WT/TPR/M/420/Add.1  
9 March  2022 
(22-2073) Page: 1/103 
Trade Policy Review Body  
12 and 14 January 2022  Original: English/anglais/inglés  
 
  
TRADE POLICY REVIEW  
GEORGIA  
MINUTES  OF THE MEETING  
Addendum  
Chairperson: H.E. Mr. Dacio Castillo (Honduras)  
This document contains the advance written questions  and additional questions by 
WTO Members , and replies provided by  Georgia .1 
 
 
Organe d'examen des politiques commerciales  
12 et 14 janvier 2022  
EXAMEN DES POLITIQUES COMMERCIALES  
GÉORGIE  
COMPTE RENDU DE LA RÉUNION  
Addendum  
Président : S.E.  M. Dacio Castillo (Honduras)  
Le présent document contient les questions écrites communiquées à l'avance par les 
Membres de l'OMC, leurs questions additionnelles, et les réponses  fournies par  la Géorgie .1 
 
 
Órgano de Examen de las Políticas Comerciales  
12 y 14 de enero de 2022  
EXAMEN D E LAS POLÍTICAS COMERCIALES  
GEORGIA  
ACTA DE LA REUNIÓN  
Addendum  
Presidente: Excmo.  Sr. Dacio Castillo (Honduras)  
En el presente documento figuran las preguntas presentadas anticipadamente por escrito  
y las preguntas adicionales de los Miembros de la OMC,  así como las respues tas facilitadas 
por Georgia .1 
  
 
1 In English only./En anglais seulement./En inglés solamente.  WT/TPR/M/420/Add.1  
 
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  Contents  
INDIA  ................................ ................................ ................................ .............................  3 
REPUBLIC OF KOREA  ................................ ................................ ................................ ..... 13 
UNITED STATES  ................................ ................................ ................................ ............  14 
UNITED STATES – FOLLOW -UP ................................ ................................ .......................  25 
EUROPEAN  UNION  ................................ ................................ ................................ ........  26 
EUROPEAN UNION – FOLLOW -UP ................................ ................................ ..................  43 
SINGAPORE  ................................ ................................ ................................ ...................  47 
HONG KONG, CHINA  ................................ ................................ ................................ ...... 48 
UNITED KINGDOM  ................................ ................................ ................................ .........  52 
UKRAINE  ................................ ................................ ................................ .......................  63 
CANADA  ................................ ................................ ................................ ........................  72 
JAPAN  ................................ ................................ ................................ ...........................  82 
TURKEY  ................................ ................................ ................................ .........................  85 
CHINA  ................................ ................................ ................................ ...........................  90 
CHINA – FOLLOW -UP ................................ ................................ ................................ .... 94 
ICELAND  ................................ ................................ ................................ .......................  99 
THAILAND  ................................ ................................ ................................ ...................  101  
 
  WT/TPR/M/420/Add.1  
 
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  INDIA  
Questions based on Government Report (WT/TPR/G/420)  
 
Page 5, Paragraph 2.17  
 
Background: GoG has launched various programmes aimed at further improving the economic 
condition of rural areas and their workers. These included green grant programme, state pro gramme 
of co-financing agricultural mechanization, improving rural development in Georgia, industrial apple 
sale promotional programme, agro -diesel support programme, plant the future, 
Georgian  tea plantation rehabilitation programme, Preferential Agro -Credit, agro insurance, state 
programme of dairy modernization and market access (DIMMA) and programmes supporting 
development of agricultural cooperatives.  
 
Question 1: Can Georgia inform whether there are any restrictions for foreign investment in the 
beneficiary sectors of the programmes launched?  
 
Reply to Question 1:  Beneficiaries of projects/programs implemented by the Rural Development 
Agency may be a natural citizen of Georgia or an entrepreneur natural/legal entity registered 
in Georgia.  
 
Page 8, Paragraph 2.37  
Background:  To further aid the development of the tou rism industry in the post -COVID period, the 
tailor-made Tourism Recovery Plan is being elaborated in the framework of the Georgia Tourism 
Strategy 2025. Furthermore, to insure provision of high -quality ecotourism -related products and 
services to the intern ational visitors, Georgia's Eco -Tourism Development Strategy 2020 -30 has 
been adopted and entered into force.  
 
Question 2:  Could Georgia provide details of the Tourism Recovery Plan adopted within the 
framework of the Georgia Tourism Strategy 2025, as well  as the Eco -Tourism Development 
Strategy  2020-30? Georgia may also outline what makes it 'tailor -made' and furnish details of the 
assistance being provided/envisaged (nature, quantum, beneficiary, eligibility criteria etc.) . 
 
