  Health and social services  Pharmaceutical products  
7 United Kingdom  1,970  .. .. 
 
201 Decree No.  164 of 28 January 2020 on the Approval of Measures to Prevent the Possible Spread of 
the Novel Coronavirus in Georgia and the Plan of Operative Response to the Cases of the Disease Caused by 
the Novel Coronavirus.  
202 State Procurement Agency, 2020 Annual Report . 
203 State Procurement Agency, 2020 Annual Report . WT/TPR/S/420 • Georgia  
 
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  Rank  Country  Total contracts 
awarded  
(GEL '000)  Main procuring entity 
sector  Main product or service 
supplied  
8 Italy  1,960  Resort development  Architectural and related 
services  
9 Sweden  979 .. .. 
10 North  Macedonia  907 .. .. 
.. Not available.  
Source:  State Procurement Agency,  2020 Annual Report .  
3.190.   Georgia has established its procurement thresholds in line with those of the 
European  Union.204 An Order of the Chairman of the State Procurement Agency from 2019 
establishes that the thresholds in the EU directives are to be followed:  
• For supplies of goods and services, the equivalen t of EUR  139,000 in GEL; and  
• For works, the equivalent of EUR  5,350,000 in GEL.  
However, both national and EU thresholds determine tender timelines  (Table 3.25).  
Table 3.25 Monetary thresholds and timelines for e -tenders  
Procurement 
procedure  Object  Monetary threshold  Minimal timeline  
Electronic Tender  Goods and Services  Up to GEL  150,000  7 (5+2) calendar days  
GEL 150,000 and over  
Above EU thresholds  10 (7+3) calendar days  
30 (25+5) calendar days  
Construction Works  Up to GEL  300,000  10 (7+3) calendar days  
GEL 300,000 and over  
Above EU thresholds  20 (15+5) calendar days  
30 (25+5) calendar days  
Source:  Information provided by the State Procurement Agency.  
3.191.   The move to digitization or e -procurement in 2010 has been acknowledged as one  of the 
important developments and success stories in Georgia's procurement sector in recent  years. While 
the number of tenders provided through e -procurement  has remained relatively stable, the value of 
tenders doubled during the last five years (Table 3.26). Through the Unified Electronic System of 
public procurement ( https://tenders.procurement.gov.ge/ ), suppliers may register and participate 
through electronic tenders. The platform also contains information on annual procurement plans of 
participating organizations, tender announcements and related documentation, supplier bids, and 
contracts. The electronic  system improves geographic inequality, transparency, and access to 
information, as it allows not only organizations and suppliers, but also the public, to receive 
information on tendering. Despite these changes, further improvements are sought, such as 
providing the information or data in an easily accessible, machine -readable format as there have 
been requests to the agency to further increase transparency and make such data more user -
friendly.  
Table 3.26 E-procurement, 2015 -20 
 Contract value (e -tenders)  
(GEL)  Number of tenders 
(contracts) awarded  Number of announced 
tenders  
2015 2,124,163,190  24,950  35,421  
2016 2,532,805,944  27,768  38,054  
2017 2,762,441,150  24,215  33,095  
2018 3,308,643,197  23,074  32,597  
2019 4,395,339,249  23,032  32,597  
2020 4,088,057,239  18,375  25,598  
Source:  Information provided by the authorities.  
 
204 Order No.  3 of the Chairman of the State Procurement Agency on 21 August  2019 on Rules and 
Conditions for the Application of Monetary Thresholds Established by EU Directives in Force in the Field of 
Public Procurement, as amended.  WT/TP R/S/420 • Georgia  
 
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  3.192.   Georgia's procurement law (Chapter VI) also has provisions for handling disputes. The 
Dispute Resolution Board was established to hear and address complaints from suppliers. In the 
last three  years, there was a slight decrease in the number of complaints filed, which has been 
attributed to procurement reforms (Table 3.27). A majority of the complaints were found in fav our 
of complainant.  
Table 3.27 Overview of disputes, 2015 -20 
(Number)  
 2015  2016  2017  2018  2019  2020  
Complaints filed  1,017  1,573  1,492  1,040  1,245  1,044  
-Resolved in favour of the 
supplier  .. .. 633 588 705 559 
-Percentage  .. .. 63% 57% 57% 54% 
.. Not available.  
Source:  State Procurement Agency, 2020 Annual Report . 
3.193.   Georgia has been an observer to the Committee on the Agreement on Government 
Procurement  (GPA) since  1999.205 As part of its accession commitments, Georgia committed to 
tabling an offer to join the GPA upon its WTO accession, with a view to completing the negotiations 
by 31  December  2000.206 In October  2002, Georgia completed its application for accession to 
the GPA and in December  2003 submitted its draft informal initial offer.207 Since 2003 -04, the 
process has essentially stalled. There have been no further developments in Georgia's accession, as 
not all questions from GPA parties have been replied to and no furt her offers have been made by 
Georgia. According to the authorities, Georgia is actively utilizing its observer status and keeps 
working with the Secretariat.  
3.3.7   Intellectual property rights  
3.194.   The Legal Entity of Public Law (LEPL) National Intellectual Property Center of 
Georgia -Sakpatenti (NIPCG Sakpatenti) is Georgia's government agency in charge of all major fields 
of intellectual property (IP), patents, trademarks, industrial designs, copyright and related rights, 
new varieties of plants and breeds of animals , geographical indications,  and topographies of 
integrated circuits .208 Sakpatenti determines and carries out state IP policy in Georgia, and also 
initiates and conducts legislative amendments in the field of IP, including drafting by -laws. In 
addition, the  Chamber of Appeals is established at Sakpatenti, which is an independent, specialized 
administrative body for dispute resolution in IP matters. It is authorized to revise decisions taken by 
Sakpatenti examination units. Moreover, a national IP training ce ntre functions at Sakpatenti, which 
consolidates training and capacity -building activities for staff members, as well as the relevant target 
groups. In 2016, Sakpatenti launched a new  e-filing system and database of all IP objects and made 
them available t o the public on the Internet. Applications, as well as appeals procedures and 
communication with the public through the electronic system, have been promoted and enhanced. 
Publicly available electronic databases of trademark, design, and patent application s and 
registrations, as well as decisions of the Chamber of Appeals, are available on the Sakpatenti 
website .209 
3.195.   Most of the developments over the review period involved implementation of 
DCFTA  commitments on IP. In line with Georgia's commitm ents under the DCFTA, to prevent and 
suppress infringements of IPRs and to ensure the implementation of appropriate sanctions, 
Sakpatenti drafted a package of amendments to the IP legislation, which was adopted by Parliament 
on 23  December  2017 and entered  into force on 11  January  2018. Amendments were made to the 
following legislative acts regulating IP: the Patent  Law, the Law on Copyright and Related Rights, 
the Law on Design, the Trademark Law, the Code of Civil Procedure, the Law on Pesticides and 
Agrochemicals, and the Law on Drugs and Pharmaceutical Activity. In response to the entry into 
force of the DCFTA, Georgia has engaged in a number of initiatives to improve its system of IP 
 
205 WTO document GPA/W/89, 15 July 1999.  
206 WTO document WT/ACC/GEO/31, 31 August 1999.  
207 WTO documents GPA/S/1/Rev.2, 30 April 2021; GPA/71, 17 October 2002; and GPA/SPEC/34, 
15 December 2003.  
208 Patent Law, Article  2.1.a.  
209 Sakpatenti. Viewed at: https://www.sakpatenti.gov.g e/en/search_engine/search/ . WT/TPR/S/420 • Georgia  
 
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  enforcement and to build awareness of IP. At the legislative level, se veral amendments were 
introduced to harmonize or approximate Georgia's IP laws with those of the European  Union, 
especially with regard to the determination and specification of new adequate provisional measures 
for effective enforcement of IP rights.  
3.196.   Moreover, the Law of 13  December  2017 on Border Measures Related to Intellectual Property 
was adopted pursuant to the provisions in Annex XIII, stipulating the approximation of Georgia's 
IPR legislation with EU Regulation No.  608/2013 of 12  June 2013 concernin g customs enforcement 
of IP rights. Prior to the enactment of the Law, enforcement at the border was applicable only to 
trademarks, copyright and related rights, appellations of origin and geographical indications, and 
designs. Now the new provisions are a pplicable to patents, integrated circuit topology, and breeders' 
exclusive rights. The scope of IP protection was also expanded and now allows enforcement on 
imports, warehousing, storage in free zones, re -exports, and exports in the territory of Georgia, 
whereas previously only customs warehousing, customs terminal storage, and other storage for 
export were covered. The new Law also allows for the possibility of proactive application of 
IP measures at the border through an ex officio  process.  
3.197.   With an assis tance of the European  Union, Georgia is participating in the EU -Georgia 
Intellectual Property Project (EUGIPP). This international cooperation project funded by the 
European  Union has an initial duration of three years from 1  January  2020. EUGIPP supports 
Sakpatenti by focusing on specific activities in the field of capacity -building and training, technical 
and legal support, research and data collection, awareness raising, and information sharing. It is 
expected that EUGIPP will contribute to the achieveme nt of an adequate and effective level of 
protection and enforcement of IP rights in Georgia, supporting IP authorities in their efforts to further 
approximate to European standards and integrate into the global economy by stimulating economic 
development a nd market opportunities.  The project aims to fully modernize trademarks, designs, 
and copyright and related rights system in Georgia through supporting the authorities in 
approximating European standards, thus reaching an effective level of protection and enforcement 
of IP rights in accordance with the commitments of the  DCFTA. Within the project, the main activities 
are focused on strengthening current institutions, and approximating and harmonizing legislation 
and practice. An ongoing EUGIPP project is st rengthening compliance with IPR by bringing together 
Georgian, European, and international stakeholders in sharing experience and good practices, which 
includes legislative drafting assistance. Legislative acts in the areas of trademarks, designs, and 
copyright and related rights are expected to be revised and new amendments adopted.210 
3.198.   Another successful project in cooperation with the European  Union was the Twinning Project 
to support the development of Appellations of Origin (AOs) and Geographical Indications  (GIs) 
systems in Georgia through the creation of effective supporting tools with the provisions of the 
European  Union's GIs protection system.211 The project was a component of the sectoral support 
from the European  Union to Georgia, which was launched in November 2019 and was financed with 
EUR 1.5 million from the European  Union. The implementation of the project was entrusted to the 
national serv ices of the European  Union member States in the relevant field. On the Georgian side, 
several state and private stakeholders were involved in the project's implementation, and the main 
beneficiary was Sakpatenti. The overall objective of the project was to  support the development of 
AOs and GIs systems in Georgia through the creation of legal, administrative, and institutional 
mechanisms to enhance GI protection and strengthen capacity of the local stakeholders and national 
institutions to implement and ado pt EU best practices . 
3.199.   In the framework of the project,  the new draft amendments to the Law on Appellations of 
Origin of Goods and Geographical Indications were prepared. The amendments include definition of 
the state control mechanisms for AOs and GIs, ide ntification of the basic elements of specifications 
of goods, specification of the procedures of conducting examination, and determination of the role 
of producers' unions, taking into consideration legal mechanisms of protection and other significant 
issues. On the basis of the draft Law, by -laws, guidelines, and instructions were developed. As 
at September 2021, the draft Law was under consideration by the Government. The EU -funded 
project was expected to be completed in January 2021; however, due to the COVID‑19 pandemic 
 
210 EUGIPP. Viewed at: https://internationalipcooperation.eu/en/eugipp . 
211 Sakpatenti, Twinning Project . Viewed at: http://twinning.sakpatenti.org.ge/en/page/2/ ; 
European  Union for Georgia, Establishing Efficient Protection and Control System of Geographical Indications 
(GIs) in Georgia . Viewed at: https://eu4georgia.ge/establishing -efficient -protection -and-control -system -of-
geographical -indications -gis-in-georgia/ . WT/TP R/S/420 • Georgia  
 
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  and related restrictions, it was prolonged by an additional seven months. Most of the project 
activities have been halted and shifted online, and the project was completed in August 2021.  
3.200.   The filings and registrations of IP protection in Georgia remained relatively unchanged 
throughout the review period, although there was a slight decline in patent applications  (Table 3.28). 
Registration of objects of IP in the Revenue Service's  Registry of the Objects of Intellectual Property 
is free of charge. However, various fees are applicable for the services of Sakpatenti (Table A3.7). 
There is no differentiation in fees for Georgian and foreign applicants. In the case of electronic filing 
of applications with Sakpatenti, a 20% reduction applies to the fees, including the issuance of 
certificates. In order to reduce expenses for businesses and increase the opportunity to receive 
additional benefits, Sakpatenti has introduced a 50% reduction of the fee for trademarks. Within the 
package of additional measures offered by the Government to support businesses during the 
COVID‑19 pandemic, a 50% reduction in the fees for trademark registration for applications filed 
electronically was valid for six months, i.e. from 7  December  2020 to 7  June 2021.212 
3.201.   Georgi a is a member of all the main conventions and agreements on IP protection and is 
also a party to a number of bilateral agreements on IP. A draft Mutual Recognition and Protection of 
Geographical Indications Agreement between Georgia and the Republic of  Moldova has been agreed 
but as at September 2021 had not been signed nor entered into force. The Agreement on the Mutual 
Recognition and Protection of Geographical Indications, Appellations of Origin and Indications of 
Source between the Swiss Confederation a nd Georgia  was concluded in May 2018 and entered into 
force in November 2018. In November  2018, Georgia accepted the Protocol Amending the 
TRIPS  Agreement.  
3.202.   In 2019, the Agreement between the Government of Georgia and the European Patent 
Organization (EPO) on Validation of European Patents (Validation Agreement) was signed; however, 
as at September 2021 it had not yet entered into force. Under the terms of the Agreement, applicants 
will be able to validate their European patent applications and patents grant ed by the EPO in Georgia. 
Likewise, European applications and patents validated for Georgia will have the same legal effects 
and will be subject to Georgian law exclusively. An agreement on strategic partnership was signed 
with the United Kingdom in Octobe r 2019 concerning legal protection of IP including mutual 
protection of GIs. It establishes cooperation on a number of fronts and creates a legal framework; 
it entered into force in December 2020. MOUs were concluded with the respective patent offices of 
a number of partners – including Azerbaijan, China, EUIPO, Serbia, Singapore, Turkey, and 
Ukraine  – during the period in order to strengthen cooperation in the IP field.  
3.203.   Georgia has not made any notifications to the WTO on IP since 2013. The authorities 
indicated that these would be forthcoming.  
Table 3.28 IPR protection, by type, 2015 -21 
(Number)  
  2015  2016  2017  2018  2019  2020  2021a 
Applications                
Patents  271 274 232 260 197 215 160 
Industrial designs  328 273 252 182 209 204 131 
Topographies of integrated circuits  0 0 0 0 0 0 0 
Trade marks  5,339  4,655  5,576  5,165  5,398  4,706  3,396  
Geographical indications  68 50 3 60 15 9 8 
Registrations         
Patents  206 177 206 133 115 152 82 
Industrial designs  288 267 166 201 134 216 104 
Topographies of integrated circuits  0 0 0 0 0 0 0 
Trade marks  3,692  4,646  3,572  4,723  4,561  4,386  2,883  
Geographical indications  33 67 40 1 70 10 4 
Appeals (Chamber of Appeals)  166 152 121 183 176 152 90 
a As of 15  September  2021.  
Source:  National Statistics Office of Georgia ; and information provided by the authorities.  
 
212 Information provided by the authorities.  WT/TPR/S/420 • Georgia  
 
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  3.3.7.1   Patents and utility models  
3.204.   Georgia's Patent Law of 1999 is the primary source of law for patents and utility models. It 
is complemented by the Instruction on Procedures Related to Drafting and Filing Applications for 
Inventions and Utility Models and Granting a Patent as the two mai n legal instruments on patents. 
Patents are valid for 20 years from the date of filing. The Law prescribes the criteria for obtaining a 
patent, the application procedure, and international applicability. Provisions on utility models and 
the rules for their  protection, i.e. for a period of 10 years, are also contained in the Patent Law.  
3.205.   New Georgian legislation re -introduced compulsory licensing in the Patent Law in 2018 and 
since that period no compulsory licence has been requested.213 In conjunction with th is change, the 
associated rules were approved in Resolution No.  586 of 17  September  2020 on Approving the Rules 
for Issuing Compulsory Licences for the Use of Patented Inventions and Utility Models and 
Determining the Composition of the Permanent Decision -making Board for Issuing Compulsory 
Licences, which sets out the timeframes and respective procedures to follow. The board that 
considers compulsory licences was also established under the same Resolution and has 
representatives from various ministries in addition to Sakpatenti.214 
3.206.   The 2018 amendments also added provisions on pharmaceutical products and plant 
protection products and give these products up to an additional five years of protection per a 
supplementary protection certificate. In 2020, amendment s to the Instruction on Procedures Related 
to Drafting and Filing Applications for Inventions and Utility Models and Granting a Patent were 
drafted, and these changes entered into force on 15  September  2021.215 
3.207.   During the review period, most foreign patent applications filed were of the category of 
human necessities and were most numerous from the United  States, Germany, and Italy. There was 
a slight general decline in the number of patent applications during the period, in which the 
COVID -19 pandemic likely  was a contributing factor, according to the authorities.  
3.3.7.2   Copyright  
3.208.   The Law on Copyright and Related Rights of 1999 remains the applicable law in Georgia on 
copyright. It was amended in 2017 to change the validity of copyright for textual works of music 
whereby the copyright is valid for the life of each co -author and for 70 years after the death of the 
last co -author, regardless of whether they are the authors of the text or musical work. Another 
change involved the terms and length of protection of relate d rights for performers and producers 
of phonograms or videograms.216 Adjustments were also made to the provisions of Article  59 on 
Protection of Copyright, Related Rights and Rights of Makers of Databases. The amendments 
introduced comprehensive rules rega rding civil enforcement of IP rights. These amendments fully 
reflect the enforcement provisions of the DCFTA chapter on IP rights and ensure proper functioning 
of the system and effective implementation of sanctions.  
3.209.   The Law on Copyright and Related Rights  has been the subject of constitutional legal 
adjudication.217 According to the judgement of the Constitutional Court of 25  December  2020, the 
following provisions of the Law on Copyright and Related Rights were declared unconstitutional:  
• Article  21, paragr aph 5, third sentence : "The above -mentioned organizations {collective 
management organizations} are entitled to request from natural and legal persons, 
 
213 Compulsory licensing was provided in the Patent Law until 2010 when it was abolished.  
214 The board includes: (i)  Minister of Economy and Sustainable Development (Chairperson); (ii)  Minister 
of Defense; (iii)  Minister of Environmental Protection and Agriculture; (iv)  Deputy Head of Chancellery of the 
Government; (v)  First Deputy Minister of Internal Affairs; (vi) First Deputy Minister of Health, Labour and 
Social Affairs of Georgia; (vii) Deputy Minister of Finance;  and (viii) Chairperson of the National Intellectual 
Property Center of Georgia – Sakpatenti.  
215 Sakpatenti, WIPO Digital Access Service (DAS) Is Introduced in Sakpatenti , 15 September 2021.  
216 It provides protection for 50 years after the first performance/ recording but if a recording is lawfully 
made available to the public by publication or public transmission, this right shall be valid for 50/70  years after 
the first occurrence of one of these facts.  
217 The case was brought by Alta Ltd, Okay Ltd, Zummer Ge orgia Ltd, Georgian Mobile Import Ltd, and 
Smiley Ltd to challenge the obligation to pay royalties on imports of certain equipment for personal use. The 
case also addresses potential challenges regarding unfairness in the calculation of the royalty fee as set out in 
the law and the role of collective management organization in the assessment and collection of the fee.  WT/TP R/S/420 • Georgia  
 
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  including governmental organizations and institutions, the information concerning 
production and importa tion of the equipment and material carriers referred to in 
Paragraph  4 of this Article"; and  
• Article  64, paragraph  4: "The user of a subject -matter of copyright or related right shall, 
upon request of the collective management organization, provide it with  all the documents 
containing precise data on the use of the work or subject -matter of a related right, which 
is necessary for collecting and distribution of the remuneration".  
3.210.   As a result of this case, changes are envisioned in the normative content of th e specified 
Articles. According to the authorities, the amendments are expected to provide adequate guarantees 
for the confidentiality of the information.  
3.211.   During the review period, Sakpatenti  was involved in raising public awareness on the 
importance of the legal protection of copyright and related rights, which remained a priority.  
3.3.7.3   Trademarks  
3.212.   In the area of trademarks, Georgia has taken steps to simplify the examination procedure 
for trademar k examiners and applicants by improving the system of electronic filing, establishing a 
new database, and joining the WIPO -administered Madrid e -filing programme. As a result, the 
number of electronically filed applications increased steadily over the peri od and now accounts for 
over 99% of all applications. Sakpatenti also implemented an artificial intelligence trademark search 
programme for examiners and applicants on its website. However, the number of trademark 
applications and registrations in Georgia remained stable throughout the period (Table 3.28). The 
top categories for trademark applications were pharmaceutical products, which predominated, and 
advertising, business administration, and office functions. During the review period, foreign 
trademark filings were mainly from the Russian  Federation, the United  States, China, and Germany.  
3.213.   Work was ongoing during the period to draft amendments to the 1999 Trademark Law and 
its related Instruction on Registration of Trademarks to better harmonize them with  modern 
requirements and improve examination procedures. As a result, the Trademark Law was amended 
five times during the review period. One of the DCFTA -related amendments involved clarification of 
enforcement provisions. In 2020, Sakpatenti adapted and p ublished European  Union Intellectual 
Property Network (EUIPN) practice papers on the Common Communication on the Distinctiveness – 
Figurative Marks containing descriptive/nondistinctive words (CP3) , Scope of Protection of Black and 
White Marks (CP4) , and Likelihood of Confusion (impact of non -distinctive/weak components) 
Relative Grounds of Refusal (CP5) . The papers will guide the practice applied by Sakpatenti on 
transparency and disclosure as it is gradually implemented.218 
3.3.7.4   Designs  
3.214.   Georgia's 2010 Law on De sign is a primary law that regulates the creation, registration, use, 
protection, and exercise of rights concerning designs. It establishes the registration procedure of 
designs at Sakpatenti for a five -year period of protection that can be extended, but m ay not be more 
than 25 years in total. The Law was amended in 2017 to add a new article on protecting the exclusive 
right to design whereby additional recourse is given to rights holders in cases where there is violation 
or infringement.  
3.215.   In 2020, Sakpatent i adapted and published EUIPN practice papers on the Common 
Communication on the Common Practice of Designs – Criteria for assessing disclosure of designs on 
the Internet (CP10) and Graphic Representation of Designs (CP6). The papers have been tailor -made 
to the specificities of Sakpatenti and made public with the purpose of further increasing 
transparency, legal certainty, and predictability for the benefit of examiners and users.219 
 
218 EUIPO, EU Georgia Intellectual Property Project. Viewed at: https://internationalipc ooperation.eu/ ; 
and Sakpatenti, Practice Documents . Viewed at: https://www.sakpatenti.gov.ge/en/page/193/ . 
219 EUIPO, EU Georgia Intellectual Property Project. Viewed at: https://internationalipcooperation.eu/ ; 
and Sakpatenti, Practice Paper: Graphic Representation of Designs . Viewed at: 
https://www.sak patenti.gov.ge/media/page_files/CP6 -Eng-for_publication_6.03.pdf . WT/TPR/S/420 • Georgia  
 
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  3.216.   As of 2020, work was ongoing on draft amendments to the Law on Design, its  related 
instructions on Design Registration, and guidelines in order to harmonize them with EU requirements 
and improve the examination procedures. As at September 2021, the instruction was adopted but 
the amendments to the Law remained pending.  
3.3.7.5   New plant  varieties and animal breeds  
3.217.   The Law on New Breeds of Animals and Plants Varieties of 2010 defines IP protection and 
relevant proceedings to certain types of plant varieties and animal breeds. The application of the 
Law is further defined by two Rules of t he Minister of Agriculture from 2007 on consideration of the 
opposition of interested persons.220 There was one amendment to the Law in 2017 related to the 
change of the name of the Ministry of Agriculture to the Ministry of Environmental Protection and 
Agriculture. In 2019, Sakpatenti began a process of harmonizing legislation with international norms 
and started work on preparation of draft amendments.  
3.3.7.6   Geographical indications (GIs) and appellations of origin (AOs)  
3.218.   Georgia's Law on Appellations of Origin o f Goods and Geographical Indications provides that 
AOs and GIs shall be protected by registration at Sakpatenti or on the basis of an international 
agreement. As of September 2021, Georgia had concluded four bilateral agreements for the 
protection of GIs, resulting in the European  Union's, Switzerland's, Ukraine's, and the 
United  Kingdom's GIs being protected in Georgia.221 As at  September 2021, negotiations on 
expected new bilateral agreements were in progress with Armenia, Azerbaijan, Belarus, the 
Kyrgyz  Republic, the Republic of Moldova, Turkey, and Uzbekistan. On the other hand, Georgian GIs 
are given protection in Armenia, Az erbaijan, Belarus, China, the European  Union, Kazakhstan, the 
Kyrgyz  Republic, the Russian  Federation, Switzerland, Ukraine, and the United  States.222 These are 
on the basis of the four bilateral agreements in force, or in other cases, protection is based o n the 
direct registration of GIs and AOs in the respective IP offices. There were no material changes to the 
Law on Appellations of Origin of Goods and Geographical Indications during the review period.  
3.219.   As of June 2021, Georgia had registered 34 AOs and 22  GIs.223 In May  2021, the Georgian 
vessel qvevri was the first non -food item added to the State Register of Appellations of Origin and 
Geographical Indications.224  
3.220.   In 2019, Georgia with the help of the European  Union commenced a Twinning Project on 
Establis hing Efficient Protection and Control System of Geographical Indications (GIs) in Georgia. 
The project was completed in August 2021.  
 
220 Decree No.  2-132 of the Minister of Agriculture of Georgia of 30 August 2007 on Approval of the Rule 
of Consideration of the Opposition of Interested Persons in Connection with Publication  of the New Animal 
Breed Data, the Rule of Application Proceeding, Extension of Procedural Terms, Termination and Reinstatement 
and the Rule of Granting of a Compulsory Licence and Decree No.  2-132 of the Minister of Agriculture of 
Georgia of 30 August 200 7 on Approval of the Rule of Consideration of the Opposition of Interested Persons in 
Connection with Publication of the New Plant Variety Data, the Rule of Application Proceeding, Extension of 
Procedural Terms, Termination and Reinstatement and the Rule o f Granting of a Compulsory Licence. 
Sakpatenti, Legislation . Viewed at: https://www.sakpatenti.gov.ge/en/page/104/ . 
221 As of September 2021, there were four bilateral agreements on GIs concluded wit h the 
Swiss  Confederation (Agreement on the Mutual Recognition and Protection of Geographical Indications, 
Appellations of Origin and Indications of Source between the Swiss Confederation and Georgia, signed in 
May 2018, entered into force in November  2018); the European  Union (EU -Georgia DCFTA Agreement, signed 
in June 2014, entered into force July 2014); the United  Kingdom and Northern Ireland (Agreement on Strategic 
Partnership and Cooperation between Georgia and the United Kingdom of Great Britain and N orthern Ireland in 
London, signed in October 2019, entered into force in December 2020); and Ukraine (Agreement between 
Georgia and Ukraine on Legal Mutual Protection of Geographical Indications of Wine, Spirits and Mineral 
Waters, signed and entered into force in 2007).  
222 Sakpatenti, Georgian Indications Protected Abroad . Viewed at: 
https://www.sakpatenti.gov.ge/en/page/113/ . 
223 Sakpatenti, State Registry . Viewed at: https://www.sakpatenti.gov.ge/en/state_registry/ . 
224 National Wine Agency, Qvevri Was Granted the Status of a Protected Geographical Indication (PGI) , 
24 May 2021.  WT/TP R/S/420 • Georgia  
 
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  3.3.7.7   Enforcement  
3.221.   Georgia has three main enforcement authorities for IP: the Customs Service Department 
and the Tax Monitoring De partment of the Revenue Service, and the Investigation Service of the 
Ministry of Finance. Each is authorized to act ex officio  and with the notice from the rights holder. 
Cases of violation for all IP objects investigated by the Investigation Service of t he Ministry of Finance 
are provided for by Articles  189 (Encroachment upon the rights of a holder of copyright or related 
rights and upon the rights of database manufacturers), 1891 (Encroachment upon industrial property 
right), and 196 (Unlawful use of tr ade (service) marks or other commercial designations) of the 
Criminal Code.225 The Customs Service operates under the new Law on Border Measures Related to 
Intellectual Property. The Tax Monitoring Department combats against infringements of all IPR 
objects  pursuant to Article  1571 of the Administrative Offences Code.226 
3.222.   During the review period, the number and value of infringements found through enforcement 
measures fluctuated from year to year (Table 3.29). The types of goods that were investigated and 
destroyed by Customs were wide ranging, but a significant amount concerned clothing, watches, 
electronic devices and accessories, motor vehicle parts, packaging, and personal care products.  
3.223.   According to the new legislation from 2018, Georgia's customs officer s are authorized to 
carry out ex officio  IP enforcement action at the borders, which is expected to result in a further 
increase in the number of counterfeit goods detained. In 2018, the Customs Department issued 
24 ex officio  orders on suspension of goods , resulting in six cases of the goods being destroyed, 
14 cases of the goods being released, and four cases of the rights holder filing a lawsuit.227 In 2019, 
there were three  ex officio  orders for the suspension of goods, of which two cases resulted in the  
rights  holder filing a lawsuit and one case of the goods being released due lack of proof of 
counterfeiting.228 A significant increase in ex officio  cases occurred in 2020, whereby 101  orders for 
the suspension of goods were issued.229 In 38 cases, the rights holder and the owner of the goods 
agreed on destruction of the goods.  
Table 3.29 Overview of IPR e nforcement, 2017 -20 
 2017  2018  2019  2020  
Investigation Service of the Ministry of Finance  
Criminal cases (No.)  21 16 12 10 
Counterfeit goods (No.)  42,876  40,268  36,907  640,012  
Counterfeit goods (Value, GEL)  148,323  113,912  141,963  204,189  
Customs Service Department of the Revenue Service  
Orders on suspension of goods (No.)  120 119 143 101 
Goods destructed (Value, GEL)  120,940  76,185  177,505  79,882  
Tax Monitoring Department of the Revenue Service  
Cases initiated (No.)  14 43 34 8 
Counterfeit goods (No.)  7,851  13,411  13,411  12,591  
Counterfeit goods (Value, GEL)  24,465  35,385  140,380  29,942  
Source:  Information provided by the authorities.  
 
 
225 Criminal Code of Georgia.  
226 Administrative Offences Code of Georgia, Article  1571. 
227 The total value of suspended goods on an ex officio  basis was GEL  59,708, of which the value of 
destroyed goods was GEL  4,731.  
228 The total value of suspended goods on an ex officio  basis was GEL  39,389. 
229 The total value of the counterfeited goods destroyed on the basis of the respective measure 
was GEL 79,882.  WT/TPR/S/420 • Georgia  
 
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  4  TRADE POLICIES BY SECTOR  
4.1  Agriculture, Forestry, and Fisheries  
4.1.1   Agriculture  
4.1.  Georgia has been described as a traditional agrarian country whereby about 40% of the 
population live in rural areas and about 40% of its total land area is considered agricultural land that 
is arable with a high level of natural fertility.1 The majority of the agricultural land is owned by the 
State  (75%), and the majority of this is administered by the Nat ional Agency for State Property.2 
Georgia's climate has also been described as favourable to supporting a wide variety of agricultural 
products but in particular grapes and nuts.3 Despite all of these natural advantages, the agricultural 
sector has been in gradual decline for about 25  years. Its contribution to GDP declined slightly during 
the review period before rebounding in 2020, thus remaining nearly identical in 2016  (8.3%) 
compared to  2020 (8.4%) (Table 4.1). The preliminary figures for  2020 reflec t a slight increase due 
to the stronger performance of the sector during the COVID‑19 pandemic compared to other sectors 
that fared comparably worse. However, during the earlier part of the review period, a gricultural 
output generally increased but was outpaced by other sectors.  
4.2.  The sector also suffers from low labour productivity – the lowest among all sectors, thus a large 
percentage of farmers remains in poverty.4 Small farms of about 1.4  ha continue to dominate the 
sector, and there has not been the  development of large -scale farming with the associated 
economies of scale. Furthermore, agriculture has not been attractive to foreign investors, in large 
part due to restrictions on land ownership. During the review period, FDI in agriculture was less 
than 1% of all FDI, on average.5 
4.3.  One of the significant developments during the period impacting the farming sector was the 
land ownership reform measures with respect to agricultural land. In  2017, a law was passed by 
Parliament that restricted the ownersh ip of agricultural land by prohibiting foreign ownership. Under 
the terms of the provision, foreigners, legal entities registered abroad, and legal entities registered 
by foreigners in Georgia were not able to own agricultural land. Thereafter, the legal a mendment 
was challenged in the Constitutional Court and was overturned. However a proposal was then made 
to amend the Constitution to include a new provision on agricultural land ownership in Article  19 on 
the Right to Property. By an amendment to the Cons titution in December  2018, agricultural land can 
only be owned by the State, a self -governing unit, a citizen of Georgia, or an association of citizens 
of Georgia; exceptional cases may be determined by the Organic Law.  
4.4.  The Organic Law on Agricultural Land  Ownership was passed in June  2019 and further clarified 
the ownership of agricultural land.6 Thus, the following entities are allowed to own agricultural land:  
a. the State of Georgia, an autonomous republic of Georgia, or a municipality of Georgia;  
b. a legal entity under public law of Georgia in cases provided for by the legislation of 
Georgia;  
c. a citizen of Georgia;  
d. a legal entity under private law registered in Geor gia, whose dominant partner is an entity 
outlined in clauses (a) -(c); or  
 
1 National Statistics Office of Georgia (2020), Natural Resources of Georgia and Environmental 
Protection, 2019 ; and Rural Communities Develo pment Agency, Agricultural Cooperatives in Georgia.  
2 National Statistics Office of Georgia (2020), Natural Resources of Georgia and Environmental 
Protection,  2019.  
3 EIT Food, Georgia . Viewed at: https://www.eitfood.eu/in -your-country/country/georgia . 
4 Transparency International (2020), Georgia's Agriculture Sector: Key Trends for 2012 -2019. Viewed 
at: https://www.transparency.ge/sites/default/files/georgias_agriculture_sector.pdf . 
5 From 2015 -19, it averaged 0.64%.  
6 Organic Law of 25  June 2019 on Agricultural Land Ownership.  WT/TP R/S/420 • Georgia  
 
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  e. an organizational entity, not a legal person, consisting of one of the entities in clauses 
(a)-(d) where the majority of its members have a practical ability to have a decisive 
influe nce on the decisions of the organizational entity in relation to agricultural land.  
4.5.  Exceptions pertain to foreigners who inherit land as well as to legal entities of private law 
registered in Georgia whose dominant partner is a foreigner, legal entities re gistered abroad, or 
where the dominant partner cannot be identified. In case of a legal entities' exception, an investment 
plan has to be approved by the Government.7 
4.6.  Land registration continues to be important for rural and agricultural development as it  protects 
property rights, simplifies land transactions, and facilitates borrowing. A reform was launched in 
August  2016 and efforts continue on the land registry. A majority of agricultural land is also held by 
males, i.e.  67.7% in 2019, compared to 32.3%  held by females, a situation that has changed only 
slightly since  2015, whereby the land held by males and females was 72% and 28%, respectively.8 
Table 4.1 Key agricultural indicators, 2016 -20 
 2016  2017  2018 2019  2020c 
Contribution to GDPa (%) 8.3 7.2 7.8 7.4 8.4 
GDPa (GEL millionb) 2,614.8  2,543.6  3,015.9  3,203.7  3,641.2  
Output, total (GEL millionb) 
 Plant growing  
 Animal husbandry  
 Agricultural services  3,882.7  
1,590.4  
2,002.2  
290.1  3,724.5  
1,456.8  
2,015.5  
252.2  4,552.8  
2,067.7  
2,197.9  
287.1  4,834.6  
2,159.5  
2,411.1  
263.9  5,471.7  
2,471.3  
2,618.7  
381.7  
Employmenta ('000 persons)  .. 290.0  254.0  247.7  247.3  
Employmenta (% total)  .. 22.5 19.6 19.1 19.9 
.. Not available.  
a Includes forestry and fishing.  
b At current prices.  
c Preliminary.  
Source:  National Statistics Office of Georgia, Agriculture of Georgia 2019 ; Agriculture of Georgia 2020 ; 
National Accounts of Georgia 2019 ; General Agricultural Sector Statistics ; Distribution of  Employed 
Persons by Economic Activity ; and information provided by the authorities.  
4.1.1.1   Production and trade  
4.7.  Agricultural  production during the review period did not change substantially in terms of 
quantity, but there was a steady increase in its value (Table s 4.1 and 4.2). Total output reached 
GEL 5.5 billion in  2020, up from GEL  3.9 billion in 2016. During most of the period, growth in 
agriculture was similar to overall growth in GDP, at current prices. Thus, given that the share of 
value -added in output did not change significantly over the years, the increase in output was driven 
in part by rising prices and otherwise by an increase in production.9 The main crop is now maize, as 
its output surpassed that of potatoes, which was the main crop  in 2015. The production of grapes 
and nuts increased steadily over the period, reflecting increased demand, especially for the 
production of wine for export and also the greater amount of land area planted as vineyards.  There 
was a small decline in the pr oduction of most livestock over the period except for poultry, which 
increased.  
Table 4.2 Production of selected agricultural products, 2015 -20 
  2015  2016  2017  2018  2019  2020  
Crops ('000 tonnes)              
 Wheat  125.6  126.6  97.9 107.1  100.6  102.4  
 Barley  40.9 47.2 43.9 57.7 53.5 45.4 
 Maize  184.6  243.7  142.5  194.2  207.1  255.0  
 Potato  186.5  249.0  180.1  237.5  194.7  208.6  
 
7 Inform ation provided by the authorities.  
8 National Statistics Office of Georgia, Distribution of Agricultural Holdings by Age and Gender . 
Viewed  at: https://geostat.ge/media/38891/2.Distribution_of_Agricultural_Holdings_and_Land_Area_Operated
_by_them_ENG.xlsx . 
9 Information provided by the authorities.  WT/TPR/S/420 • Georgia  
 