Reply to Question 2: Taking in to consideration the fact that eco -tourism represents one of the 
priority directions within the tourism industry of the country and the significant rate of growing 
demand for related products, with the support of the GIZ Eco -tourism Strategy was elaborated  
by the Georgian National Tourism Administration in active collaboration with the relevant 
governmental bodies and industry stakeholders. The main aim of the aforementioned strategy is to 
establish competitive eco -tourism services and products within the c ountry, bearing in mind 
subsequent support for their diversification, service quality improvement and further development. 
Within the framework of the document, definition of eco -tourism was thoroughly determined, 
ensuring that development actions to be ta ken are in line and better linked with the green economy 
and sustainable development track of the country, as well as development vision for 2030 was 
outlined and concrete action plan for the 2021 -2023 timeframe was determined.  
 
With regards to the Tourism  Recovery Plan within the framework of the Georgia Tourism Strategy 
2025, currently it is in the process of elaboration and the consequent details as well as the plan itself 
will be publicly available upon its finalization.  
 
Page 10, Paragraph 2.54  
Background:  
The Government of Georgia has a strong focus on developing the telecommunication sphere by using 
innovative techniques and technologies. Georgia put a lot of effort into introducing new services and 
improving existing ones using cutting -edge te chnology. Thanks to the legislative reforms of 
previous  years, there is an attractive environment for investment in the country, for example, the 
licensing regime was abolished for the use of numbering resource and for the air broadcasters. In 
addition, a number of support tools were made  available for developing entrepreneurship and 
increasing competitiveness.  
 WT/TPR/M/420/Add.1  
 
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  Question 3:  Could Georgia provide details of the 'support tools'  available to companies for 
developing entrepreneurship and increasing competitiven ess? 
 
Reply to Question 3:  
Innovation, R&D and Startup Ecosystem Development in Georgia  
Georgia has highlighted the importance of knowledge -based, innovation -driven, and private 
sector -oriented economy development.  
 
Georgia is having a favorable  regulatory framework  for promoting innovation, startup, and 
IT sector. Law on innovation, IP is in place, currently conducting  regulatory framework development, 
through initiating the amendments to the law on securities, promoting crowdfunding activities, as 
well as enhancing innovation procurement system, in order to have the startup -friendly environment 
in the country.  
 
Parliament adopted a new tax incentive –IT company employer income tax reduced to 5%.  
 
Georgia is having a high skilled relatively cheap labor force  
 
Dedicated programs are being elaborated the leverage the existing talent pool Georgia is having 
especially in IT, STEM. Beyond the formal education strong system, the Government is promoting 
vocational education to strengthen the skills of the labor force, meet the demand from the private 
sector, and ensure that workers are globally competitive.  
 
For skills development,  Georgia's Innovation and Technology Agency  continues to contribute to 
ICT sector development, by announcing t he program for 3000 Advanced IT specialists in highly 
demanded professions, ensuring their certification and licensing.  
 
In 2020, a  three -party Agreement was signed by GITA,  the world's leading US business 
accelerator - 500 startups  (https://ecosystems.500.co/500georgia ) and Bank of Georgia.  The 
launch of the world's leading business accelerator in Georgia is significant to the regional ecosystem 
development (The involvement of the private sector is vital , as Bank of Georgia will mobilize 
USD 1 billion investment in startups).  
 
Note: More than 100 applications were received from Georgia and other countries and 
only 15 of them moved on the next stage. Nine of these startups are from Georgia. While the rest 
are from the United  States,  Estonia,  Slovakia, Ukraine, United Arab Emirates, and Poland.  
 
The government is investing in Developing  Infrastructure for Innovation  and IT sector 
development  Government established Georgia's Innovation & Technology Agency (GITA) under the 
Ministry of Economy and Sustainable Development in 2014  as the main coordinator and mediator in 
the process of building an innovation ecosystem in the country. GITA's  main aim is to support 
R&D development and its commercialization . 
 
Modern and inclusive accessible infrastructure is vital for the transformation of research results into 
new innovative products and services being available on the market. Technological Parks operate on 
a one -stop shop principle, promoting innovation and  entrepreneurship, through providing access to 
physical co -working space, high technology equipment for prototyping, access to business incubation 
and acceleration programs, knowledge and education generation.  
 
Innovation and Startup Financing  
GITA, superv ised by the Ministry of economy and Sustainable Development of Georgia, is providing 
Access to Finance for innovative projects, also supports R&D commercialization and technology 
transfer. In this regard, together with the awareness -raising and training pr ograms, GITA provides 
access to finance by different types of grant programs  by providing the pre -seed and seed stage 
financing for startups, covering the risks, and enhancing their skills for further investment 
opportunities.  
 