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    2015  2016  2017  2018  2019  2020  
 Vegetables  152.3  141.7  125.9  142.2  161.1  176.1  
 Melons  72.5 72.8 80.1 70.2 79.9 83.6 
Permanent crops ('000 tonnes)              
 Tea leaves  2.1 3.0 2.3 1.7 2.0 2.4 
 Fruits (including nuts)  144.3  186.5  114.0  188.4  144.4  228.6  
 Grapes  214.5  159.2  180.8  259.9  293.8  316.9  
 White grapes  .. 111.8  121.6  179.3  203.1  224.1  
 Red grapes  .. 47.4 59.2 80.6 90.7 92.8 
 Citrus  77.6 65.5 58.2 66.3 64.0 56.8 
Livestock (as of end of year, 
'000 heads)              
 Bovine animals  992.1  962.7  909.7  878.9  869.5  925.8  
 Pigs 161.5  136.2  150.7  163.2  155.5  165.7  
 Sheep and goats  891.4  936.5  907.0  869.5  891.5  946.5  
 Poultry  8,308.6  8,237.8  8,386.0  8,110.9  9,466.4  10,146.5  
.. Not available. 2015 data are not available due to the small sample size of the survey.  
Source:  Compiled by WTO Secretariat, based on data from the National Statistics Office of Georgia, 
Agriculture of Georgia 2019 . 
4.8.  Georgia's trade of agricultural products is significant, accounting for an average of  14.8% of 
total imports over the period and 33.6% o f domestic exports (Table 4.3 and Table A1.2). A significant 
trade deficit in agricultural products persisted throughout the period but declined from 
USD 538 million in 2015 to USD  442 million in 2020. This was mainly attributed to a steady increase 
in agr icultural exports, in particular wine, as imports remained relatively stable. The main imported 
agricultural products were tobacco products and wheat, which accounted for about  20% of the value 
of all imported agricultural products; the other significant i mports included meat, sugar, cocoa, and 
colza oil.  
4.9.  Wine continued to be Georgia's dominant agricultural export over the period, with nuts and 
water also significant. Georgia's main markets and sources of agricultural traded goods  remained 
concentrated with  the Russian  Federation, the EU -27, and Ukraine. The Russian  Federation was 
particularly important as a source of wheat imports and a destination of wine exports.  
4.10.   In terms of border measures, Georgia does not have any tariff -rate quotas nor does it use 
the agricultural special safeguard  (SSG). Many agricultural products are subject to certificates, 
permits, or border inspections due to SPS measures or other import/export 
measures  (Sections  3.1.5, 3.2.3, and 3.3.3).  
Table 4.3 Trade in selected agricultural products, 2015 -20a 
(USD million)  
HS 
code  Product description  2015  2016  2017  2018  2019  2020  Average 
2015 -20 
Agricultural exports (domestic 
exports)  531.4  565.5  608.6  673.4  708.1  730.4  636.2  
2204 Wine of fresh grapes  93.3 111.8  169.9  194.6  221.5  209.1  166.7  
0802 Other nuts, fresh or dried  175.5  178.4  80.3 54.1 64.8 93.1 107.7  
2201 Waters, not containing added 
sugar or other sweetening 
matter nor flavoured  82.2 79.8 95.8 118.3  133.5  116.6  104.3  
2208 Spirits, liqueurs and other 
spirituous beverages  28.5 40.1 60.5 81.6 82.8 85.6 63.2 
0102 Live bovine animals  20.1 36.8 36.2 29.5 22.4 27.8 28.8 
2202 Waters, containing added 
sugar or other sweetening 
matter or flavoured, and other 
non-alcoholic beverages  18.0 11.6 17.0 26.8 27.1 31.2 21.9 
0805 Citrus fruit, fresh or dried  11.9 10.4 10.7 13.7 16.2 17.9 13.4 
0204 Meat of sheep or goats, fresh, 
chilled or frozen  0.1 3.7 23.8 36.5 15.2 1.0 13.4 
0104 Live sheep and goats  18.5 10.5 6.5 4.1 13.7 20.5 12.3 
0809 Apricots, cherries, peaches, 
plums and sloes, fresh  1.7 2.9 4.3 7.9 12.9 23.9 8.9 WT/TP R/S/420 • Georgia  
 
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  HS 
code  Product description  2015  2016  2017  2018  2019  2020  Average 
2015 -20 
0910 Ginger, saffron, turmeric 
(curcuma), thyme, bay leaves, 
curry and other spices  8.0 7.6 7.9 8.5 10.4 10.8 8.9 
2008 Fruit, nuts  and other edible 
parts of plants, otherwise 
prepared or preserved  9.7 10.2 6.6 9.2 7.6 9.8 8.8 
2009 Fruit juices (including grape 
must) and vegetable juices, 
unfermented and not 
containing added spirit  7.5 5.5 9.2 8.6 7.2 10.1 8.0 
0810 Other fruit, fresh  2.9 2.9 3.1 3.5 6.7 12.0 5.2 
0709 Other vegetables, fresh or 
chilled  5.9 4.5 4.1 4.4 5.7 4.6 4.9 
Agricultural imports  1,069.7  1,025.6  1,133.1  1,320.6  1,213.9  1,172.6  1,155.9  
2402 Cigars, cheroots, cigarillos  and 
cigarettes, of tobacco or of 
tobacco substitutes  103.6  102.1  102.6  187.0  105.0  88.9 114.9  
1001 Wheat and meslin  119.4  86.1 98.2 114.9  109.0  107.9  105.9  
0207 Meat and edible offal, of the 
poultry, fresh, chilled or frozen  53.0 58.4 61.7 62.2 65.2 62.3 60.5 
1701 Cane or beet sugar and 
chemically pure sucrose, in 
solid form  49.3 65.5 67.6 58.3 50.3 51.3 57.0 
1806 Chocolate and other food 
preparations containing cocoa  47.0 50.6 53.3 53.4 54.5 44.3 50.5 
1512 Sunflower -seed, safflower or 
cotton -seed oil and fractions 
thereof  43.5 39.6 36.2 40.6 38.5 46.0 40.7 
1905 Bread, pastry, cakes, biscuits 
and other bakers' wares  29.9 30.5 34.6 39.2 40.7 36.8 35.3 
2106 Food preparations not 
elsewhere specified or included  26.5 27.8 36.4 40.9 41.5 37.0 35.0 
2208 Spirits, liqueurs and other 
spirituous beverages  44.7 23.8 33.9 34.0 38.1 28.7 33.9 
0203 Meat of swine, fresh, chilled or 
frozen  26.6 26.1 34.6 28.4 30.5 27.6 29.0 
1517 Margarine; edible mixtures or 
preparations of animal or 
vegetable fats or oils  25.2 22.6 23.8 24.1 23.4 21.5 23.4 
2309 Preparations of a kind used in 
animal feeding  19.2 19.5 21.1 24.6 26.6 28.9 23.3 
0402 Milk and cream  16.5 17.9 24.4 19.2 21.3 23.2 20.4 
0405 Butter and other fats and oils 
derived from milk; dairy 
spreads  11.7 16.6 18.0 23.0 22.9 26.0 19.7 
2202 Waters, containing added 
sugar or other sweetening 
matter or flavoured, and other 
non-alcoholic beverages  21.1 18.7 18.9 18.3 19.2 15.8 18.7 
Memo items:                
Trade balance (domestic exports)  -538.3  -460.1  -524.5  -647.1  -505.8  -442.1  -519.7  
Trade balance  -481.5  -363.6  -373.5  -379.7  -341.3  -273.8  -368.9  
Note:  WTO definition of agriculture: HS Chapters 01 -24 less fish and fishery products (HS  Chapter 03, 
0508, 0511.91, 1504.10, 1504.20, 1603 -1605, and 2301.20), plus some selected products 
(HS 2905.43 -2905.45, 3301, 3501 -3505, 3809.10, 3823, 3824.60, 4101 -4103, 4301, 5001 -5003, 
5101-5103, 5201 -5203, and 5301 -5302).  
 Exports reported in the table are "domestic exp orts" and do not include "re -exports" as there are 
significant re -exports of tobacco products in certain years.  
a Major items; according to the simple average during the period 2015 -20. 
Source:  WTO Secretariat calculations, based on National Statistics Off ice of Georgia, External Trade . 
4.1.1.2   Laws and structure  
4.11.   The Ministry of Environmental Protection and Agriculture  (MEPA)  is Georgia's main 
government agency responsible for agricultural policy; in 2018 it was formed when the Ministry of 
Agriculture and the Ministry of Environmental Protection and Natural Resources were merged. 
Its governance covers the management and promot ion of development in the fields of environmental 
protection, agriculture, and rural development. A number of subsidiary agencies, such as the 
National Food Agency, the National Wine Agency, and the Rural Development Agency, are 
established underneath it t o carry out specific functions.  WT/TPR/S/420 • Georgia  
 
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  4.12.   There is no overarching law on agriculture, rather a number of specific laws pertain to 
particular areas, e.g. water, wine, animals, and aquaculture (Table 4.4). Georgia has drafted a Law 
on Biodiversity and Law on Seed Cert ification but as of September  2021 they were not yet approved. 
As a result of the DCFTA, new government decrees and other normative acts are also in progress.10 
Table 4.4 Main laws in agriculture, 2015 -19 
Laws  
Law on Animals  
Law on Water  
Law on Genetically Modified Organisms  
Law on Licences and Permits  
Law on Agricultural Cooperatives  
Law Food/Animal Feed Safety, Veterinary and Plant Protection Code  
Law on Vine and Wine  
Law on New Breeds of Animals and Varieties of Plants  
Law on Labelling of Genetically Modified Organisms Designated for Food Products/Fodder and Genetically 
Modified Products Produced from Them  
Law on Aquaculture  
Law on Changing the Purpose of Agricultural Lands and Sustaina ble Management  
Law on Soil Protection  
Source:  MEPA ; and information provided by the authorities.  
4.1.1.3   Policy and support measures  
4.13.   Since 2015, the agricultural policy of the Ministry of Agriculture, and since 2018 of the 
Ministry  of Environmental Protection and Agriculture, is based on the Strategy for Agricultural 
Development in Georgia (2015 -20). The vision of the Strategy is to cre ate an environment that will 
increase competitiveness in agro -food sector, promote stable growth of high -quality agricultural 
production, ensure food safety and security, and eliminate rural poverty through sustainable 
development of agriculture and rural areas. The Strategy includes seven  major targets:  
• improving the competitiveness of the agricultural sector, such as promoting national food 
products via marketing and other supporting measures;  
• improving institutional arrangements;  
• ameliorating soil fertil ity; 
• supporting regional and sectoral development, by creating a complete cycle for agriculture 
production and increasing its value -added;  
• ensuring food security;  
• improving food safety, veterinary, and plant protection; and  
• dealing with climate change, pro tecting the environment, and maintaining biodiversity.  
4.14.   In December 2016, the Ministry of Agriculture, in cooperation with other relevant Ministries, 
produced the Rural Development Strategy of Georgia (2017 -20). This long -term strategy ensures 
constant improvement in the quality of life and the social conditions of the rural population, based 
on a combination of increased economic opportunities, more accessible social benefits, a rich cultural 
life, environmental protections, and the sustainable  management of natural resources. The vision 
extends beyond the strategy period of 2017 -20 and identifies nine  strategic objectives in 
three  priority areas:  
• Economy and competitiveness objectives: Economic recovery of farming, restructuring 
and modernizati on through the diversification and development of effective supply chains; 
diversification of the rural economy through strengthening the agricultural -related value 
 
10 Information provided by the authorities.  WT/TP R/S/420 • Georgia  
 
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  chain and promoting various sustainable non -agricultural activities; and development of 
tourism in rural areas, based on rural specificity and unique cultural identity;  
• Social conditions and living standards objectives: Raising awareness in innovation and 
entrepreneurship; promoting cooperation through contributing to skills development and 
employment issues; improving basic rural infrastructure, and the availability of high -
quality public services, including information and communication technologies; and 
increasing the involvement of rural population in the identification of local needs and the  
determination of solutions to these needs; and  
• Environmental protection and sustainable management of natural resources objectives: 
improvement of the management of water, forest, and other resources in targeted rural 
areas; promotion of sustainable syste ms of waste management in rural areas; and 
activities used to mitigate the negative impact of climate change.  
4.15.   The other main policy instruments during the period that impacted the agriculture sector were 
numerous agriculture or rural development strategies  (Box 4.1).  
Box 4.1 Main policy instruments, 2016 -21  
Agriculture and Rural Development Strategy of Georgia 2021 -2027 
Strategy for Agricultural Development in Georgia (2015 -2020) and relevant Action Plans  
Irrigation Strategy for Georgia 2017 -2025 
Strategy for Agricultural Extension of Georgia 2018 -2019 
Rural Development Strategy of Georgia 2017 -2020 
Rural Development Strategy Action Plan for 2018 -2020 
Rural Development Strategy of Georgia Action Plan 20 17 
Source:  MEPA ; European Neighbourhood Programme for Agriculture and Rural Development (ENPARD) ; and 
information provided by the authorities.  
4.16.   There were numerous subsidy  or support measures for the agriculture sector during the 
review period that increased in number and amount subsidized, including special additional 
measures during the COVID -19 pandemic. According to the budget, Georgia has subsidized 
agriculture to arou nd GEL 243  million in 2020, approximately doubling compared to earlier  years, 
due to additional subsidies related to the pandemic (Table 3.7 in Section 3.3.1.1 on government 
subsidies on agriculture during  2017-21). The largest subsidy programme during the  period 
remained the modernization of amelioration systems aimed at rehabilitating reservoirs, irrigation 
systems, and amelioration equipment.11 
4.17.   The Produce in Georgia Program from 2014 is Georgia's main development programme 
providing support for the indu strial sector (Section 3.3.1), but it also has an agricultural component. 
The main goal is to promote the establishment of new agricultural primary and processing 
enterprises in Georgia. It provides loans between GEL  600,000 and GEL  2 million for start -up 
enterprises in the following areas: high -tech greenhouse farming of vegetables, berry crops, and 
herbs; high -tech and intensive livestock farm (dairy and meat); high -tech and intensive poultry 
factory  (only for breeding purposes); agricultural, poultry, an d fish feed enterprises; and processing 
enterprises for fruits, berries, vegetables, citrus, walnuts, hazelnuts, ground nuts and other nuts, 
wool, leather, laurel, tea, and tobacco. During the first two -year period after the loan is dispersed 
by commercial  banks, the Government co -finances the interest rate and also backs the collateral of 
the bank.  
4.18.   Under the Plant the Future initiative, which began in 2015, the Government set  out several 
objectives including more effective use of agricultural land, enhanci ng export potential, import 
 
11 According to the authorities, subsidy exp enditures under the Modernization of Amelioration Systems 
Program amounted to GEL  48.5 billion in 2017, GEL  60.2 billion in 2018, GEL  71.3 billion in 2019, and 
GEL 74.8 billion in  2020.  WT/TPR/S/420 • Georgia  
 
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  substitution, and improving socio -economic conditions in rural areas.12 Most of the subsidization is 
in the form of financial support for co -financing the purchase of seedings/saplings and for irrigation 
systems. The level of su pport varies by the crop; for example, the berry crops are supported at 
100% whereas 50% -70% is provided in the forestry sector. The other main support programmes on 
agriculture during the period are outlined in Table 4.5.  
4.19.   Georgia also provided support to the tea sector. Through cooperation with the National Agency 
of State Property  (NASP) , the Government appropriated land for tea plantation rehabilitation. Under 
the programme, land is available for lease without auction by the Government. A state -owned 
tea plantation can be leased for a term for 25  years with an annual cost of GEL  50 per ha, which can 
be reviewed after 15  years and every 5  years thereafter. Since the programme's inception in  2016, 
724 ha have been transferred to the beneficiaries.13 The Sta te Program for Support of Viticulture 
Agricultural Cooperatives provides grape processing and wine production equipment for cooperatives 
at subsidized prices. Up to 90% of the equipment is financed under the Program per certain 
conditions and up to a maxim um of GEL  500,000.14 As at September  2021, applications under the 
Program were suspended.15 
4.20.   Another state programme, specific to beekeeping cooperatives, aims to improve the material 
and technical resources of beekeeping holdings of agricultural cooperativ es in order to improve the 
quality and to increase the volume of honey and other beekeeping products. Various types of 
beehives will be made available to participants in the state programme with a grant covering  30% 
of the cost. The programme envisages co -financing of no more than 70% of the cost of the 
equipment, but not more than GEL  30,000 per cooperative. Cooperatives, of which more than  50% 
of the members are women, people with disabilities, or internally displaced persons, will receive 
additional co -financing of not more than 80% of the costs. A wheat subsidy programme was also in 
place during the review period, but it has lapsed.  
Table 4.5 Main agricultural support programmes, 2015 -21 
Programme  Purpose  Financial aspects and conditions  
Plant the Future  Offers co -financing component of 
perennial gardens, berry crops, and 
nursery farms to improve the efficiency 
of agricultural land use in Georgia; 
support agricultural products import -
replacing and increasing export potential; 
and stimulate the creation of nursery 
farms and the cultivation of perennial 
gardens.  • 70% of the value of seedlings to be 
purchased, or 80% for cooperatives 
with agricultural status, villages near 
the dem arcation line, and highland 
settlements;  
• 50% of the value of drip irrigation 
system, and 60% (not more than 
GEL 1,250 per 0.5  ha) for 
cooperatives with agricultural status, 
villages near the demarcation line, and 
highland settlements;  
• 50% of the cost o f installation of 
middle and support poles and anti -hail 
nets, and 60% for cooperatives with 
agricultural status, villages near the 
demarcation line, and highland 
settlements; and  
• Agricultural cooperatives will be 
financed with the cost of purchasing 
spraying machinery, not exceeding 
GEL 5,000.  
Co-financing subcomponent of berry 
crops provides 100% funding for the 
purchase and installation of seed crops, 
drip irrigation systems, and other 
necessary materials for the cultivation of 
crop orchards for the ag ricultural land 
from 0.15  ha through 0.5  ha. 
 
12 L. Zivzivadze, T. Taktakishvili, E. Zviadadze, and G. Machavariani,  "An Evaluation of Permanent 
Crops: Evidence from the 'Plant the Future' Project, Georgia", Open Agriculture , 3 March 2021.  
13 National Agency of State Property, 2020 Report of the National Agency for State Property LEPL . 
Viewed at: https://drive.google.com/file/d/1INyho6vJLRGgtiE3PUeNwdTkL3ZV1SAd/view?usp=sharing . 
14 Government of Georgia, State Program for Support of Viticulture Agricultural Cooperatives.  
15 Information provided by the authorities.  WT/TP R/S/420 • Georgia  
 
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  Programme  Purpose  Financial aspects and conditions  
Preferential 
Agro-credit Project  Aims to improve the processes of 
primary agricultural production – 
processing, storage, and sale – by 
providing legal and natural entities with 
cheap, affordable, long -term and 
preferential funds.  
Farms and enterprises engaged in the 
processes of primary agricultural 
production or processing and storage will 
receive the Preferential Agrocredit for 
fixed assets and the Preferential 
Agrocredit within the Produce in Georgia 
Program.  Co-financing of interest rate:  
• Fixed assets: 11% up to 48  months  
• Mechanization subcomponent: 9% 
up to 48  months  
• Subcomponent of New Gardens: 
11% up to 66  months  
• Preferential Agro Leasing: 12% up to 
48 months  
Component of 
Agro-Processing 
and Storage 
Enterprises  For the modernization of existing 
processing/storage enterprise; co -
financing of new processing/storage 
enterprises; purchase of 
machinery/equipment; implementation 
and certification of international 
standards.  Co-financing provided within the 
framework amounts to  40% interest of 
the total value of the project presented, 
while the co -financing of beneficiary 
amounts to  60%.  
Georgian Tea  Improving Georgian tea potential and 
promotion of high -quality tea production, 
including production of bio (organic) tea 
with the intent of raising self -sufficiency 
and export capacity. At this time, 
implementation of the State Technical 
Assistance Program on certification and 
co-financing of international standards 
were ongoing.  Co-financing of the rehabilitation works 
for the tea plantations owned by the 
programme beneficiary and/or by the 
State.  
The rehabilitation cost shall not exceed 
GEL 2,500 (including VAT) per  ha. 
Farms/Farmers 
Registration Project  Regulates a system of the united registry 
of farmers/farms that will consolidate 
information on the entities employed in 
agricultural activities, their agricultural -
economic activities, and agricultural 
assets existing in their 
ownership/maintenance in the united 
electronic databas e. Project is funded by the Government 
(GEL 300,000), but additional financial 
support from donors is needed.  
Agro Insurance  Aims to develop the insurance market in 
the agricultural sector, promote 
agricultural activities, retain the income 
for individual s employed in mentioned 
activities, and reduce risks.  Each insurer will receive 70% 
co-financing for each crop envisaged 
under the programme and 50% for vine 
crops. This does not apply to agricultural 
cooperatives; the amount of insurance 
premium subsidies  per 
insurer/beneficiary shall not exceed 
GEL 50,000.  
Program of 
Co-financing 
Agricultural 
Machinery  Aims to increase access to agricultural 
machinery (any type of crop harvesting 
machinery, both self -propelled and 
trailer; agricultural tractors), except for 
grape harvesting machinery.  The amount of co -financing in the case of 
one crop harvester (combine) is 30% but 
not more than GEL  150,000, and for 
other agricultural machinery 50% but not 
more than GEL  150,000.  
Source:  Information provided by the authorities.  
4.21.   In 2020, a new Resolution on Approval of the State Program for Access to Agricultural Land 
Resources established the State Program Access to Agricultural Land Resources for a period of three 
years; further amendments took place in 2021.16 The Program aims to improve the use of state -
owned agricultural land through the direct sale of these leased lands, maximum 10  hectares, to 
lessees through privatization. The 2021 amendment removed the 10 -hectare threshold and certain 
timing requirements, e.g.  the requirement of obtaining a lease six  months in advance. The Program 
 
16 Resolution No.  464 of 23  July 2020 on Approval of the State Program Access to Agricultural Land 
Resources ; and Resolution No.  160 of 8  April 2021 on Amendments to Resolution No.  464 of 23 July 2020 on 
Approval of the State Program for Access to Agricultural Land Resources.  WT/TPR/S/420 • Georgia  
 
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  was expected to generate GEL  100 million through the sale of the land; as at 31  December  2020, 
165 applications were received.17  
4.22.   More recently, Georgia included a number of agricultu ral elements in its COVID -19 Anti -Crisis 
Plan to help the economy during the pandemic. For example, additional funds were earmarked to 
the credit  guarantee scheme and agricultural support, in particular for wine promotion 
(see Section  1.2.1). The specific measures to support agriculture, especially for small -scale farmers 
are mainly co -financing measures and grants (Box 4.2). It was expected that about  200,000  farmers 
would receive direct support. The recently announced Economy 2030 plan contains provisions  to 
develop agro -tourism.  
4.23.   A resolution was passed in July 2021 on a programme for financing agricultural machinery for 
farmers.18 The programme provides for up to GEL  10 million for co -financing of combine harvesters, 
tractors, and related agricultural mac hinery. The co -financing level is either 30% or 35%,  depending 
on the type and cost of the machinery, up to a certain limit, ranging from GEL  7,000 to GEL  70,000.  
Box 4.2 Anti-Crisis Plan on agriculture, key pro visions  
Component  Budget 
(GEL  million)  
• Up to 80% grant for the dairy sector for improving inventory and developing 
infrastructure  42 
• 50% grant for technical equipment, greenhouses, and irrigation systems up to 
GEL 50,000  10 
• 70% co -financing for agricultural insurance; farmers can insure perennial crops 
for three  years  9 
• Grant of up to GEL 15,000 (GEL 25,000 for cooperatives) for the introduction of 
international food safety standards, accounting services to cooperatives, and 
financing equipment for cooperatives  1.5 
• Diesel fuel discounted price for agricultural lands of 0.25 to 100  ha, 1 L of diesel 
with GEL  1 discount from market price  40 
• Subsidizing agricultural goods and ploughing services for landowners of registered 
lands of 0.25 to 10  ha, including co -financing for the purchase of goods and 
services (fertilizers and chemical/biological plant protection, seed and planti ng 
materials, agro -tech services for landowners)  37 
• Grants for cooperatives:  
  - Co-financing of honey and milk processing enterprises in certain 
municipalities  
  - Support for viticulture and dairy sector cooperatives  0.15 to 0.5  
• GEL 8 million debt cancellation for irrigation services for 42,000  natural and legal 
entities  13 
• Beneficiaries of the Plant the Future initiative will have new benefits and 
opportunitie s for the co -financing of irrigation systems for perennial crops  13 
• Banks will offer new conveniences to support agriculture production: loan 
interest rate will be totally financed for annual crops for six months and various 
co-financing initiatives, i.e. up to 17% co -financing of loans  74 
Source:  StopCoV.ge, Anti-Crisis Plan on Agriculture . Viewed at: https://stopcov.ge/en/Gegma . 
 
17 Government of Georgia. Viewed at: 
http://gov.ge/print.php?gg=1&sec_id=288&info_id=79091&lang_id=GEO ; National Agency of State Property, 
2020 Report of the National Agency for State Property LEPL ; and information provided by the authorities.  
18 Resolution No.  385 of 29 July 2021 on Approval of the State Program of Co -Financing of Agricultural 
Mechanization.  WT/TP R/S/420 • Georgia  
 
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  4.24.   During 2015 -19, Georgia notified the Committee on Agric ulture that it had not granted export 
subsidies on agricultural products.19 Furthermore, domestic support measures were notified during 
2015-19.20 
4.1.1.4   Key subsectors  
4.1.1.4.1   Wine  
4.25.   Georgia has a rich history of winemaking going back to 6,000 -5,800  BC, making it the olde st 
winemaking country in the world. Today Georgia produces wine in 10 main wine -growing regions 
and has more than 500  recognized varieties of grapes.21 It produces a wide variety of wines, both 
red and white, that are very diverse reflecting its numerous v arieties of grapes, varied growing 
zones, and climatic conditions. The number of wine producers grew substantially over the review 
period, from about 400 in 2016 to over 1,600 in 2020. However, most are small -scale family 
winemakers.  
4.26.   The sector is highly p rofitable compared to other sectors of the economy and is a major export 
earner, yet it receives various forms of state support. Georgia's National Wine Agency was 
established as a Legal Entity of Public Law under the M EPA, whose main role is to promote th e 
development of viticulture and the winemaking industry in Georgia. The Agency is involved in 
marketing and promoting Georgian wine, research on vine culture, laboratory research, certification 
for export, and development of the system of designation of o rigins of Georgian wine. In 2020, its 
total budget amounted to more than GEL  10 million of which the development of viticulture 
constituted the largest share.  
4.27.   In addition to the support of the National Wine Agency, support was also given to the sector 
in 2020 due to the downturn of the economy. As a result of the COVID -19 pandemic and its related 
impact on exports and the tourism sector that normally contributes to the sale of Georgian wine, 
the 2020 vintage was subsidized by the Government. The subsidy cov ered Rkatsiteli or Kakhetian 
green grapes grown in the Kakheti region in the amount of GEL 0.30 per  kg purchased by 
wine companies, and GEL  0.80 per  kg was provided for the delivery of those grapes. In 2020, a total 
of GEL  50.5 million was spent on subsidi es to the wine sector, much more than in previous  years, 
e.g. during 2015 -17, the average annual amount was GEL  28 million.22 
4.28.   During the review period, developments in the sector included the establishment of the 
Vineyard Cadastre Program, amendments on th e technical regulations for wine production, 
laboratory accreditation for easier export procedures, and continued development of the Georgian 
Protected Designation of Origin (PDO) system of protecting Georgian wine designations. As of  2020, 
there were 24 G eorgian wines registered at Sakpatenti with PDO. In 2021, there were two  regions 
expected to be finalized by the end of the year in the Vineyard Cadastre Program.  
4.29.   The production of grapes, mainly for use in the wine sector, grew over the period from 
215,00 0 tonnes in 2015 to a record level of 284,000 tonnes  in 2020; there was a downturn in 
production in 2016 -17, which quickly rebounded. State -owned factories for wine production often 
purchase surplus grapes that are otherwise not purchased by private sector  winemakers.  
4.30.   Georgia's wine exports grew considerably over the period and were relatively stable in  2020, 
despite the COVID -19 pandemic, with exports, in terms of quantity, remaining almost identical 
to 2019, although the total value declined slightly (Table 4.6). Since  2015, the number of bottles 
exported has increased 156% and the value by  121%, thus exports to most countries  exhibited 
similar growth. The Russian  Federation continued to be the largest market throughout the period, 
 
19 WTO documents G/AG/N/GEO/16, 5 April 2016; G/AG/N/GEO/17, 15  January  2020; G/AG/N/GEO/21, 
29 July 2020; G/AG/N/GEO/22, 29 July 2020; and G/AG/N/GEO/24, 31  July 2020.  
20 WTO documents G/AG/N/GEO/14, 5 August 2015; G/AG/N/GEO/15, 5 April 2016; G/AG/N/GEO/18, 
15 January  2020; G/AG/N/GEO/19, 17 January 2020; G/AG/N/GEO/20, 17  January  2020; and 
G/AG/N/GEO/23, 30  July 2020.  
21 Georgian Wine Association, Grape Variet ies. Viewed at: http://gwa.ge/yurdznis -jishebi/?lang=en ; and 
information provided by the authorities. The regions are Kakheti, Kartli, Meskheti, Imereti, Racha, Lechkhumi, 
Guria, Samegrelo, Abkhazia, and Ajara.  
22 Information provided by the authorities. In 2015, GEL 35 million; in 2016, GEL  35 million; and 
in 2017, GEL  13 million. No subsidies were reported in 2018 -19. WT/TPR/S/420 • Georgia  
 
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  accounting for approximately 60% of Georgia's wine exports. Concerns have been raised in recent 
years due to the growing dependence on the Russian  Federation as the leading export market, thus 
significant marketing efforts have promoted wine to other markets. Exports of wine grew significantly 
to the key growth markets of Poland, the United  States, and the United  Kingdom during the period, 
albeit from  a much lower base compared to the that of the Russian  Federation. China is also an 
emerging market for Georgian wines, although exports declined to the Chinese market in  2020 in 
large part due to the COVID -19 pandemic.  In 2020, 376  Georgian winemakers exp orted wine to 
60 countries.23 
Table 4.6 Wine exports, 2015 -20 
Year Number of bottles  Value (USD)  
2015 36,071,399  98,102,614  
2016 49,848,668  113,801,462  
2017 76,663,225  169,668,562  
2018 86,194,288  203,130,809  
2019 93,478,757  237,967,015  
2020 92,366,571  216,459,259  
Source:  Information provided by the authorities.  
4.1.1.4.2   Mineral and fresh water  
4.31.   Georgia is a country rich in water resources, with over 2,000 mineral water springs. Georgian 
mineral water is known for its high -quality, curative properties, and guarantees of safety. It is also 
known for its many varieties of water that are marketed domestically as well as for export. Recent 
investment by foreigners has also modernized the secto r, thus manufacturing improved, costs 
reduced, and profits increased.  
4.32.   The sector grew as an export sector during the period, in which Georgia saw exports 
increase  42%, although there was a slight contraction in 2020. Exports, as well as domestic 
consumptio n, were impacted negatively by the COVID -19 pandemic due to the fall in tourism and 
closures in the food service sector.  
4.33.   Since 2014, Georgia has had in place technical regulations on packaged natural mineral and 
spring water.24 The sector also has a number  of state -owned enterprises (SOEs) operating.  
4.1.2   Forestry  
4.34.   Georgia is a country rich in forests with about 40% of its total land area covered as of 2020, 
although forestry reportedly contributed very little to GDP at 0.4%.25 Despite the natural abundance 
of forests, a significant amount is inaccessible for economic exploitation due to location and terrain; 
there is limited road infrastructure and much is on steep or erosive mountainous slopes. The forests 
of Georgia are public lands, but some are leased to priv ate loggers for long periods while others are 
exploited through shorter -term licences. Due to Georgia's climate and geographical situation, forests 
are spread among lowland and highlands with varying species, although beech is the most 
predominant, followe d by oak and hornbeam. Georgia's forests provide timber for household (fuel) 
and industrial use, and there are also non -timber resources such as cones, seeds, and bulbs. A 
number of reforms were ongoing during the review period and are expected to continue  in the near 
term.  
4.35.   The land area covered by forests remained stable over the review period at 40% of Georgia's 
total land area over the period (Table 4.7). However, due to ongoing land survey and inventory 
work, it is estimated to be more accurately at 43% ; the revisions are expected shortly.26 Georgia's 
forests are state property with the majority of the forest land managed by the National Forest 
Agency  (NFA) while a small percentage is protected reserves and parks.27 Over the past 
 
23 National Wine Agency, National Wine Agency Report 2020 . Viewed at: 
https://wine.gov.ge/En/Files/Download/14179 . 
24 Resolution No.  719 of 26 December 2014.  
25 UNECE and FAO, Overview of the State of Forests and Forest Management in Georgia , 2019.  
26 Information provided by the aut horities.  
27 The new Forest Code also allows for forest plantations that may be established in the future.  WT/TP R/S/420 • Georgia  
 
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  five-year period, there was a growing amount of state funds invested in forest restoration that began 
in 2013; however, the amount still remains well below historic highs that were in place prior to 
independence. According to the United Nations Economic Commission for Europe (UNE CE) and the 
Food and Agriculture Organization of the United Nations (FAO), the consumption of forest products 
is low in Georgia at 0.2  m3 roundwood equivalent per  capita compared to 0.86  m3 in Europe.28 
Table 4.7 Overview of the forestry sector, 2015 -20 
 2015  2016  2017  2018  2019  2020  
Forest land ('000 hectares)  2,822  2,822  2,822  2,822  2,822  2,822  
Forest land (%)  40 40 40 40 40 40 
Under the National Forest 
Agency ('000 hectares)  2,005.8  2,008.5  2,008.9  1,996.9  1,993.9  1,990.5  
Forest restoration (hectare)a 142 178 156 265 201 159 
Illegally obtained wood 
(cubic metre)b .. 15,960  15,024  22,973  38,092  16,825  
Illegal logging violations 
identified by the Department 
of Environmental 
Supervision  .. 2,483  2,882  2,324  3,745  2,807  
Illegal logging violations in 
the Protected Areas  .. 88 147 86 38 30 
.. Not available.  
a Includes forest seeding and planting, and  facilitating natural recovery of forests.  
b Official figures as reported by the Government. Other studies suggest this figure is significantly 
higher. See GIZ, Wood Market Study: Integrated Biodiversity Management, South Caucasus , 
December  2016.  
Source:  National Statistics Office of Georgia, Natural Resources of Georgia and Environmental Protection, 
2019; FAO, Global Forest Resources Assessment 2020, Report, Georgia ; and information provided 
by the authorities.  
4.1.2.1   Structure, strategies, and reforms  
4.36.   The major institutional reforms in the forest sector commenced in 2012 with the aim to create 
sustainable forest management on the national level. Thus, the MEPA29 has initiated a number of 
institutional and legal reforms. In this context, the functions and duties o f forest policy, 
management, and supervision were separated, and a national forest concept was conceived  as the 
main strategy for the forest sector. The main goal of reform was to ensure sustainable management 
by creating an environment for the forest econ omy. 
4.37.   In 2013, Parliament adopted the National Forest Concept (NFC). The Concept noted several 
weaknesses, such as imperfect legislation, lack of planning, violations of the licensing system, and 
poor enforcement, which it proposed to rectify by implementing a systemic approach for the 
Government to deal with ongoing issues of the forestry sector. The NFC proposed appropriate state 
supervision of forest management planning, voluntary and independent certification of forests, and 
an increase in the  contribution of timber harvesting and processing to the national economy to study 
the potential tourist and recreational use of forests. The Concept has led to several initiatives or 
reforms during the review period, including Georgia's first Forest Inven tory in 2018.30 
4.38.   The NFA31 is the independent agency under the MEPA tasked with forest maintenance and 
restoration, sustainable use of forests, implementation of forest care and restoration, control over 
the territory of the forest fund, and implementation of forest registration. The MEPA retains the 
competence over developing forest policy through its Department of Biodiversity and Forestry.  
 