In this direction, since 201 6 the support from the World Bank Group was secured for the 
Project  - Georgia National Innovation Ecosystem (GENIE). The main objective of the project is to 
increase innovative activities of the micro, small, and medium -sized enterprises (MSMEs), including  
startups, and individuals in Georgia, and their participation in the digital economy.  
 WT/TPR/M/420/Add.1  
 
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  R&D 
Georgia's Innovation and Technology Agency (GITA) with World Bank Group elaborated the 
Technology Transfer Pilot.  
 
Promoting R&D commercialization, GITA together wi th Trust Fund between World Bank and  EU, 
GITA is running TechTransfer  Pilot Program, identifying high potential research projects with 
commercialization opportunities and bringing them to the industry.  
 
Page 10, Paragraph 2.55  
Background : The adoption of the Law of Georgia on Information Technology Zones resulted the 
creation of an attractive environment for persons carrying out the economic activities in the field of 
Information Technology. Acquiring virtual zone person status is needed  to start activities in the 
IT virtual zones. Since software product is created, status holders will be exempted from: i)  Profit 
tax on product deliveries outside of Georgia; ii) VAT on product deliveries outside of Georgia; 
iii) Export tax for export leavi ng Georgian customs territory.  
 
Question 4:  Could Georgia  provide details about the application and licensing procedures and 
requirements for entities to obtain virtual zone person status?  Are these requirements and 
procedures same for foreign entities?  
 
Reply to Question 4: The status of a virtual  zone person is granted to an interested person 
by the LEPL Financial Analytical Service of the Ministry of Finance of Georgia within 10  working  days 
from submission of the application. Electronic application can be filled -in and submited through the 
Electronic Declaration system ( www.newzone.mof.ge ). 
 
An electronic certificate evidencing the status of virtual zone persons shall be issued not later 
than 2 working days after the status of a virtual zone person is granted.  
 
Activities in the virtual zone shall comprise of the economic activities of legal persons (Including 
foreign entities registered in Georgia)  related to the production of ITs in the territory of Georgia.  
 
See below detailed information:  
LAW OF GEORGIA  
ON INFORMATION TECHNOLOGY ZONES  
 
Article 1 - Purpose of the Law  
1. This Law is intended to attract foreign investments and create a favourable environment for 
legal persons operating in the Information Technology (IT) sector.  
2. The relationships related to IT activities and issues related to the taxation of virtual zone 
persons are regulated by this Law, the Tax Code of Georgia and other legal acts.  
 
Article 2 - Definition of terms  
The terms used in this Law have the following m eaning:  
a) virtual zone - a virtual zone person or an aggregate of virtual zone persons;  
b) virtual zone person – a legal person engaged in IT activities and holding an appropriate 
status;  
c) information technologies (IT) – study, support, development, des ign, production and 
introduction of computer information systems, as a result of which software products are 
obtained.  
 
Article 3 - Tax benefits for virtual zone persons  
1. The issues related to the taxation of virtual zone persons are regulated in accorda nce with the 
Tax Code of Georgia.  
2. The following shall not be levied:  
a) tax on the profits earned from supplying outside Georgia the information technologies 
created by virtual zone persons;  
b) tax on the supply with VAT outside Georgia of information technologies (ITs) created by 
virtual zone persons  
c) export duties on exporting from the customs territory of Georgia of the information 
technologies produced by virtual zone persons.  WT/TPR/M/420/Add.1  
 
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  3. The expenses, related to earning income from supplying w ithin or outside of the territory of 
Georgia of the ITs produced by a virtual zone person, shall be deducted from the gross income in 
proportion to the share of the income earned from supplying the ITs within the territory of Georgia.  
Law of Georgia N °. 5969 of 27 March 2012 - website, 12.4.2012  
 
Article 4 - Regulatory benefits for virtual zone persons  
1. Virtual zone persons shall be exempt from any special regulations.  
2. Virtual zone persons do not need licences, permits and other regulatory documents to conduct 
their activities.  
 
Article 5 - Granting the status of virtual zone person  
1. The status of a virtual zone person is granted to an interested person by a person designated 
by the Government of Georgia.  
2. The status of a virtual zone person is gr anted to an interested person not later than 
10 working  days after submitting an application for the status.  
The procedure and terms for granting the status of a virtual zone person are determined by an 
ordinance of the Government of Georgia.  
3. An electro nic certificate evidencing the status of virtual zone persons shall be issued not later 
than 2  (two) working days after the status of a virtual zone person is granted.  
 
Article 6 - Activities in the virtual zone  
Activities in the virtual zone shall compris e the economic activities of legal persons related to the 
production of ITs in the territory of Georgia.  
 
Article 7 - Transitional provision  
The Government of Georgia shall, by an ordinance, determine the procedure and terms for granting 
the status of a vi rtual zone person.  
 
Article 8 - Final Provision  
This Law shall enter into force from 1 January 2011  
 
and 
 
Resolution of Georgian Government  
 
N°. 49 26th January 2011 year  Tbilisi  
 
On determining the order and conditions of granting the status of a virtual zone person, and 
determining the person who will grant the status of the virtual zone person  
 
Article 1. on the bases of the paragraphs 1 and 2 of the Article 5, and Article 7 of the Law of Georgia 
on Information Technology Zones:  
1. should be appr oved attached order and conditions for granting the status of the virtual zone 
person.  
2. a legal entity of public law - financial -analytical service should be determined as the granter 
of the status of a virtual zone person.  
 
Article 2. The resolution sho uld come into legal force since 1 February 2011.  
 
Prime Minister  
N. Gilauri  
 
The order and conditions of granting the status of a virtual zone person Article 1. General Provisions  
The order and conditions of granting the status of a virtual zone person wil l determine the order and 
conditions of granting status to a candidate for the virtual zone person.  
 
Article 2. Definition of Terms  
For the purposes of this resolution the terms used in the resolution have the following meanings:  
a) Virtual zone person - a legal person implementing information technological activities 
and having a relevant status;  WT/TPR/M/420/Add.1  
 
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  b) Information technology - study, design, development, implementation, support and 
management of computer information systems, namely, software product s and computer 
equipment;  
c) Certificate of a virtual zone person (hereinafter - Certificate) - Electronic Certificate 
confirming the status of a virtual zone person by which the status of the virtual zone is 
confirmed;  
d) Candidate for the virtual zone pe rsons status (hereinafter - Candidate) - a legal entity 
implementing information technological activities and who applies to the legal entity of public 
law - financial - analytical service for granting the status (hereinafter - financial - analytical 
service). 
 
Article 3. Order and conditions of granting the status  
1. The candidate shall apply to the financial -analytical service to obtain the status of a virtual 
zone person. The candidate electronically fills the form of application posted on the website of  the 
financial -analytical service ( www.fas.ge ), which is sent to the financial -analytical service.  
 
2. The list of informational and technological projects (if any) made within the last three  years 
shall be attached to the application.  
 
3. The Financial -Analytical Service is authorized to request additional information about the 
candidate's information -technological activities.  
 
4. The Information -Analytical Service shall ensure the confidentiality of informa tion obtained in 
accordance with paragraph 3 of this Article.  
Decree of the Government of Georgia, 9 December 2016,  N°. 536 - website, 13.12.2010.  
 
Article 4. Terms of Granting the Status  
1. Financial -Analytical Service shall grant the status of a candidat e within the term defined by 
the Law of Georgia on Information Technological Zones.  
 
2. No later than 2 (two) working days after granting the status, the Financial -Analytical Service 
shall issue an electronic certificate issued to the virtual zone person t hat is published on the website 
of the financial -analytical service ( www.fas.ge ). 
 
3. Revenue Service shall be notified in writing by the Financial -Analytical Service within 
2 (two)  working days from the granting the statu s of the virtual zone person for the candidate.  
 
4. Status is permanent.  
Decree N°. 89 of the Government of Georgia of 22 February 2011 - website, 28.02.2011. Decree of 
the Government of Georgia, 9 December 2016, N°. 536 - website, 13.12.2010.  
 
Article 5. Cancellation of Status  
1. Financial -Analytical Service shall cancel the status of a virtual zone person:  
a) if the status received in accordance with the relevant legislation by the virtual zone 
person is used to avoid paying taxes;  
b) based on the electronic application of the virtual zone person, which is sent through the 
website of the financial -analytical service ( www.fas.ge ). 
 
2. The Financial -Analytical Service shall cancel the status on the basis of the in formation provided 
by the relevant body, based on the cases envisaged by paragraph "a" subparagraph "a" of this 
article.  
 
3. Revenue Service shall be notified in writing by the Financial -Analytical Service within 
2 (two)  working days from the cancellation the status of the virtual zone person for the candidate.  
 