28 UNECE and FAO (2019), Overview of the State of Forests and Forest Management in Georgia , 2019. 
Viewed at: https://unece.org/DAM/timber/publications/2020/Georgia_DP80_1922467_E_WEB.pdf . 
29 The Ministry of Environmental and Natural Resources Protection and the Ministry of Agriculture were 
merged in 2018 and the Ministry of Environmental Protection and Agriculture of Georgia was created. Thus, the 
name of the ministry at the time was not the same as it is referred today.  
30 UNECE and FAO, Overview of the State of Forests and Forest Management in Georgia . 
31 The NFA was formally established in 2013, although its functions and activities have existed and been 
in operation since independence under various entities or structures.  WT/TPR/S/420 • Georgia  
 
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  4.39.   More recently, the MEPA has elaborated the Forest Code, which was adopted by Parliament 
in May  2020 and entered into force on 1  January  2021.32 The new law is based on internationally 
recognized principles, which aim to establish sustainable silviculture. Within the outline of the NFC, 
the Code redefines the term "forest" according to international standards, discards th e practice of 
long-term licensing of timber harvesting, recognizes new forms of forest property, and introduces a 
new system of categorization of forests. One of the significant changes was the initiative to put the 
non-timber resource extraction sector un der regulation. Most importantly, in practical terms, it 
prohibits the long -standing practice of persons obtaining firewood from forests (unless obtaining a 
ticket (permit)), directs all commercial felling through the NFA, establishes forest plantations, a nd 
puts the NFA in charge of distribution, price, quality, and marketing of wood/primary products.  
4.40.   In June 2021, the NFA established a new development strategy and action plan for the 
period  2021-26. The plan identifies a number of key goals and an annual action plan to achieve 
them. For example, developing forest restoration and maintenance were identified as areas to be 
improved. Other key areas include, inter alia, forest management, employee development, 
community awareness, multipurpose forest use, str engthening governance.33 
4.1.2.2   Production and trade  
4.41.   Georgia's forests have primarily been used to supply energy through firewood collected by 
local communities. This has been termed "social forest management" or "social cuts", whereby local 
populations are entit led to subsidized fuelwood from state forests for their energy needs.34 Thus, 
this dependence on forests for fuel has created challenges for sustainability and restoration efforts, 
and has led to illegal felling. Lack of forest inventory and management pla ns has also been an issue 
for the sector in recent years. However, with the adoption of the new Forest Code, a new stage of 
sectoral reform was initiated that aims to change the existing practice of social cuts. The forest 
sector reform envisages a new mec hanism for the sustainable provision of fuelwood and timber 
through NFA -operated Business Service Yards (BSYs) to support procurement, concentration, 
sorting, utilization, marketing, and distribution of wood. According to the new Code, social cuts will 
be phased out and prohibited from 2023, and the NFA will organize all timber production, sorting, 
storage, and selling of firewood through BSYs. The marketing or selling of wood is through electronic 
timber selling auctions.  
4.42.   The downstream industries stemming  from forestry consist of logging, sawmilling/processing, 
and production of goods such as furniture. Until full implementation of the new Forest Code, 
commercial logging is done by the private sector through short - or long -term licensing arrangements 
throu gh forest management bodies, and firewood is extracted by the local population. Georgia's 
downstream manufacturing sector tends to be highly vertically integrated as the logging companies 
that have licences tend to also have sawmills producing cut wood and  many also produce goods 
such as packaging or furniture. This structure is fostered or largely determined by Georgia's licensing 
regime that requires licence holders to conduct all primary processing in Georgia.35 Thus, Georgia 
has value -added exports of p rocessed or semi -processed wood products in lieu of timber. As a result 
of the implementation of the new Forest Code, the use of long -term licences is being phased out 
(until 2026 at the latest) in addition to the social cuts noted above (by 2023). Thereaf ter, all 
commercial logging will take place under the auspices of the NFA with commercial loggers becoming 
service providers and the use of BSYs for distribution and marketing. The logging sector has been 
characterized as inefficient as it uses outdated lo gging equipment with frequent break -downs and is 
 
32 Law on the Forest Code of Georgia.  
33 National Forestry Agency, National Forest Ag ency Development Strategy and Action Plan 2021 -26. 
Viewed at: https://forestry.gov.ge/Ge/Projects/Details/37?menuId=31 . 
34 World Bank (2020), South Caucasus: Armenia, Azerbaijan and Georgia – Private Enterprises in the 
Forest Sector . 
35 Primary processing includes planks, rods, poles, sleepers, friezes, parquet, firewood, plywood, etc. 
Resolution No.  608 of 31 October 2014 on Amendment to the Reg ulation No.  132 of 11  August  2005 on the 
Rules and Conditions for Issuance of Forest Use Licences. Another regulation, Resolution No.  46 of 
10 January  2014 on Rules of Timber Movement in the Territory of Georgia and Round Timber Technical 
Regulations for P rimary Processing Facilities (Sawmills), outlines the rules for the movement of timber in 
Georgia with an origin certificate.  WT/TP R/S/420 • Georgia  
 
- 110 - 
 
  also hampered by  access and transport issues. On the other hand, the sawmills and logging 
conducted through the NFA generally use more modern technology.36 
4.43.   In terms of border measures, there are no formal restrictions, however, due to the practices 
noted above with respect to licensing and required processing of timber in Georgia, there are 
essentially no, or limited, exports of unprocessed timber due to this requirement.37 As regards 
customs procedu res, there exists a requirement to submit a document to customs certifying the 
origin of the timber by the appropriate authority in order to export. Some species of trees or plants 
may also be restricted due to CITES, requiring a licence for export, for ex ample. However, Georgia 
does not have any certifying body nor private schemes that certify wood for export and has no plans 
to do so in the future.38 For imports, there are no prohibitions except as already noted regarding 
CITES. The average tariff on wood  products of HS Chapter 44 is 7.5%, and there is significant tariff 
escalation. There are no tariffs on imported unprocessed wood or raw materials, e.g.  fuel wood, 
charcoal, rough wood, but most semi -processed and finished goods of wood have a duty rate of  12%. 
Exceptions include plywood, fibreboard, particle board, packing cases, tableware, casks, and tools, 
which have zero rates of duty.  
4.44.   Over the last 20 years, a major shift occurred in wood production and trade. There was a 
steady decline in felled timbe r, a significant decrease in the export of unprocessed timber, and a 
significant increase in the importation of unprocessed timber, thus Georgia moved from being a net 
exporter to a significant net importer of wood raw materials. Major shifts commenced aft er Georgia 
gained independence when forest management, restoration, and wood processing declined 
significantly, and firewood became essential for the majority of the population for fuel. Illegally 
sourced wood and logging became widespread, leading to unsu stainability, and was facilitated by 
lack of controls.39 In the near term, these trends have continued with legal logging figures in decline, 
raw timber exports plummeting, and a significant, and growing, trade deficit in wood 
products  (Table  4.8). Most ex ports are semi -processed wood and wood products made of beech; 
these exports generally increased over the period. The major sources of imported unprocessed 
timber were Lithuania, Turkey, Latvia, and Ukraine. For processed wood exports, the leading 
markets were the Islamic Republic of Iran, Azerbaijan, and Armenia.  
Table 4.8 Forestry production and trade, 2015 -20 
 2015  2016  2017  2018  2019  2020  
Felled timber (cubic 
metre)  712,336  628,035  630,462  578,031  593,235  .. 
Imports (USD)        
 Fuel wood  398,030  486,369  541,325  751,536  576,809  507,280  
 Raw timber  4,058,335  3,043,091  4,019,395  5,448,089  5,015,870  3,091,703  
 Semi-processed  62,354,743  72,845,448  86,312,249  96,158,223  96,073,001  81,457,776  
 Processed  19,318,734  19,226,094  22,980,640  29,154,908  34,004,745  24,260,709  
Total 86,129,842  95,601,002  113,853,609  131,512,756  135,670,425  109,317,468  
Exports (USD)        
 Fuel wood  226,296  437,428  429,374  461,466  90,829  6,442  
 Raw timber  15,092  11,855  15,884  500 0 22,184  
 Semi-processed  16,239,465  17,893,651  25,322,800  22,501,533  22,968,976  17,037,277  
 Processed  1,701,492  8,530,385  11,776,685  11,286,336  12,443,786  15,912,771  
 Total 18,182,345  26,873,318  37,544,742  34,249,835  35,503,591  32,978,675  
Trade balance  
(USD)        
 Fuel wood  -171,734  -48,941  -111,951  -290,070  -485,980  -500,837  
 Raw timber  -4,043,243  -3,031,236  -4,003,511  -5,447,590  -5,015,870  -3,069,519  
 Semi-processed  -46,115,279  -54,951,798  -60,989,449  -73,656,690  -73,104,026  -64,420,498  
 Processed  -17 617 242  -10,695,709  -11,203,956  -17,868,572  -21,560,959  -8,347,938  
 Total -67 947 497  -68 727 684  -76 308 867  -97 262 921  -100 166 834  -76 338 793  
.. Not available.  
Source:  National Statistics Office of Georgia, Natural Resources of Georgia and Environmental Protection, 
2019; and UN Comtrade.  
 
36 World Bank (2020), South Caucasus: Armenia, Azerbaijan and Georgia – Private Enterprises in the 
Forest Sector . 
37 World Bank (202 0), South Caucasus: Armenia, Azerbaijan and Georgia – Private Enterprises in the 
Forest Sector . 
38 The high cost of certification and the lack of wood for export, given Georgia is a net importer of wood, 
are given as reasons for lack of pursuing certificati on. Information provided by the authorities.  
39 GIZ, Wood Market Study: Integrated Biodiversity Management, South Caucasus , December  2016. 
Viewed at: https://biodivers -south caucasus.org/uploads/files/5b45b2b4d8951.pdf .  WT/TPR/S/420 • Georgia  
 
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  4.2  Mining and Energy  
4.2.1   Mining  
4.45.   Georgia is rich in various metals, notably manganese, copper, and gold, and in construction 
materials such as stone.40 In 2020, mining (together with quarrying) accounted for 2%  of 
Georgia's  GDP compared to 1.2% in 2015 (Table 1.1). During the same period, exports and imports 
of mining products (excluding fuels) increased significantly, with copper ores and concen trates – one 
of Georgia's main export and import product categories – driving such increase (Table  A1.1).41 
In 2020, exports of mining products amounted to USD  892 million (or 26.7% of merchandise 
exports) compared to USD  322 million in 2015 (or 14.6% of merchandise exports), while imports 
increased from USD  300 million (or 4.1% of merchandise imports) to USD  684 million (or 8.5% of 
merchandise imports). Gold exports accounted for 3% of total goods exports. According to the 
authorities, mining employed abo ut 45,000  persons in 2020.  
4.46.   In 2020, copper ores and concentrates accounted for 87% of mining exports (or 23.3% of 
total merchandise exports), and 85% of mining imports (or 7.2% of total merchandise imports). 
Regarding exports, the authorities indicate that  while some of the exports of copper ores and 
concentrates are produced in Georgia, a large part originate in other countries and are imported into 
Georgia to be processed and subsequently re -exported .42 
4.47.   Georgia's mining legal framework is viewed as outdat ed and dispersed, but reform is 
ongoing.43 The main legal instruments governing the mining sector are the Law on Subsoil of  1996, 
the Law on Licences and Permits, and Resolution No.  136 of  2005 on Approval of the Regulation 
on Terms and Conditions for Gran ting a Licence for Extraction of Mineral Resources 
(Resolution  No. 136), and their amendments. The Law on Subsoil regulates property rights and 
obligations for mines, quarries, and groundwater, and contains the conditions for their  extraction 
and acquiring  licensing rights. Resolution No.  136 provides for the procedures and requirements for 
granting the mining licence referred to in the Law on Licences and Permits and the Law on Subsoil. 
This legislation is complemented by five other legal instruments (Tabl e 4.9) dealing with licensing 
procedures and fees, two of which were adopted during the review period.  
Table 4.9 Main legal instruments governing Georgia's mining sector, 2021  
Law Entry into force  Latest amendment  
Law on Subsoil  17 May 1996 15 July 2020 
Law on Licences and Permits  24 June 2005 17 July 2020 
Law on Licence and Permit Fees  12 August  2003 25 June 2020 
Law on Regulatory Fees  1 July 2005 24 June 2020 
Law on Fees for Use of Natural Resources  29 December  2004 15 July 2020 
Resolution No.  136 on Approval of the Regulation on Terms 
and Conditions for Granting a Licence for Extraction of 
Mineral Resources  11 August  2005 12 November  2020 
Order No.  2 by the National Agency of Mines on Approval of 
the Regulation on the Conduct of the Auction for the 
Issuance of a Mineral Use Licence, Determining the Starting 
Price for the Issuance of a Licence and the Rules for 
Paymenta 1 May 2018 9 July 2021 
 
40 European Bank for Reconstruction and Development (EBRD) (2018), Mining Sector Development 
Programme, Phase I Policy and Strategy: Status Report . 
41 The definition of mineral products follows the SITC definiti on, excluding fuels.  
42 Official data report these exports as domestic exports.  
43 EBRD (2018), Mining Sector Development Programme, Phase I Policy and Strategy: Status Report . WT/TP R/S/420 • Georgia  
 
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  Law Entry into force  Latest amendment  
Resolution No.  84 on Approving the Rule of Exercising State 
Control when Inspecting the Fulfilment of the Conditions of 
the Mineral Extraction Licence or the Mineral Exploitation 
Licence  16 February  2018 n.a. 
n.a. Not applicable.  
a Order No.  2 replaced Order No.  1 on Approval of the Regulation on the Conduct of an Auction for the 
Issuance of a Use Licence, Determining the Starting Price of the Use Licence and the Rules for 
Payment. Order  No. 1 was originally issued by the National Environment Ag ency and entered into 
force on 20  March  2017, and while it is not used any more, according to the authorities, it has not 
been revoked.  
Source:  Compiled by WTO Secretariat.  
4.48.   During the review period, the development of the mining sector and its reform becam e 
priorities for the Government.44 The reform was launched in 2018, and consists of three  phases: 
(i) policy development; (ii)  preparation and adoption of laws and regulations; and 
(iii) capacity -building and institution strengthening.45 The first phase wa s finalized in December  2019 
with the adoption of Georgia's first Mining Sector Strategy46, which includes the principles for 
modernizing the mining sector and achieving its long -term development.47 The second  phase was 
launched in June  2020 and is ongoing . Georgia is developing new legislation – the Mining Code – 
that is expected to be completed by the first trimester 2022. The new Mining Code will be based on 
the Mining Sector Strategy principles and objectives. According to the authorities, it will be mo re 
detailed than the existing Law on Subsoil, and include provisions on different licence categories, 
environment and social protection, geodata management, fiscal regime, health and safety, and 
dispute resolution.  
4.49.   At the institutional level, the National Agency of Mines (NAM), established in 2017 under the 
Ministry of Economy and Sustainable Development (MESD), is responsible for implementing the 
mining legislation and leading the sector's reform with the support of the European Bank for 
Reconstruction and  Development (EBRD) under the Georgian  Mining Sector Development Program.48 
Prior to 2017, these functions were the responsibility of the National Environment Agency under the 
MEPA. In 2018, Georgia also created an Interagency Steering Committee for Coordination of the 
Mining Sector Reform to monitor the performance of the mining strategy and ensure periodic 
reviews.49 
4.50.   According to the Law on Subsoil, the subsoil is the property of the State, and mining activities 
are permitted subject to a licence.50 Georgia currently administers two types of mining licences: 
one for exploration and extraction activities (i.e. mineral study/research and extraction licence) and 
one for extraction activities.51 The Law on Licences and Permits defines a third type of lic ence (for 
the use of underground space), but the authorities indicate that this licence has never been used 
and so will not be included in the new legislation. The duration of an extraction licence can be up to 
45 years for mineral resources for energy pur poses (Section  4.2.2), 40  years for ferrous and 
 
44 Government plans for the periods 2016 -20 (November 2016), 2019 -20 (September 20 19), and 
2021-24 (February 2021).  
45 EBRD (2019),  Laws in Transition 2019: Reforms Needed to Balance Benefits of Mining in Georgia . 
46 The Mining Sector Strategy was published in Decree No.  2575 of 9 December 2019. The Mining Sector 
Strategy builds upon the draft of the Mining Sector Policy, which was also completed during the first  phase 
(in March  2019). The difference between these two documents lies primarily in their objectives, which are 
defined in Resolution No.  629 of 20  December  2019.  
47 In 2018, the E BRD, which supports Georgia in the implementation of this reform, also published two 
policy papers to inform the reform process: one detailing the situation of the mining sector in the country and 
another on mining best practices.  
48 Resolution No.  565 of 2 7 December 2017 on the Establishment of a Legal Entity under Public Law – 
the National Agency for Mineral Resources.  
49 Information provided by the authorities; and Resolution No. 457 of 11  September  2018 on the 
Establishment of the Interagency Council for Coordination of Subsoil Reform and Approval of its Statute.  
50 Law on Subsoil, chapeau , paras.  1 and 10.  
51 Resolution No.  136 of 11 August 2005, Article  3; Law on Subsoil, Article  9; and Law on Licences and 
Permits, Article  7. WT/TPR/S/420 • Georgia  
 
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  non-ferrous minerals, and 30 years for construction material and other non -metallic minerals. 
Licences for the exploration of minerals may be granted for up to five years.52 
4.51.   Licences are granted as a general rule through online open auctions, where the highest bidder 
wins.53 Auctions are conducted through Georgia's auction website ( www.eauction.ge ).54 Information 
on the opening of an auction is published on the NAM's webs ite (www.nam.gov.ge ) and on 
Georgia's  auction website. As of September 2021, 23 sites were advertised for auction, four  mining 
licences had been granted, and another five were being processed, according to the authorit ies. 
Auctions can be organized at the initiative of the NAM  or following a licence application.55 Under the 
latter, a licence applicant shall submit its application to the NAM, together with information about 
the project. If the application is approved, th e information will be posted on the auction website and 
an auction will be announced and organized, for which any interested person can apply. Applicants 
may be natural or legal persons established in Georgia, a ministry or government agency of Georgia, 
or other organizational entities provided for by Georgian legislation.56 To participate, applicants must 
register on the auction website and submit their application and supporting documents (e.g.  receipt 
of payment of the licence fee). Registration is free of charge. If  the licence application refers to a 
territory that is under private ownership, the applicant requires the owner's consent for using the 
land. Foreigners can lease land but cannot own agricultural land.57 Companies holding an exploration 
licence that have found a mineral or metal in the licensed subsoil are automatically granted an 
extraction licence without any auction process provided an additional payment is made for the 
extraction licence.58 In addition, since February 2020 and with the vie w to facilitating vertical 
integration of mineral extraction and processing activities, Georgia has allowed holders of an 
extraction licence to lease a state -owned land plot for the whole term of the licence directly from 
the N ASP without participating in an additional auction.59 
4.52.   The NAM may also decide to conduct closed auctions for awarding an exploitation licence in 
case of national and/or public interest, or award it directly in very specific cases. Closed auctions 
are held in public.60 The authorities indicate that no closed auctions were held during the review 
period, and they are not envisaged in the near future. Activities that are not subject to licensing 
include: (i)  the extraction of therapeutical minerals, such as mud and underground mineral wate rs 
for external use for tourism and recreational purposes; and (ii)  mineral exploration for the purpose 
of geological, geophysical, or scientific research.61 
4.53.   The authorities indicate that no local capital or legal form requirements apply to foreign 
companies willing to participate in an auction.  
4.54.   There are three main types of fees/payments associated with a mining licence: the auction 
price, the regulation fee, and the fee for the use of natural resources (i.e.  royalty).62 The auction 
price of a licen ce is based on an initial auction price to which bidders add a fixed amount – called 
a step. The initial auction price varies with the type of the licence, but in each case for the licence 
 
52 Law on Subsoil, Article  10. 
53 Resolution No.  136 of 11 August 2005, Article  3; and EBRD (2018), Georgia Mining Sector 
Development Pro gramme, Phase I, Policy and Strategy: Status Report . 
54 Online auctions are held within a time limit set by the licensing authority, during which the interested 
persons who register electronically are given the opportunity to make a bid of the desired price  (Order No.  2 by 
the National Agency of Mines,  Articles 1, 7, and 13 -15). 
55 Resolution No.  136, Article  3. 
56 Law on Subsoil, Article  11. 
57 EBRD (2018), Georgia Mining Sector Development Programme, Phase I, Policy and Strategy: 
Status  Report . 
58 German Econo mic Team Georgia (2015), Removing Obstacles to Investment in Georgia's Mining 
Regulation , Policy Paper Series (PP/05/2015).  
59 Law on State Property, Article  36, as amended on 5 February 2020. The authorities further indicate 
that the processing of minerals  is subject to a permit (and not a licence) issued by the Ministry of 
Environmental Protection and Agriculture.  
60 Order No.  2 by the National Agency of Mines, Articles 1 -2 and 8.  
61 Information provided by the authorities; Law on Licences and Permits, Article  171; and Law on 
Subsoil, Article  6. 
62 The payments of these fees contribute to the budget of different recipients: the central Government 
(for the auction price), the NAM (for t he regulation fee), and the municipalities (for the fee for the use of 
natural resources). The Revenue Service is responsible for administering the fee for the use of natural 
resources, but payments are forwarded to municipal budgets. Information provided by the authorities.  WT/TP R/S/420 • Georgia  
 
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  to be awarded, the final auction price must be at least GEL  10,000.63 In addition to the auction price, 
a regulation fee and a fee for the use of natural resources must be paid after the issuance of the 
licence. These fees are paid on a quarterly and semi -annual basis, respectively; their amount is 
based on the approved e xploitation plan or the volume of minerals actually extracted if the volume 
exceeds the initial plan.64 Mining licences are also subject to an application fee (GEL  200).65 
4.55.   In terms of duties, t ariff protection is very low for the mining and metal sector.  In 2021, the 
simple average MFN rate applied was 4% for ores and other minerals and 0% for non -ferrous 
metals.66 The MFN applied rate for copper ores and concentrates is 0%.  
4.56.   Georgia provides some support to the sector through specific programmes and measures. For 
example, companies engaged in the production of metal products may benefit from credits loans at 
preferential rates and credit guarantees under the Industrial Compone nt of the Produce Georgia 
Program (Section  4.3). In addition, inputs used in the metal industry, such as ferrous and/or non -
ferrous scrap and waste, are exempted from VAT.67 Moreover, the exports of these inputs are subject 
to a customs service fee ranging  between GEL  10 and GEL  160 per tonne depending on the good 
(Section  3.2.2), which may affect their export volumes and decrease their domestic price.  
4.57.   The Government does not have any participation in mining companies, and in February  2020, 
it included mini ng deposits for auction under its 100 Investment Offers for Business Program 
(Section  2), under which investors benefit from simplified investment procedures.68 
4.2.2   Energy  
4.2.2.1   Overview  
4.58.   During the review period, the energy sector contributed on average 3% to the co untry's  GDP 
(Table  1.1). The sector is going through a transformation driven by the implementation of Georgia's 
commitments under the Association Agreement with the European  Union, as well as the Treaty 
Establishing the Energy Community.  
4.59.   Georgia's main pri ority is to increase energy security and gradually reduce its dependence on 
energy imports by increasing its production through the maximization of the use of internal resources 
and the promotion of investments in the sector.69 Georgia is also seeking to c reate a competitive 
environment and strengthen its role in the region as major oil and gas pipelines pass through its 
territory.70 
4.60.   Georgia's main sources of energy are natural gas (45% of its total energy supply in  2019), 
oil products (26%), and hydropower  (15%) (Chart 4.1).71 Hydropower is the leading domestic source 
of energy, while natural gas and oil products are almost entirely imported. The local production of 
natural gas and crude oil is viewed as negligible.72 
 
63 Order No.  2 by the National Agency of Mines, Articles 6 -7. 
64 If the volume of minerals extracted is lower than the volume described in the exploitation plan, the 
planned volume is used to calculate the fees.  
65 Law on Licence and Permi t Fees, Article  6. 
66 WTO Secretariat based on SITC classification.  
67 Tax Code, Article  172. 
68 National Agency of State Property. Viewed at: http://www.nasp.gov.ge/ . 
69 Georgia Government Plan 2016 -2020 adopted in Nove mber 2016, and Main Directions of the State 
Policy in the Field of Energy of Georgia, adopted on 14 June 2015.  
70 International Energy Agency (2020), Georgia 2020 Energy Policy Review . 
71 The International Energy Agency defines the total energy supply of a c ountry (previously known as 
total primary energy supply) as its energy production plus imports of primary and secondary energy, minus 
exports of primary and secondary energy, minus international bunkers, and plus or minus stock changes. 
International Energ y Agency, World Energy Balances, 2020 Edition: Database Documentation . Viewed at: 
https://iea.blob.core.windows.net/assets/4f314df 4-8c60-4e48-9f36-
bfea3d2b7fd5/WorldBAL_2020_Documentation.pdf . 
72 Draft National Sustainable Energy Action Plan of Georgia, 2019.  WT/TPR/S/420 • Georgia  
 
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  Chart 4.1 Total energy supply, 2015 -19 
 
Note:  Mtoe: million tonnes of oil equivalent.  
Source:  National Statistics Office of Georgia.  
4.2.2.2   Institutional and legal framework  
4.61.   During the review period, Georgia made various adjustments to its energy legal framework 
notably in the areas of electricity and gas in order to approximate its legislation to the EU  energy 
legislation as provided under its Protocol of Accession to the Tre aty Establishing the Energy 
Community73 and the Association Agreement with the European  Union (Article  300 and Annex XXV). 
This list of EU directives and regulations subject to approximation refers mostly to electricity, 
natural  gas, oil, and renewable ene rgy. 
4.62.   In 2019, Georgia adopted the Law on Energy and Water Supply (also known as the Law on 
Energy), which replaces the Law on Electricity and Natural Gas.74 The new law covers: (i)  the 
generation, transmission, distribution, supply, and trade of electricit y; and (ii)  the transmission, 
distribution, supply, storage, and trade of natural gas. It also provides the legal framework for the 
functioning of these markets in line with the EU directives and regulations. The Law also provides 
for the development of a concept model and rules for the markets of electricity and natural gas to 
guide their organization, and their gradual opening, which is ongoing (see below).75 These 
documents were adopted for the electricity market in April and August 2020. The market mode l 
concept entered into force in April 2020, immediately after its adoption, and the rules for the 
wholesale and retail markets in July  2021.76 The concept model for the natural gas market was 
adopted and entered into force in September 2021; the correspond ing rules are still under 
discussion.77 
4.63.   The oil sector is mainly governed by the Law on Oil and Gas, complemented by Order  No. 2 
on Approval of the National Regulations for Oil and Gas Operations. During the review period, the 
 
73 Georgia signed the Protocol on the Accession of Georgia to the Treaty Establishing the Energy 
Community on 14 October 2016.  
74 The Law on Electricity and Natural Gas was terminated on 27 December 2019.  
75 Law on Energy and Water Supply, Articles 159, 160, and 165.  
76 Resolution No. 246 of 16  April 2020 on Approval of the Concept of the Electricity Market Model; 
Resolution No. 46 of the Georgian Energy and Water Supply Regulator National Commission of 11 August 2020 
on Approving Electricity Market Rules; and Resolution No. 47 of the Georgian Energy a nd Water Supply 
Regulator National Commission of 13  August 2020 on Approval the Electricity Retail Market Rules.  
77 Resolution No.  447 of 2 September 2021 on Approval of the Concept of the Natural Gas Market Model.  
0.00.51.01.52.02.53.03.54.04.5
2015 2016 2017 2018 2019Chart 4. [GEO] Total primary energy supply (TPES)
Imports (net)
Domestic ProductionHydroDomestic 
productionBiofuel & waste Other Other Natural gas Oil productsImports 
(net)(Mtoe)
Source: International Energy Agency, Georgia 2020 Energy Policy Review.  WT/TP R/S/420 • Georgia  
 
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  Law on Oil and Gas was subjec t to changes mainly affecting the gas market and intended to improve 
transparency and foster competition, according to the authorities.  
4.64.   Other developments during the review period included the adoption of the Law on Energy 
Efficiency (May 2020), and other secondary legislation ensuring the approximation with 
EU legislation (Table 4.9). During this period, Georgia also developed various policy and strategy 
documents. For instance, in 2015, it adopted the Main Directions of the State Policy in the Field of 
Energy of Georgia, which defines the energy sector's vision and objectives.78 In 2019, it approved 
the Energy Strategy of Georgia 2020 -30, and also adopted its First National Energy Efficiency Action 
Plan (NEEAP), which provides for the investment and policy  measures to be carried out 
during  2019-20. 
Table 4.10 Main legal instruments governing Georgia's energy sector, 2021  
Legal instrument  Entry into force  
Law on Energy and Water Supply  20 December  2019 
Law on Energy Efficiency  21 May 2020 
Law on Oil and Gas  1 May 1999 
Law on Promoting the Generation and Consumption of Energy from Renewable 
Sources  20 December  2019 
Natural Gas Market Model Concept (approved by Resolution No.  447) 3 September  2021 
Electricity Market Concept Design (approved by Georgian National Energy and 
Water Supply Regulatory Commission (GNERC) Resolution No.  246) 16 April 2020 
Electricity Market Rules (approved by GNERC Resolution No.  46) 1 July 2021 
Electricity Retail Market Rules (approved by GNERC Resolution No.  47) 1 July 2021 
Security of Supply Rules on Electricity (approved by MESD Order No.  1-1/520)  2 December  2020 
Unbundling Plan of Electricity Transmission System Operators (approved by 
Resolution No.  682) 13 November  2020 
Certification Rules for Transmission System Operators (approved by 
Resolution  No. 9 of 27  March  2020)  31 March  2020 
Order No.  2 on Approval of the National Regulations for Oil and Gas Operations 
issued by the State Agency of Oil and Gas (SAOG)  .. 
.. Not available.  
Source:  Information provided by the authorities.  
4.65.   The M ESD has been responsible for defining and formulating Georgia's energy policy 
since 2017, when the Ministry of Energy was dissolved and merged with the MESD. Other institutions 
playing a key role in the energy market are the Georgian National Energy and Water Supply 
Regulatory Commission (GNERC) and the State Agency of Oil and Gas (SAOG). The GNERC is 
Georgia's regulatory entity for the supply of electricity, natural  gas, and water. It is responsible for 
implementing the sector's regulations, including issuing licences, setting tariffs, and resolving 
disputes between customers and companies in these markets. Tariffs are calculated in accordance 
with international best  practice. The SAOG, within the  MESD, is responsible for oil and gas 
operations, organizing tenders and auctions, issuing licences, and monitoring their implementation 
and contractual obligations.  
4.66.   The Government continues to have a significant presence in the energy sector through SOEs. 
As at September 2021, according to the authorities, seven partially or fully state -owned companies 
operated in this sector, all managed by the MESD: (i)  JSC Georgian State Electrosystem; (ii)  JSC 
Electrosystem Commercial Ope rator; (iii)  JSC Georgian Oil and Gas Corporation; (iv)  JSC Georgian 
Energy Development Fund; (v)  JSC Sakrusenergo; (vi)  LLC Enguhesi; and (vi) LLC Georgian Gas 
Transportation Company.  
4.2.2.3   Electricity  
4.67.   Most of Georgia's electricity is generated by hydropower, w hich in 2019 ensured about 76% 
of the country's electricity needs, the rest being generated by natural gas.79 In that year, 
 
78 The Main Directions of the State Policy in the Field of Energy of Georgia was adopted on 
14 June 2015.  
79 International Energy Agency, Statistics . Viewed at: https://www.iea.org/ . WT/TPR/S/420 • Georgia  
 
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  88 hydropower plants operated in the country80 and together had an installed capacity 
of 3,342  MW.81 Due to Georgia's vast river network, it is estimated that the country could have the 
capacity to generate 15,000  MW .82 
4.68.   Electricity production fluctuates between seasons, peaking during spring and summer when 
consumption decreases thus creating an excess o f production, which is exported. In winter, the 
opposite happens and to meet demand, local production is compensated by electricity imports.83 
During 2015 -20, exports of electricity totalled on average USD  17.4 million (or 0.6% on average of 
total exports)  and imports USD  58.5 million (or 0.7% on average of total imports). Exports were 
destined mainly to Turkey (which captured on average 60.7% of electricity exports), Armenia (23%), 
and the Russian  Federation (15.4%), while imports came mainly from Azerbaij an (which accounted 
on average for 61.4% of electricity imports) and the Russian  Federation (30.6%).84 
4.69.   During the review period, Georgia implemented various changes affecting, inter alia , the 
electricity market structure and licensing system to align its l egislation under that of the 
European  Union as provided under the Treaty Establishing the Energy Community and their 
Association Agreement. Such reform included the creation of an electricity exchange market and the 
unbundling (i.e.  separation) of transmis sion and distribution activities from production/supply 
activities among electricity operators with the view of ensuring access to the electricity network, and 
promoting competition. The overall implementation is ongoing, and Georgia is viewed as having 
made significant progress.85 According to the authorities, the unbundling process of distribution and 
production/supply activities among electricity operators was completed in July 2021.  
4.70.   Participation in the electricity sector and tariffs are regulated by th e GNERC. Companies willing 
to conduct activities in the electricity sector require a licence issued by the GNERC, with some 
exceptions. As of September 2021, and as a result of the ongoing reform, there were four types of 
licences: generation, transmission , distribution, and market operator.86 In 2019, Georgia introduced 
the market operator licence and abolished the dispatch licence, with dispatching activities now being 
covered under the transmission licence.  
4.71.    Changes under this reform are also reflected i n the current market structure, which consists 
of multiple generation plants, one transmission company, two generation companies, and 
two companies holding a market operator licence (Box 4.3). Since 1  July 2021, JSC Georgian State 
Electrosystem (GSE), a st ate-owned company, is the only company holding a transmission licence 
and is the single Transmission System Operator in Georgia. Prior to this date, two companies, 
including GSE, held a transmission licence.87 Electricity transmission and dispatching activ ities, and 
to a lesser extent production, are dominated by state -owned companies.  
4.72.   The licence requirement for generation activities is waived for power plants generating less 
than 15  MW. A generation licence is awarded based on an application process. Elec tricity importers 
and exporters are not subject to any licence requirement but must register with the 
Electricity  System Commercial Operator (ESCO) (see below).88 
 
80 Of the 88 hydropower plants, 62 are "small", generating less than 13 MW. Georg ia has also one wind 
power plant and five thermal power plants. National Statistics Office of Georgia, Energy Balance of 
Georgia  2020. 
81 National Statistics Office of Georgia, Energy Balance of Georgia 2020 . 
82 OECD (2019), Sustainable Infrastructure for Lo w-Carbon Development in Central Asia and the 
Caucasus: Hotspot Analysis and Needs Assessment, Green Finance and Investment . 
83 Draft National Sustainable Energy Action Plan of Georgia, 2019.  
84 WTO Secretariat based on National Statistics Office of Georgia d ata. 
85 Energy Community Secretariat, Annual Implementation Report 2020 , 1 November 2020.  
86 Law on Licences and Permits, Article  6. In 2019, the dispatching licence ceased to exist, and the 
market operator licence was introduced. Since then, dispatch activi ties have been covered by the transmission 
licence and are not under a separate licence.  
87 MESD (2021), Georgia Security of Supply Statement in Electricity Sector, 2021 . 
88 Law on Energy and Water Supply, Articles 11 and 102.  WT/TP R/S/420 • Georgia  
 
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  Box 4.3 Electricity market structure, 2021  
Generation:  Twenty -one companies hold a generation licence, of which two state -owned plants – Engurhesi 
and Vardnilhesi – generated almost half of the country electricity production.  
Transmission:  One company holds a tr ansmission licence: JSC Georgian State Electrosystem (GSE) (a state -
owned company). Since 1  July 2021, GSE is the single Transmission System Operator operating in Georgia.  
Distribution: Two companies hold a distribution licence: JSC Telasi (a majority foreign -owned company that 
became an entirely private company in 2020)89, and JSC Energo -Pro Georgia (a foreign -owned company).  
Wholesale market: Two companies hold a market operator licenc e: the Georgian Energy Exchange, which 
conducts day -ahead and intra -day market operations, and GSE, which operates the balancing and ancillary 
markets.  
Source:  Information provided by the authorities.  
4.73.   Regarding the wholesale market, electricity trade is b ased on direct contracts between sellers 
and buyers. Sellers are represented by electricity generators, and importers and buyers by 
distribution licence holders, exporters, direct customers, and dispatchers. Under this market 
organization and pending the f ull implementation of an electricity exchange market, ESCO, a 
state-owned company, is the electricity market operator, and as such it is responsible for ensuring 
the stability of the market by purchasing and selling on a monthly basis the difference betwee n the 
estimated volumes of the direct contracts and the actual consumption, including through exports 
and imports.90 In 2020, contracts by ESCO accounted for about 24%  of the total electricity trading.91 
To participate in the electricity wholesale market, companies must register with ESCO as a qualified 
enterprise.92 
4.74.   With the implementation of the market model concept of  2020, the current organization of 
the wholesale market will change and be replaced by a  real-time energy market with the view to 
improving  transparency and efficiency in the operation of the electricity trading market. In 
accordance with the market model concept, Georgia established in 2019 the Georgian Energy 
Exchange that will, inter alia , operate a day -ahead market, while GSE will operate  a balancing and 
ancillary services market (Box 4.3).93 Both the day -ahead and balancing and ancillary services 
market are currently in the testing phase but are expected to open on 1  January  2022, according to 
the authorities. Under this new market model, ESCO shall not trade in electricity but have other 
functions94, e.g. providing wholesale public services to help power plants to integrate into the new 
market model, and providing financial support under certain conditions to power plants participat ing 
in the day -ahead market.  
4.75.   The GNERC set the tariffs for electricity generation, transmission, and distribution, with some 
exceptions. Tariffs for electricity generation are unregulated for hydropower plants built after 
1 August  2008, and for hydropower plants built before this date generating less than 15  MW. In 
accordance with the market model concept of  2020 (Article  12 and Appendix 1),  tariffs for 
hydropower plants built before 1  August  2008 with a capacity not exceeding 50  MW will also become 
unregul ated from 2021 onwards. The condition on the capacity will increase gradually over a period 
of seven years to reach 120  MW, so that only tariffs for those plants built before  2008 with a 
capacity  greater than 120 MW will be regulated. Tariffs are establish ed in accordance with 
GNERC  Resolution  No. 33 on Electricity Tariffs of 2008, last amended in 2019. According to the 
authorities, once fixed, tariffs may be adjusted only when the analysis of the company's annual 
report shows that the adjustment amount equ als or exceeds plus or minus  10% of the expected 
revenue. At the retail level, residential tariffs are also regulated and are considered to be 
 
89 In 2020, the state -owned company JSC Partnership Fund sold its the shares of JSC Telasi 
(approximately  24.5%) to a private company.  
90 MESD (2021), Georgia Security of Supply Statement in Electricity S ector, 2021 . 
91 Information provided by the authorities.  
92 Qualified enterprises are defined in Article  3 of the Electricity (Capacity) Market Rules (Order  No. 77 
by the Minister of Energy of 30 August 2006), which remain in force during the transitory peri od, and until the 
new market rules come into force. The definition includes, inter alia, generation licensees, direct consumers, 
exporters, importers, and electricity wholesale suppliers.  
93 Georgian Energy Exchange (2020), The First Year . 
94 Resolution No. 246 of 16  April 2020 on Approval of the Concept of the Electricity Market Model.  WT/TPR/S/420 • Georgia  
 
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  cross-subsidized through higher prices charged on industrial and commercial consumers.95 
Since  2020, wholesale an d retail tariffs are set for a period of five years, so that the current tariffs 
are valid for the period 2021 -25.96 Following an increase in the fees for residential consumers for 
this period, the Government announced that it will cover the increased elec tricity fees for households 
whose electricity consumption is lower than 300 kWh of electricity per month in 2021. It will also 
subsidize 50% of the increase in the electricity tariff for all primary food processing companies.97 
4.76.   The authorities indicate tha t are no restrictions to foreign investment in electricity generation 
and distribution activities.  
4.77.   Georgia is also expecting to build an additional 1140  km of power transmission lines by  2024 
to further develop transit trade.98 
4.2.2.4   Natural gas  
4.78.   Natural gas is Georgia's main source of energy supply. In 2019, it accounted for 45% of the 
country's total energy supply, almost the same as in 2015 (44%) (Chart 4.1). Almost all natural gas 
is imported, as local production is minimal, accounting for abou t 0.2% of demand.99 During the 
review period, imports of natural gas totalled on average USD  320 million, or 3.9% of total 
imports.100 Most imports of natural gas were sourced from Azerbaijan (87.2% on average), and to 
a lesser extent from the Russian  Feder ation (10.9%).  
4.79.   Activities in the sector are subject to a licence issued by the GNERC or the SAOG depending 
on the activity. A licence is primarily required for: (i)  exploration; (ii)  extraction; (iii)  processing; 
(iv) distribution; (v)  transmission; and (v i) transportation. These activities are grouped according to 
two licence categories: a general licence for use of oil and gas resources and an activity licence. The 
general licence for the use of oil and gas resources covers exploration and extraction acti vities, while 
an activity -specific licence is required for other types of activities.101 The GNERC is responsible for 
issuing the licences for distribution and transmission, while the SAOG issues the licences for the 
remaining activities. The licences for g as distribution, transmission, transportation, and processing 
are granted based on an application by the interested party where anyone can apply, while the 
licences for exploration and extraction activities are awarded following an open international tende r. 
In 2019, Georgia established another three licences to be administered by the GNERC: storage 
system operation, liquefied natural gas equipment operation, and market operation.102 As in the 
case of electricity, Georgia shall conduct various reforms to com ply with its obligations under the 
Treaty Establishing the Energy Community and the Association Agreement with the European  Union. 
The reforms include the unbundling of transmission and distribution activities, and the creation of 
an exchange gas market. I mplementation of the obligations is ongoing but is less advanced than in 
the electricity sector.103 
4.80.   Importers of natural gas do not require a licence. In 2020, according to the authorities, there 
were three importers of natural gas: JSC Georgian Oil and Gas  Corporation, State Oil Company of 
Azerbaijan (SOCAR) Georgia Gas LLC, and Georgian International Energy Corporation.  
 