4. In case of cancellation the status of a virtual zone person, the relevant electronic certificate 
shall be canceled, on the basis of which the financial -analytical service within 2  (two)  working d ays 
from the cancellation of the status will remove the electronic certificate from the financial - analytical 
service web site ( www.fas.ge ). 
 WT/TPR/M/420/Add.1  
 
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  Questions based on Secretariat Report (WT/TPR/S/420)  
 
Page N °. 10; Paragraph: 17  
Background: 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.  
 
Question 5:  Against the above -mentioned background India re quests Georgia to clarify the 
following:  
 
a. Did import subsidy of wheat help in controlling price of basic commodities during 2020? 
How long was the measure in place?  
 
Reply :Georgia mainly imports wheat and the volume of wheat flour imports is insignificant, 
therefore the purpose of the price subsidy was to maintain the retail selling price of non -forage/food 
wheat and first grade wheat flour. It should be noted that according to the National Statistics Office 
of Georgia, in 2020 the consumer pr ice index for this product was stable compared to previous years. 
The measure was in place more than one year.  
 
b. Kindly explain what does a preferential agricultural credit entail?  
 
Reply:  Preferential Agrocredit Project has been initiated by the Ministry o f Environment Protection 
and Agriculture of Georgia and has been implemented by the Rural Development Agency 
since 27 March 2013 and is regulated by Government Resolution N°. 139 of 27 January 2014.  
 
The purpose of the project is to improve the processes of primary agricultural production, processing, 
storage and sale by providing the legal and natural entities with cheap, affordable long -term and 
preferential funds.  
 
Within the frame of the project, the enterprises engaged in the processes of pr imary agricultural 
production, processing and storage receive the preferential agrocredit/agroleasing from the financial 
institutions for fixed and current assets. The loan shall be granted only to the individuals meeting 
the terms and conditions of the pr oject.  
 
c. By what percentage did Georgia's subsidies increase w.r.t. viticulture and preferential 
agricultural credits in 2020?  
 
Reply to Question 5(c):  State support through co -financing in 2020 compared to 2019 increased 
by 66% in viticulture and by 32% in preferential agrocredit . 
 
Page N °. 20; Table – Box 1.3  
Background: Box 1.3 Main COVID -19-related plans and measures, 2020 -21 
 
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 fe rtilizers of 
small farmers; co -financing of agricultural equipment and 
greenhouses; grants for cooperatives, etc.  
 
Question 6: Against  the above -mentioned background could Georgia please clarify the following:  
 
a. What are the eligibility criteria under the scheme for loans for the farmers?  
 
Reply:  The beneficiary of the program can be a natural citizen of Georgia or an entrepreneur 
natural/legal entity registered.  WT/TPR/M/420/Add.1  
 
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  b. Under which provision(s) of the AoA  does Georgia intend to notify this programme?  
Reply to Question 6(b): Anti-Crisis Plan on Agriculture was a one -time project and has not re -
launched since. Some relevant state programs from that plan have been notified to WTO in 
previous  years.  
Page 21, P aragraph 1.21  
Background: 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 Ec onomy 2030 initiative contains 
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 uni fied 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.  
 
Question 7: On the privatization process under the Economy 2030 initiative, are foreign entities 
allowed to invest and participate  and if so, then kindly inform the applicable Rules and Regulations 
thereof?  
 
Reply to Question 7: Foreign entities are allowed to participa te and invest according to the national 
laws and regulations.  
  
Page 36, Paragraph 2.39  
Background:  The Georgia 2020 Strategy, adopted in June 2014, identified weak private sector 
competitiveness as one of the three most critical problems facing the Georgi an economy (along with 
insufficiently developed human capital and limited access to financial resources). To enhance the 
productivity and competitiveness of the private sector, it proposed a series of measures designed to 
improve the investment and busines s 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 and 
stable fiscal environment for the private sector and foreign investment, strengthening 
of (intellectual) property rights, supporting the development of entr epreneurship, 
strengthening  mechanisms for the resolution of commercial disputes, improving legislative 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 regulation. Significant reforms were adopted  during 
the review period in a number of these areas (Section 1.2, Box 1.1).  
 
Question 8: Georgia may please inform the measures suggested in Georgia Strategy  2020 
regarding foreign investment?  Are there any restrictions? If so, please provide the details.  
 
Reply to Question 8:  Social -economic Development Strategy of Georgia "GEORGIA 2020" included 
special chapter on Improvement of investment and business environment. Measures defined in the 
strategy for the Improvement of investment environment:  
 
• Strengthening the protection of property rights ; 
• Strengthening mechanisms for the efficient resolution of commer cial disputes ; 
• Improving investment legislation ; 
• Improving legislative and institutional mechanisms for free market competition ; 
• Improving mechanisms for the regulation of bankruptcy and the closing of businesses ; 
• Improving public services and enhancing th e transparency of public administration ; 
• Ensuring flexible regulations . 
 