95 OECD (2018), Inventory of Energy Subsidies in the EU's Eastern Partnership Countries . 
96 New tariffs came into effect from 1 January 2021 and will be valid until 31 December 2025. 
Until 2017, tariffs were fixed for one year for each utility, but after this date tariffs were for longer periods of 
time, initially for a period of three years for  electricity generation, dispatch, transmission, and distribution 
licensees, and since 2020 for a period of five years for transmission and distribution licensees for the 
period  2021-25. 
97 Agenda.ge, PM Gakharia: "Gov't Will Cover Increased Electricity Fee s for Households which Consume 
Less than 300 kWh in 2021" , 29 December 2020. Viewed at: https://agenda.ge/en/news/2020/4058 . 
98 Georgia Government Plan 2020 -24. 
99 MESD (2021), SoS Statement for Natural Gas  2021. 
100 WTO Secretariat based on National Statistics Office of Georgia data.  
101 Law on Licences and Permits, Articles 6 and 7; Law on Oil and Gas, Article  1; and information 
provided by the authorities.  
102 Law on Licences and Permits, Articles 6 and 7; and information provided by the authorities.  
103 Energy Community Secretariat, Annual Implementation Report 2020 , 1 November 2020; and GNERC, 
Annual Report 2020 . WT/TP R/S/420 • Georgia  
 
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  4.81.   The structure of the natural gas market is highly concentrated and is dominated by foreign -
owned companies, namely companies affiliated wi th SOCAR.104 At the wholesale level, natural gas 
is traded only between wholesale importers of natural gas and retailers or consumers through 
bilateral agreements. At the retail level, suppliers of natural gas sell directly to end users. A supplier 
can oper ate in both the retail and wholesale markets. In 2020, 34  suppliers operated in the natural 
gas market. Of these one was a wholesale supplier, 23 were retail suppliers, and 10 operated in 
both markets.105 Imports of natural gas are primarily based on long -term contracts (i.e.  valid 
until 2026 and 2068) with Azerbaijan, under which Georgia receives natural gas at a preferential 
rate. GOGC, a state -owned company (see below), has the exclusive right to purchase natural gas 
delivered through import contracts wit h Azerbaijan. All the natural gas bought by GOGC is sold 
to SOCAR Gas Export -Import (a SOCAR subsidiary) for distribution in Georgia based on a purchase 
agreement concluded in 2011 and valid until 2030 with Azerbaijan.106 
4.82.   The GNERC determines the prices for  natural gas supply, transmission (except transit), and 
distribution, and for the residential sector in accordance with GNERC Resolution No.  33 on Approving 
Natural Gas Tariff Setting Methodology of 2014.107 At the retail level, non -residential prices are 
unregulated and determined by the market. The Government subsidizes natural gas for the 
residential sector, and there is no cap in the volume supplied to each household. In 2017, these 
subsidies were estimated to account for 4.6% of total budget spending.108 Natural gas is subject to 
VAT and excise tax (Section 3).  
4.83.   Two state -owned companies operate in the sector and have important roles: GOGC and the 
Georgian Gas Transportation Company (GGTC). GOGC is the owner of the country's main gas 
pipeline system, and t he GGTC is a transportation licensed company that operates the main pipelines 
in the country and conducts transit activities.109 
4.84.   Under the ongoing reform, the launch of a new market structure and completion of a natural 
gas trading platform are expected by 2023.110 
4.2.2.5   Oil products  
4.85.   Oil products accounted on average for about one fourth of Georgia's energy supply (26%) 
during the review period (Chart 4.1). Their supply relies almost entirely on imports, as Georgia's 
crude oil production is negligible.111 As a result, oil products rank as the second -largest source of 
energy imported by Georgia after natural gas. In 2020, imports totalled about USD  499 million 
(or 6.2% of totalled imports in 2020), compared to USD  657 million in 2015.112 Imports consisted 
mainly of motor gasoline and diesel, and came from the European  Union (primarily Romania, 
Bulgaria, and Greece), the Russian  Federation, and Azerbaijan.113 
4.86.   Due to its location, Georgia serves as transit corridor for oil transportation. It operates 
two oil pipelines: the Western Route Export Pipeline (WREP) and the Baku -Tbilisi -Ceyhan  (BTC) 
Pipeline, which is considered to be among the longest in the world. Most of the oil transported is 
produced in Azerbaijan, and transits to Turkey. Kazakhstan and Turkmenista n also use these 
pipelines to transport their oil. Transit trade also takes place by rail and through seaports. Georgia 
has four big oil terminals: Batumi, Poti, Kulevi, and Supsa.114 
 
104 MESD (2021), SoS Statement for Natural Gas 2021 . 
105 Information provided by the authorities.  
106 Energy Community Secretariat (2017), Energy Governance in Georgia, Report on Compliance with 
the Energy Community Acquis , July 2017.  
107 GNER Resolution No. 33 of 25  December  2014 on Approving Natural Gas Tariff Setting Methodology.  
108 International Energy Agency  (2020), Georgia 2020 Energy Policy Review .  
109 MESD (2021), SoS Statement for Natural Gas 2021 . 
110 International Energy Agency (2020), Georgia 2020 Energy Policy Review .  
111 MESD (2019), Security of Supply Oil Sector 2019 . According to the MESD,  crude oil pr oduced in 
Georgia accounts for 2% of oil products supply.  
112 National Statistics Office of Georgia, External Merchandise Trade of Georgia , 2015 and 2020 
(preliminary) (figures for petroleum and petroleum oils).  
113 National Statistics Office of Georgia (2019) , Supply and Consumption of Oil and Oil Products, 2019 ; 
and MESD (2019), Security of Supply Oil Sector 2019 . 
114 Energy Community Secretariat (2017), Energy Governance in Georgia, Report on Compliance with 
the Energy Community Acquis , July 2017; and MESD (2019), Security of Supply Oil Sector 2019 . WT/TPR/S/420 • Georgia  
 
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  4.87.   Activities in the oil sector are regulated through a licensing system. The legislation 
distinguishes two type of licences: a general licence for use of oil (and gas) resources and an activity 
licence. Both type of licences are issued by the SAOG. The gener al licence for the use of oil (and 
gas) resources covers exploration and production/extraction activities, while the activity licence 
covers oil refining and transportation activities.115 General licences for the use of oil resources are 
granted through ope n international tenders; activity licences are granted based on an application by 
the interested party. Any interested company – local or foreign – may participate in a tender for a 
general licence or apply for an activity licence. The licence will be gran ted provided all requirements 
are met. The import of fuel is not subject to licensing.116 According to the authorities, as 
at September  2021, 13  companies held a licence to conduct exploration activities, of which 
eight were also producing oil; another two companies held refinery licences. Wholesale and retail 
activities in the oil sector were dominated by five companies.117 
4.88.   GOGC, the national oil company, is the only Georgian state -owned company operating in the 
sector. Its main oil activity is transportatio n, but it is also engaged, although to a lesser extent, in 
upstream activities.  
4.89.   Prices of oil products are not regulated, and oil is imported in general at market price.118 In 
addition to VAT, oil products are subject to excise taxes (Section 3). In 2021, t he average MFN tariff 
is zero for petroleum products.119 
4.3  Manufacturing  
4.90.   Georgia's manufacturing sector continues to play an important role in the economy. 
During  2015-20, it accounted on average for 10% of GDP, with food products and beverages being 
the bigg est contributo r. In 2020, food products and beverages accounted for 45% of the country's 
total manufacturing production , followed by non -metallic mineral products (13%) and basic 
metals  (13%) (Table A4. 1).120 
4.91.   Manufactured products are also an important comp onent of the country's trade portfolio. 
In 2020, exports of manufactured products excluding re -exports accounted for 26.2% of total 
exports (USD  630 million), and for 41.3% (USD  1,382 million) including re -exports. Imports of 
manufactured products captured  64.2% of total imports (USD  5,169 million), making Georgia a net 
importer of these products (Section 1). Georgia' s main manufacturing domestic exports (exports 
excluding re -exports) were iron and steel goods (mainly ferro -alloys) (11.3% of 
merchandise  exports), chemicals (6%), and clothing (3.5%), and its main imports consisted of 
transport  equipment (13.3% of total merchandise imports), chemicals (13%) , and electrical 
machines  (7.3%).121 
4.92.   Re-exports account for a significant part of the total exports of manufacturing products. 
During 2015 -20, on average half of the exports of manufactured products were re -exports, mostly 
driven by vehicles (used and new). Georgia's participation in manufacturing value chains remains 
limited (Section 1).  
4.93.   Georgia does not h ave an industrial policy per se  but maintains a broad economic policy, 
which seeks , inter alia , to attract investments and support the private sector, notably SMEs, while 
promoting directly or indirectly the production of certain manufacturing goods.122 Georgia's economic 
 
115 Law on Licences and Permits, Articles 6 and 7; and Law on Oil and Gas, Articles 1, 81, 151, and 255. 
116 MESD (2019), Security of Supply Oil Sector 2019 . 
117 MESD (2019), Security of Supply Oil Sector 2019 ; and information provided by the authorities.  
118 International Energy Agency (2020), Georgia 2020 Energy Policy Review . 
119 WTO Secretariat based on SITC definition.  
120 Production figures on manufacturing are based on NACE (Rev. 2 ) class ification, and trade figures on 
manufacturing are based on SITC classification.  
121 WTO Secretariat based on SITC classification. Under SITC, food (processed and unprocessed) and 
beverages are classified under agriculture.  
122 Georgia's strategies on investmen t and SMEs are detailed in the Georgia 2020 Strategy (Section 2.4) 
and the National SME Development Strategy 2016 -20, which was adopted in 2018 , and implemented by  
the MESD . WT/TP R/S/420 • Georgia  
 
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  policy is defined and implemented by the MESD.123 In its mission, the MESD is supported  by 
Enterprise Georgia  and other institutions . 
4.94.   During the review period and in accordance with its economic policy, the Government 
maintained various type s of programmes to support businesses  (Section 3.3.1.1). These 
programmes are in general administered by Enterprise Georgia, and some have a sectoral 
component, and were adjusted during the review period in response to the COVID ‑19 pandemic. Of 
these progr ammes, two are designed to specifically promote and support certain 
industrial/manufacturing activities: one falls under the Produce in Georgia Program , and the other 
is a credit guarantee mechanism launched in 2019. In both cases, beneficiaries of these p rogram mes 
must operate in one of the priority sectors of activity identified by the authorities. Under the 
industrial component of the Produce in Georgia  Program , Georgia provides  financial support in the 
form of co -financing of interest rates and a credit  guarantee to companies operating in one of the 
Program's list of industrial activities124, which include the manufacturing of paper and paperboard, 
metal products, chemicals, rubber and plastics, textiles , and electrical equipment. A new version of 
this in dustrial component will enter into force in 2022 and replace the current one. In  2019, 
Enterprise Georgia also introduced a credit guarantee mechanism with a view to improving the 
access to finance for SMEs operating in certain industrial and services sect ors, e.g. manufacturing 
of food, textiles, plastics , and pharmaceuticals (Section  3.3.1).125 
4.95.   The Government also support s certain manufacturing activities through the JSC Partnership 
Fund and the LLC Industrial and Regional Development Company, both state -owned companies. The 
JSC Partnership Fund promotes investment in Georgia by co -financing up to 50% of the project's 
total equity at the initial stage of development. The programme targets commercially profitable 
projects in priority sectors , namely agri culture , energy, manufacturing, logistics, and real estate and 
tourism.126 The LLC Industrial and Regional Development Compan y (created in 2017) is responsible  
for, inter alia , designing industrial development projects and conducting feasibility studies to 
contribute to the development of Georgia's industrial sector. Its work currently includes projects for 
the production of con struction materials  and of milk powder , citrus and fruit processing, and sewing 
and textile factories.127 
4.96.   Georgia also maintains free industrial zones  (FIZs) , which provide various types of tax benefits 
to the enterprises located within them (Section 3.2.4) . As at September 2021, four FIZs operated 
in Georgia.  
4.97.   Tariff prote ction for manufacturing is low, with an average MFN tariff of 0.6% in 2021.128 
Most manufactured products enter duty -free in the Georgian market ; exceptions include wood, 
plastic, iron and s teel products, and vehicles, which  account for about 5% of the total number of 
tariff lines (479 lines). Of the dutiable manufacturing lines, vehicles and u ndenatured ethyl alcohol 
were subject to non-ad valorem duties. For vehicles, the tariff is a functi on of the age and engine 
capacity of the vehicle (Section  3.1.3), and for u ndenatured ethyl alcohol, the tariff is a specific duty . 
4.98.   Georgia requires a licence or permit for the production and trade of certain manufactured 
products, in most cases based on s ecurity and health considerations (Section 3). Products subject 
to a production licence or permit are: (i) baby and child food products ; (ii) biological pesticides ; 
(iii) military weapons and goods ; (iv) non-military weapons, ammunitions, and major elements of 
ammunitions and firearms ; (v) electronic means of surveillance ; (vi) metrological and measuring 
tools; (vii) seals and stamps (permit) ; and (viii) pharmaceuticals (i.e. therapeutic agents except for 
narcotics) (permit).129 Some of these products are also subject to import  and export  licence s, 
 
123 The MESD is also responsible for implementing the Association Agreement with the  European  Union, 
which includes provisions on cooperation between the parties in the areas of industrial and enterprise policy 
and mining (Articles 313 -315).  
124 The complete list of activities is provided in Annex 1 to Resolution No.  365 of 30 May 2014 and its 
amendments.  
125 The complete list of priority activities under the Credit Guarantee Scheme is contained in Annex 1 to 
Resolution No.  163 of 29 March 2019, and its amendments.  
126 JSC Partnership Fund. Viewed at: www.fund. ge. 
127 LLC Industrial and Regional Development Company . Viewed at:  https://girdc.gov.ge/en/project/31 . 
128 WTO Secretariat based on SITC definition.  The manufactured product with the highest rate is ethyl 
alcohol, which is subject to a specific rate and whose estimated AVE was 33.6% in 2021.  
129 Law on Licences and Permits, Articles 6 and 24.  WT/TPR/S/420 • Georgia  
 
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  e.g. weapons,  and electronic means of surveillance. The complete list of goods subject to an import 
and/or export licence  or permit is presented in Table A3.4.  
4.4  Services  
4.4.1   Financial servi ces 
4.99.   The financial sector (Table 4.11) has assets of about USD  18 billion (108% of GDP) and is 
dominated by banks, which account for 94% of the financial sector's assets.130 Non-bank institutions 
operating in the financial sector include exchange bureaus, cr edit unions, microfinance 
organizations  (MFOs), stock exchanges, insurance companies, pension schemes, and loan issuing 
entities. An important objective of government policy in recent years has been to improve the 
efficiency of bank and non -bank financial intermediation to increase and diversify access to finance 
for business development.131 
Table 4.11 Financial institutions, 2015 -20 
    2015  2016  2017  2018  2019  2020  
Number of commercial 
banks  unit  19 16 16 15 15 15 
Of which foreign controlled  unit  18 14 15 14 14 14 
 per 100,000 inhabitants  0.5 0.4 0.4 0.4 0.4 0.4 
Branches  unit  125 143 134 135 149 160 
Service centres  unit  827 826 847 792 835 765 
Authorized capital of 
commercial banks  GEL million  1,070  1,019  996 1,083  1,032  1,108  
Equity capital of 
commercial banks  GEL million  3,513  3,978  4,435  5,132  5,745  5,848  
Exchange bureaus  unit 1,115  1,200  1,127  1,018  844 791 
 per 100,000 inhabitants  30 32 30 27 23 21 
Credit unions  unit 17 15 11 8 2 1 
Microfinance organizations  unit 69 80 75 67 48 40 
Stock exchanges  unit 2 2 2 2 2 2 
Insurance companies  unit 14 14 16 17 17 18 
Pension schemesa unit 5 3 4 5 5 5 
Loan issuing entities  unit         204 198 
a Pension Agency and Schemes; since August 2018 including LEPL – Pension Agency.  
Source:  Information provided by the authorities.  
4.4.1.1   Banking  
4.100.   The banking sector currently consists of 15 commercial banks, compared with 19 in 2015132, 
of which 14  are foreign -controlled (Table 4.1 1). Non -resident banks operate through subsidiaries, 
which may have several branches, but there are no direct branches of foreign banks, according to 
the authorities.  Four of the five largest banks are almost fully owned by foreign beneficial owners.133 
There are no state -owned banks in Georgia. The banking sector is highly concentrated, as the two 
largest banks account for nearly three  quarters of lending.134 Banks are adequately capitalized and 
liquid (Table 4.12), and profitability, which was high before the COVID ‑19 crisis, but dropped sharply 
in 2020, recovered in early  2021.135 However, the banking sector continues to be marked by a 
 
130 IMF (2021), Georgia: Financial System Stability Assessment,  IMF Country Report  No. 21/216, 
pp. 11, 14. 
131 For example, Government of Georgia (2014), Social -economic Development Strategy of Georgia: 
Georgia  2020, pp. 60-65. 
132 JSC TBC Bank; JSC Bank of Georgia; JSC Liberty Bank; JSC Basisbank; JSC VTB Bank – (Georgia ); 
JSC Cartu Bank; JSC ProCredit Bank; JSC Silk Road Bank; JSC Ziraat Bank Georgia; JSC Isbank Georgia; 
JSC TeraBank; JSC Halyk Bank Georgia; JSC PASHA Bank Georgia; JSC Finca Bank Georgia; and JSC Credo 
Bank. NBG, Banking Institutions Licensed in Georgia.  Viewed at: 
https://old.nbg.gov.ge/index.php?m=403%20sinl . There have been three merger cases in the banking sector 
since 2015. Information provided by the authorities.  
133 More specifically, as 3 1 December 2020, up to 85% of equity capital and about 86% of assets of the 
largest five banks were owned by non -resident beneficial owners. Information provided by the authorities.  
134 IMF Country Report No.  21/216, p. 16.  
135 IMF Country Report No. 21/216, pp.  14-15, 20 -22. WT/TP R/S/420 • Georgia  
 
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  high degree of dollariz ation of assets and liabilities (Table 4.12), which the IMF regards as the key 
financial sector vulnerability in Georgia.136 
Table 4.12 Selected financial soundness indicators, banking sector, 2015 -20 
(%) 
 2015  2016  2017  2018  2019  2020  Notes  
Deposit dollarization 
(residents and non -
residents in % total 
of deposits)  69.4 71.3 65.6 63.1 64.1 61.5 Includes only deposits in 
banking system, without 
interbanks.  
Deposit dollarization 
(residents, in %)  64.0 67.5 60.4 58.4 59.2 56.8 Includes only deposits in 
banking system, without 
interbanks.  
Loan-to-deposit ratio  1.04 1.04 1.07 1.11 1.17 1.08 Includes only loans and 
deposits in banks.  
Credit -to-GDP ratio  51.1 57.6 58.5 63.8 68.3 .. Includes loans issued by 
banks, MFOs, and loan 
issuing entities, also local 
bond issues.  
CET 1 ratio  12.0 10.5 13.6 13.3 12.8 11.0   
Tier 1 ratio  12.0 10.5 13.8 13.5 14.6 12.8   
Total capital 
adequacy ratio  16.7 15.1 18.9 18.4 19.4 17.6   
LCR 120.8  119.2  129.6  125.5  129.0  143.6    
NSFR  .. .. .. .. 129.3  130.7    
Non-performing 
loans (NPLs) (in % 
of total loans)  7.5 7.3 6.0 5.6 4.4 8.4 National definition: NPLs 
are defined as loans in 
substandard, doubtful, 
and loss loan categories.  
Non-performing 
loans (in % of total 
loans)  2.7 3.4 2.8 2.7 1.9 2.3 NPLs are defined as 
90 days overdue.  
.. Not available.  
Source:  Information provided by the authorities.  
4.101.   There are no requirements for banks to accord preferential treatment to specific sectors of 
the economy in their lending activities. No distinction is made in the regulation and supervision of 
banks based on the degree of foreign control. During the review period, Georgia continued to 
implement major reforms to the institutional and regulatory framework for fin ancial sector oversight 
and financial stability, including with respect to capital adequacy and liquidity requirements, risk 
management, and governance and internal controls.137 It also adopted measures to reduce the 
extent of dollarization of the banking s ystem.  
4.102.   In 2017, the Law Defining Minimum Capital Requirements for Commercial Banks was 
amended to increase minimum regulatory capital requirements for existing commercial banks and 
legal persons seeking a banking licence from GEL 12 million to GEL 50 milli on.138 The purpose of this 
change was to limit excessive risk -taking in low capitalized banks and to ensure financial stability.139 
4.103.   The Organic Law on the National Bank of Georgia and the Law on the Activities of Commercial 
Banks were amended in 2017 to impr ove the framework for supervision of the activities of banking 
 
136 IMF Country Report No.  21/216, pp  11, 19-20; and IMF (2021), Georgia: Staff Report for the 2021 
Article  IV Consultation,  IMF Country Report No.  21/215, pp. 15 -16. 
137 In addition to the developments described in this section, which mainly concern the banking sector, 
the NBG also adopted measures to strengthen non -bank sector financial regulation, supervision, and oversight. 
IMF (2020), Georgia: Technical Assistance Report – Strengthen Regulation, Supervision, and Oversight of M icro 
Lending Institutions , IMF Country Report No.  20/273.  
138 The increase was subject to a transition period for existing banks not meeting the new requirement.  
139 NBG, Annual Report 2017 , p. 74.  WT/TPR/S/420 • Georgia  
 
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  groups by the National Bank of Georgia (NBG) and align it with international best practice.140 The 
amendments strengthened the NBG's authority to regulate banking groups on a consolidated level,  
to impose a temporary administration regime on a commercial bank at an early stage of financial 
difficulty, and to exercise risk -based supervision more effectively, including the process of licensing 
and purchasing significant shares of commercial banks. The amendments also introduced restrictions 
regarding property ownership rights, asset ownership, and group structure.141 To ensure effective 
and robust competition, r estrictions and requirements were imposed with respect to prohibited 
agreements and workin g methods for shareholders, and controlling persons and administrators of 
commercial banks.  
4.104.   As provided for in the amended Organic Law on the National Bank of Georgia, the 
NBG launched an initiative in 2018 to publish draft versions of supervision -related normative acts 
on its website to enable interested parties to comment on such draft acts.142 
4.105.   Several legal acts were amended or adopted in 2017 aimed to align Georgia's regime with 
Basel  III standards143 relating to capital adequacy requirements.144 Amendments were made to the 
Regulation on Capital Adequacy Requirements for Commercial Banks and new regulations were 
adopted on Additional Capital Buffer Requirements within Pillar 2 for Commercial Banks, the Rule of 
Defining the Countercyclical Buffer R ate, and the Rule on Defining Systematically Important 
Commercial Banks and Imposing a Systemic Risk Buffer.145 In respect of Pillar 1 of Basel  III 
(minimum capital and liquidity requirements), the minimum capital requirements resulting from the 
legal chang es made in 2017 are as follows: (i)  Common Equity Tier 1 (CET 1) ratio of 4.5%; 
(ii) Tier 1 Capital ratio of 6%; and (iii)  Regulatory Capital ratio of 8%.146 Banks are also required to 
hold an additional, so -called combined buffer through Common Equity Tier  1. The combined buffer 
consists of a conservation buffer147, a countercyclical buffer148, and a systemic buffer applicable to 
systemically important banks.149 
4.106.   In respect of Pillar 2 of Basel III (supervisory review process for firm -wide risk management 
and c apital planning), an additional capital buffer is required for those risks that are not addressed 
in Pillar 1 under the Regulation on Capital Adequacy Requirements for Commercial Banks. 
Pillar 2 capital buffers are defined by the Regulation on Capital Buff er Requirements for Commercial 
Banks within Pillar 2. The requirements introduced under Pillar 2 consist of the following buffers: 
(i) unhedged currency induced credit risk buffer; (ii)  credit portfolio concentration buffer, which 
entails name and sectoral  concentration buffers; (iii)  net stress test buffer, set in accordance with 
stress tests administered by the NBG150; (iv)  and net GRAPE buffer, set in accordance with the 
NBG's  General Risk Assessment Program and the assessment of banks' internal capital.151 
 
140 NBG, Annual Report 2017 , p. 72. These changes were made in r esponse to recommendations from 
the Financial Sector Assessment Programme and to meet Georgia's obligations under the 
European  Union -Georgia DCFTA.  
141 This includes a provision prohibiting a commercial bank from owning directly or indirectly any share 
of the capital of the legal person that is not a financial institution or an ancillary services agency, or that is 
connected with the social projects of t he bank.  
142 NBG, Annual Report 2017 , p. 73.  
143 BIS, Basel III: International Regulatory Framework for Banks . Viewed at: 
https://www.bis.org/bcbs/basel3.htm?m=3%7C14%7C572 . 
144 The NBG continues  to work on approximating its legislation to EU directives and regulations in line with 
the obligation set by the EU -Georgia Association Agreement. Specifically, the NBG works on analysing and 
implementing of CRD IV package (CRD -CRR Capital Requirements Di rective and Regulation) requirements and 
standards in line with Basel III platform, including but not limited to advancing capital adequacy requirements.  
145 NBG, Annual Report 2017 , p. 73.  
146 NBG, Annual Report 2017 , p. 114.  
147 The rate for the conservation b uffer was set at 2.5% of risk weighted assets by separating the buffer 
requirement from the minimum capital requirement.  
148 The countercyclical buffer requirement was introduced in 2017. A rate of 0% was defined, which can 
vary within the range of 0 -2.5% an d is now reviewed quarterly based on the financial and macroeconomic 
environment by the Financial Stability Committee.  
149 NBG, Annual Report 2017 , p. 114.  
150 The NBG published a Stress Test Methodology Manual in 2020, which aims to disclose to stakeholders 
the methodology for determining capital adequacy for commercial banks in times of stress, including the scenario 
used, the assumptions, and the approaches to each risk.  
151 NBG, Annual Report 2017 , pp. 72, 114 -117. WT/TP R/S/420 • Georgia  
 
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  4.107.   In relation to Pillar 3 of Basel III (enhanced disclosure and market discipline), a Regulation 
on Disclosure Requirements for Commercial Banks within Pillar 3 was approved and entered into 
force in  2017.  This Regulation replaced the Regulation on Transpa rency of Financial Conditions of 
Commercial Banks that was approved in 2006.  It requires commercial banks to publish qualitative 
and quantitative information regarding capital elements, risk weighted assets, remuneration of 
senior management, and other mat erial issues. The quarterly reports published by commercial banks 
within the Pillar 3 framework, containing quantitative information, are available on the websites of 
the NBG and the corresponding commercial banks.152 The requirements of this regulation are  
designed to be in line with the updated Pillar 3 framework of the Basel Committee and the principles 
of corresponding EU directives.153 
4.108.   Regarding liquidity requirements, the NBG implemented the Basel III liquidity coverage ratio 
in 2017154 and the Net Stable Funding Ratio in 2019.155 
4.109.   In 2018, the NBG implemented the Basel III leverage ratio, adopted a Corporate Governance 
Code for Commercial Banks and a Code of Ethics and Professional Standards for Commercial Banks, 
and approved Instructions  on Real Estate Appraisal for Commercial Banks.  
• The Regulation on the Leverage Ratio Requirements for Commercial Banks came into force 
in September 2018 and established the requirement of a minimum leverage ratio of 5%, 
which is higher than 3% established by the Basel III framework.156 
• The Corporate Governance Code for Commercial Banks is designed to follow internationally 
accepted requirements and standards, including regarding the composition of a bank's 
supervisory board, ensuring the inclusion of indepen dent members and maintaining 
gender balance. The Code also addresses issues related to the composition and 
qualifications of the management board, risk management and internal control functions, 
and remuneration principles for senior management and materia l risk takers.157 
• The Code of Ethics and Professional Standards for Commercial Banks provides for 
standards and principles of ethics and professional conduct for commercial banks. The 
framework aims to integrate internationally accepted standards of ethics and banking 
profession in banking sector that will encourage gaining public trust, including investors, 
in banking sector and banking profession, and stable and effective functioning of the 
banking sector.158 
• The main purpose of the Instructions on Real Est ate Appraisal for Commercial Banks is to 
improve the quality of real estate valuation in the banking sector and to ensure greater 
transparency of valuation principles and processes.  
4.110.   In 2019, the NBG adopted the Regulation on Large Exposure and Concentratio n Risks in 
Commercial Banks, based on Basel III and relevant EU legislation. According to the new Regulation, 
limits on connected counterparties will be changed and calculated as a percentage of Tier 1 instead 
of total regulatory capital. The Regulation de fines limits for interbank exposures. The Regulation 
should have come into effect in June 2020, but because of the supervisory actions taken in response 
 
152 Annual Pillar 3 reports, con taining quantitative and qualitative information, are also published on the 
websites of the NBG and the corresponding banks.  
153 NBG, Annual Report 2017,  p. 73.  
154 NBG, Annual Report 2017,  p. 74. 
155 NBG, Annual Report 2019 , pp. 67 -68. 
156 NBG, Annual Report 2018 , p. 72. The authorities note that banks' leverage ratios currently are far 
above the minimum requirement . 
157 NBG, Annual Report 2018 , p. 72.  
158 NBG, Annual Report 2018 , p. 72. In early 2021, this Code was combined with the Unified Code of 
Ethics and Profess ional Standards for Commercial Banks and Security Market Intermediaries. Information 
provided by the authorities. The NBG is updating a Regulation on the Management of Conflict of Interests, 
adopted in  2015, to align it with international best practice.  WT/TPR/S/420 • Georgia  
 
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  to COVID ‑19, its entry into force has been suspended until 2022.159 The NBG also adopted rules on 
requir ements that commercial banks must meet with respect to the management of cybersecurity.160 
4.111.   During 2019 -20, a comprehensive framework for bank recovery and resolution was 
developed, based on IMF -World Bank recommendations under the Financial Sector Assessmen t 
Program with the assistance of IMF technical experts. Primary and secondary legislation adopted 
in 2019-20 entered into effect in January 2021. In case of financial difficulties of a bank, the recovery 
and resolution framework ensures early and effective  responses and broad powers of the NBG to 
resolve or restructure a bank with the consideration of the purpose of protecting financial stability, 
depositors, and critical functions of the bank while minimizing the use of public funds for resolution 
purposes .161 
4.112.   In 2020, the NBG adopted the Regulation on the Management of Interest Rate Risk in the 
Banking Book, based on the Basel  Framework, to address the risks in banking books associated with 
interest rate changes.162 
4.113.   To facilitate financial innovation, the NB G set up a Financial Innovation Office and adopted 
a regulation establishing a Regulatory Laboratory. In 2020, it adopted a Regulation on Managing 
Risks for data -based Statistica, Artificial Intelligence and Machine Learning Models, which sets 
standards fo r the use of mathematical and statistical models in the financial sector.  
4.114.   The NBG is in the process of implementing the XBRL standard for the banking sector. The 
NBG also continues to work on the transition from GAAP to International Financial Reporting 
Standards and to prepare the approximation of Georgia's legislation and requirements on payment 
services to EU acquis . 
4.115.   Pursuant to Georgia's approximation obligations under the DCFTA, the NBG is developing a 
framework for the consolidated supervision of bank s, notably regarding capital adequacy 
requirements. In addition, the NBG, in cooperation with the State Insurance Supervisory Service, is 
working on the development of a supplementary framework for the consolidated supervision of 
financial conglomerates.163 A draft law on supplementary prudential supervision of financial 
conglomerates has been developed and is expected to be submitted to Parliament in the near future.  
4.4.1.2   Other financial services  
4.116.   Participants in the securities market include eight brokerage comp anies, three asset 
management companies, two investment funds, three independent registrars, two licensed stock 
exchanges, and one licensed central depositary.164 
4.117.   Promotion of capital market development has been an important policy theme in 
recent  years. Un derdeveloped capital markets are a source of inefficient financial intermediation, 
which is one of the main factors impeding the access to finance that is necessary for business 
development.165 In this regard, the Georgia 2020 Strategy called for provision of adequate legislation 
and infrastructure for capital markets as one means to improve non -bank financial intermediation.166 
The Strategy provided for measures to improve the level of financial  education, increase 
transparency in company accounting and reporting systems, improve legislation to facilitate capital 
market development, and develop capital market infrastructure and capital market instruments, 
 
159 NBG, Annual Report 2019,  p. 68. The authorities indicate that the Regulation will come into force 
in January 2022.  
160 NBG, Annual Report 2019,  p. 106.  
161 NBG, Annual Report 2019 , p. 67; and information provided by the authorities.  
162 NBG, Annual Report 2020,  p.112.  
163 NBG, Annual Report 2019 , p. 69. 
164 NBG, List of Securities Market Participants.  Viewed at: 
https://old.nbg.gov.ge/index.php?m=487&lng=eng . 
165 Government of Georgia (2014), Social -economic Development Strategy of Georgia: 
Georgia  2020,  p. 56. 
166 Government of Georgia (2014), Social -economic Development Strategy of Georgia: 
Georgia  2020,  p. 62. WT/TP R/S/420 • Georgia  
 
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  including corporate bonds, other types of  securities, private capital instruments, and other financial 
instruments.167 
4.118.   There was substantial growth during the review period in the volume of corporate bonds 
issuance, including bonds listed on both foreign and local exchanges.168 The expansion of domestic 
bond activities was stimulated by measures taken by the NBG, notably the repo eligibility of 
corporate bonds. In 2020, the NBG introduced a new framework for Global Depositary Receipts and 
Global Depositary Notes. Other factors c ontributing to the development of fixed income securities 
were the expansion of the market for treasury bonds, including the launch of a primary dealer pilot 
programme, the introduction of a tax exemption for listed securities, and reform of the pension 
system.  
4.119.   The capital market legal and regulatory reform is a vital element of Georgia's development 
strategy. In 2020, a "first generation reform" was successfully accomplished with the adoption of 
the amended Law on Securities Market and the Investment Funds  Law, which are designed to be in 
full compliance with international best practice regarding securities market regulation and 
International Organization of Securities Commissions (IOSCO) principles.169 Following the adoption 
of these laws, the NBG upgraded the vast majority of its capital market regulations.170 The legislative 
changes and implementing regulations, inter alia , streamline investment fund registration, contain 
detailed provisions to prohibit insider dealing, and provide new definitions of accred ited investors, 
and new corporate governance principles. A  new capital market development strategy was expected 
to be released by mid -2022.171 
4.4.2   Telecommunications  
4.120.   Significant developments have taken place in the Georgian telecommunications sector 
since 2015 as many legal amendments have occurred and new by -laws adopted. The sector has 
undergone steady growth and it accounts for about 3% of GDP. While concrete steps were taken to 
implement 5G172 and further develop its infrastructure, in particular broadband, t here was a steady 
decline in capital investment by telecom operators during the period.173 As it is with many 
other  sectors, Georgia is working hard on implementing comprehensive reforms in the telecom and 
broadcasting sectors as a result of its DCFTA commi tments. Liberalization of the fixed and wholesale 
markets was also initiated during the review period with a view to improving competitiveness and 
achieving high -quality telecommunications services.  
4.121.   Mobile voice as well as fixed and mobile broadband (Inter net) demand in Georgia remained 
strong and increased over the period 2016 -20 (Table 4.13). Penetration in mobile services remained 
high, at 148% in 2020, indicating more than one mobile number per person, although it declined 
over the period due to operato rs' migrating and updating billing procedures that adjusted the number 
of active subscribers (Chart 4.2). The percentage of households with Internet access improved 
from 70% in 2016 to 84% in 2020, fixed broadband subscribers and penetration rates increase d, 
and the consumption of mobile Internet services also increased significantly with an average annual 
growth rate of 7.1% over the period in part due to the development of modern technologies and 
increased demand for online information (Chart 4.3). Howeve r, similar to trends throughout the 
world, the number of fixed telephone subscribers continued to decline, from 840,000 in  2016 
to 378,000 in  2020.174 Both wired and wireless subscriptions declined along with this figure, 
 
167 Government of Georgia (2014), Social -economic Development Strategy of Georgia: 
Georgia  2020,  pp. 63-64. 
168 According to data provided by the authorities, the average annual growth rate has been about 40% 
since 2016. See also TBC Bank (2020), Fixed Income Securities in Georgia.  Viewed at: 
https://tbccapital.ge/reports/Fixed -Income -Securities -in-Georgia -1-1-1-1-1-1-1-1-1-1-1-1. 
169 The NBG was accorded IOSCO associated membership in 2018.  
170 NBG, Securities Market Surveillance -Legal Acts.  Viewed at: 
https://old.nbg.gov.ge/index.php?m=704 . 
171 See also Government of Georgia (2020), Government Program 2021 -2024: Toward Building a 
European State , p. 23 (noting that a new policy for the capital market will be presen ted in 2021 to continue the 
structural reform of the capital market).  
172 The consultation paper regarding the 5G auction has been published and ComCom received some 
comments and questions from telecom operators. As at October 2021, the process of finalizing  auction and 
licence terms was underway with a view to announcing the auction in December 2021.  
173 ComCom, Annual Report 2020 . Viewed at: https://comcom.ge/uploads/other/8/8000.pdf . 
174 The number of minutes of fixed -line use also declined significantly, from 1,117  million minutes 
in 2016 to 464  million minutes in 2020.  WT/TPR/S/420 • Georgia  
 
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  but VoIP increased slightly in the fixed telephone sphere. The broadcasting transit (pay TV) sector 
saw steady growth over the period as the number of subscribers has increased 51% since  2016; 
growth was also observed in terms of revenues, as it amounted to GEL  121.1  million in 2020. The 
growth in broadcasting can be attributed to IPTV technology take -up as the most popular means 
of pay TV  services, accounting for  85% of broadcasting revenues in 2020.  
Table 4.13 Telecom and e -commerce main indic ators, 2016 -20 
Indicator  2016  2017  2018  2019  2020  
Share of households with Internet access (%)  70.1 70.7 75.8 79.3 83.8 
Share of the population using the Internet to 
purchase goods/services (%)  18.6 16.7 20.6 20.8 21.3 
Share of population that own a mobile phone  (%) 78.4 80.1 82.5 84.8 86.5 
Share of the population using mobile devices to 
access the wireless Internet (%)  59.1 79.6 91.5 92.8 94.7 
Share of households with computer access (%)  63.8 64.2 64.9 62.0 61.8 
Share of households with broadcasting subscription 
(%) 43.9 55.2 62.6 65.9 66.0 
Mobile voice traffic (outgoing) (billion minutes)  10.3 9.6 9.9 9.9 10.2 
Fixed telephone traffic (outgoing) (million minutes)  1,117  873 666 520 464 
Fixed broadband Internet subscribers ('000)  681 781 865 941 998 
Mobile Internet subscribers (million)  2.47 2.60 2.95 3.19 3.26 
Fixed telephone subscribers ('000)  840 714 605 520 378 
Ported numbers ('000)  79 57 49 52 46 
Broadcasting transit subscribers ('000)  486.4  612.2  694.4  730.8  732.4  
Source:  National Statistics Office of Georgia , Information and Communication Technologies Usage in 
Households ; and  ComCom, Annual Report 2020 . 
Chart 4.2 Mobile, 2016 -20 
(No. million)  
 
Source:  Information prov ided by the authorities.  
5.525.50
5.46
5.38
5.10160%159%
158%
156%
148%
142%144%146%148%150%152%154%156%158%160%162%
4.64.85.05.25.45.65.86.0
2016 2017 2018 2019 2020Subscribers Penetration rate (%)(No. million)Chat 4. [GEO] Mobile 
Source: Information provided by the authorities.WT/TP R/S/420 • Georgia  
 
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  Chart 4.3 Fixed broadband, 2016 -20 
(No. '000) 
 
Source:  Information provided by the authorities.  
4.4.2.1   Framework and structure  
4.122.   Georgia had 295 registered operators in the electronic communications field in  2020. There 
were three main mobile operators – MagtiCom, Geocell, and Veon (also known as Beeline) – during 
the review period. MagtiCom acquired the retail unit of Caucasus Onli ne, and Geocell was acquired 
by the incumbent Silknet, thus there are currently two large operators (MagtiCom and 
Geocell/Silknet) active in the market for fixed broadband, PSTN/VoIP telephone services, and 
pay TV (IPTV services), while Veon is operating o nly in the mobile market.175 Shares of the 
main companies on the market (MagtiCom, Geocell/Silknet, and Veon ) are owned by Georgians 
jointly with foreigners. Twenty -five companies operate in the fixed telephone market, and 9 provide 
fixed wired technology. Two companies provide wireless service, and 24 authorized entities provide 
VoIP service. Furthermore, 160 e ntities provide fixed broadband services, 127  supply 
Wi-Fi technology, 8 supply DSL, and 1 provides fixed LTE technology. For broadcasting, there were 
89 TV companies broadcasting 106 TV channels and 2 public broadcasters operating  channels.  
4.123.   Thus, Georgia' s telecommunications sector has undergone consolidation in recent years with 
fewer operators, i.e. two significant players in the higher -growth subsectors and one generally 
dominating with a market share of 50% or more. In addition, small and medium -sized operators 
have faced hurdles to gain access. This has not gone unnoticed and was recognized as a concern by 
the telecom regulator. As a result, a study on the retail market for mobile services was carried out, 
revealing that there was no strong competition  in the mobile services market, in particular in terms 
of offers and retail tariff policy, and prices for combined mobile services were above average.176 
Furthermore, the number of ported subscribers between operators in the mobile retail market is low 
and continually declined over the period (Table 4.13). The Georgian National Communications 
Commission, known as ComCom, has identified several improvement initiatives for low portability 
that include the Mobile Virtual Network Operator  (MVNO) initiative and n ew rules on portability.  
4.124.   In response, one initiative launched in 2020 was the MVNO initiative, i.e. an operator 
providing mobile services without its own network or infrastructure by operating through the network 
of other providers. While MVNO has legally been possible for some  time, there have been no 
operators due to market concentration powers. New rules on deadlines, access, and information 
transparency were put in place to encourage new market entrants, expand the choice of mobile 
 
175 MagtiCom and Geocell/Silknet offer bundled services (double/triple and quad -play services) in both 
rural and urban areas. All three operators offer 3G and 4G mobile services and are expected to offer 5G in  the 
near future once the auctioning and licensing process is completed.  
176 ComCom, Annual Report 2020 .  
6817818…941998
58.2%66.8%74.2%80.8%85.7%
0%10%20%30%40%50%60%70%80%90%
02004006008001,0001,200
2016 2017 2018 2019 2020Subscribers Penetration rate (%)(No. 1,000)Chart 4. [GEO] Fixed broad band, 2016 -20
Source: Information provided by the authorities.WT/TPR/S/420 • Georgia  
 
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  services, and offer i nnovative new products. A decision of ComCom specified the deadline of 
December  2020 for providing the access of virtual operators and imposed an obligation of 
information transparency on companies with significant market power. Mobile Network Operators 
(MNOs) were obliged to publish reference offers by the end of November 2020, but their introduction 
has been delayed. Accordingly, no MVNOs were operating under the ex ante regulation regime as at 
September 2021, and ComCom was considering setting a new dead line for MNOs to issue reference 
offers in order to ensure MVNO introduction into the Georgian telecom market. All three  MNOs 
announced their readiness to give access to MVNO candidates under commercial terms.177 Another 
positive move since the MVNO access decision was introduced has been the organization of SME 
operators through the MVNO association of Georgia and their proactive communication of readiness 
towards obtaining access to MNO networks. As the market regulator, ComCom continued to monitor 
this pr ocess and in case the results do not meet the expectations – i.e. MVNOs have access barriers 
of entry and/or no mobile virtual operator access is realized, ComCom will consider stepping in to 
re-define the ex-ante regulation regime.178 
4.125.   Georgia took several other steps during the review period to liberalize the telecom sector 
and encourage competition. One development in this regard is the draft Law on Sharing 
Telecommunication Infrastructure and Physical Infrastructure Used for Telecommunication Purposes. 
It aims to  use the existing  telecommunications physical infrastructure to develop broadband 
networks on a competitive basis. As at October 2021, the draft law was submitted to Parliament for 
consideration. The regulator also reduced tariffs on wholesale glob al Internet and call termination 
with a view to improve competitiveness.  
4.126.   To promote competition in the SMS market, in particular the bulk wholesale sector, new 
rules were established in 2020 to ensure market fairness and provide services to small and 
mediu m-sized operators. The three main mobile operators have a particular dominance in the sector, 
and concerns were raised over lack of competition. As a result, the new Bulk SMS regulation was 
established as well as a non -discriminatory rule for setting price s. As a result, there was a marked 
increase in the year -to-year growth in the sector, i.e. the bulk SMS  count increased 91% during a 
three -month period in  2021 compared to the same period in 2019 and revenues generated on bulk 
SMS services increased 272% d uring the same period.179 
4.127.   Liberalization in the fixed broadband Internet market is also expected as Georgia 
approximates EU  legislation with respect to bitstream regulation. It has been demonstrated that 
Georgia's retail market has high structural barriers to entry and the wholesale market requires 
new regulation to guarantee access. As of 2020, the regulatory framework was being analy zed to 
determine how best to increase competition in the retail market and provide access to the wholesale 
market. The first  phase of the consultation process, which ended in the first quarter of 2020, aimed 
to conduct a preliminary study of fixed broadband access services, including bitstream services. This 
analysis was preceded by the comprehensive study of Next Generation Acc ess network 
developments performed in 2017 -18. The study identified the constraints at the retail level, related 
to barriers of entry associated with high investment costs and a long network construction process. 
As a result, market access to trunk and bac khaul infrastructure has been regulated since 
January  2019. Mindful of the need to give so -called bitstream access, ComCom continues to study 
competition constraints in the fixed Internet market and, based on the results, will determine the 
regulatory fram ework.180 
4.128.   Georgia has two government entities in the telecommunications sector: a Government 
Ministry that establishes the policy and an independent commission for regulatory aspects. 
ComCom  is the regulatory authority in Georgia for broadcasting and electr onic communications. It 
is an independent state agency operating as a legal entity under public law with an independent 
commission of five appointed members. Although it has autonomy in its operations and budget, it is 
held accountable to the President, th e Government, and Parliament.181 The respective Laws on 
Electronic Communications and  Broadcasting provide that licensing and authorization activities for 
electronic communication and broadcasting are under the purview of ComCom. Further, ComCom is 
 
177 Information provided by the authorities.  
178 Information provided by the author ities. 
179 Information provided by the authorities.  
180 Information provided by the authorities.  
181 It does not receive funds from the state budget; rather, it is financed from the regulation fees 
it collects.  WT/TP R/S/420 • Georgia  
 
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  also the  competition regulator for the sector as it has the authority for ex ante as well as ex post 
competition regulation and it has enforcement powers to prevent monopolies, set tariffs, and protect 
consumer rights. Recent amendments to the Law on Competition i n 2020 grant the sectoral 
regulators (i.e. ComCom) powers to act within the framework of the Law when there are breaches 
or antitrust concerns in the regulated economic area. In this respect, ComCom adopted the 
respective by -laws in July 2021. During the r eview period, ComCom worked to address a number of 
well-known weaknesses in the Georgian market, including improving the effectiveness of retail 
competition, improving access to wholesale connectivity, and tackling the urban/rural divide.182 
4.129.   The Department of Communications, Information and Modern Technologies in the MESD is 
the policy -making body that develops and carries out state policy for electronic communications, 
information technologies, and the post. The MESD represents Georgia in the sectoral and o ther 
international organizations  that participate in international cooperation and enters into international 
agreements for these sectors.  
4.4.2.2   Strategies and initiatives  
4.130.   During the review period, Georgia developed the State Program for Broadband Infrastructure  
Development in Georgia in order to build its fibre -optic network.183 Open Net, a non -profit, was 
established in  2016 by the MESD in response to this Program. Its main goal is to develop broadband 
infrastructure in Georgia through a financial support compon ent and an infrastructure component.184 
In 2020, amendments were made to Resolution No.  375 of 28  July 2016 on Approval of the 
State  Program for Broadband Infrastructure Development in Georgia, which resulted from the 
change of the programme model and the d efinition of the pilot region and at the same time brought 
the Program into compliance with the National Broadband Development Strategy for 2020 -25. The 
financial support component was removed from the Program because there was no interest in it 
from the private sector. The goals of the Program are to: (i)  create a unified neutral fibre -optic 
network; (ii)  develop wholesale broadband services in the target geographic areas of white zones; 
and (iii)  connec t any two access points of the created network. Under the provisions of the Program's 
mandate, the broadband infrastructure and network being built cannot be transferred to another 
operator within 10 years after commissioning and Open Net is obliged to pro vide open access to 
other operators but cannot provide services to end customers.  
4.131.   With the aid of the World Bank and the European  Union, a further policy document, 
the National Strategy for Development of Broadband Networks for 2020 -2025 was approved in 
January  2020 and EUR  35.7 million in financing from the World Bank has been established for the 
Log-in Georgia project. Operating in conjunction with Open Net, the project is expected to increase 
access to affordable broadband Internet and promote digital se rvices that utilize high -speed 
Internet.185 It has three basic components: (i)  increase access to affordable broadband Internet; 
(ii) promote the use of broadband -enabled digital services; and (iii)  support project implementation. 
Component (i)  supports the  creation of a unified neutral fibre -optic network, development of 
broadband wholesale services, and plans for access points and providing open access. As of 
July 2021, Open  Net had built 140  km of infrastructure. Also, a second pilot project is being laun ched 
that is expected to construct an additional 50  km of broadband infrastructure in 13  settlements of 
Kobuleti Municipality.  
4.132.   The fibre -optic cable infrastructure between Europe and Asia via Georgia was another project 
of the Government during the period as part of the National Strategy for Development of Broadband 
Networks for 2020 -2025. The MESD is working with the World Bank on the concept paper for the 
development of the digital corridor via Georgia and for a regional digital hub in Georgia that will 
describe the general state of development of the international Internet connection in the region, its 
development trends, and activities to be implemented by the State and the private sector in order 
to develop the potential of these digital initiatives in Georgia.  
 
182 Information provided by the authorities.  
183 State Program for Broadband Infrastructure Development in Georgia. MESD, Resolution No.  375 of 
28 July 2016 on Approval of the State Program for Broadband Infrastructure Development in Georgia.  
184 Resolution No.  375 of 28  July 2016 on Approval of the State Program for Broadband Infrastructure 
Development in Georgia.  
185 Ministry of Finance, "35.7 Million Eu ros to Support Georgia's Digital Transformation", 
31 August  2020. Viewed at: https://www.mof.ge/en/News/9539 . WT/TPR/S/420 • Georgia  
 
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  4.133.   The Harmonization of Digital Markets in the Eastern Partnership  (EaP) countries (HDM) is 
another initiative Georgia undertook during the review period. The MESD (Telecommunication, 
Information and Modern Technologies Department) is a country coord inator for the HDM project; 
along with five other countries in the region186 and the European  Union, Georgia was working 
towards delivering tangible results in six  key areas by 2020: ICT innovation, telecom rules, e -trade, 
e-health, e -skills, and trust and security. The programme aimed to eliminate obstacles and barriers 
to online  services and harmonize the digital environments. After 2020, the project continued in 
accordance with the EU decision Post -2020 EaP Priorities, Chapter  2.4 ("Together for a resilient 
digital transformation").  
4.134.   As to the Telecom Rules stream of the HDM, a R egional Roaming Agreement  (RRA) was 
worked on during the period. After entry into force of the RRA, a reduction of roaming mobile tariffs 
between EaP countries will start in stages. Moreover, a study on the possibility of a reduction of 
roaming tariffs bet ween EaP countries and the European  Union was launched in 2021. As to the 
strengthening of the national regulatory authorities' (NRA) independence, the legislation of the six 
countries was studied and a gap analysis was prepared during 2019 -20. In 2021, fi ve priority 
recommendations were identified by ComCom as a result. By the end of 2021, country -specific 
recommendations were expected to be prepared, based on which the amendments to the Law on 
Electronic Communications are expected. Additionally, recommen dations on broadband 
development, as well as on digital mapping, have been prepared as part of this undertaking.  
4.135.   A regional agreement on the spectrum was also discussed and considered among 
HDM member countries. The text of the Regional Spectrum Agreement  (RSA) was recently finalized 
with active participation of the six EaP countries and is currently undergoing inter -state 
consultations. The RSA is expected to be signed together with the RRA in December 2021; however, 
due to the pandemic the date is not con firmed.  
4.136.   ComCom worked on its Radio Broadcasting Market Development Strategy during the period 
in order to develop an efficient zonal division of radio broadcasting. This would involve defining 
15 zones, allowing new market entrants, and competing for licen ces based on efficient use of 
exhaustible frequency resources and achieving maximum coverage with a signal. In March  2021, 
amendments to the Resolution on the Zonal Division of Local Broadcasting were adopted so as to 
make changes prescribed by the strateg y. 
4.137.   In 2018 the Media Literacy strategy and action plan were approved and a department of 
Media Literacy Development was created in ComCom. The department is expected to work on issues 
related to the development of media literacy in society. In addition, al so to meet the same challenge 
of developing media literacy, the non -commercial legal entity Media Academy was established to 
provide special capacity -building initiatives to the media, journalists, and producers.  
4.4.2.3   Legal framework  
4.138.   Changes to the legal framew ork over the period were numerous. There were legal 
amendments to the Constitution, the main Law on Electronic Communications, and new or amended 
by-laws of ComCom, the latter being the most numerous. Georgia was also working on a draft Law 
on Critical Inf rastructure, which if enacted, may replace the need for some of the long -standing 
legislation in this area.  
4.139.   In 2017, Georgia amended the Constitution to include a provision in Article  17 on basic rights 
and freedoms that everyone has the right to use and f reely access to the Internet. The Article also 
strengthened the institutional and financial independence of ComCom.  
4.140.   The main laws of the sector remain the Law on Electronic Communications and the Law on 
Broadcasting (Table 4.14). The Law on Electronic Comm unications was amended several times. 
One amendment targeted all authorized enterprises having critical infrastructure that do not abide 
by the decisions of ComCom and consequently give the regulator more effective mechanisms for 
enforcement in cases of no ncompliance. Thus, the provisions of Article  46 were strengthened so that 
ComCom can more easily put in place a special manager to enforce decisions or violations instead 
of revocation of authorization. Another amendment abolished the need for permits for the use of 
 
186 Armenia, Azerbaijan, Belarus, the Republic of Moldova, and Ukraine.  WT/TP R/S/420 • Georgia  
 
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  radiofrequencies of auxiliary technology and numerology resources. As a result, a right to use was 
established and an applicable fee is paid to ComCom.  
4.141.   In addition, over 20 by -laws of ComCom were adopted during the period (Table A4. 2), 
covering a number of areas in electronic communications and broadcasting. For example, they 
include the allocation of frequencies, the operation of ComCom, protection of end -users' rights, and 
Internet service quality and inspection.  
Table 4.14 Main legislation in telecommunications, 2021  
Legislation  Main elements  
Law on Electronic Communications  Establishes the legal and economic basis for the operation 
of electronic communications networks and facilities in 
Georgia  
Law on Broadcasting  Regulates broadcasting activities and establishes public 
broadcasting  
Law on Independent National Regulatory 
Authorities  Establishes the legal basis for ComCom including its 
independence, authority, and role as a public defender  
Resolution of Georgian National 
Communications Commission on Approval of 
the Regulation on Provision of Services in the 
Field of Electronic Communications and 
Protection of Consumers' Rights  Establishes the general rules for the provision of 
electronic communi cations services to the customer and 
to protect the rights and legitimate interests of 
consumers  
Resolution on Approval of National Broadband 
Development Strategy  (NBDS) and its 
Implementation Action Plan for 2020 -25 Includes objectives and plans to enhan ce the legal and 
regulatory framework for broadband development in line 
with EU norms and to overcome the digital divide across 
urban and rural areas   
Government Program 2021 -2024, Chapter  2.9 
(Communication and Information Technologies)  Describes priorit ies of digital economy and information 
society  
Law on Electronic Signatures and Electronic 
Documents  Defines electronic document management system and 
the legal basis for the use of electronic signatures  
Resolution on Approval of the State Program for 
Broadband Infrastructure Development in 
Georgia  Plans the development of broadband infrastructure and 
addresses infrastructure  
Source:  ComCom and MESD. Viewed at: https://comcom.ge/ge/legal -acts; and information provided by the 
authorities.  
4.4.2.4   E-commerce  
4.142.    As of October 2021, Georgia did not have any dedicated e -commerce laws or policies. During 
the review period, the MESD worked on developing a draft law on e -commerce,  and certain issues 
were still in the process of being clarified. Thereafter, the draft law is expected to be submitted to 
Parliament for adoption but, according to the authorities, it is inherently linked to the adoption of 
the new consumer protection law . The draft law, if adopted, is expected to regulate the rights and 
obligations of intermediary service providers as well as protect consumers by making information 
services more transparent and standardized. However, as part of its DCFTA commitments, 
Georgia was working towards identification of Internet exchange point (IXP) liabilities in its 
legislation. Georgia's  2008 Law on Electronic Signatures and Electronic  Documents contained some 
important elements for e -commerce as it established a legal framewor k for electronic document flow 
systems and the use of electronic signatures; however, it was invalidated by the 2017 Law on 
Electronic Documents and Electronic Trust Services but the same or similar provisions remain in 
place in the new law.187 
4.143.   The mobile e -commerce (or m -commerce) market in Georgia is reportedly small but 
expected to grow significantly as the pandemic has pushed companies to develop apps or 
online  interfaces. According to the National Statistics Office, the share of the population 
using  the Internet to purchase goods/services was 21.3% in  2020, up slightly from 18.6% 
in 2016 (Table  4.13).  
 
187 Law No.  7 of 26  March  2008 on Electronic Signatures and Electronic Documents; and Law of 10 May 
2017 on Electronic Documents and Electronic Trust Services.  WT/TPR/S/420 • Georgia  
 
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  4.4.2.5   International and regional initiatives  
4.144.   Georgia's DCFTA commitments in Chapter 6 on trade in services and electronic  commerce 
provide for the provision of b asic services such as national treatment, most -favoured -nation 
treatment, market access, and modes of supply. Subsection 5 on electronic communication requires 
the parties to maintain certain rules for regulatory authorities, licensing and fees, access and  
interconnection, scarce resources, universal service, cross -border provisions, disputes, and gradual 
approximation. The gradual approximation of Georgia's existing and future legislation to EU  acquis  
set out in Annex XV -B requires Georgia to implement cer tain provisions of six  EU directives or 
decisions within three or five years from the entry into force. The specific EU  rules being 
implemented are contained in the Framework Directive, Authorization Directive, Access Directive, 
Universal Service Directive , Directive on Privacy and Electronic Communications, and the Radio 
Spectrum Policy Decision. As at October 2021, draft amendments to the Law on Electronic 
Communications had been prepared to incorporate four of these directives and were expected to be 
adopted by Parliament in the near future. Under the additional provisions of Section  6, electronic 
commerce is to be treated as a service and no customs duties shall apply. The parties agreed to 
maintain a dialogue on e -commerce regulatory issues, for example , by the exchange of legislation 
on the matter.  
4.145.   The DCFTA also contains provisions on audiovisual services that impact the broadcasting 
sector although the depth of the commitments and approximation is much less than in the 
telecom  subsector. The agreement  calls for a greater dialogue and cooperation, including on training 
of professionals and exchange of information on policies. Georgia was expected to approximate one 
Directive, the Audiovisual Media Services Directive, within three to five years of its en try into force. 
ComCom worked on the package of amendments to the Law on Broadcasting with outside experts 
and submitted the package of amendments to Parliament in December 2018; however, the law -
making process had not been initiated. In parallel, taking i nto consideration that EU Directive 
2010/13/EU58 on Audiovisual Media Services was replaced by EU Directive 2018/1808 of the 
European Parliament and of the Council of 14  November  2018, ComCom was expected to commence 
a Twinning Project with the European  Union to ensure the approximation with the new Directive.  
4.146.   Georgia is a beneficiary of the European  Union's EU4Digital initiative that supports work in 
the region in the six main areas under the Telecom Rules network;  this project is also working 
towards the RRA and RSA (Section 4.4.2.2). The analysis performed by EU4Digital regarding 
NRA independence in six partner countries identified Georgia as the best -case scenario in terms of 
independence and confirmed that the Georgian regulatory system was well aligned  with 
EU regulatory framework.  At present, EU4Digital, in cooperation with ComCom relevant specialists, 
members of the Eastern Partnership Electronic Communications Regulators Network, and the 
Independent Regulators and Broadband Expert Working Group, is d rafting country -specific 
recommendations on NRA independence.  
4.147.   Georgia participates as a member of several international or regional organizations in the 
area of  telecommunications. There were no changes to its membership in these organizations during 
the review period (Table 4.15). In addition, Georgia has concluded 20  international or sectoral 
agreements, or MOUs, with other Governments in the information techno logies or communications 
sector and is in the process of concluding five  additional agreements.188 These agreements aim at 
promoting cooperation with partner countries in the fields of telecommunications, information 
technology, post, and innovations and to  support development of the digital economy and 
information society.  
 
188 Agreements are in place with Armenia, Austria, Azerbaijan, Bulgaria, China, Estonia, Greece, 
Hungary, the Islamic Republic o f Iran, Israel, Kazakhstan, the Kyrgyz  Republic, Latvia, the Republic of 
Moldova, the Russian  Federation, Turkey, Ukraine, and Uzbekistan. Agreements are in the process of being 
negotiated with Belarus, Czech  Republic, India, Lithuania, and Poland. MESD, International and Sectoral 
Agreements . Viewed at: http://www.economy.ge/?page=ecopolitic&s=25 . WT/TP R/S/420 • Georgia  
 
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  Table 4.15 Membership in international or regional organizations, 2021  
Organization  Year joined  
European Telecommunications Standards Insti tute (ETSI)  2007 
Internet -Corporation for Assigned Names and Numbers/Governmental Advisory 
Committee (ICANN/GAC)  2005 
European Conference of Postal and Telecommunications Administrations (CEPT)  2007 
International Telecommunications Union (ITU)  1993 
Eurasian Cooperation in the Field of Telecommunications Regulation  2004 
European Commission – Eastern Partnership (EaP)  2009 
European Platform for Regulatory Authorities (EPRA)  2013 
Source:  ComCom, International Cooperation . Viewed at: https://comcom.ge/en/the -
commission/international -cooperation . 
4.4.3   Transportation  
4.148.   At the crossroads of Asia and Europe, Georgia is in a strategic location that enables its 
transport  and logistics sectors to profit. Georgia's potential as a regional hub has been recognized, 
and the Government has taken steps to develop the country's infrastructure, in particular for ports, 
road, and rail, which are increasingly interconnected. According to Georgia's Government Program 
2021-2024, the Government recognized the importance of making advancements in transport 
corridors.189 The transportation sector makes a significant contribution to the Georgian  economy, as 
it contributed 6.2% to GDP, on avera ge, during the review period.  
4.149.   In terms of trade, Georgia is most reliant on road and maritime modes of transport for the 
majority of its imports and exports. In 2018, these two modes accounted for 89% of exports, based 
on value, and 77% of imports.190 There  was slightly more use of rail transport for imports due to oil 
and oil products imported from neighbouring countries where the infrastructure exists for transport 
of this type of good. Shipping by sea is typically the most cost -effective means of transpor t, 
particularly for longer distances.  
4.150.   According to the M ESD, the Government is working towards modernization and development 
of the transportation infrastructure in accordance with international standards, harmonizing its 
legislation with international law s, and integrating into the Trans -European Transport Network. It is 
currently revising regulations and legislation in respect of transport -related infrastructure and 
services to facilitate adherence to its DCFTA commitments and greater integration into wor ld and 
regional markets.  
4.151.   Recently, the Ministry established the National Transport and Logistics Strategy (2021 -30) 
and its Action Plan (2021 -22); however, as at October  2021, they were not yet formally approved. 
The Strategy aims to further develop Georgi a's transport and logistics sector through improved 
coordination, enhanced transport connectivity, and faster logistics, as well as increased human 
capital in transport and logistics. The implementation of the strategy is expected to contribute to 
increase d competitiveness of the transport and logistics sector. Moreover, work was ongoing on the 
Maritime Transport Strategy document that was also not yet approved as of October  2021.  
4.152.   There was steady growth in the use of most forms of transport during 2015 -19 (Table 4.16). 
However, the impact of the global pandemic and the consequences it had on movements and the 
economy have caused a significant decline in the transport of persons since 2020. Freight transport, 
or the movement of goods, on the other hand, rema ined steady or declined only slightly over the 
same period.  
4.153.   Georgia has also endorsed the Belt and Road Initiative (BRI) with transport 
infrastructure  projects occurring in its territory during the review period, i.e. parts of the 
China -Europe BRI corridor  route through Tbilisi. Infrastructure elements including the extension of 
the Baku -Tbilisi -Kars Railway (Section 4.4.3.5) and the port of Anaklia (Section 4.4.3.4) are 
considered important in enhancing connectivity in BRI countries but are not financed un der the 
BRI framework. Once completed, the BRI improvements in Georgia and across other BRI  participants 
 
189 Government of Georgia (2020), Government Program 2021 -2024, Toward Building a European State , 
Decemb er 2020.  
190 CAREC (2021), Railway Sector Assessment for Georgia . Viewed at: 
https://www.carecprogram.org/uploads/2020 -CAREC -Railway -Assessment_GEO_7 th_2021 -3-25_WEB.pdf . WT/TPR/S/420 • Georgia  
 
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  are expected to lower Georgia's average shipment time with its trading partners by  3.5%. However, 
as Georgia has its own ports, it is not as dependent on the BRI project as are many of its 
neighbours.191 
Table 4.16 Key transport statistics, 2015 -21 
 2015  2016  2017  2018  2019  2020  2021  
Railway, operational 
length (km)  1,576  1,576  1,576  1,576  1,576  1,576  1,412  
Rail freight turnover 
(million tonnes -kms) .. .. 2,930  2,571  2,909  2,895  .. 
Rail passenger 
turnover (million 
passenger -kms) .. .. 597 634 677 247 .. 
Air cargo volume 
(tonnes)  14,885  34,065  31,724  25,511  24,911  19,266  .. 
Air passenger 
transfers  (No.) 2,261,006  2,840,455  4,073,959  5,033,323  5,209,505  833,846  .. 
Roads, operational 
length (km)  20,553  20,727  20,741  20,742  20,964  .. .. 
Ship traffic in 
ports (No.) 1,937  1,937  1,646  1,588  1,859  1,712  .. 
.. Not available.  
Source:  National Statistics Office of Georgia , Statistical Yearbook of Georgia , 2020 ; Georgian Railway, 
Ratings and Performance Highlights . Viewed at: https://www.railway.ge/en/ratings -and-
performance -highlights/ ; and  GCAA , Number of Flights Performed .  
4.154.   Legislation in the transport sector for Georgia is elaborated by various transport codes for 
most modes of transport (Table 4.17). Most of this legislation remains long -standing, and there  were 
not significant changes during the review period. In addition to its domestic legislation, Georgia 
adheres to many of the international conventions in the transport field (Table  4.18).  
Table 4.17 Main tr ansport legislation, 2021  
Legislation  Summary  
Law on Road Transport  Defines the legal, economic, and organizational basics for all 
owners of motor vehicles  
Law on Management and Regulation of 
Transport  Describes the management and regulation of the transport sector  
Law on the Maritime Space  Protects the rights, interests, territorial integrity, sovereignty, and 
security within the maritime space of Georgia  
Maritime Code  Regulates relations for ships carrying passengers, cargo, luggage, 
and post; f or fishing and other offshore harvesting operations; for 
exploring and extracting minerals; for towage and rescue 
operations; and for other economic, scientific, and cultural 
purposes  
Railway Code  Regulates the economic, legal, organizational, and technol ogical 
base for rail transport, and its place and role in the economy and 
social sector  
Air Code  Provides the legal regulations of aviation activities in the area of 
air transportation and other aviation operations  
Law on Roads  Defines rules for the us e and protection of roads by road owners 
and road users  
Law on Traffic  Provides the legal grounds for ensuring traffic regulations and 
traffic safety in the territory of Georgia  
Source:  Legislative Herald of Georgia.  
 
191 World Bank (2020), South Caucasus and Central Asia: The Belt and Road Initiative, Georgia Country 
Case Study . WT/TP R/S/420 • Georgia  
 
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  Table 4.18 Principal international conventions in the transport sector, 2021  
Convention  Entry into 
force  
Maritime   
Convention on the International Maritime Organization (IMO 1948)  1993 
International Convention for the Safety of Life at Sea, SOLAS Protocol (1978)  1993 
International Convention for the Prevention of Pollution from Ships (1973) amended by the 
Protocol of 1978 (MARPOL 73/78)  1993 
International Convention on Standards of Training, Certification and Watchkeeping for 
Seafarers  (1978)  1993 
International Convention on Salvage (1989)  1994 
International Convention for Safe Containers (1972)  1994 
Athens Convention relating to the Carriage of Passengers and their Luggage by Sea (1974)  1995 
Convention on Facilitation of International Maritime Traffic (1965)  1995 
United Nations Convention on the Law of the Sea (UNCLOS 1982)  1995 
Convention on Facilitation of International Maritime Traffic (1965)  1995 
Convention on the International Maritime Satellite Organization (IMSO 1976), IMSO 
Amendments  2008 2014 
International Convention for the Control and Management of Ships' Ballast Water and 
Sediments  (2004)  2014 
Road   
European Agreement concerning the Work of Crews of Vehicles Engaged in International 
Road Transport (AETR), Geneva, 1  July 1970 2011 
Agreement concerning the Adoption of Uniform Technical Prescriptions for Wheeled Vehicles, 
Equipment and Parts which can be fitted and/or be used on Wheeled Vehicles and the  
Conditions for Reciprocal Recognition of Approvals Granted on the Basis of these 
Prescriptions, Geneva, 20  March  1958 2015 
European Agreement concerning the International Carriage of Dangerous Goods by 
Road (ADR), Geneva, 20 September  1957 2016 
Air  
Chicago Convention on International Civil Aviation (1944)  1993 
Tokyo Convention on Offences and Certain Other Acts Committed on Board Aircraft (1963)   
Hague Convention for the Suppression of Unlawful Seizure of Aircraft (1970)  1993 
Montreal Convention for the Suppression of Unlawful Acts Against the Safety of Civil 
Aviation  (1971)  1993 
Protocol to Amend the International Convention for the Unification of Certain Rules of Law 
Relating to Bills of Lading of 13 February  1968 1995 
Protocol for the Suppression of Unlawful Acts of Violence at Airports Serving International 
Civil Aviation, Supplementary to the Convention for the Suppression of Unlawful Acts against 
the Safety of Civil Aviation done at Montreal on  23 September  1971 1998 
Montreal Convention on the Marking of Plastic Explosives for the Purpose of Detection (1991)  2000 
Protocol Relating to an Amendment to the Convention on International Civil Aviation 
(Article  83bis) of 6  October  1980 2002 
Montreal Convention for the Unification of Certain Rules for International Carriage by Air 
(1999)  2010 
EUROCONTROL International Convention relating to Cooperation for the Safety of Air 
Navigation of 13  December  1960 (amended by the Additional Protocol of 6  July 1970, the 
Protocol of 21  November  1978 and the Protocol of 12  February  1982 amending the 
Convention); Multilateral Agreement relating to Route Charges of 12  February  1981; Protocol 
consolidating the EUROCONTROL International Convention r elating to Cooperation for the 
Safety of Air Navigation of 13  December  1960 (27  June 1997), the Protocol on the Accession 
of the European Community to the said consolidated EUROCONTROL Convention 
(8 October  2002)  2013 
Rail  
Agreement on International Goo ds Transport by Rail  1951 
Agreement between the Republic of Azerbaijan, Turkmenistan, Georgia  and the Republic of 
Uzbekistan on Coordination of Activities of the Railway Transport  1996 
Agreement between the Government of the Republic of Bulgaria, the Executive Authority of 
Georgia and the Cabinet of Ministers of Ukraine on Joint Exploitation of R ailway Ferry 
Crossings between the Ports of Varna (the Republic of Bulgaria), Poti/Batumi (Georgia) and 
Ilyichevsk  (Ukraine)  1999 
Agreement on Baku -Tbilisi -Kars New Railway Connection Line  2007 
Intergovernmental Agreement on the Trans -Asian Railway Network  2009 WT/TPR/S/420 • Georgia  
 
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  Convention  Entry into 
force  
Intergovernmental Organization for International Carriage by Rail (OTIF), Protocol of 
3 June 1999 for the Modification of the Convention concerning International Carriage by 
Rail (COTIF) of 9  May 1980 (Protocol 1999)  2011 
Agreement o n Development of Multimodal Transport TRACECA  2009 
Basic Multilateral Agreement on international transport for the development of the 
Europe  Caucasus -Asia corridor  1998 
Source:  MESD , Agreements . Viewed at: 
http://www.economy.ge/uploads/files/2017/transport/agreements/agreements_eng_.pdf . 
4.4.3.1   Air 
4.155.   Georgia's civil aviation sector comprises three international airports at  Tbilisi, Batumi, 
and Kutaisi; four domestic airports at Ambrolauri, Mestia, Natakhtari, and Telavi; and a number of 
other small airports or airstrips.192 The United Airports of Georgia LLC, a 100% SOE, is the airport 
authority of Georgia and owns all airpo rts in the country, including the three  international and 
four domestic airports. Georgian Airways, the main carrier, is privately owned. 
Sakaeronavigatsia  LTD is a 100% SOE, and it provides all navigation, air traffic control, and 
meteorological services for operations within Georgian airspace. Cargo or freight carried by 
air entering Georgia is solely through Tbilisi International Airport.  
4.156.   The M ESD through its Transport and Logistics Development Policy Department is responsible 
for defining an aviation po licy and ensuring its implementation. This includes market access, air 
service agreements, designation of airlines, points of entry, traffic rights, and related services. On 
the other hand, responsibilities for air travel safety and security, including ove rsight, fall under a 
separate regulator, the Georgian Civil Aviation Agency  (GCAA), which operates under the M ESD. The 
GCAA certifies aircraft airworthiness, maintenance, licensing of aviation personnel, airports, air 
navigation, air  cargo terminals, and p roviders of related services.  
4.157.   Developments during the period include the expansion of Kutaisi International Airport and 
the update of its navigation system, the replacement of the automated air traffic control  (ATC) 
system, and the gradual installation of the Automatic Dependent Surveillance -Broadcast (ADS -B) 
aircraft surveillance system  at airports throughout the country.193 Air cargo volumes during the 
period were the highest in 2016, and they have steadily declined since; this peak and sub sequent 
decline were attributed to trends in Georgian livestock exports, which also peaked and declined in 
parallel. Air  passenger transport in Georgia grew significantly over the period, more than doubling 
before the  COVID -19 pandemic (Table 4.1).  
4.158.   Georgia  has adopted a liberalized environment in the aviation sector since  2005; 
consequently, the bilateral agreements are based on the Open Skies policy. Air transport services 
with the European  Union are largely governed by the 2010 Common Aviation Area Agreem ent. 
Georgia has  10 international conventions in place on civil aviation (Table 4.18) and 36  bilateral 
agreements. Since  2015, bilateral air services agreements have been signed  with the 
Kingdom  of Bahrain  (2016), Belarus  (2017), India  (2017), the Kingdom of Saudi  Arabia  (2019), and 
the Republic of Korea  (2021).  
4.4.3.2   Roads  
4.159.   Road transport in Georgia is regulated by the  Law on Road Transport, which determines 
legal, economic, and organizational bases for road transport activities. The M ESD is responsible for 
elabo ration and implementation of the state policy in the field of road transport. The Land Transport 
Agency functioning under the Ministry serves as technical regulator. The main function of the Agency 
is to elaborate, administer, and oversee the implementatio n of domestic and international legislation 
in the road transport sector. The Land Transport Agency is mandated to issue respective 
certifications and permits in accordance with international agreements, treaties, and the national 
legislation of Georgia.  
 