Page 50, Paragraph 3.42  
Background:  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 WT/TPR/M/420/Add.1  
 
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  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 and 
excise tax on imported goods generated 30.7% and 1 3.3%, respectively, of total tax revenue.  
 
Question 9: Can Georgia elaborate on the Agricultural goods on which the application of 
VAT depends on the goods' origin and how much is the tax differential between imported and locally 
produced goods?  
 
Reply to Question 9: VAT for certain imported agricultural is 18%.  
 
Page 63, Paragraph 3.96  
Background : 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 gran ts. 
 
Question  10: Georgia is requested  to indicate service sectors, if any, that have been treated as 
potential sectors for export -oriented and import -substituting support mechanisms?  Georgia may 
kindly furnish further details of the envisaged support mech anisms (nature of assistance, quantum  of 
assistance, beneficiaries, eligibility criteria etc.) ? 
 
Reply to Question 10:  Toward the end of 2020, Enterprise Georgia introduced a new program 
named "Business Universal" the program has identified over 300 NACE codes (economic activities), 
which can be supported. The program offers a loan support mechanism and gives companies 
opportunity to take advantage of: credit co -financing and credit guarantee schemes jointly, the 
program offer support on loans issued by commercial banks from USD  17,000 to 
USD 3.3 milion.  (loans can only be issued in GEL). Among the supported sectors are also 
service  sectors, such as: IT, creative industry, hospitality sector, etc.  
 
Full list of supported economic activities can be foun d on the link below:  
http://www.enterprisegeorgia.gov.ge/files/1/N1.pdf  
as well as more details about the program can be found on the link below:  
http://www.enterprisegeorgia.gov.ge/en/business -development/universal -industry  
 
Page 65, Paragraph 3.102  
Background:  Enterprise Georgia, established 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. U nder 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. The recently added 
Business  Universal component of fers loan/ lease interest rate co -financing, credit guarantees and 
grants. The support measures are limited to certain sectors that as of 2021 included the broad 
categories of development of hotels, production of audio -visual products (films), development  of 
balneological resorts, tourism services, real estate, and industry.  
  
Question 11:  Are there any restrictions placed by Georgia on content requirements, screening etc. 
in the audio -visual services sector. If yes, kindly give details?  
 
Reply to Question 11: There are not any restrictions placed by Georgia on content requirements, 
screening etc. in the audio -visual services sector  
 
Question 12:  Which services sectors are supported  under the 'Produce in Georgia 
Program'?  Georgia may kindly give details of assistance provided (nature, quantum, beneficiaries, 
eligibility criteria etc.)?  
 
Reply to Question 12:  Toward the end of 2021, Enterprise Georgia introduced a new program 
named "B usiness Universal" the program has identified over 300 NACE codes (economic activities), 
which can be supported. The program offers a loan support mechanism and gives companies 
opportunity to take advantage of: credit co -financing and credit guarantee sche mes jointly, 
the program offer support on loans issued by commercial banks from USD 17,000 to WT/TPR/M/420/Add.1  
 
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  USD 3.3 milion.  (loans  can only be issued in GEL). Among the supported sectors are also service 
sectors, such as: IT, creative industry, hospitality sector, etc.  
Full list of supported economic activities can be found on the link below:  
http://www.enterprisegeorgia.gov.ge/files/1/N1.pdf  
as well as more details about the program can be found on the link below:  
http://www.enterprisegeorgia.gov.ge/en/business -development/universal -industry  
 
Page 66, Paragraph 3.107 . 
Background : Enterprise Georgia also imp lements the Micro and Small Business Support Program 
that provides various support measures to Georgian citizens establishing or expanding their micro 
or small business projects subject to a competition. The main objectives 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, development 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 
agricultural production as well as religious, political , and military activities are excluded.  
 
Question  13: Which 'regional services' have received assistance for diversification under this 
Program?  
 
Reply to Question 13:  EG has been implementing a Micro and Small Business Support program as 
part of Produce in Georgia since 2015. The program is designed to render financial support through 
grants to micro and small businesses across the country, as well as to provide training and 
technical  assistance.  
 
Financial assistance entails up to  GEL 30,000 gran ts for startups or expansion of enterprises while 
technical support includes individual and group consultations where entrepreneurs have 
an opportunity to get relevant business knowledge/training. The program is being implemented in 
all regions of Georgia,  including Tbilisi, according to geographical lots.  
 