192 GCAA, Georgian Civil Airports and Aerodromes . Viewed at: https://gcaa.ge/aerodromes -and-
airports/ . 
193 MESD, Projects . Viewed at: http://www.economy.ge/?page=projects&s=31 . WT/TP R/S/420 • Georgia  
 
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  4.160.   As for recent developments in the sector, Georgia achieved significant progress in a wide 
area of road transport -related activities in the course of implementation of the DCFTA. In particular, 
Georgia implemented the legislation concerning the carriage of d angerous goods, reinstated periodic 
technical inspection of vehicles, and introduced EU requirements concerning the weights and 
dimension of vehicles and speed limitation devices. Georgia regularly issues bilateral road transport 
permits (usually single -use authorizations) between the competent authorities of its partner 
countries on an annual basis, allowing international road transport operations (to/from the country 
and in transit). Georgia is also involved in a number of multilateral systems of licences , such as the 
European Conference of Ministers of Transport (ECMT), Black Sea Economic Cooperation (BSEC), 
and Transport Corridor Europe -Caucasus -Asia (TRACECA) permit systems.  
4.161.   In total, Georgia has 31 bilateral road transport agreements. Since 2015, bilat eral 
agreements on international road transport have been concluded with Bosnia and Herzegovina , 
China, Estonia, Kazakhstan, Slovenia, the Slovak  Republic , and Turkmenistan. Georgia is also a 
party to three international road conventions (Table 4.18).  
4.4.3.3   Maritime 
4.162.   Georgia is a maritime nation with a large maritime register with thousands of seafarers and 
connection to the Mediterranean Sea through its ports on the Black Sea. As of mid -2021, work was 
ongoing to develop the Maritime Transport Strategy document, w hich was expected to be adopted 
in late 2021.  
4.163.   Georgia has established institutional and governance structures for the maritime sector, 
including regulatory implementation and monitoring. The Maritime Transport Agency  (MTA) under 
the M ESD is the main regula tory agency with respect to key areas of technical regulation, maritime 
safety, environmental protection, and maritime labour regulation. The MTA operates independently 
and has established offices in the three major ports of the country. Other relevant mar itime 
institutions include the Georgian  Coast  Guard, the Maritime  Transport and Civil Aviation Accident 
Investigation Bureau, and the State Hydrographic Service. This structure ensures separates 
statutory and regulatory functions. The MTA is also responsib le for certain standards in the sector, 
e.g. the authorization of maritime educational institutions thereby monitoring the quality standards 
of ISO 9001:2015, and the implementation of  EU Directive 2008/106/EC on the minimum level of 
training of seafarers.  As such, Georgian seafarers' competency certificates in respect to education 
and the certification system are recognized by the European  Union.  
4.164.   The economic  regulation  of maritime  services  is almost  absent.  There  has been little or no 
regulation  of market  access,  competition,  or pricing  in the maritime  and port sectors.  Furthermore,  
full port privatization  in Georgia  has been achieved  in a way that no public  authority  is currently  in 
charge  of regulating  port operations  and services  economically,  although  the State  retains  some  
ownership.  The fishing  and inland  waterways  fleet remains  largely  unregulated.194 
4.165.   From 2020, changes in the Tax Code now offer a new maritime tax incentive scheme for 
shipowners and ship -management companies that allow for a lower tax  regime on their services. 
Under these amendments, foreign shipowners and maritime companies can apply for the status of 
an international company in Georgia. If they meet this criteria, taxes on property, profits, and income 
taxes will be reduced to 5%, wh ile dividends will be tax exempt.  
4.166.   In the maritime  transport  sector,  Georgia  is a party to 23 international  conventions  
(Table  4.18, in part) and has 22 intergovernmental bilateral agreements with other  countries  on, 
inter alia, maritime  transport,  shipping,  inland  navigation,  and ferry services.  Two bilateral  
agreements  were concluded  in 2017,  with Malta  and Ukraine,  on maritime  shipping  and on direct  
rail-ferry services  through  the ports,  respectively.  In May 2018,  Georgia  signed  the Burgas  
Ministerial  Declaration,  which  is expected  to be important  for structured  cooperation  on maritime  
affairs  in the Black  Sea, and is in the process  of ratifying  the Maritime  Labour  Convention  (MLC).  
4.167.   Georgia has concluded seafarers' certificate recognition memoranda of understanding 
(MOUs) with many Europea n countries and with most of the important flag States in the world. The 
European  Union recognized Georgian national seafarers' certificates of competency in the maritime 
 
194 Information provided by the  authorities.  WT/TPR/S/420 • Georgia  
 
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  sector in 2013. Georgia was the first among International Maritime Organization  (IMO)  
member  States to give full effect to the Standards of Training, Certification, and Watchkeeping 
Convention Manila Amendments.  
4.4.3.4   Ports  
4.168.   Georgia maintains four sea ports, at Batumi, Poti, Supsa, and Kulevi on the Black Sea. These 
ports are important for Georgi a but movements through them also support trade to many of its 
landlocked neighbours. The ports of Poti and Batumi have been described as medium -size ports that 
handle a variety of goods including bulk (dry and liquid), general cargo, and containerized tra ffic, 
while the ports at Supsa and Kulevi are specialized and are dedicated oil terminal facilities.195 Both 
Poti and Batumi ports are directly linked to the Georgian Railway network. The Poti port operator 
has been undertaking improvements to expand its of f-dock container storage capacity and started 
work to expand berth capacity. A fifth port, a deep -water port at Anaklia, has been planned and 
feasibility studies have been undertaken. As at September  2021, an updated feasibility study had 
been completed wi th a new traffic study, updated financial model, and marketing strategy, as well 
as recommendations on a new public -private partnership (PPP) structure. Thus, the 2014 tendering 
conditions were being revised and a new tender selection process was being und ertaken for a 
new investor in the project.196 
4.169.   In terms of management and ownership of ports, there is a varied situation, in part due to 
the absence of a national regulatory body and lack of a legislative mandate for port operations 
(see also Section  4.4.3. 3). Two ports are still owned by the Government, but their operations and 
management have been awarded to a private company in one case and a foreign SOE in the other. 
Another port is privately owned and operated through a freehold arrangement, and the las t is owned 
and operated by a foreign SOE. The situation of governance over Georgia ports has been described 
as weak and fragmented.197 This ad hoc arrangement in port sector governance has raised concerns, 
and there have been calls for reform.198 
4.4.3.5   Rail 
4.170.   Georgi a's rail infrastructure comprises 1,412  km of operational rail, of which 90% is 
electrified and is run and operated by JSC Georgian  Railway, a 100% SOE. Its operations consist of 
cargo and passenger transport; it also has an infrastructure unit. It is the largest single employer in 
Georgia, with over  12,000  employees. Georgian Railway sets tariffs for freight transportation and 
related services independently according to its railway tariff policy. Current railway business is not 
regulated and is not subject  to licensing. It is reported that more than 95% of Georgian Railway's 
revenue is from freight operations and at least half of this from transit traffic, thus freight traffic 
cross-subsidizes passenger traffic.199 
4.171.   One of the major undertakings begun during the period is the modernization of the 
Tbilisi -Makhinjauri railway line, which is being carried out by international firms chosen after a 
competitive tendering process. The project is expected to increase the capacity of the line, improve 
safety, and reduc e travel times. In cooperation with Azerbaijan and Turkey, the three  countries 
recently completed the construction of the Baku -Tbilisi -Kars (BTK) Railway, which provides a direct 
connection between Baku and southern Turkey via Georgia. Working towards meet ing 
European  standards in rail transport has also been a priority during the period.  
4.172.   Railway transport in Georgia is regulated by the Railway Code , which determines the 
economic, legal, organizational, and technological bases for the functioning of rail tr ansport, and its 
place and role in the economy and social sector. The Code also regulates legal relations arising 
during the use of railway services and determines the rights, obligations, and responsibilities of the 
providers and recipients of these servi ces. This Code applies to the transport of passengers, cargo, 
luggage, cargo -luggage, and mail on public railroads. In addition to the Code, the sector is regulated 
 
195 CAREC (2021), Ports and Logistics Scoping Study in CAREC Countries . Viewed at: 
https://www.carecprogram.org/?event=ports -and-logistics -scoping -study -in-carec -countries . 
196 Ministry of the Economy and Sustainable Development, Ongoing Projects . Viewed at: 
http://www.economy.ge/?page=projects&s=31 ; and information provided by the authorities.  
197 CAREC (2021), Ports and Logistics Scoping Study in CAREC Countries . 
198 CAREC (2021), Ports and Logistics Scoping Study in CAREC Countries . 
199 CAREC (2021), Railway Sect or Assessment for Georgia . WT/TP R/S/420 • Georgia  
 
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  by certain by -laws adopted by the Minister of Economy and Sustainable Development in accord ance 
with the Railway Code, such as:  
• Order of the Minister of Economy and Sustainable Development on Rail Passengers' Rights 
and Obligations;  
• Order of the Minister of Economy and Sustainable Development on the Approval of Rules 
on Transportation of Goods by Rail;  
• Order of the Minister of Economy and Sustainable Development on the Approval of Rules 
on Transportation of Passengers, Luggage and Mai l by Rail; and  
• Order of the Minister of Economy and Sustainable Development on Approval of the Form 
of Receipt of the Penalty and Administrative Offence Protocol, Its Filing, Registration and 
Reporting Rules for Administrative Violations Committed on Railw ay Transport.  
4.173.   Fulfilment of the rail -related obligations of the DCFTA entails substantial changes to the 
railway sector in Georgia, i.e. eight EU directives or regulations concerning railway transport are to 
be implemented. In particular, the railway opera tions of freight and passenger services and 
infrastructure are to be separated with their own respective new authorities for licensing and 
regulatory aspects. Through the recently launched Twinning Project, the European  Union will support 
Georgia in its ef forts to approximate its legal and institutional framework to the EU  acquis  in the 
field of rail transport.  
4.174.   In 2017, Georgia participated with 11 partners in approving the Central Asia Regional 
Economic Cooperation Programme (CAREC) Railway Strategy that a imed to expand and coordinate 
rail transport, improve infrastructure, and advance the commercialization of and reforms to the 
sector. An Asian Development Bank (ADB) technical assistance project followed to further develop 
certain aspects of the strategy. Georgia is a party to eight international rail transport conventions 
(Table  4.18) and has an additional 11  bilateral agreements with neighbouring countries covering the 
rail sector, mainly on coordinating railway transport activities.200 During the period, a new bilateral 
agreement with Turkey was concluded in 2016 on a framework for the rail transport of passengers 
and goods.  
4.4.4   Tourism  
4.175.   Georgia's services statistics demonstrate the economy's heavy reliance on tourism, as travel 
and transport services accounted  for more than 90% of services exports during most of the 
period  2015-20201 (Section 1, Table 1.4). Travel services exports increased 75%, from 
USD 1.9 billion in 2015 to USD  3.3 billion in 2019, before falling to USD  541.7  million 
in 2020 (Section 1, Table  1.4) when the number of international visitors declined by 80%. The 
dramatic loss of income from tourism in 2020 was one of the main factors contributing to the 
COVID‑19 pandemic's severe impact on Georgia's economy. According to the IMF, the tourism sect or 
showed signs of faster -than-expected recovery in 2021, driven not only by foreign but also 
domestic  tourists. A  gradual post -pandemic recovery of tourism is expected to result in a reduction 
of the current account deficit from 10% in  2021 to 5.5% by 2026.202 
4.176.   The top countries in terms of international visitors are Azerbaijan, the Russian  Federation, 
Armenia, and Turkey.203 A World Bank study published in 2018 notes that efforts to diversify the 
profile of foreign travellers have not yet been successful,  as over 80% of tourists arrived overland 
from these four countries. The same study also observes that while the underlying assets of 
 
200 Ministry of the Economy and Sustainable Development, Agreements . Viewed at: 
http://www.economy.ge/uploads/files/2017/transport/ag reements/agreements_eng_.pdf . 
201 Tourism accounted for 8.4% of GDP in 2019 and 5.9% in 2020. Information provided by the 
authorities.  
202 IMF Country Report No.  231/215.  
203 In 2019, the numbers of visits from these countries were: Azerbaijan, 1,527,000; the 
Russian Federation, 1,472,000; Armenia, 1,365,000; and Turkey, 1,157,000. Information provided by the 
authorities.  WT/TPR/S/420 • Georgia  
 
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  Georgia's tourism sector are sound, Georgia needs to maximize the potential of its tourism sector 
by making improvements r egarding accessibility and hospitality infrastructure and services.204 
4.177.   The intuitional  framework for the regulation of the tourism sector has not changed since the 
previous Review. The Georgian National Tourism Administration (GNTA), a Legal Entity of Public Law 
under the M ESD, is responsible  for the formulation and implementation of tourism policy, promotion 
of sustainable tourism development, promotion of high export growth and job creation on the basis 
of tourism development, attraction of foreign tourist s to Georgia, development of domestic tourism, 
promotion of human resources development in the field of tourism, and infrastructure 
development.205 The main legislation in this sector is the Law on Tourism and Resorts, adopted 
in 1997 and last amended in 20 19, which is currently in the process of being updated.206 Since  2015, 
891 new hotels projects have been realized, including 15  new internationally branded hotels.207 
There are no special requirements for hotel operation, such as licences or permits.  
4.178.   Georgia 's tourism policy is based on the Georgia Tourism Strategy 2025,  adopted in 2015.208 
The vision of this strategy is that by 2025, Georgia will be well known as a premier, year -round, 
high-quality tourism destination, centred on its unique cultural and natur al heritage, world -class 
customer service, and tradition of hospitality. Georgia will be at the forefront of tourism 
competitiveness, through strategic investments in infrastructure, education, marketing, and the 
development of unique Georgian visitor expe riences that appeal to high -value markets around the 
globe. Increased visitor spending is expected to significantly raise tourism's contribution to economic 
growth and development. The focus will be on the quality and diversity of visitor arrivals, rather 
than on the total number of visitors.209 The Strategy defines eight strategic objectives, 50  priority 
actions, and more than 100 activities to raise awareness in target markets about Georgia's tourism 
potential, assist the private sector in the creation of higher quality and niche tourism products, and 
improve service quality.  
4.179.   Enterprise Georgia, the Government's economic development agency (Section 2), 
administers several programmes to support the development of the tourism sector. The Host in 
Georgia Program, launched in 2016 to support the hotel sector, provides for the co -financing of 
interest rates on loans for the development of hotels with more than 10 rooms. The Program has 
supported the development of more than 140 hotels throughout Georgia. To mitig ate the impact of 
the COVID ‑19 pandemic, the coverage of the Program was extended from 632 strategic locations in 
Georgia to all locations, excluding Tbilisi and Batumi, and the duration and terms of the co -financing 
were made more favourable.210 Under the Host in Georgia Program, Enterprise Georgia also provides 
co-financing for international brands/franchises to enter the market. Since  2016, co -financing 
facilities to support the development of the hotel industry have also been provided under the Produce 
in Georgia Program. Finally, Enterprise Georgia provides support to the tourism sector under the 
Micro and Small Business Support Program (Section 3.3.1.1).  Over the years, more than 700 family 
hotels and guesthouses were developed with the support of this programme.  In the context of the 
COVID‑19 pandemic, geographical restrictions attached to this type of support were relaxed and the 
amounts of support provided were increased.  
4.180.   Several new support programmes directed at the tourism sector were launched in 2020 as 
part of the measures taken to mitigate the economic impact of the COVID ‑19 pandemic. These 
programmes, administered by Enterprise Georgia, have been terminated.  
4.181.   The co-financing Mechanism for the Small, Medium & Family Hotel Industry  aimed to  support 
small, medium, and family -type hotels during the COVID ‑19 crisis. The programme provides 
co-financing for accrued interest on loans for 12 months. The co -financing amount is 80% of the 
interest rate, if the loan is in lari, and 70% of the in terest rate if the loan is in US dollars  or euro. 
 
204 World Bank (2018), Georgia: From Reformer to Performer , pp. 72 -73. 
205 This description of the GNTA's role is based on information viewed at: https://gnta.ge/about -us/. 
206 Information provided by the authorities.  
207 Information provided by the authorities.  
208 The GNTA is currently developing a post -COVID‑19 tourism recovery and crisis management oriented 
strategic annex to the Georgia Tourism Strategy 2025. The main aim of the document is to adapt the Strategy 
to the current challenges of the pandemic and post -pandemic period in order to guarantee the timely and 
effective recovery of tourism industry.  
209 Information provided by the authorities; and MESD, Vision . Viewed at: 
http://www.economy.ge/?page=ecopolitic&s=18 . 
210 Information provided by the authorities.  WT/TP R/S/420 • Georgia  
 
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  The maximum loan amount under this programme is GEL 5,000,000, USD  1,750,000, or 
EUR 1,600,000. Any hotel that has at least four or more operational rooms and has had less than 
GEL 20,000,000 in turnover is  qualified to apply. The programme had 3,265 beneficiaries in 2020.  
• The Loan Subsidy Scheme for Event Companies provides support to organizers of any kind 
of gathering, exhibition, conference, meeting, or event by subsidizing the interest rates 
on commerci al bank loans. The programme aimed to subsidize 100% of the interest 
accrued on the principal of the business entity's loan balance, for the next 12 months. The 
programme has had 53 beneficiaries since it was launched.  
• The Bank Guarantee Subsidy Mechanism for Operation in Cooperation with the 
International Air Transport Association (IATA) and General Sales Agent (GSA) aimed to 
subsidize the interest/fee on bank guarantees issued by the guarantor for the following 
entrepreneurial entities: IATA -accredited co mpanies and GSA Companies under the 
GSA contract. Under this mechanism, Enterprise Georgia has subsidized 100% of the 
monthly payments of the bank guarantees of the beneficiaries involved in the programme, 
for the next six months. The programme has had 33 beneficiaries since it was launched.  
• The Co -Financing Mechanism for Restaurants was created with a view to supporting 
restaurants in Georgia during the COVID ‑19 crisis. The programme provided co -financing 
for accrued interest on loans for six months. The co -financing amount is 80% of the 
interest rate if the loan is in lari, and 70% of the interest rate if the loan is in US  dollars  
or euro. The programme has had 633 beneficiaries since it was launched.  
4.182.   To promote entrepreneurship and investment , the Government implemented the Law on 
Supporting the Development of Free Tourism Zones, which determines the conditions, as well as tax 
and other privileges, for the construction and operation of hotels in free tourism zones.  WT/TPR/S/420 • Georgia  
 
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  5  APPENDIX TABLES  
Table A1. 1 Merchandise exports including re -exports by group of products, 2015 -20 
  2015  2016  2017  2018  2019  2020  
Total exports (USD  million)  2,204.2  2,117.1  2,745.7  3,379.7  3,798.4  3,343.4  
      (% of total)  
Total primary products  49.2 54.2 50.9 48.6 44.1 55.7 
 Agriculture  28.4 33.5 29.1 29.1 24.0 28.5 
 Food 27.6 32.5 28.1 28.3 23.2 28.0 
 1121 – Wine of fresh grapes (including 
 fortified wine)  4.4 5.4 6.3 5.9 5.9 6.3 
 1110 – Non-alcoholic beverages, n.e.s.  4.6 4.3 4.1 4.3 4.2 4.4 
 1124 – Spirits; liqueurs and other spirituous 
 beverages, n.e.s.  2.9 4.3 4.6 3.8 3.4 4.0 
 0577 – Edible nuts, fresh or dried  8.0 8.5 3.0 2.1 1.8 2.8 
 0579 – Fruit, fresh or dried, n.e.s.  0.3 0.4 0.3 0.4 0.6 1.2 
 1222 – Cigarettes containing tobacco  0.3 0.5 1.5 4.4 1.4 0.9 
 0011 – Bovine animals, live  0.9 1.7 1.3 0.9 0.6 0.8 
 Agricultural raw material  0.8 1.0 1.0 0.8 0.8 0.5 
 Mining  20.8 20.7 21.8 19.5 20.1 27.2 
 Ores and other minerals  14.1 17.1 17.0 16.8 18.9 26.1 
 2831 – Copper ores and concentrates  12.3 14.8 15.4 14.9 17.1 23.3 
 2891 – Precious metal ores and 
 concentrates  0.0 0.2 0.0 0.0 0.3 1.2 
 Non-ferrous metals  0.5 0.6 0.8 0.7 0.6 0.5 
 Fuels 6.2 2.9 4.0 2.0 0.7 0.5 
Manufactures  48.0 41.9 46.5 49.3 53.9 41.3 
 Iron and steel  11.1 9.9 13.5 12.4 9.6 8.3 
 6715 – Other ferro -alloys  8.4 8.0 10.9 10.3 8.0 7.4 
 Chemicals  14.4 10.9 10.7 9.8 9.8 8.2 
 5429 – Medicaments, n.e.s.  5.8 4.6 4.6 4.0 4.2 2.6 
 5621 – Mineral or chemical fertilizers, 
 nitrogenous  5.0 3.1 2.8 2.7 2.5 2.2 
 Other semi -manufactures  2.7 3.0 3.2 3.4 3.2 2.6 
 Machinery and transport equipment  13.3 11.4 13.7 18.0 25.1 16.4 
 Power generating machines  0.2 0.2 0.2 0.4 0.2 0.0 
 Other non-electrical machinery  1.0 1.3 2.2 2.1 2.0 1.1 
 Office machines & telecommunication 
 equipment  1.0 0.4 0.5 0.4 0.4 0.4 
 Other electrical machines  0.8 0.6 0.7 0.8 1.0 0.9 
 Automotive products  9.1 8.6 9.9 13.9 20.8 13.0 
 7812 – Motor vehicles for the transport of 
 persons, n.e.s.  8.1 8.1 8.9 12.7 19.3 12.1 
 Other transport equipment  1.3 0.3 0.2 0.3 0.8 1.0 
 Textiles  0.2 0.2 0.3 0.5 0.5 0.7 
 Clothing  4.0 3.8 3.1 2.5 2.8 2.7 
 8454 – T-shirts, singlets  and other vests, 
 knitted or crocheted  1.9 1.8 1.6 1.2 1.0 1.2 
 Other consumer goods  2.2 2.7 2.0 2.7 2.9 2.6 
Other  2.8 3.8 2.6 2.1 1.9 3.0 
 9710 – Gold, non -monetary  2.8 3.8 2.6 2.1 1.9 3.0 
Note:  Based on SITC Rev.3.  
Source:  WTO Secretariat calculations, based on National Statistics Office of Georgia, External Trade . 
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  Table A1. 2 Merchandise domestic exports by group of products, 2015 -20 
  2015  2016  2017  2018  2019  2020  
Total exports (USD  million)  1,602.5  1,620.4  2,007.8  2,226.2  2,324.5  2,408.1  
       (% of total)  
Total primary products  58.8 64.4 60.6 60.3 64.0 69.7 
 Agriculture  35.4 37.8 32.1 31.9 31.7 32.4 
 Food 34.4 36.5 31.0 31.0 30.9 31.7 
 1121 – Wine of fresh grapes (including 
 fortified wine)  5.8 6.9 8.5 8.7 9.5 8.7 
 1110 – Non-alcoholic beverages, n.e.s.  6.2 5.6 5.6 6.5 6.9 6.1 
 0577 – Edible nuts, fresh or dried  11.0 11.0 4.0 2.4 2.8 3.9 
 1124 – Spirits; liqueurs and other spirituous 
 beverages, n.e.s.  1.8 2.5 3.0 3.7 3.6 3.6 
 0579 – Fruit, fresh or dried, n.e.s.  0.3 0.4 0.4 0.6 0.9 1.6 
 0011 – Bovine animals, live  1.3 2.3 1.8 1.3 1.0 1.2 
 0012 – Sheep and goats, live  1.2 0.6 0.3 0.2 0.6 0.9 
 0814 – Flours, meals and pellets, of meat or 
 meat offal, of fish or of crustaceans  0.7 0.9 0.7 0.7 0.4 0.9 
 Agricultural raw material  1.0 1.3 1.2 0.9 0.8 0.7 
 Mining  23.4 26.6 28.4 28.4 32.4 37.3 
 Ores and other minerals  14.6 22.3 23.3 25.5 30.8 36.3 
 2831 – Copper ores and concentrates  12.1 19.3 21.0 22.7 27.9 32.3 
 2891 – Precious metal ores and 
concentrates  0.0 0.3 0.1 0.0 0.5 1.7 
 2882 – Other non -ferrous base metal waste 
 and scrap, n.e.s.  1.7 1.2 1.4 1.3 1.2 1.1 
 Non-ferrous metals  0.7 0.8 1.1 1.0 0.8 0.6 
 Fuels 8.1 3.4 4.1 2.0 0.7 0.4 
Manufactures  37.3 30.6 35.9 36.5 32.8 26.2 
 Iron and steel  15.1 12.8 18.3 18.4 15.3 11.3 
 6715 – Other ferro -alloys  11.6 10.4 15.0 15.6 13.0 10.2 
 Chemicals  9.4 6.5 6.6 7.3 6.8 6.0 
 5621 – Mineral or chemical fertilizers, 
 nitrogenous  6.8 4.1 3.8 4.1 4.1 3.0 
 Other semi -manufactures  1.9 2.2 2.3 2.3 2.0 1.8 
 Machinery and transport equipment  4.0 1.9 3.0 2.9 2.5 1.6 
 Power generating machines  0.2 0.2 0.2 0.2 0.0 0.0 
 Other non -electrical machinery  0.7 0.6 1.8 1.3 0.9 0.6 
 Office machines & telecommunication equipment  0.9 0.4 0.4 0.4 0.3 0.3 
 Other electrical machines  0.5 0.4 0.4 0.4 0.5 0.3 
 Automotive products  0.0 0.0 0.0 0.1 0.1 0.1 
 Other transport equipment  1.6 0.3 0.1 0.4 0.8 0.4 
 Textiles  0.2 0.2 0.2 0.2 0.2 0.4 
 Clothing  4.8 4.5 4.0 3.5 4.2 3.5 
 8454 – T-shirts, singlets and other vests, 
 knitted or crocheted  2.6 2.3 2.2 1.8 1.6 1.7 
 Other consumer goods  1.9 2.5 1.5 1.9 1.7 1.5 
Other  3.9 5.0 3.5 3.2 3.2 4.2 
 9710 – Gold, non -monetary  3.9 5.0 3.5 3.1 3.1 4.1 
Note:  Based on SITC Rev.3.  
Source:  WTO Secretariat calculations, based on National Statistics Office of Georgia, External Trade .  
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  Table A1. 3 Merchandise domestic exports by destination, 2015 -20 
  2015  2016  2017  2018  2019  2020  
Total exports (USD  million)  1,602.5  1,620.4  2,007.8  2,226.2  2,324.5  2,408.1  
      (% of total)  
Americas  13.3 8.0 6.9 8.4 6.9 4.6 
 United  States  6.4 4.2 6.0 7.1 5.5 3.2 
 Other America  6.9 3.8 0.9 1.3 1.3 1.4 
 Peru 0.2 0.2 0.2 0.4 0.4 0.6 
Europe  50.2 48.5 46.0 46.7 48.1 42.8 
 EU-27 33.3 30.4 27.8 27.5 30.4 25.8 
 Bulgaria  11.1 9.7 9.3 11.6 12.1 12.9 
 Spain  2.6 2.5 2.9 2.2 1.8 3.4 
 Germany  4.4 4.7 1.9 2.0 1.8 2.4 
 Lithuania  1.7 1.3 1.6 1.8 1.8 1.4 
 Italy 4.6 4.5 3.0 1.9 1.7 1.4 
 Poland  1.8 0.5 0.9 0.7 1.0 1.1 
 Romania  1.7 2.3 3.7 2.6 7.6 0.8 
 EFTA 0.7 3.1 3.3 3.0 3.1 4.0 
 Switzerland  0.7 3.1 3.3 3.0 3.1 4.0 
 Other Europe  16.2 15.0 14.9 16.2 14.7 13.0 
 Turkey  11.1 10.3 10.3 10.4 8.1 7.2 
 Ukraine  3.4 3.8 3.7 5.1 5.6 5.2 
CISa 25.8 22.4 29.0 29.7 30.9 27.9 
 Russian  Federation  9.7 11.8 17.8 17.2 18.6 16.7 
 Armenia  5.4 3.8 3.6 3.5 3.6 3.6 
 Azerbaijan  5.6 2.9 4.3 5.2 3.7 3.3 
 Belarus  1.2 1.0 0.9 0.9 1.4 1.4 
 Kazakhstan  2.4 1.6 1.2 1.7 1.9 1.4 
 Uzbekistan  0.5 0.6 0.5 0.8 0.7 0.9 
Africa  0.7 1.2 1.4 0.8 0.4 0.8 
Middle East  2.9 6.6 5.1 4.1 3.7 2.8 
 Saudi Arabia, Kingdom of  0.3 1.5 0.2 0.2 0.3 0.8 
 Iran, Islamic Republic of  0.7 1.8 2.4 2.3 1.7 0.7 
 Iraq 0.6 2.4 1.5 0.8 0.7 0.6 
Asia 7.1 13.3 11.5 10.2 10.0 20.9 
 China  5.5 10.6 9.5 8.2 8.7 19.1 
 Japan  0.2 0.2 0.4 0.5 0.4 0.6 
 Other Asia  1.4 2.6 1.7 1.5 0.9 1.2 
Other  0.0 0.0 0.0 0.0 0.0 0.0 
Memo        
EU-28 34.6 31.0 28.4 28.1 31.3 26.4 
a Commonwealth of Independent States, including certain associate and former member States.  
Source:  WTO Secretariat calculations, based on National Statistics Office of Georgia, External Trade . 
 
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  Table A1. 4 Merchandise exports including re -exports by destination, 2015 -20 
  2015  2016  2017  2018  2019  2020  
Total exports (USD  million)  2,204.2  2,117.1  2,745.7  3,379.7  3,798.4  3,343.4  
 (% of total)  
Americas  9.9 6.3 5.2 5.9 4.4 3.4 
 United  States  4.7 3.2 4.4 4.7 3.5 2.4 
 Other America  5.1 3.1 0.8 1.1 0.9 1.0 
Europe  42.2 42.5 39.3 36.4 35.7 36.9 
 EU-27 28.3 26.0 23.4 21.1 20.8 20.8 
 Bulgaria  9.7 7.6 6.8 7.7 7.5 9.4 
 Spain  1.9 2.0 2.2 1.8 1.2 2.5 
 Germany  3.4 4.0 1.7 1.5 1.4 1.8 
 Lithuania  1.5 1.2 1.3 1.3 1.2 1.1 
 Italy 3.4 3.4 2.5 1.3 1.1 1.0 
 France  1.0 1.2 1.0 1.3 0.8 1.0 
 Poland  1.3 0.4 0.7 0.5 0.7 0.9 
 Netherlands  1.9 1.7 1.5 1.4 0.7 0.7 
 EFTA 1.4 3.9 2.6 2.3 2.2 3.2 
 Switzerland  1.4 3.9 2.6 2.3 2.2 3.2 
 Other Europe  12.5 12.6 13.3 13.0 12.7 12.8 
 Ukraine  2.7 3.5 4.6 5.3 6.6 6.5 
 Turkey  8.5 8.2 7.9 7.1 5.3 5.7 
CISa 35.4 31.5 38.9 44.7 47.2 38.6 
 Azerbaijan  10.9 7.2 10.0 15.0 13.4 13.2 
 Russian  Federation  7.4 9.8 14.5 13.0 13.1 13.2 
 Armenia  8.2 7.2 7.8 8.5 11.4 5.6 
 Uzbekistan  4.4 3.4 2.3 2.4 2.3 2.2 
 Kazakhstan  2.0 1.9 1.9 2.7 1.8 1.4 
 Belarus  0.9 0.9 1.0 0.8 1.2 1.4 
Africa  0.8 1.4 1.2 0.6 0.4 1.1 
Middle East  4.4 7.2 5.9 4.7 4.9 3.7 
 United Arab Emirates  1.3 1.5 1.4 1.3 1.7 0.9 
 Iran, Islamic Republic of  1.6 2.2 2.8 2.2 1.9 0.9 
 Israel  0.3 0.3 0.3 0.3 0.4 0.6 
Asia 7.3 11.0 9.6 7.9 7.5 16.3 
 China  5.7 8.2 7.3 5.9 5.9 14.3 
 Japan  0.1 0.1 0.3 0.3 0.3 0.5 
 Other Asia  1.5 2.7 2.0 1.6 1.3 1.5 
Other  0.0 0.0 0.0 0.0 0.0 0.0 
Memo:        
EU-28 29.3 26.7 23.9 21.6 21.6 21.4 
a Commonwealth of Independent States, including certain associate and former member States.  
Source:  WTO Secretariat calculations, based on National Statistics Office of Georgia, External Trade . 
 
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  Table A1. 5 Merchandise imports by group of products, 2015 -20 
  2015  2016  2017  2018  2019  2020  
Total imports (USD  million)  7,304.2  7,341.9  8,057.2  9,361.8  9,519.2  8,052.9  
 (% of total)  
Total primary products  36.6 33.3 34.8 34.4 34.5 35.6 
 Agriculture  15.5 14.8 14.9 14.7 13.5 15.2 
 Food 14.6 14.0 14.1 13.8 12.7 14.4 
 0412 – Other wheat (including spelt) and 
 meslin, unmilled  1.6 1.1 1.2 1.2 1.1 1.3 
 1222 – Cigarettes containing tobacco  1.4 1.4 1.3 2.0 1.1 1.1 
 0989 – Food preparations, n.e.s.  0.7 0.7 0.8 0.7 0.7 0.8 
 0123 – Meat and edible offal of the poultry, 
 fresh, chilled or frozen  0.7 0.8 0.8 0.7 0.7 0.8 
 Agricultural raw material  0.9 0.8 0.8 0.8 0.8 0.8 
 Mining  21.1 18.5 20.0 19.8 20.9 20.3 
 Ores and other minerals  3.7 4.0 4.9 5.0 6.8 8.0 
 2831 – Copper ores and concentrates  2.8 3.4 4.2 4.2 6.3 7.2 
 Non-ferrous metals  0.4 0.4 0.4 0.5 0.5 0.5 
 Fuels 17.0 14.1 14.6 14.3 13.6 11.9 
 334 – Petroleum oils or bituminous minerals  9.0 8.4 8.7 9.2 8.0 6.2 
 3432 – Natural gas, in the gaseous state  5.6 4.2 3.7 3.0 3.3 3.8 
 3510 – Electric current  0.6 0.3 0.8 0.8 0.8 0.8 
Manufactures  63.0 66.5 64.8 65.3 65.2 64.2 
 Iron and steel  4.0 3.0 3.2 3.5 2.9 3.2 
 Chemicals  11.5 11.8 11.8 10.8 11.2 13.0 
 5429 – Medicaments, n.e.s.  3.8 4.1 3.9 3.4 3.5 3.8 
 5986 – Organic chemical products, n.e.s.  0.2 0.2 0.2 0.2 0.2 0.6 
 Other semi -manufactures  9.7 10.6 10.4 9.8 10.1 10.2 
 6911 – Structures and parts of structures  0.9 1.3 0.8 0.8 0.8 0.8 
 Machinery and transport equipment  26.2 29.1 27.4 29.1 30.1 27.2 
 Power generating machines  1.7 1.3 0.5 1.5 0.8 0.5 
 Other non -electrical machinery  6.5 8.2 6.1 6.8 6.7 6.2 
 Office machines & telecommunication equipment  4.8 4.7 5.7 5.0 4.4 4.0 
 7643 – Transmission apparatus for radio -
 telephony, radio -telegraphy, radio -broadcasting 
 or television  1.5 1.7 2.0 1.6 1.7 1.6 
 Other electrical machines  4.4 4.8 4.1 3.9 3.5 3.2 
 Automotive products  8.2 9.3 9.7 11.0 14.1 12.5 
 7812 – Motor vehicles for the transport of 
 persons, n.e.s.  6.5 7.1 7.3 9.0 11.6 9.7 
 7821 – Motor vehicles for the transport of goods  0.7 1.0 0.9 0.8 0.8 0.9 
 7831 – Motor vehicles for the transport of 10 or 
 more persons, including the driver  0.1 0.2 0.4 0.1 0.5 0.7 
 Other transport equipment  0.6 0.9 1.4 0.8 0.7 0.8 
 Textiles  1.6 1.6 1.7 1.6 1.7 1.9 
 Clothing  2.3 2.6 2.6 2.3 2.2 1.9 
 Other consumer goods  7.8 7.8 7.8 8.3 6.9 6.8 
Other  0.3 0.3 0.3 0.3 0.3 0.2 
Note:  Based on SITC Rev.3.  
Source:  WTO Secretariat calculations, based on National Statistics Office of Georgia, External Trade . 
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  Table A1. 6 Merchandise imports by origin, 2015 -20 
  2015  2016  2017  2018  2019  2020  
Total imports (USD  million)  7,304.2  7,341.9  8,057.2  9,361.8  9,519.2  8,052.9  
 (% of total)  
Americas  5.2 5.5 6.8 7.5 10.9 11.0 
 United  States  3.5 3.1 4.1 5.4 7.1 6.9 
 Other America  1.8 2.4 2.7 2.2 3.8 4.1 
 Brazil  1.0 1.0 1.2 1.4 1.2 2.0 
 Chile 0.0 0.2 0.6 0.2 1.3 1.0 
Europe  54.1 55.4 51.2 49.5 47.6 47.3 
 EU-27 27.3 28.4 26.4 26.2 24.2 23.0 
 Germany  5.9 5.9 5.6 5.0 5.3 5.1 
 Italy 2.7 3.6 2.7 2.5 2.4 2.3 
 Netherlands  1.8 3.0 2.0 2.3 1.9 2.0 
 France  1.6 1.6 1.7 2.8 1.7 1.9 
 Poland  1.2 1.4 1.6 1.5 1.8 1.7 
 Romania  2.8 2.6 2.4 2.2 2.2 1.5 
 Bulgaria  2.3 2.0 1.9 1.9 1.3 1.4 
 Spain  1.3 1.2 1.3 1.1 1.1 1.1 
 Belgium  0.9 0.8 0.9 0.9 1.1 1.0 
 Czech  Republic  0.8 0.9 1.0 0.9 0.9 0.9 
 EFTA 1.1 0.8 0.8 0.8 0.8 0.9 
 Other Europe  25.7 26.2 23.9 22.4 22.6 23.4 
 Turkey  18.2 18.4 17.1 15.7 17.0 17.5 
 Ukraine  6.2 5.7 5.6 5.5 4.4 4.8 
 United Kingdom  1.3 2.0 1.2 1.1 1.1 0.9 
CISa 20.7 21.4 23.3 23.3 21.3 25.1 
 Russian  Federation  8.6 9.3 9.8 10.0 10.3 11.0 
 Azerbaijan  7.4 6.7 7.0 6.3 5.9 6.4 
 Armenia  2.4 3.0 3.5 3.6 2.8 5.2 
 Turkmenistan  1.5 1.0 1.5 1.9 1.2 0.9 
Africa  0.8 0.3 0.4 0.5 0.5 0.2 
Middle East  4.6 3.3 3.4 3.9 4.0 2.2 
 United Arab Emirates  2.9 1.9 1.8 1.7 1.7 1.4 
Asia 14.6 14.1 15.0 15.3 15.7 14.1 
 China  8.0 7.5 9.1 8.9 9.0 8.8 
 Japan  2.9 2.7 2.0 2.6 2.7 2.0 
 Other Asia  3.7 3.9 3.9 3.8 4.0 3.3 
Other  0.0 0.0 0.0 0.0 0.0 0.0 
Memo:        
EU-28 28.5 30.3 27.6 27.3 25.3 23.9 
a Commonwealth of Independent States, including certain associate and former member States.  
Source:  WTO Secretariat calculations, based on National Statistics Office of Georgia, External Trade . 
 WT/TPR/S/ 420 • Georgia  
 
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  Table A1. 7 Balance of payments, 2015 -20 
(USD million)  
  2015  2016  2017  2018  2019  2020  
Current account  -1,767.0  -1,890.6  -1,305.6  -1,191.4  -960.1  -1,965.6  
 Goods and services  -2,547.8  -2,310.7  -1,784.9  -1,872.0  -1,560.6  -3,040.8  
 Credit  6,108.2  6,177.7  7,560.0  8,896.6  9,544.8  5,926.6  
 Debit  8,656.0  8,488.5  9,344.9  10,768.6  11,105.4  8,967.4  
 Goods  -3,951.9  -3,882.5  -3,809.2  -4,115.8  -3,736.4  -3,165.0  
 Credit  3,021.0  2,864.7  3,569.9  4,406.5  4,944.3  4,346.5  
 Debit  6,973.0  6,747.2  7,379.1  8,522.3  8,680.7  7,511.5  
 Services  1,404.1  1,571.8  2,024.3  2,243.8  2,175.8  124.2  
 Credit  3,087.1  3,313.0  3,990.1  4,490.1  4,600.5  1,580.1  
 Debit  1,683.0  1,741.2  1,965.8  2,246.3  2,424.7  1,455.9  
 Primary income  -338.8  -701.0  -793.8  -683.2  -774.5  -734.4  
 Credit  844.5  914.0  1,129.8  1,281.8  1,372.6  961.9  
 Debit  1,183.3  1,614.9  1,923.6  1,965.0  2,147.1  1,696.3  
 Secondary income  1,119.6  1,121.1  1,273.1  1,363.8  1,375.0  1,809.7  
 Credit  1,221.7  1,233.0  1,397.3  1,502.7  1,539.0  1,906.8  
 Debit  102.1  111.9  124.3  139.0  164.0  97.1 
 Of which: workers' remittances  (net) 587.3  578.1  749.7  864.4  915.2  1,166.9  
Capital account  58.3 56.0 83.1 76.1 47.1 41.1 
Net lending (+) / net borrowing ( -) (balance 
from current and capital account)  -1,708.7  -1,834.7  -1,222.5  -1,115.4  -913.0  -1,924.5  
Financial account  -1,781.2  -1,823.3  -1,254.8  -1,218.4  -958.0  -2,001.7  
 Direct investment  -1,419.6  -1,246.8  -1,711.3  -976.9  -1,054.3  -549.1  
 Assets  315.7  413.0  209.3  293.6  311.9  -15.1 
 Liabilities  1,735.3  1,659.8  1,920.6  1,270.5  1,366.2  534.0  
 Portfolio investment  153.6  -41.5 75.9 47.6 -697.6  -71.0 
 Assets  82.8 102.3  241.7  254.8  28.5 50.7 
 Liabilities  -70.8 143.8  165.8  207.1  726.1  121.6  
 Financial derivatives and employee stock 
 options  1.8 4.0 0.5 1.2 -3.7 -27.2 
 Assets  -12.3 -12.8 -7.1 -9.3 -28.7 -48.4 
 Liabilities  -14.1 -16.8 -7.6 -10.6 -25.0 -21.3 
 Other investment  -417.5  -783.7  138.1  -568.9  595.4  -1,659.9  
 Assets  782.3  271.7  655.1  51.3 471.0  -95.2 
 Liabilities  1,199.8  1,055.4  517.0  620.1  -124.4  1,564.7  
 Reserve assets  -99.4 244.8  242.0  278.5  202.1  305.5  
Net errors and omissions  -72.5 11.4 -32.3 -103.0  -44.9 -77.2 
Source:  NBG, Statistics . 
 