Over the years, more than 6,900 entrepreneurial projects have been supported through the 
program, ranging in their activities, from guest houses to local stores to local services (barbershops, 
vehicle re pair, etc.), also manufacturing of goods, for example: furniture, apparel, etc.  
 
Question 14:  Does Georgia provide any export -promotion and export -contingent assistance to 
service sectors and service suppliers under this Program? If yes, Georgia may kindly give details of 
the assistance provided (nature, quantum, beneficiaries, eligibility criteri a etc.)?  
 
Reply to Question 14:  None of the programs implemented by Enterprise Georgia have contingency 
for beneficiaries to have to export and distribution of support is not related to the company's success 
in terms of export.  
 
Enterprise Georgia simply i dentified a set of sectors which it believes has growth potential and 
provides commercial loan co -financing, credit guarantee and grants programs, to the companies 
willing to manufacture these products, without any requirement for the company to be liable to 
export.  
 
Page 133, Paragraph 4.133:   
Background: 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 
coordinator for the HDM project; along with five other countries in the region 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").  
 WT/TPR/M/420/Add.1  
 
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  Question 15:  Could Georgia please explain and elaborate specific provisions related to the following 
in its laws, regulations or policies:  
a. Cross-border transfer of personal/ non -personal data  
b. Localization of data  
c. Data sharing obligations and provisions, if any, with regard to SME/ start ups  
d. Sharing of source code of digital technologies with public authorities  
e. Data adequacy arrangements with oth er countries  
f. Measures to address anti -competitive behaviour due to network effect of digital 
monopolies  
g. Regulations of social media applications  
h. Artificial Intelligence  
 
Reply to Question 15:  Rights to freedom of opinion,  information, mass media  and right to access 
and freely use the internet is protected under the Constitution of Georgia. Georgia has regulations 
to ensure media pluralism and openness of internet.  
 
Question: 15.  Is not subject of HDM/ EU4Digital  Initiative. In the framework of the Initiative, the 
European Union supports the digital economy and society in the Eastern Partner countries, fostering 
the harmonisation of digital markets in the region, in order to deliver integrated online services for 
citizens, public administratio ns and businesses.  
 
The topics a; b; c; d; e; g and h are not regulated by the laws, as for the topic f. - The Law of 
Georgia on Electronic Communications envisages the creation of a competitive environment in the 
field of Electronic Communications and for  this purpose imposes specific obligations for the SMPs to 
ensure transparency of information, obligation to prohibit discrimination, obligation to record 
expenditure and income separately in accordance with the methodological rules approved by the 
Regulat ory authority, obligation to provide access to relevant elements of an electronic 
communication network, obligation to regulate tariffs and prepare cost estimates.  
  WT/TPR/M/420/Add.1  
 
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  REPUBLIC OF KOREA  
PART I: Questions Regarding the Secretariat Report  
 
Page 88 (Para 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 legislation, 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.  
 
Question 1  
 
There have been concerns from our stakeholders that the use of so -called "black list" or "white list" 
might be associated with the disc riminatory practices against certain foreign companies. 
Could  Georgia explain its position on this matter, as well as any plans to improve relevant practices?  
 
Reply: Register of mala fide participants of the procurement ("the Black List") is crucial for t he 
effective functioning of the Georgian Public Procurement System. The Black List includes the data 
on mala fide persons, bidders and suppliers participating in public procurement, who may not 
participate in public procurement and be awarded a public proc urement contract within one  year 
after they are entered into the Black List. Therefore, the Black List is a sanction by its characteristics. 
However, taking into consideration that economic operators registered in the Black list do not have 
the possibility  to participate in public procurement procedures for one year, the list can be considered 
as the preventive instrument for the economic operators to fulfil the obligations defined by the 
public  procurement contract. The procedures and conditions for mainta ining the Black List are 
defined in a subordinate normative act approved by the chairperson of the Public Procurement. It 
should also be noted that this subordinate normative act does not differ between non -resident and 
resident economic operators. These p rocedures and conditions for maintaining the Black List apply 
equally both to resident and non -resident companies.  
 
As for the register of qualified suppliers participating in procurements ('the White List'), according 
to the Law of Georgia "On Public Proc urement", the White List includes data on qualified suppliers 
participating in procurements who meet the criteria determined by a subordinate normative act for 
inclusion in the White List. When participating in public procurement, qualified suppliers regis tered 
in the White List shall enjoy simplified procedures provided under a subordinate normative act. The 
procedures and conditions for maintaining the White List are defined by the subordinate normative 
act – by the decree of the Chairperson of the State Procurement Agency. According to this legal act, 
in order for an economic operator to be registered in the While List, it shall meet the certain 
requirements defined by the above mentioned decree. The White List can be considered as the 
motivation for the economic operators as they will be able to enjoy simplified procedures whilst 
participating in the Georgian public procurement procedures. It should also be noted that according 
to Georgian legislation, both non -resident economic operators and a branch of the non -resident 
company are eligible to apply for registering in the While List. However, they shall submit the relevant 
information and documentation to the State Procurement Agency.  
 