  WT/TP R/S/420 • Georgia  
 
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  Table A2. 1 Notifications, January 2016 -June 2021  
Notifications  Title Document 
Date  Doc #  
G/TBT/N/GEO/114  Committee on Technical Barriers to Trade – 
Notification – Georgia – Water content of frozen, fast -
frozen poultry meat and fresh, frozen, and fast -frozen 
poultry pieces  06/05/2021  21-3863 
S/C/N/1035; WT/REG440/N/1  Committee on Regional Trade Agreements – Council 
for Trade in Services – Notification  of Regional 
Trade  Agreement – United Kingdom and Georgia  07/01/2021  21-0278 
G/TBT/N/GEO/113  Committee on Technical Barriers to Trade – 
Notification – Georgia – Poultry meat marketing 
requirements  06/01/2021  21-0226 
G/TBT/N/GEO/112  Committee on Technical Barriers to Trade – 
Notification – Georgia – Poultry meat  18/12/2020  20-9168 
G/TBT/2/Add.81/Rev.3  Committee on Technical Barriers to Trade – 
Implementation and Administration of the Agreement 
on Technical  Barriers to Trade – Communication from 
Georgia – Revision  03/12/2020  20-8709 
G/ADP/N/1/GEO/2  Committee on Anti -Dumping Practices – Notification 
of laws and regulations under Article  18.5 of the 
Agreements – Georgia  15/10/2020  20-7111 
G/STR/N/18/GEO  Working Party on State Trading Enterprises – State 
trading – New and full notification pursuant to 
Article  XVII:4(a) of the GATT  1994 and paragraph 1 
of the Understanding on the Interpretation of 
Article  XVII – Georgia  18/09/2020  20-6305 
G/AG/N/GEO/24  Committee on Agriculture – Notification – Georgia – 
Export subsidy – Table  ES:1 – Calendar year  2017 31/07/2020  20-5337 
G/AG/N/GEO/23  Committee on Agriculture – Notification – Georgia – 
Domestic support – Table  DS:1 – Calendar year  2019 30/07/2020  20-5333 
G/AG/N/GEO/21  Committee on Agriculture – Notification – Georgia – 
Export subsidy – Table  ES:1 – Calendar year  2016 29/07/2020  20-5263 
G/AG/N/GEO/22  Committee on Agriculture – Notification – Georgia – 
Export subsidy – Table  ES:1 – Calendar year  2019 29/07/2020  20-5265 
G/MA/QR/N/GEO/2/Add.2  Committee on Market Access – Notification pursuant 
to the Decision on notification procedures for 
quantitative restrictions  (G/L/59/Rev.1) – Georgia – 
Addendum  28/07/2020  20-5212 
G/TBT/N/GEO/107  Committee on Technical Barriers to Trade – 
Notification – Georgia – Toys  04/06/2020  20-3992 
G/TBT/N/GEO/108  Committee on Technical Barriers to Trade – 
Notification – Georgia – Equipment and protective 
systems intended for use in potentially explosive 
atmospheres  04/06/2020  20-3993 
G/TBT/N/GEO/109  Committee on Technical Barriers to Trade – 
Notification – Georgia – Appliances burning gaseous 
fuels 04/06/2020  20-3994 
G/TBT/N/GEO/110  Committee on Technical Barriers to Trade – 
Notification – Georgia – Personal protective 
equipment  04/06/2020  20-3995 
G/TBT/N/GEO/111  Committee on Technical Barriers to Trade – 
Notification – Georgia – Machinery  04/06/2020  20-3996 
G/MA/QR/N/GEO/2/Add.1  Committee on Market Access – Notification pursuant 
to the Decision on notification procedures for 
quantitative restrictions  (G/L/59/Rev.1) – Georgia – 
Addendum  15/04/2020  20-2951 
G/MA/QR/N/GEO/2  Committee on Market Access – Notification pursuant 
to the Decision on notification procedures for 
quantitative restrictions  (G/L/59/Rev.1) – Georgia  10/02/2020  20-1039 
G/AG/N/GEO/19  Committee on Agriculture – Notification – Georgia – 
Domestic support – Table  DS:1 – Calendar year  2016 17/01/2020  20-0493 
G/AG/N/GEO/20  Committee on Agriculture – Notification – Georgia – 
Domestic support – Table  DS:1 – Calendar year  2017  17/01/2020  20-0494 
G/AG/N/GEO/17  Committee on Agriculture – Notification – Georgia – 
Export subsidy – Table  ES:1 – Calendar year  2018 15/01/2020  20-0457 
G/AG/N/GEO/18  Committee on Agriculture – Notification – Georgia – 
Domestic support – Table  DS:1 – Calendar year  2018 15/01/2020  20-0469 WT/TPR/S/ 420 • Georgia  
 
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  Notifications  Title Document 
Date  Doc #  
G/SCM/N/315/GEO; 
G/SCM/N/343/GEO  Committee on Subsidies and Countervailing Measures 
– Subsidies – New and full notification pursuant to 
Article  XVI:1 of the GATT  1994 and Article  25 of the 
SCM Agreement – Georgia  19/11/2019  19-7863 
G/RO/N/185  Committee on Rules of Origin – Notification under 
paragraph  4 of Annex II of the Agreement on Rules of 
Origin – Preferential rules of origin – 
Hong Kong,  China and Georgia  15/04/2019  19-2492 
S/C/N/923; WT/REG397/N/1  Committee on Regional Trade Agreements – Council 
for Trade in Services – Notification of regional trade 
agreeme nt – Hong Kong,  China and Georgia  12/02/2019  19-0824 
G/TBT/N/GEO/105  Committee on Technical Barriers to Trade – 
Notification – Georgia – Construction products  28/11/2018  18-7487 
G/TBT/N/GEO/106  Committee on Technical Barriers to Trade – 
Notification – Georgia – Construction products  28/11/2018  18-7488 
G/STR/N/16/GEO; 
G/STR/N/17/GEO  Working Party on State Trading Enterprises – State 
trading – Notifications pursuant to Article  XVII:4(a) of 
the GATT  1994 and paragraph 1 of the Understanding 
on the Interpretation of Article  XVII – Georgia  20/11/2018  18-7264 
G/LIC/N/3/GEO/8  Committee on Import Licensing – Replies to 
questionnaire on import licensing procedures – 
Notification under Article  7.3 of the Agreement on 
Import Licensing Procedures  (2018) – Georgia  19/11/2018  18-7231 
G/TFA/N/GEO/2  Committee on Trade Facilitation – Notification under 
Articles  1.4, 10.4.3, 10.6.2 and 12.2.2 of the 
Agreement on Trade Facilitation – Communication 
from Georgia  31/07/2018  18-4832 
G/RO/N/166  Committee on Rules of Origin – Notification under 
paragraph  4 of Annex II of the Agreement on Rules of 
Origin – Preferential rules of origin – Georgia and 
EFTA States (Iceland, Liechtenstein, Norway and 
Switzerland)  24/05/2018  18-3092 
G/RO/N/17 1 Committee  on Rules of Origin – Notification under 
paragraph  4 of Annex II of the Agreement on Rules of 
Origin – Preferential rules of origin – China and 
Georgia  24/05/2018  18-3091 
S/C/N/900; WT/REG391/N/1  Committee on Regional Trade Agreements – Council 
for Trade in Services – Notification of regional trade 
agreement – China and Georgia  05/04/2018  18-2101 
G/TBT/N/GEO/104  Committee on Technical Barriers to Trade – 
Notification – Georgia – Civil aviation 
aerodromes/helicopter  03/04/2018  18-1979 
G/TFA/N/GEO/1  Committee on Trade Facilitation – Notification of 
category commitments under the Agreement on 
Trade Facilitation – Communication from Georgia  22/02/2018  18-1167 
G/LIC/N/3/GEO/7  Committee on Import Licensing – Replies to 
questionnair e on import licensing procedures – 
Notification under Article  7.3 of the Agreement on 
Import Licensing Procedures – Georgia  31/10/2017  17-5898 
G/TBT/N/GEO/101  Committee on Technical Barriers to Trade – 
Notification – Georgia – Medical waste  05/09/2017  17-4719 
G/TBT/N/GEO/102  Committee on Technical Barriers to Trade – 
Notification – Georgia – Liquid fuel  05/09/2017  17-4720 
G/TBT/N/GEO/103  Committee on Technical Barriers to Trade – 
Notification – Georgia – Road transport  05/09/2017  17-4721 
S/C/N/891; WT/REG386/N/1  Committee on Regional Trade Agreements – Council 
for Trade in Services – Notification of regional trade 
agreement – Georgia, Iceland, Norway  30/08/2017  17-4599 
G/RO/N/160  Committee  on Rules of Origin – Notification under 
paragraph 4 of Annex II of the Agreement on Rules of 
Origin – Preferential rules of origin – Republic of 
Moldova, Azerbaijan, Georgia, Ukraine  21/07/2017  17-4019 
G/LIC/N/3/GEO/6  Committee on Import Licensing – Replies to 
questionnaire on import licensing procedures – 
Notification under Article  7.3 of the Agreement on 
Import Licensing Procedures – Georgia  21/04/2017  17-2197 
G/SCM/N/284/GEO  Committee on Subsidies and Countervailing Measures 
– Subsidies – New and full notification pursuant to 
Article XVI:1 of the GATT  1994 and Article  25 of the 
Agreement on Subsidies and Countervailing Measures 
– Georgia  21/04/2017  17-2196 
G/TBT/N/GEO/99  Committee on Technical Barriers to Trade – 
Notification – Georgia – Misleading products  06/03/2017  17-1312 WT/TP R/S/420 • Georgia  
 
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  Notifications  Title Document 
Date  Doc #  
G/TBT/N/GEO/100  Committee on Technical Barriers to Trade – 
Notification – Georgia – Lighters  06/03/2017  17-1313 
G/TBT/N/GEO/97  Committee on Technical Barriers to Trade – 
Notification – Georgia – Safety on roads  01/11/2016  16-5974 
G/TBT/N/GEO/98  Committee  on Technical Barriers to Trade – 
Notification – Georgia – Road construction  01/11/2016  16-5975 
G/TBT/N/GEO/94  Committee on Technical Barriers to Trade – 
Notification – Georgia – Buildings  25/04/2016  16-2295 
G/TBT/N/GEO/95  Committee on Technical Barriers to Trade – 
Notification – Georgia – Wastes  25/04/2016  16-2299 
G/TBT/N/GEO/96  Committee on Technical Barriers  to Trade – 
Notification – Georgia – Wastes  25/04/2016  16-2300 
G/AG/N/GEO/15  Committee on Agriculture – Notification – Georgia – 
Domestic support  05/04/2016  16-1895 
G/AG/N/GEO/16  Committee on Agriculture – Notification – Georgia – 
Export subsidy  05/04/2016  16-1903 
G/TBT/N/GEO/93  Committee on Technical Barriers to Trade – 
Notification – Georgia – Buildings  22/02/2016  16-1055 
WT/PCTF/N/GEO/1  Preparatory Committee on Trade Facilitation – 
Notification of category  A, B and C commitments 
under the Agreement on Trade Facilitation – 
Communication from Georgia  02/02/2016  16-0696 
Source:  WTO documents.  
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  Table A3. 1 Georgia's applied MFN tariff summary, 2021  
 
Number of 
lines  
Simple 
average (%)  
Tariff range 
(%) 
Standard 
deviation  
Share of 
duty- free 
lines (%)  
Share of non -
ad valorem  
tariffs  
(%) 
Total  10,028  2.0 0-56.8 4.6 81.3 2.5 
HS 01 -24 2,290  6.2 0-56.8 6.6 44.7 9.2 
HS 25 -97 7,738  0.8 0-12 2.8 92.1 0.5 
By WTO category        
WTO agricultural products  2,097  6.8 0-56.8 6.6 39.6 10.1 
Animals and products thereof  322 8.5 0-12 5.2 24.8 0.0 
Dairy products  157 5.3 0-12 5.0 39.5 0.0 
Fruit, vegetables, and plants  521 10.0 0-12 4.5 16.5 0.0 
Coffee, tea, and cocoa and cocoa 
preparations  49 5.0 0-12 5.2 44.9 0.0 
Cereals and preparations  242 6.6 0-56.8 7.7 49.2 1.7 
Oils seeds, fats, oil and their 
products  173 0.1 0-12 0.9 99.4 0.0 
Sugars and confectionery  49 11.0 0-12 3.3 8.2 0.0 
Beverages, spirits and tobacco  291 11.8 0.1-56.1 8.3 0.0 71.1 
Cotton  6 0.0 0.0 0.0 100.0  0.0 
Other agricultural products, n.e.s.  287 0.3 0-12 2.0 97.2 0.0 
WTO non -agricultural products  7,931  0.7 0-12 2.8 92.3 0.5 
Fish and fishery products  336 0.0 0.0 0.0 100.0  0.0 
Minerals and metals  1,564  2.0 0-12 4.5 83.1 0.0 
Chemicals and photographic supplies  1,367  0.8 0-12 2.5 87.6 0.0 
Wood, pulp, paper and furniture  447 2.8 0-12 5.1 76.5 0.0 
Textiles  867 0.1 0-5 0.6 98.6 0.0 
Clothing  333 0.0 0.0 0.0 100.0  0.0 
Leather, rubber, footwear  and travel 
goods  347 0.0 0.0 0.0 100.0  0.0 
Non-electric machinery  1,035  0.1 0-12 1.2 99.0 0.0 
Electric machinery  563 0.1 0-5 0.5 98.9 0.0 
Transport equipment  319 0.1 0-7.7 0.6 88.4 11.6 
Non-agricultural products, n.e.s.  706 0.1 0-12 0.8 99.6 0.0 
Petroleum  47 0.0 0.0 0.0 100.0  0.0 
By stage of processing        
First stage of processing  1,142  3.1 0-12 5.3 73.8 0.0 
Semi-processed products  2,949  1.0 0-12 3.1 89.7 0.0 
Fully processed products  5,937  2.2 0-56.8 4.9 78.6 4.2 
By HS Section        
01 Live animals and products  740 4.6 0-12 5.5 56.8 0.0 
02 Vegetable products  570 5.6 0-12 6.0 53.5 0.0 
03 Fats and oils  127 0.1 0-12 1.1 99.2 0.0 
04 Prepared food, beverages and 
tobacco  853 9.3 0-56.8 7.0 20.2 24.7 
05 Mineral products  255 4.1 0-12 5.7 65.9 0.0 
06 Chemicals and products thereof  1,237  0.2 0-12 1.2 97.4 0.0 
07 Plastics, rubber, and articles 
thereof  376 2.6 0-12 3.7 60.1 0.0 WT/TPR/S/ 420 • Georgia  
 
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Number of 
lines  
Simple 
average (%)  
Tariff range 
(%) 
Standard 
deviation  
Share of 
duty- free 
lines (%)  
Share of non -
ad valorem  
tariffs  
(%) 
08 Raw hides and skins, leather, and 
its products  219 0.0 0.0 0.0 100.0  0.0 
09 Wood and articles of wood  204 6.2 0-12 6.0 48.5 0.0 
10 Pulp of wood, paper and 
paperboard  216 0.0 0.0 0.0 100.0  0.0 
11 Textiles and textile articles  1,168  0.0 0.0 0.0 100.0  0.0 
12 Footwear, headgear, etc.  112 0.0 0.0 0.0 100.0  0.0 
13 Articles of stone, plaster, cement  267 3.2 0-12 5.3 73.4 0.0 
14 Precious stones and metals, 
pearls  63 2.5 0-12 4.9 79.4 0.0 
15 Base metals and articles thereof  1,013  1.3 0-12 3.7 89.4 0.0 
16 Machinery, electrical equipment, 
etc. 1,639  0.0 0-5 0.3 99.6 0.0 
17 Transport equipment  338 0.1 0-7.7 0.6 89.1 10.9 
18 Precision equipment  371 0.0 0.0 0.0 100.0  0.0 
19 Arms and ammunition  28 0.0 0.0 0.0 100.0  0.0 
20 Miscellaneous manufactured 
articles  225 0.0 0.0 0.0 100.0  0.0 
21 Works of art, etc.  7 0.0 0.0 0.0 100.0  0.0 
Note:  Calculations are based on national tariff line level (11 -digit). Calculations include ad valorem  
equivalents (AVEs) for non -ad valorem  rates, where available; AVEs for the 2021 tariff schedule 
were estimated based on 2019 import data (WTO Integrated Database (IDB) submission) at the 
11-digit level; and AVEs for 38 tariff lines were provided by the authorities.  
Source:  WTO Secretariat cal culations, based on data provided by the authorities; and WTO IDB.  
 WT/TPR/S/ 420 • Georgia  
 
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  Table A3. 2 Revenue from taxation, 2015 -20 
 2015  2016  2017  2018  2019  2020  
Total tax revenue (GEL  million)  8,010.9  8,786.1  9,778.9  10,506.3  11,417.8  10,964.4  
          % of total  
Import duties  0.9 0.8 0.7 0.7 0.7 0.7 
Indirect tax  55.5 50.4 57.7 56.8 59.8 59.6 
 Value  added tax  43.8 37.4 42.2 42.1 45.9 44.1 
 Imports  20.4 26.8 29.6 31.9 32.6 30.7 
 Domestic  23.3 10.6 12.6 10.2 13.3 13.4 
 Excise tax  10.9 12.2 14.8 14.0 13.2 14.8 
 Imports  8.1 10.1 12.8 12.3 11.9 13.3 
 Domestic  2.3 2.1 2.0 1.7 1.3 1.5 
 Other unclassified excise  0.4 0.0 0.0 0.0 0.0 0.0 
Direct tax  44.2 43.6 41.6 42.1 42.2 42.7 
 Income tax  27.8 27.5 29.8 30.9 30.5 30.3 
 Profit tax  12.8 12.0 7.7 7.0 7.6 8.4 
 Property tax  3.6 4.1 4.0 4.2 4.2 4.0 
 Other tax  0.0 0.0 0.0 0.0 0.0 0.0 
Other revenue (non -declared 
revenue)a 0.3 6.0 0.7 1.1 -2.0 -2.2 
Memo:         
Total customs revenue (a share of 
total tax revenue)b 29.4 37.7 43.1 44.9 45.2 44.7 
a Since 1  January  2016, other Revenue (non -declared Revenue) accounts for revenue that for the 
duration has not yet been allocated to one of the aforementioned specific taxes.  
b Total customs revenue consist of the revenue collected from import duties and th e VAT and excise 
tax on imported goods.  
 
Source:  WTO Secretariat based on data provided by the authorities and Ministry of Finance of Georgia.  
  WT/TPR/S/ 420 • Georgia  
 
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  Table A3. 3 List of excisable goods, by product heading (HS four -digit level), 2021  
HS Product description  Number 
of tariff 
lines in 
2021  Unit (per)  Range of 
excise  rate (GEL)  
2015  2021  
Alcoholic beverages  
2203 Beer made from malt  3 litre/1% Vol  0.6 0.12 
2205 Vermouth and other wine of fresh grapes 
flavoured with plants or aromatic substances  6 litre 5 5 
2206 Other fermented beverages  28 litre 5 0.6-5 
2206 Other fermented beverages  2 litre/1% Vol  ..  0.12 
2207 Undenatured ethyl alcohol of an alcoholic strength 
by volume of 80% vol. or higher; ethyl alcohol 
and other spirits  2 1 litre 
of pure alcohol  5.2 7.5 
2208 Undenatured ethyl alcohol of an alcoholic strength 
by volume of less than 80% vol.; spirits, liqueurs 
and other spirituous beverages  59 1 litre of pure  
alcohol  2-10 15-22.5 
Raw tobacco and tobacco products  
2401 Unmanufactured tobacco; tobacco waste  21 kg 0 60 
2402 Cigars, cheroots, cigarillos and cigarettes, of 
tobacco or of tobacco substitutes  1 piece 0.9 1.9 
2402 Cigars, cheroots, cigarillos  and cigarettes, of 
tobacco or of tobacco substitutes  4 20 cigarettes  0.25-1 1.7-2.2 
2403 Other manufactured tobacco and manufactured 
tobacco substitutes; "homogenized" or 
"reconstituted" tobacco; tobacco extracts and 
essences  4 kg 20 60 
2403 Other manufactured tobacco and manufactured 
tobacco substitutes; "homogenized" or 
"reconstituted" tobacco; tobacco extracts and 
essences  2 20 cigarettes  .. 1.7 
Oils and other products distilled at high temperature from coal tars  
2707 Oils and other products of the distillation of high 
temperature coal tar  15 tonne  350-400 350-400 
Petroleum gas product and natural gas (other than carried through a pipeline)  
2709 Petroleum oils and oils obtained from bituminous 
minerals, crude  1 tonne  80 300 
2711 Petroleum gases and other gaseous hydrocarbons  13 tonne  80-120 300 
2711 Petroleum gases and other gaseous hydrocarbons   1 1000 m3 80 200 
Petroleum products, petroleum distillates and used oil products  
2710 Petroleum oils and oils obtained from bituminous 
minerals, other than crude  37 tonne  50-400 100-800 
Admixture, solvent, anti -detonator  
2712 Paraffin wax  2 tonne  400 400 
2901 Acyclic hydrocarbons and butene (butylene) and 
isomers thereof  3 tonne  .. 300 
2902 Cyclanes, cyclenes and cycloterpenes; benzene; 
toluene  7 tonne  400 400 
2905 Saturated monohydric alcohols; butan -1-ol 
(n-butyl alcohol) and other butanols; octanol 
(octyl alcohol) and isomers thereof  8 tonne  400 400 
3811 Anti-knock preparations, oxidation inhibitors, gum 
inhibitors, viscosity improvers, anti -corrosive 
preparations and other prepared additives, for 
mineral oils or for other liquids used for the same 
purposes as mineral oils  6 tonne  400 400 
3814 Organic composite solvents and thinners, not 
elsewhere specified or included; prepared paint or 
varnish removers  2 tonne  400 400 WT/TPR/S/ 420 • Georgia  
 
- 159 - 
 
  HS Product description  Number 
of tariff 
lines in 
2021  Unit (per)  Range of 
excise  rate (GEL)  
2015  2021  
Lubricants  
3403 Lubricating preparations  7 tonne  400 800 
Liquids to be used in electronic cigarettes  
3824 Liquids to be used in electronic cigarettes  1 ml 0 0.2 
Biodiesel  
3826 Biodiesel and mixtures thereof, not containing or 
containing less than 70% by weight of petroleum 
oils or oils obtained from bituminous minerals  1 tonne  150 150 
Liquid product of pyrolysis  
3911 Petroleum resins, coumarone -indene resins, 
polyterpenes, polysulphides, polysulphones and 
other products specified in Note 3 to this Chapter, 
not elsewhere specified or included, in primary 
forms  6 tonne  400 400 
Motor cars and a motorcycles (including a motor bicycle) according to their age and engine 
displacement  
8703 Motor cars and other motor vehicles principally 
designed for the transport of persons  37 cm3 0.5-1.5 0.8-2.4 
8711 Motorcycles (including mopeds) and cycles fitted 
with an auxiliary motor  10 cm³ 0 0.7-2.4 
Total  289    
.. Not available.  
Source:  WTO Secretariat based on Articles 185, 188, and 189 of the Tax Code.  WT/TPR/S/ 420 • Georgia  
 
- 160 - 
 
  Table A3. 4 Goods subject to a licen ce or permit requirement to import and/or export, 
2021  
Goods subject to permit (or licence)  Fees (GEL)  Permit/licence 
required to  Rationale  
National Communications Commission     
▪ Electronic communications interception systems 
(licence)  200 Import and export  Security  
Ministry of Environmental Protection and 
Agriculture     
▪ Hazardous waste  200 Import and export  Environmental 
and health 
protection  
▪ Non-hazardous waste for the purpose of its further 
recovery  200 Only import  Environmental 
and health 
protection  
▪ Radioactive waste  40 Only export  Environmental 
and health 
protection  
▪ Ozone -depleting substances  200 Import and export  Environmental 
protection  
▪ Radioactive materials and sources, and raw 
materials from which nuclear materials can be 
obtained or produced, equipment containing 
radioactive substances, nuclear technologies and 
know-how  40 Import and export  Environmental 
and health 
protection  
▪ Species listed in the appendices to the Convention 
on International Trade in Endangered Species of 
Wild Fauna and Flora (CITES), their parts and 
derivatives  50 Import and export  Environmental 
protection  
▪ Fir cones, snowdrop bulbs and cyclamen tubers 
that are listed in the Appendices to the CITES 
(licence)  100 Only export  Environmental 
protection  
▪ Products of animal origin and veterinary drugs 
subject to veterinary controla Freeb Only import  Health  
▪ Products of plant origin subject 
to phytosanitary  control  Freec Only import  Health  
Ministry of Defence     
▪ Non-military weapons (civil weapons), major 
elements of firearms, ammunition, and major 
elements of ammunition  Varies with 
transaction 
valued Import and export  Security  
▪ Military goods  Varies with 
transaction 
valued Import and export  Security  
Revenue Service     
▪ Dual-use goods  30 Import and export  Security  
▪ Non-iodized salt  Free Only import  Health  
Ministry of IDP from the Occupied Territories, 
Labour, Health and Social Affairs     
▪ Pharmaceutical products (i.e. therapeutic agents) 
subject to special control  100 Import and export  Health protection  
Ministry of Internal Affairs     
▪ Electronic means of surveillance (Licence)  1% of the 
transaction 
value  Import and export  Security  
▪ Hunting and sports firearms and ammunition 
exported by foreign nationals  8 Import and export  Security and 
public order  
▪ Non-military weapons, gas guns, their key 
components and ammunition exported by 
Georgian citizens  8 Import and export  Security and 
public order  
▪ Sports and hunting firearms temporarily exported 
by a sports institution for participation in a 
sporting event  16 Import and export  Security and 
public order  WT/TPR/S/ 420 • Georgia  
 
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  Goods subject to permit (or licence)  Fees (GEL)  Permit/licence 
required to  Rationale  
Ministry of Culture     
▪ Georgian cultural valuables  14 Only export  Protection of 
national 
treasures of 
artistic, historic, 
or archaeological 
value  
a Products subject to veterinary control fall mainly within HS Chapters 01 -43, while those subject to 
phytosanitary control are mainly in HS Chapters  6-54. Permits for goods subject to veterinary 
control include all kind of animals, products of animal origin and raw materials, and animal feed, as 
well as any biological, medical, or chemical -pharmaceutical preparations used in veterinary 
medicine. The fees  for these permits vary with delay for the request. Revenue Service, Permits . 
Viewed at: https://www.rs.ge/LegalEntitySafetyControl -en?cat=7&tab=1 .  
b Free if issued in 20 working da ys, GEL 20 if issued in 10 working days, GEL 40 if issued in 5 working 
days, and GEL 50 if issued in 1 working day.  
c Free if issued in 20 working days, GEL 10 if issued in 10 working days, GEL 20 if issued in 5 working 
days, and 25 GEL if issued in 1 work ing day.  
d 0.5% of the transaction value for imports worth between GEL 500 to GEL 10 million and 0.1% (but 
not more than GEL 120,000) of the transaction value for imports worth more than GEL 10 million.  
Source:  WTO Secretariat based on WTO document G/MA/QR /N/GEO/2, 10  February  2020; Law on Licences and 
Permits, Articles 6, 7, and 24; Law on Licence and Permit Fees, Articles  6 and 7; and information 
provided by the authorities . 
 WT/TPR/S/ 420 • Georgia  
 
- 162 - 
 
  Table A3. 5 New resolutions, rules, or changes to existing legislation concerning SPS 
measures  
Resolutions, rules, guidelines, or decisions  
- Resolution No.  567 of 23  December  2016 on Approval of the Rule on Border Control of Food/Animal Feed 
Safety is elaborated ac cording to Commission Regulation  (EC) No.  669/2009 of 24  July 2009 implementing 
Regulation (EC) No.  882/2004 of the European Parliament and of the Council as regards the increased level 
of official controls on imports of certain feed and food of non -animal  origin and amending Decision 
2006/504/EC. This legal act fully entered in force in December  2017.  
- Food/Feed Safety, Veterinary and Plant Protection Code of Georgia  
- Resolution No.  578 of 10  November  2015 on Approval of the Regulations on the Measures  for Integration 
in the EU Rapid Alert System for Food and Feed (RASFF)  
- Resolution No.  547 of 23  October  2015 amending Governmental Resolution  No. 419 on Approval of the 
General Crisis Management Plan in the Area of Food/Feed Safety  
- Resolution No.  534 of 16  October  2015 amending Resolution No.  173 on Approval of General Hygiene Rule 
of Food/Feed Producing Enterprise/Distributor and Implementation of Surveillance, Monitoring and State 
Control in Food Safety, Veterinary and Plant Protec tion Areas  
- Resolution No.  90 of 7  March  2012 on Approval of the Special Rule of the Hygiene for the Products of 
Animal Origin  
- Resolution No.  581 of 10  November  2015 on Approval of Technical Regulations for the Food Microbiological 
Criteria  
- Resolution No.  430 on Models of Veterinary Certificates of Products Subject to Veterinary Control, Intended 
for Export  
- Resolution No.  533 of 16  October  2015 on Approval of the Rule of State Control in the Areas of Food/Feed 
Safety  
- Resolution No.  55 of 12 February  2015 on Approval of Special Rule for the Implementation of Official 
Control on Food of Animal Origin  
- Resolution No.  577 of 10  November  2015 on Approval of General Principles and Requirements of 
Traceability in Food/Feed Safety, Veterinary and Plant Protection  
- Resolution No.  22 on 18  January  2016 on Technical Regulation Establishing Measures to Monitor Certain 
Substances and Residues Thereof in Live Animals and Animal Products  
- Resolution No.  567 of 9  November  2015 on Approval of the Te chnical Regulations on Maximum Permissible 
Levels of Some Contaminants in the Food  
- Resolution No.  118 of 9  March  2016 on Beef and Beef Products Labelling Rule  
- Resolution No.  228 of 27  May 2015 on Approval of the Rule of Identification and Registration of Small 
Ruminants and Registration of their Stalls and Pens  
- Resolution No.  348 of 14  July 2015 on Approval of the Procedures of Carrying Out Preventive and 
Quarantine Measures against Animal Communicable Diseases  
- Resolution No.  764 of 3 1 December  2014 on Approval of Regulation Relating to the Identification and 
Registration of Bovine Animals and Registration of their Holdings/Temporary Holdings  
- Resolution No.  8 of 26  January  2015 on Approval of the Procedure for the Notification of In compliance with 
Phytosanitary Requirements during International Transportation  
- Resolution No.  11 of 11  January  2016 on Technical Regulation on Approval of the Rule of Preventing the 
Spread of Western Corn Beetle  
- Resolution No.  427 of 31  December  2010 on Approval of Rule on Granting the Phytosanitary Export and 
Re-export Certificates and Models of Certificates  
- Resolution No.  499 of 8  November  2016 on the Rule on the Performance of Analytical Methods and 
Interpretation of Results of Certain Substance s and Residues in Live Animals and Food of Animal Origin  
- Resolution No.  623 of 29  December  2016 on Approval of Technical Regulation on Maximum Residue Levels 
of Pesticides in or on Food and Feed of Plant and Animal Origin  
- Resolution No.  301 of 1 July 2016 on Approval of Technical Regulations for Providing Consumers with 
Information about Food  
- Resolution No.  510 of 17  November  2016 on Approval of the Procedure for Nutrition and Health Claims 
Made on Foods  
- Resolution No.  585 of 23  December  2016 on Approval of the Technical Regulation on Food Additives  
- Resolution No.  508 of 17  November  2016 on Approval of the Technical Regulation on the Addition of 
Vitamins, Minerals and of Certain Other Substances to Foods  
- Resolution No.  639 of 18  Decem ber 2015 on Approval of the Technical Regulations on Pharmacologically 
Active Substances and Their Classification Regarding Maximum Residue Limits in Foodstuffs of Animal Origin  
- Resolution No.  497 of 7  November  2016 on Approval of Technical Regulations for Sampling and Analysis 
Methods for Determining Mycotoxins in Food  
- Resolution No.  547 of 13  December  2016 on Technical Regulation about Rule of Sampling and Analyse 
Methods for Control of Microelements and Contaminants Amount in Food Products  
- Resolution No.  548 of 13 December 2016 on Approval of the Procedure for Identification and Registration 
of Pigs and Registration of Pig Holdings  
- Resolution No.  597 of 27  December  2016 on Amendments to Ordinance No.  348 of 14 July 2015 on 
Approval of Rules for Implementation of Prophylactic -Quarantine Measures against Animal Transmitting 
Diseases  
- Resolution No.  498 of 8  November  2016 on Approval of Technical Regulation – Diagnostic Manual of 
Classical Swine Fever  WT/TPR/S/ 420 • Georgia  
 
- 163 - 
 
  Resolutions, rules, guidelines, or decisions  
- Resolution No.  496 of  7 November  2016 on Approval of the Technical Regulations on the Diagnostic 
Manual of African Swine Fever  
- Resolution No.  637 of 30  December  2016 on Approval of the Technical Regulations on Avian Influenza 
Diagnostic Manual  
- Resolution No.  600 of 28  December  2016 on Approval of the Technical Regulation of the Rules for the 
Prevention, Control and Eradication of Certain Transmissible Spongiform Encephalopathies  
- Resolution No.  636 of 30  December  2016 on Approval of the Technical Regulation on Sampling Plans and 
Diagnostic Methods for Fish Viral Hemorrhagic Septicemia (VHS) and Infectious Hematopoietic Necrosis 
(IHN) Detection and Confirmation  
- Resolution No.  190 of 27  April 2015 on Approval of Technical Regulation on the Procedure for Introduction 
into Georgia of Harmful Organisms, Plants, Plant Products and other Phytosanitary Regulated Objects for 
Trial, Scientific Purposes and Work on Varietal Selections  
- Resolution No.  302 of 1  July 2016 on Approval of Procedure for Control of Potato Cyst Nematodes  
- Resolution No.  354 of 21  July 2017 on the Amendments to Resolution No.  429 of 31  December  2010 on 
Approval of the Rule for Implementation of the Phytosanitar y Border Quarantine Control and Veterinary 
Border Quarantine Control  
- Resolution No.  456 of 6  October  2017 on Approval of the Procedures on Denomination of Food Lot  
- Resolution No.  195 of 13  April 2017 on Approval of the Technical Regulation on Method s for the Analysis 
and Testing of Heat -Treated Milk for Direct Human Consumption  
- Resolution No.  370 of 27  July 2017 on Approval of Technical Regulations on Food Intended for Complete 
Replacement of Ration of Infants and Young Children for the Purposes o f Special Medical Use and Weight 
Control  
- Resolution No.  594 of 28  December  2017 on the Requirements related to Aquaculture Animal Health and 
Products thereof and the Regulation for the Prevention and Control of Certain Diseases of Aquatic Animals  
- Resolution No.  605 of 29  December  2017 on Technical Regulation on Health Rules as regards to Animal 
By-products and Derived Products Not Intended for Human Consumption (Including Animal Waste) and on 
Approval of Business Operators Related to this Activity  
- Resolution No.  597 of 29  December  2017 on Approval of Conditions and Certification Requirements for the 
Placing on the Market and the Import of Aquaculture and Products Thereof and the List of Vector Species  
- Resolution No.  595 of 28  December  2017 on Ap proval of the Regulation Related to Public Health and 
Animal Health during Trading and Import of the Products Subject to Special Requirements  
 Resolution No.  323 of 5  July 2017 on Approval of the Regulation Related Rules for Monitoring of Zoonosis 
and Zoo notic Agents  
- Resolution No.  584 of 28  January  2017 on the Technical Regulation on Animal Health Affecting Country's 
Trade in Bovine Animals and Swine  
- Resolution No.  602 of 29  December  2017 on the Technical Regulation on the Procedures for the Control  of 
Potato Brown Rot  
- Resolution No.  556 of 15  December  2017 on Approval of the Technical Regulation on Identity and Plant 
Health Checks of Plants, Plant Products or Other Regulated Phytosanitary Objects, Which May Be Carried 
Out at a Place other than th e Border Inspection Points and Specifying the Conditions Related to These 
Checks  
- Resolution No.  553 of 15  December  2017 on Technical Regulations on Control Procedures of 
Potato  Ring Rot 
- Resolution No.  317 of 5  June 2018 on Requirements for Materials and Articles Intended to Come into 
Contact with Food  
- Resolution No.  548 of 16  November  2018 on Approval of the Technical Regulation concerning the 
Traceability and Labelling of Genetically Modified Organisms and the Traceability of Food and Fe ed Products 
Produced from Genetically Modified Organisms  
- Resolution No.  549 of 16  November  2018 on Requirements for Genetically Modified Food and Feed  
- Resolution No.  551 of 16  November  2018 on Approval of the Regulation of Non -Commercial Movement of 
Pet Animals on the Customs Border of Georgia  
- Resolution No.  398 of 3  August  2018 on Approval of the Special Rule for Elimination and Control of 
Bluetongue  
- Resolution No.  587 of 13  December  2018 on Approval of the Animal Health Rule Govern ing the Production, 
Processing, Distribution and Import of Products of Animal Origin for Human Consumption  
- Resolution No.  112 of 19  February  2019 on Approval of the Rule of Veterinary Medicinal Products 
Marketing Authorization, Manufacturing Authorizati on and Control  
- Resolution No.  591 of 13  December  2018 on Approval of Technical Regulation on Protected Zone and Plant 
Passport  
- Resolution No.  588 of 13  December  2018 on Approval of the Technical Regulation on Conditions for 
Marketing the Materials fo r the Vegetative Propagation of vines  
- Resolution No.  553 of 16  November  2018 on Approval of Technical Regulation on Procedures of Marketing 
of Vegetable and Cucurbit Propagating and Planting Material Other Than Seeds  WT/TPR/S/ 420 • Georgia  
 
- 164 - 
 
  Resolutions, rules, guidelines, or decisions  
- Resolution No.  62 of 12 February  2019 on Amending Resolution No.  443 of 31  December 2013 on Approval 
of Technical Regulations on the Statute Registration Tests, Examinations and Registration of Pesticide and 
Agrochemicals in Georgia  
- Resolution No.  516 of 31  October  2018 on Approval of the Technical Regulation  on Methods of Taking 
Samples when Implementing the State Control for Determining the Maximum Residue Level of Pesticides in 
Plant and Animal Products  
- Resolution No.  379 of 7  August  2019 on Approval of Technical Regulations on Specifications for Food 
Additives  
- Resolution No.  167 of 13  March  2020 on Approval of Regulations on Novel Food  
- Guidelines on the Scientific Aspects and the Presentation of Information Necessary to Support Applications 
for the  Placing on the Market of Novel Foods and Novel Food Ingredients and the Preparation of Initial 
Assessment Reports (Not a legally binding document; does not require official approval by the normative 
act) 
- Resolution No.  120 of 20  February  2020 on Amendm ents to Resolution No.  317 of 5  June 2018 on 
Requirements Concerning Materials and Items that Come into Contact with Food Products  
- Resolution No.  90 of 10  February  2020 on Amendments to Resolution No.  549 of 16  November  2018 on 
Requirements Related to G enetically Modified Foodstuffs and Animal Feeds  
- Guidelines on the Presence of T -2 and HT -2 Toxin in Cereals and Products Produced through Processing of 
Cereals (Not a legally binding document; does not require official approval by the normative act)  
- Resolution No.  166 of 13  March  2020 on Approval of Animal Health Rules for the Importation into and 
Transit through Georgia of Certain Live Ungulate Animals  
- Resolution No.  172 of 13 March 2020 on Approval of Regulations on the Control of Salmonella and Other 
Specific Food -borne Zoonotic Agents  
- Resolution No.  173 of 13  March  2020 on Approval of the Rule on Feed Hygiene  
- Resolution No.  46 of 20  January  2020 on Approval of Marketing Conditions for Fodder Plant Seeds  
- Resolution No.  45 of 20 January  2020 on Approval of Marketing Conditions for Seeds of Cereal Crops  
- Resolution No.  22 of 13  January  2020 on Amendments to Resolution No.  443 of 31  December  2013 on 
Approval of Technical Regulations on Rules of Registration Examinations, Inspec tion and Registration of 
Pesticides and Agrochemicals in Georgia  
- Resolution No.  40 of 17  January  2020 on the Marketing of Fruit Plant Propagating Materials and Fruit 
Plants Intended for Fruit Production  
- Resolution No.  199 of 22  April 2019 on Approval  of Conditions for Marketing of Materials Used for 
Reproduction of Ornamental Plants  
- Resolution No.  37 of 17  January  2020 on the Marketing of Sugar Beet and Fodder Beet Seeds  
- Resolution No.  44 of 20  January  2020 on Approval of the Conditions for Plac ing Vegetables and Garden 
Seeds on the Market  
- Resolution No.  482 of 6  August  2020 on Approval of the Rule on Food Enzymes  
- Resolution No.  497 of 13  August  2020 on the Technical Regulation on Flavourings and Certain Food 
Ingredients with Flavouring Properties for Use in and on Foods  
- Resolution No.  606 of 1  October  2020 on Approval of the Technical Regulation on Unified Methods for 
Sampling and Analysis for Temperature Monitoring, State Control and Execution of State Control of Quick -
frozen Frozen Food for Human Consumption  
- Resolution No.  782 of 23  December  2020 on the Amendment to Resolution  No. 348 of 14  July 2015 on 
Approval of the Rules for the Implementation of Prophylactic -quarantine Measures for the Prevention of 
Animal Contagio us Diseases  
- Resolution No.  747 of 10  December  2020 on Approval of the Technical Regulation on the Diagnostic 
Manual for Swine Vesicular Disease  
- Resolution No.  57 of 8  February  2021 on Establishing a List of Intended Uses of Animal Feeding Stuffs for 
Particular Nutritional Purposes  
- Resolution No.  58 of 8  February  2021 on Approval of the Rules for the Use and Marketing of Animal 
Feeding Stuffs  
- Guidelines for Ascertaining the Distinction Between Feed Materials, Feed Additives, Biocidal Products and 
Veterinary Medicinal Products  
- Resolution No.  59 of 8  February  2021 on the Catalogue of Feed Materials  
- Resolution No.  630 of 16  October  2020 on Approval of the Technical Regulation on Rules on Fighting Citrus 
Long-Horned Beetle Anoplophor a chinensis  (Forster)  
- Resolution No.  404 of 2  July 2020 on Approval of the Technical Regulation on the Rules of Control against 
Potato Flea Species: Epitrix cucumeris  (Harris), Epitrix papa  sp. n., Epitrix  subcrinita  (Lec.), Epitrix tuberis  
(Gentner)  
- Resolution No.  649 of 28  October 2020 on the Marketing of Seed Potatoes  
- Resolution No.  648 on Approval of the Conditions for Placing Seed of Oil and Fibre Plants on the Market  WT/TPR/S/ 420 • Georgia  
 
- 165 - 
 
  Resolutions, rules, guidelines, or decisions  
- Resolution No.  695 of 20  November  2020 on Amendments to Resolution  No. 336 of 13  June 2018 on the 
Procedures for Labelling Seed and Planting Material of Agricultural Plant Species Subject to Mandatory 
Certification  
- Decision referring to the equivalence of field inspections carried out in specified third countries on seed -
producing crops and on the equivalence of seed produced in specified third countries  
- Resolution No.  712 of 27  November  2020 on Amendments to Resolution  No. 337 of 13  June 2018 on the 
Procedure for the Certification of Seed and Planting Material of Agricultural Plant Species Subject to 
Mandatory Certification  
- Draft Amending Resolution No.  443 of 31  December  2013 on Approval of Technical Regulations on the 
Statute Registration Tests, Examinations and Registration of Pesticide a nd Agrochemicals in Georgia  
Note:  Major parts of the indicated new or amended legislative acts are introduced in line with EU -Georgia 
DCFTA obligations.  
Source:  Information provided by the authorities.  
  WT/TPR/S/ 420 • Georgia  
 
- 166 - 
 
  Table A3. 6 Selected sta te enterprises and areas of activity, 2021  
Enterprise  State participation  Areas of activity  Prerogatives  
2015  2021  
Marabda -Kartsakhi 
Railway Ltd  100%  100%  Railway  Exclusive rights on 
rehabilitation -reconstruction 
of Marabda -Akhalkalaki 
railway  
Geoairnav Ltd  100%  100%  Navigation and information 
service to Georgian airports  Exclusive rights on 
air-navigation service  
Nautical Tech -service  Ltd 100%  100%  Technical service for ships  Exclusive licences for 
technical support  
Mountain Resorts 
Development 
Company  Ltd 100%  100%  Support and maintenance of 
mountain resorts  Exclusive rights for 
technical, informational, 
and other types of support 
of mountain resorts  
United Airports of 
Georgia Ltd  100%  100%  Building and operating 
Georgian airports  Exclusive rights to build, 
operate, develop, and 
modernize Georgian 
airports  
Rehabilitation Ltd  100%  100%  Appointment of directors and 
management of 
liquidation/reorganization/ 
bankruptcy of government -
owned entities  Exclusive right to 
implement its duty  
Thermal Waters Ltd  100%  100%  Extraction and distribution of 
thermal waters  Exclusive right to extract 
and distribute thermal 
waters  
Georgian 
Teleradiocenter  Ltd 100%  100%  Distribution of TV -radio 
programmes  Exclusive right to distribute 
TV/radio programmes  
Tbilisi Aircraft 
Manufacturing Ltd  100%  100%  Design, manufacture, and 
modernize civil and military 
machinery  Exclusive right to 
manufacture civil/military 
machinery  
Primary Healthcare 
Centre of Shida 
Kartli  Ltd 100%  100%  Hospital services  Government grant  
Scientific Practical 
Centre of Pathology  Ltd 100%  100%  Morphology analysis  Government grant  
National Centre of Pearl 
Disease and Lung 
Disease  Ltd 100%  100%  Medical care of pearl and lung 
diseases  Government grant  
N. Makhviladze Scientific 
Research Institute of 
Labour, Medicine and 
Ecology  Ltd 100%  100%  Medical care of professional and 
labour diseases  Government grant  
Tbilisi Mental Health 
Centre Ltd  100%  100%  Medical care of mental health 
problems  Government grant  
Disinfection and 
Fumigation Centre  Ltd 100%  100%  Disinfection/fumigation service  .. 
Outpatient Medical 
Rehabilitation Centre  Ltd 100%  100%  Medical rehabilitation service  Government grant  
Infectious Diseases, 
AIDS and Clinical 
Immunology Research 
Center  Ltd 100%  100%  Medical care/diagnosis  Government grant  
Kutaisi Regional Blood 
Bank Ltd 100%  100%  Manufacturing blood/blood 
components  Government grant  
Kutaisi Adults N5 
Polyclinic  Ltd 100%  100%  Medical care/diagnosis  Government grant  
D. Nazarishvili Medical 
Regional Centre Ltd  100%  100%  Biochemical/allergology 
research  Government grant  
Kurta Hospital Ltd  100%  100%  Therapy/paediatrics/  
gynaecology  Government grant  
Zugdidi Pharmacy  Ltd 100%  100%  Medicine sale  Government grant  
Akhalgori District 
Polyclinic  Ltd 100%  100%  Outpatient medical treatment  Government grant  
Akhalgori District 
Hospital  Ltd 100%  100%  Medical care  Government  grant/licence  
Manglisi  Polyclinic  Ltd 100%  100%  Medical care  Government grant  
Telavi 
Psychoneurological 
Dispensary Ltd  100%  100%  Psychiatric care  Government grant  
Nevroni Ltd  100%  100%  Psychiatric care  Government grant  WT/TPR/S/ 420 • Georgia  
 
- 167 - 
 
  Enterprise  State participation  Areas of activity  Prerogatives  
2015  2021  
Senaki Mental Health 
Centre Ltd  100%  100%  Psychiatric care  Government grant  
East Georgia Mental 
Health Centre Ltd  100%  100%  Psychiatric care  Government grant  
Georgian Post Ltd  100%  100%  Postal service  .. 
Rustavi Mental Health 
Centre Ltd  100%  100%  Psychiatric care  Government grant  
Tbilisi N1 Dental Clinic 
Ltd 100%  100%  Dental service  Government grant  
Georgian Movie 
Development Centre Ltd  100%  100%  Support Georgian movie 
development  .. 
Mental Health and 
Prevention of Drug 
Addiction Centre Ltd  100%  100%  Research/rehabilitation/  
expertise  Government grant  
Ponichala Med 
Outpatients' 
Department  Ltd 100%  100%  Medical care  Government grant  
Kvemo Kartli Regional 
Blood Transfusion 
Station  Ltd 100%  100%  Manufacturing blood/blood 
components  Government grant  
Food Manufacture 
Company Ltd  62.97%  62.97%  Food purchase/manufacture/  
distribution  .. 
Black Sea Arena 
Georgia  Ltd 100%  100%  Music/entertainment  .. 
Public Building 
Company  Ltd 100%  100%  Public road maintenance/repair  .. 
Asset Management and 
Development 
Company  Ltd 100%  100%  Management of public assets/ 
buildings and etc.  .. 
Autobase Ltd  100%  100%  Parking space rentals  .. 
Georgian Oil and Gas 
Service Company Ltd  100%  100%  Oil extraction and processing  Government licence  
Kakheti Energy 
Distribution Ltd  100%  100%  Electricity distribution  Government licence to 
distribute electricity in 
Kakheti region  
Demetre 96 Ltd  100%  100%  Shoe manufacture and sale  Government grant  
E. Pipia Public 
Hospital  Ltd 100%  100%  Medical care  Government grant  
Tbilisi SPA Ltd  100%  100%  Medical care  Government grant  
Resort Akhtala Ltd  100%  100%  Medical care  Government grant  
O. Chkhobadze Clinical 
Centre  Ltd 100%  100%  Medical care  Government grant  
Tbilisi Cardiological 
Hospital  Ltd 100%  100%  Medical care  Government grant  
.. Not available.  
Source:  Information provided by the authorities.  
  WT/TPR/S/ 420 • Georgia  
 
- 168 - 
 
  Table A3. 7 Intellectual property feesa 
No. Action  USDb 
Registration of a Design  
Examination as to Form  
1 Examination as to form for one design  50 
2 Examination as to form for each extra design  10 
3 Requesting convention priority for one design  30 
4 Requesting convention priority for each extra design  10 
Substantive Examination  
5 Substantive examination for one design  80 
6 Substantive examination for each extra design  10 
Publication, Issue of Certificate and Renewal  
7 Publication of one design  10 
8 Registration, issue of certificate and renewal for first five years for one design  100 
9 Registration, issue of certificate and renewal for first five years for each extra design  10 
10 In case of more than one design owner, issue of each extra certificate  20 
11 Renewal of registration for the second five years for one design  80 
12 Renewal of registration for the second five years for each extra design  10 
13 Renewal of registration for the third five years for one design  100 
14 Renewal of registration for the third five years for each extra design  10 
15 Renewal of registration for the fourth five years for one design  300 
16 Renewal of registration for the fourth five years for each extra design  30 
17 Renewal of registration for the fi fth five years for one design  550 
18 Renewal of registration for the fifth five years for each extra design  50 
Actions on Request of Applicant, Owner and/or Third Party  
19 Entering corrections and amendments in application materials  40 
20 Entering amendments in the Register data for each registration  40 
21 Postponement of publication of design for each request  100 
22 Extension of term for reply to notification -request of Sakpatenti for each month  30 
23 Suspension  of application processing  for each month  30 
24 Issue of certified copy of application  30 
25 Issue of certified extract from the Register  30 
26 Issue of duplicate of certificate  60 
27 Issue of certified extract on payment of fees  5 
28 Registration of agreement for one registration  100 
29 Appeal hearing on one design  200 
30 Appeal hearing on each extra design  20 
31 Reinstatement of application rights forfeited due to failure to meet the deadline  30 
Accelerated Registration  
32 Accelerated examination as to form for one design  100 
33 Accelerated examination as to form for each extra design  20 
34 Accelerated substantive examination for one design  160 
35 Accelerated substantive examination for each extra design  20 
36 Requesting convention priority for one design in case of accelerated examination  60 
37 Requesting convention priority for each extra design in case of accelerated examination  20 
38 Publication of one design by accelerated procedure  20 
39 Registration, issue of certificate by accelerated procedure and renewal for first five years  200 
40 In case of more than one design owner, issue of each extra certificate by accelerated 
procedure  20 WT/TPR/S/ 420 • Georgia  
 
- 169 - 
 
  No. Action  USDb 
Patenting an Invention and Utility Model  
Examination as to Form  
1 Examination as to form  90 
Substantive Examination  
2 Determination of subject -matter of protection  90 
3c Determination of state of the art for one independent claim  180 
4c Determination of state of the art for each independent claim in excess of one  120 
Publication  
5 Publication of  application materials up to 30 pages  60 
6 Publication of application materials over 30 pages, for each extra page  2 
Issue of Patent and Renewal  
7 Registration of patent, issue of patent and renewal for the first two years  200 
8 In case of more than one patent owner, issue of each extra patent  20 
9 Renewal of patent for third, fourth, fifth years, per each year  50 
10 Renewal of patent for sixth, seventh, eighth years, per each year  70 
11 Renewal of patent for ninth, tenth, eleventh years, per each year  170 
12 Renewal of patent  for twelfth, thirteenth, fourteenth years, per each year  250 
13 Renewal of patent  for fifteenth, sixteenth, seventeenth years, per each year  300 
14 Renewal of patent  for eighteenth, nineteenth, twentieth years, per each year  500 
15 Requesting supplementary protection certificate  100 
16 Renewal of patent on the basis of  supplementary protection certificate for 21st  year 600 
17 Renewal of patent on the basis of  supplementary protection certificate for 22nd  year 700 
18 Renewal of patent on the basis of  supplementary protection certificate for 23rd  year 800 
19 Renewal of patent on the basis of  supplementary protection certificate for 24th  year 900 
20 Renewal of patent on the basis of  supplementary protection certificate for 25th  year 1,000  
21 Renewal of patent on the basis of  supplementary protection certificate for 26th  year 1,100  
22 Reinstatement of patent  100 
Actions Concerning International Applications  
23 Checking international application under Patent Cooperation Treaty (PCT) 
requirements and transmitting application materials  100 
24 Submission of translation of application in one month  250 
Actions on Request of Applicant, Patent Owner and/or Third Party  
25 Entering corrections and amendments in application materials for each  request  40 
26 Extension of term for reply to notification -request for each month  30 
27 Transformation of an application for invention into an application for utility model  50 
28 Transformation of an application for utility model into an application for invention  70 
29 Request  of evaluation of  inventive step for  each application  150 
30 Re-examination after issue of patent  180 
31 Suspension  of application processing  for each month  30 
32 Restoration of the right of convention and exhibition priority  60 
33c Determination of state of the art for each extra independent claim after issue of 
documentary conclusion  120 
34 Drawing up and issue of a certified copy of application  30 
35 Making  amendments to the Register, except correcting mechanical mistakes, upon a 
single request in relation with each patent  60 
36 Issue of duplicate of patent  60 
37 Drawing up  and issue of a certified extract from the Register  30 
38 Registration of agreement  100 
39 Appeal hearing on invention  360 WT/TPR/S/ 420 • Georgia  
 
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  No. Action  USDb 
40 Requesting correction of mechanical mistakes for 30 pages of application materials, 
for one patent  10 
41 Requesting correction of mechanical mistakes for each extra page of application 
materials over 30 pages  2 
42 Issue of certified extract on payment of fees  5 
43 Reinstatement of application rights forfeited due to failure to meet the deadline  100 
44 Carrying out search in bibliographic data in the Register  30 
Patenting and Utility Models  
Examination as to Form  
1 Examination as to form  90 
Substantive Examination  
2 Determination of subject -matter of protection and novelty  90 
Publication  
3 Publication of application materials up to 30 pages  60 
4 Publication of application materials over 30 pages, for each extra page  2 
Issue of Patent and Renewal  
5 Registration of patent, issue of patent and renewal for the first two years  170 
6 Renewal of patent for third, fourth years, per each year  50 
7 Renewal of patent for fifth, sixth, per each year  70 
8 Renewal of patent for seventh, eighth years, per each year  170 
9 Renewal of patent for ninth, tenth years, per each year  300 
10 Reinstatement of patent  100 
11 In case of more than one patent owner, issue of each extra patent  20 
Actions Concerning International Applications  
12 Checking international application under PCT requirements and transmitting 
application materials  100 
13 Submission of translation of application in one month  250 
Actions on Request of Applicant, Patent Owner and/or Third Party  
14 Entering corrections and amendments in application materials for each request  40 
15 Extension of term for reply to notification -request for each month  30 
16 Request of evaluation of inventive step for each application  150 
17 E-examination after issue of patent  180 
18 Suspension of application processing for each month  30 
19 Restoration of the right of convention and exhibition priority  60 
20 Drawing up and issue of a certified copy of application  30 
21 Making amendments to the Register, except correcting mechanical mistakes, upon a 
single request in relation with each patent  60 
22 Issue of duplicate of patent  60 
23 Drawing up and issue of a certified extract from the Register  30 
24 Issue of certified extract on payment of fees  5 
25 Registration of agreement  100 
26 Appeal hearing on utility model  360 
27 Requesting correction of mechanical mistakes for 30 pages of application materials, 
for one patent  10 
28 Requesting correction of mechanical mistakes for each extra page of application 
materials over 30 pages  2 
29 Reinstatement of application rights forfeited due to failure to meet the deadline  100 
30 Carrying out search in bibliographic data in the Register  30 
Registration of a Trademark  
1 Examination of trademark as to form for one class of goods  90 
2 Examination of trademark as to form for each extra class of goods  50 
3 Examination of collective mark as to form for one class of goods  150 
4 Examination of collective mark as to form for each extra class of goods  90 
5 Requesting convention priority  30 
6 Substantive examination of trademark  120 WT/TPR/S/ 420 • Georgia  
 
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  No. Action  USDb 
7 Substantive examination of collective mark  310 
8 Publication of trademark  60 
9 Publication of collective mark  60 
10 Reinstatement of application proceedings  90 
11 Registration of trademark, issue of certificate and renewal for 10 years  150 
12 In case of more than one applicant, issue of each extra certificate  30 
13 Renewal of trademark registration for subsequent 10 years for one class of goods  300 
14 Renewal of trademark registration for next 10 years for each extra class of goods  50 
15 Registration of collective mark, issue of certificate and renewal for 10 years  550 
16 Renewal of collective mark for subsequent 10 years for one class of goods  550 
17 Renewal of collective mark for subsequent 10 years for each extra class of goods  90 
18 Certifying international application and sending to the International Bureau of World 
Intellectual Property Organization (WIPO)  60 
19 Certifying international application on additional extension and sending to the 
International Bureau of World Intellectual Property Organization (WIPO)  60 
20 Entering corrections and amendments in application materials for each request  60 
21 Suspension  of application processing  for each month  50 
22 Entering amendments in the Register for one request for each mark  60 
23 Filing a national application under the Madrid Protocol on the basis of cancelled 
international registration  60 
24 Issue of certified copy of application  30 
25 Issue of certified extract from Register  30 
26 Issue of the duplicate of certificate  90 
27 Issue of the duplicate of certificate annex  30 
28 Issue of certified extract on payment of fees  5 
29 Registration of agreement for each mark  90 
30 Appeal hearing on trademark  200 
31 Appeal hearing on collective trademark  400 
32 Extension of term for submission of requested document for one month  30 
33 Examination as to form of trademark application  by accelerated procedure for one 
class of list of goods  200 
34 Examination as to form of collective mark application  by accelerated  procedure for one 
class of list of goods  260 
35 Substantive examination of trademark application  by accelerated procedure for one 
class of list of goods  300 
36 Substantive examination of collective mark application  by accelerated procedure for 
one class of list of goods  390 
37 Examination as to form of trademark application  by accelerated procedure for each 
extra class of list of goods  100 
38 Examination as to form of collective mark application  by accelerated procedure for 
each extra class of list of goods  130 
39 Substantive examination of trademark application  by accelerated procedure for each 
extra class of list of goods  100 
40 Substantive examination of collective mark application  by accelerated procedure for 
each extra class of list of go ods 130 
41 Registration of trademark, issue of certificate, publication by accelerated procedure 
and renewal for 10 years  340 
42 Registration of collective mark, issue of certificate, publication by accelerated 
procedure and renewal for 10 years  440 
43 Registration of trademark, issue of certificate, publication by accelerated procedure 
and renewal for 10 years for each extra class  100 
44 Registration of collective mark, issue of certificate, publication by accelerated 
procedure and renewal for 10 years for each extra class  130 
Schedule of Individual Fees for Extension to Georgia under the Protocol Relating to the Madrid 
Agreement Concerning the International Registration of Marks  
45 Extension of international registration in Georgia under the Madrid  Protocol for 10 
years for one class of goods  CHF 314 
46 Extension of international registration in Georgia under the Madrid  Protocol for 10 
years for each extra class of goods  CHF 115 WT/TPR/S/ 420 • Georgia  
 
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  No. Action  USDb 
47 Renewal of international registration under the Madrid Protocol for subsequent 10 
years for one class of goods  CHF 314 
48 Renewal of international registration under the Madrid Protocol for subsequent 10 
years for each extra class of goods  CHF 115 
Deposition of a Copyright Work and a Database  
1 Fee for deposit of work and issuance of deposition certificate  GEL 10 
2 Fee for deposit of database and issuance of deposition certificate  GEL 10 
3 Fee for issuance of duplicate of deposition certificate  GEL 5 
Registration of an Appellation of Origin and Geographical Indication  
1 Examination of application for appellation of origin and geographical indication of 
goods  40 
2 Registration of appellation of origin and geographical indication of goods, registration, 
issue of certificate  20 
3 Entering amendments in the Register  30 
4 Issue of certified extract from the Register  30 
a There are no applicable fees for registration of new breeds of animals and varieties of plants.  
b All fees designated in USD  except as otherwise noted in the column. Equivalent to be paid in national 
currency (GEL).  
c If international search and/or international preliminary examination reports are submitted 
to Sakpatenti, fees for these actions shall be reduced by 50%. (Georgian translation of 
PCT Forms  237 and 409, if  issued, should be filed.)  
Source:  Information provided by the authorities.  
 WT/TPR/S/ 420 • Georgia  
 
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  Table A4. 1 Structure of Georgia's manufacturing sector, 2015 -20 
Production value (GEL million)  2015  2016  2017  2018  2019  2020  
Manufacturing  6,537  7,049  8,402  9,131  10,287  10,655  
Food products  1,889  2,099  2,045  2,009  2,218  2,507  
Beverages  1,158  1,294  1,615  1,903  2,407  2,293  
Other non -metallic mineral products  890 976 1,099  1,057  1,334  1,424  
Basic metals  799 740 1,395  1,654  1,486  1,387  
Chemicals and chemical products  379 309 368 436 481 498 
Rubber and plastic products  233 304 319 357 401 424 
Fabricated metal products, except 
machinery and equipment  197 232 288 310 309 378 
Wearing apparel  125 129 169 206 251 304 
Basic pharmaceutical products and 
pharmaceutical preparations  148 146 199 209 257 273 
Motor vehicles, trailers and 
semi-trailers and other transport 
equipment  25 30 27 16 73 74 
Other  694 790 879 975 1,073  1,094  
Source:  National Statistics Office of Georgia, based on NACE  (Rev.2) classification.  
 WT/TPR/S/ 420 • Georgia  
 
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  Table A4. 2 By-laws adopted by ComCom, 2015 -21 
Resolutions  Summary  
2015  
Resolution No.  1 of 12  June 2015 on 
Amendments to Resolution No.  6 of the 
Georgian National Communications 
Commission of 30  June 2006 on Approval 
of the National Radiofrequency Allocation 
Plan Radiofrequencies of certain ranges have been issued based on 
auctions and as a result led to the provision of compliance of 
the National Radiofrequency Allocation Plan with a new reality.  
Resolution No.  2 of 9  July 2015 amending 
Resolution No.  2 of 21  February  2012 on 
Rules on Issuing, Use and Payments 
Related to Numbers Resources  Under the amendment, if the owner of the numbering resource  
provides electronic communication services to the end -user in 
exchange for a specified fee and assigns this numbering 
resource to another person/entity on the basis of a joint 
application, the said owner is not subject to the restriction that 
it may obtai n a permit on the use of numbering resources from 
the range of those resources that was covered by the licence 
assigned to it and was given away to another person/entity on 
its request.  
Resolution of 9  September  2015 amending 
Resolution No.  1 of 27  June 2003 on 
Regulatory Rules of Georgian National 
Communications Commission (Bylaw No.  1 
of 27 June 2003)a Under the amendment, procedural rules of submitting the 
application on the extension of the validity of the licence to the 
regulator have been changed.  
Resolution No.  9 of 3  September  2015 
amending Resolution No.  2 of 
21 February  2012 on Rules on Obtaining, 
Use and Payments Related to Numbering 
Resources  The amendment changed the procedures for assigning a 
numbering resource (Euronumber) to public services . The 
assignment will be made in accordance with the principles set 
out in European Commission Decision  72007/116/EC. In 
addition, two Euronumbers were added to the numbering 
resource for public services, which is used for telephone 
services defined in acc ordance with the same decision of the 
European Commission (hotline for victims of 
violence  - 116006, non -emergency telephone medical 
assistance  - 116117).  
Resolution No.  10 of 3  November  2015 
amending the Resolution No.  13 of 
12 December  2005 on Approval of the 
Auction Regulations for Obtaining the 
Right to Use Radio Frequency Spectrum 
and/or Numbering Resource  The rules for conducting and participating in multi -licence 
(consecutive) auctions for obtaining a licence/licences for the 
use of radio frequency spectrum on a radio frequency resource 
available within the radio frequency range or similar 
characteristics have been added to the resolution. In addition, 
changes and additions were made to the restriction of 
participation in the auction for the right to  use the radio 
frequency spectrum, as well as the restriction of the right to 
use the radio frequency spectrum, the documentation 
submission procedures, and the powers of the auction 
chairperson.  
Resolution No.  11 of 10  November  2015 
on Amendments to Reso lution No.  6 of the 
Georgian National Communications 
Commission of 30  June 2006 on Approval 
of the National Radiofrequency Allocation 
Plan In accordance with the practice introduced in Europe, the 
bands for terrestrial systems for electronic communications  
services with broadband access networks were defined as 
791.0 -821 MHz instead of 791.0 -816.0  MHz, and 832.0 -
862.0  MHz instead of 832.0 -857.0 MHz.  WT/TPR/S/ 420 • Georgia  
 
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  Resolutions  Summary  
2016  
Resolution No.  5 of 30  June 2016 on Rules 
of Access of Broadcasters to the Open Air 
Multiplex Platforms  In 2015, Georgia fully switched from analogue broadcasting to 
digital terrestrial television broadcasting, which, given its 
specifics, offers different opportunities f or both television 
broadcasters and digital terrestrial television broadcasters. On 
12 June 2015, a number of legislative acts were amended 
(Law on Broadcasting, Law on Electronic Communications, and 
other related laws), resulting in a new legal framework for 
broadcasters and distributors of digital terrestrial television 
broadcasters. On 27  April 2016, the Law on Amendments to 
the Law on Electronic  Communications was adopted 
(registration code:  320110000.05.001.018102), according to 
Article  2 of which on 3 0 June 2016 the Commission adopted 
the relevant normative act that defines high -resolution format 
and established the rules of access of broadcasters to the open 
air multiplex platforms of the licence holder of the radio 
frequency spectrum and the owner of  the local digital 
terrestrial broadcasting network to provide digital terrestrial 
television network and the order and procedures of access.  
Resolution No.  3 of 25  April 2016 
amending Resolution No.  13 of 
12 December  2005 on Approval of the 
Auction Regulations for Obtaining the 
Right to Use Radio Frequency Spectrum 
and/or Numbering Resource  Calculation of the licence fee has been determined for the 
cases when the geographical area defined by the radio 
frequency spectrum licence differs from t he geographical area 
of the licences issued on the basis of the auctions held for the 
right to use the relevant band of the radio frequency spectrum.  
2017  
Resolution No.  1 of 9  February  2017 on 
Amendments to Resolution No.  6 of the 
Georgian National Comm unications 
Commission of 30  June 2006 on Approval 
of the National Radiofrequency Allocation 
Plan The indication has been added that radiofrequency spectrum is 
divided into a range of radiofrequencies.  
Resolution No.  2 of 24  February  2017 
partly nullifying  and amending Resolution 
No. 12 of 28  October  2005 on 
Determination and Payment of Regulatory 
Fees In order to facilitate the completion and submission of the 
forms for calculating the monthly fee to be submitted to the 
Commission by the authorized entitie s and persons, the 
Commission has developed an electronic form for calculating 
the fee, which will be common to all authorized entities and 
persons.  
Resolution No.  3 of 27  July 2017 
amending Resolution No.  3 of 
17 March  2006 on  Regulations on the 
Rules of Provision of Services and 
Protection of End -users'  Rights in the Field 
of Electronic Communications  ComCom introduced regulatory provisions on distance 
contracts between service providers and consumers. The goal 
of these provisions is to provide s ervices to identified 
customers and to simplify consumption of electronic 
communications services by consumers.  
Resolution No.  4 of 1  August  2017 
amending Resolution No.  5 of 
20 April 2006 on  Methodological Rules for 
Cost Accounting and Cost Allocation 
Separation by Authorized Persons  In particular, ComCom refined, clarified, and brought specific 
regulating principles for accounting separation into compliance 
with international standards. It also defined the rules for 
accounts preparation. New methodologic al rules envisage 
formulation of more detailed criteria and rules for tariff 
regulation, cost - and revenue -separated accounting, prepared 
services cost calculation for authorized entities with significant 
market power and provision of explanations of proce sses and 
procedures thereto.  
Resolution No.  6 of 26  October  2017 
partly nullifying and amending Resolution 
No. 12 of 28  October  2005 On determination and payment of regulatory fees: The 
amendment provided for full compliance of the resolution with 
the Law  on Electronic Communications and the part of the 
resolution that allowed authorized entities/persons to pay a 
regulatory fee of 0.75% of the total value excluding excise tax 
along with VAT has been nullified. As a result of the 
amendment, the amount of th e regulatory fee shall be 0.75% 
of the total value (excluding VAT) of the regulated 
products  (services) provided and/or of the work performed by 
an authorized person as it is stated in the law.  
Resolution No.  8 of 28  December  2017 
amending Resolution No.  3 of 6  July 2006 
Approving Regulations on 
Subscribers'  Number Portability  The amendment changed the duration of the number 
portability process and as a result, the process takes a 
maximum of 24  hours instead of 3 days.  WT/TPR/S/ 420 • Georgia  
 
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  Resolutions  Summary  
2018  
Resolution No.  1 of 22 February  2018 
Amending Resolution No.  13 of 
12 December  2005 on Approval of the 
Auction Regulations for Obtaining the 
Right to Use Radio Frequency Spectrum 
and/or Numbering Resource  As mentioned above, imposing new function of developing 
media literacy on the regulator led to the necessity to provide 
the Commission with additional financial support. As  a result, 
based on the amendments to the Law on Electronic 
Communications, permits for the use of radiofrequencies of 
auxiliary technology and numerology resources have been 
withdrawn. Instead, the right to use has been established, 
which is assigned by decision of the Commission. The fee of 
the use of the said resources has to be paid to the budget of 
the Commission.  
Resolution No.  4 of 10 May 2018 on Rules 
on Determination of Internet Service 
Quality and Inspection  With the view of protecting the interests of the users, the 
Georgian National Communications Commission developed the 
mechanism of Internet quality control by means of which a ny 
user is given the opportunity to measure the speed and quality 
of fixed Internet, and check to what extent the quality of 
provided Internet corresponds with the terms and conditions 
envisaged by the agreement concluded between a subscriber 
and a provide r company. The Internet quality monitoring 
system enables both the user and ComCom to observe 
whether the obligations of ISPs towards subscribers are met 
properly. In case of violation, the Commission shall apply 
measures define by law. To ensure improveme nt of the 
existing situation on the fixed Internet market and make sure 
that Internet quality is adequate to the price paid by the user, 
the Commission adopted a resolution on the basis of which 
quality indicators of Internet service were defined and 
metho dological rules of inspecting them were set. All 
interested parties were involved in the mentioned process. 
With the view of ensuring the respective quality of Internet, 
new obligations were imposed on the companies that 
envisaged bringing the agreements w ith subscribers into 
compliance with the resolution.  
Resolution No.  8 of 25  December  2018 
Amending Resolution No.  2 of 
21 February  2012 on Rules on Issuing, 
Use and Payments Related to Numbering 
Resources  Amendments have nullified provisions that restrict ed 
authorized persons from obtaining a new numbering resource 
and offering customers a choice of subscriber numbers, as 
authorized persons were required to first fill in the numbering 
resource from an already selected numbering resource and 
also provide do cumentation confirming that they have been 
actually using 75% of the total numbering resources obtained. 
At the same time, as mentioned above, imposing new function 
of developing media literacy on the regulator led to the 
necessity to provide the Commissio n with additional financial 
support. As a result, based on the amendments to the Law on 
Electronic Communications, permits on the use of 
radiofrequencies of auxiliary technology and numerology 
resources have been withdrawn. Instead, the right to use has 
been established, which is assigned by decision of the 
Commission. The fee of the use of the said resources has to be 
paid to the budget of the Commission.  
2019  
Resolution No.  5 of 12  December  2019 
Amending Resolution No.  2 of 
21 February  2012 on Rules on Issuing, 
Use and Payments Related to Numbering 
Resources  Based on the amendments to the Resolution, the Commission 
has allocated numbering resources for  M2M/IoT services. 
Amendments also cover issues related to application for 
obtaining the numbering resource. In particular, authorized 
entities/persons are required to submit electronic application 
to obtain numbering resource. This amendment serves to 
simplify procedures related to assigning numbering resources.  
Resolution No.  1 of 17  January  2019 
Amending Resolution No.  5 of 
20 April 2006 on Methodological Rules for 
Cost Accounting and Cost Allocation 
Separation by Authorized Persons  Amendments aim to establish and clarify the principles, 
criteria, and rules for the calculation of costs and for the 
preparation of reports within the specific obligations to 
regulate tariffs and make cost estimates and to record 
expenditure and income separately.  WT/TPR/S/ 420 • Georgia  
 
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  Resolutions  Summary  
2020  
Resolution No.  1 of 28  February  2020 on 
the Regulation on the  Rules of Placement 
of Information Hazardous to Children on 
the Internet  The resolution aims to protect children from hazardous 
information posted in Internet. The resolution has been 
adopted based on the new law "Code of the Rights of the 
Child". ComCom ha s imposed an obligation on website owners 
to assign appropriate age markings to their websites, in 
particular, taking into consideration the age category that the 
audiovisual products posted on their website are intended for. 
Websites that place movies, an imated films, TV series, 
programmes, and games are required to make special age 
markings for programmes unsuitable for minors under 18, 15, 
12, and 7 years of age. The Internet Service Provider is 
obliged to update the mechanism of blocking (restricting) 
child-hazardous Internet sites once a week on the basis of a 
special rating list of hazardous Internet sites for children.  
Resolution No.  2 of 19  March  2020 
Amending Resolution No.  3 of 
17 March  2006 on Regulations on the 
Rules of Provision of Services and  
Protection of End -users' Rights in the Field 
of Electronic Communications  Authorized persons are obliged to register on the unified portal 
of electronic services of the LEPL Data Exchange Agency 
(my.gov.ge) and provide information about it to the 
Commissi on. This simplified procedure will allow the authorized 
persons to receive services (permit/consent) for the 
deployment of the network in a much shorter time, which 
ultimately serves the rapid development of the communication 
network, simplification of bur eaucratic barriers, and 
registration of new subscribers providing them access to 
network and services.  
Resolution No.  3 of 23  April 2020 
Amending Resolution No.  2 of 
21 February  2012 on Rules on Issuing, 
Use and Payments Related to Numbering 
Resources  The rule of issuance of numbering resource 131XX for motor 
technical assistance was not defined in the Resolution on 
Approval of the Rules for Issuance, Use and Payment of 
Numbering Resources. There was also no rule on issuing short 
numbers for long -distance,  international auto 
stations  (1334X), and taxi calls  (132XX). Based on 
amendments, the Commission has allocated numbering 
resources for the said services.  
Resolution No.  4 of 30  April 2020 on 
Approving Forms of Information to be 
Submitted by Authorized an d/or Licenced 
Persons in the Field of Electronic 
Communications for the Purpose of 
Mapping the Telecommunication 
Infrastructure on a Single Digital Map  Authorized persons in the field of electronic communications 
are obliged to provide data on infrastructu re to the Georgian 
National Communications Commission through electronic 
carriers (CD, DVD, external memory) via forms and within the 
time-frame established by the resolution. The submitted data 
will be reflected on a single digital map with a view to map the 
telecommunication infrastructure.  
Resolution No.  7 of 12  November  2020 
Amending the Resolution of 
12 December  2005 on Approval of the 
Auction Regulations for Obtaining the 
Right to Use Radio Frequency Spectrum 
and/or Numbering Resources  Resolution provides different methods for determining the 
initial amount of the fee for the use of the radio frequency 
spectrum in the harmonized and non -harmonized radio 
frequency range. The need for the amendment was caused by 
the fact that in the non -harmonized radio frequency range, the 
initial amount of the fee for the use of the radio frequency 
spectrum was determined by a special formula, which in some 
cases failed to meet modern challenges. The amendments to 
the resolution aim to provide an adequate  assessment of the 
market value of the frequencies for its effective use. The 
amendments also aim to introduce more efficient and 
adequate methodology for calculating the initial fee for the use 
of frequency resources used for a certain technology and for a 
certain purpose, and to encourage those wishing to use the 
frequency resources to effectively manage the frequency 
resources.  
a Later it came into compliance with the Law on Electronic Communications and the new time -frame 
for the application to the reg ulator was determined (one month) . 
Source:  Information provided by the authorities.  
__________