  WT/TPR/M/420/Add.1  
 
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  UNITED STATES  
Part I. Questions based on the Secretariat Report (WT/TPR/S/420)  
 
2 TRADE AND INVESTMENT REGIMES  
 
Page 33, paragraph 2.25: Please outline Georgia's process for ensuring notification to 
WTO Committees of legislation or other measures as it continues approxi mation to the EU acquis . 
 
Reply:  The responsibility to submit the notifications on legislation and other measures in relation to 
the approximation to the EU acquis  is distributed to relevant line agencies according to the areas. 
For instance, the notifications on approximation in the are a of SPS should be submitted by the 
Ministry of Environmental Protection and Agriculture, whereas the topics related to TBT are 
submitted by the Georgian National Agency for Standards and Metrology  under the Ministry of 
Economy and Sustainable Development of Georgia.  
 
Page 37, paragraph 2.40 : The Secretariat's Report notes that the main functions of Enterprise 
Georgia include "export support" and "granting of financial incentives" . Are any of these financial 
incentives contingent upon export performance? If  so, please explain how these incentives are 
consistent with Georgia's obligations not to provide subsidies contingent upon export, as provided 
under Article 3 of the Subsides Agreement.  
 
Reply:  The "Enterprise Georgia" does not provide any subsidies contingent upon export. The type 
of measures done by the Entity is considered  as allowed subsidies, which do not distort trade or 
violate Article 3 of Subsidies Agreement. These measures are technica l assistance and capacity 
building activities including training courses and workshops for export managers, consulting 
services, assistance for SMEs participation in international fairs and exhibitions and trade missions. 
With regards to  financial incentiv es "Enterprise Georgia" provides access to Finance to support local 
production granting loans on competitive interest rates.  
 
3. TRADE POLICIES AND PRACTICES BY MEASURE  
 
Page 41, paragraph 3.14: The Secretariat notes that Georgia's customs code regarding c ustoms 
valuation  was updated , but Georgia has yet to notify these updated regulations to the 
WTO Committee on Customs Valuation . When will Georgia notify this legislation to the WTO?  
 
Reply:  The notification on Customs Valuation will be notified  to the WTO  no later than 
January  of 2022.  
 
Page 48, paragraph 3.36:  The report notes that  "Georgia continues to grant duty exemptions for 
social and economic purposes, notably for the promotion of exports and investment" . To the extent 
that duty exemptions are contingent upon export, they could be inconsistent with obligations 
under  Article 3 of the Subsidies Agreement. Please explain how these incentives are consistent with 
Georgia's obligations not to provide subsidies contingent upon export, as provided under Article 3 of 
the Subsides Agreement.  
 
Reply:  Duty exemptions provided in the tax co de and customs code are not to be considered as 
subsidies contingent upon export performance.  
 
Page 55, paragraph 3.57 : According to the report, Georgia has not completed its Annual 
Questionnaire for the Committee on Import Licensing since 2018. When will Georgia submit the 
7.3 Annual Questionnaire, and can Georgia commit to annually meeting this transparency obligation 
to the Committee on Import Licensing?  
 
Reply: The next notification on Import Licensing will be submitted to the WTO no later than 
January  2022. Georgia is commited to annually meet transparency obligations.  
 WT/TPR/M/420/Add.1  
 
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  Page 55, paragraph 3.58 : The report notes that Georgia introduced new import licensing 
procedures in 2017 and 2019 but has yet  to notify the WTO Secretariat. What is the timeline for 
Georgia to make these notifications?  
 
Reply: The next notification on Import Licensing, inlcuding the information on above mentioned 
procedures in 2017 and 2019, will be submitted to the WTO no later than January 2022.  
 
Page 55, paragraph 3.60 : The report not es that applications for permits issued by the Revenue 
Service and the National Food Agency may be submitted  electronically. Is the process for the other 
four administering ministries performed through the mail or only in person?  
 
Reply:  All applications may be submitted electronically through the GRS relevant Customs e -portals, 
but at the same time some limited number of requested documents may be submitted only in person.  
 
Page 56, paragraph 3.61 : The report notes that Georgia has two ce ntral online 
platforms  (eCustoms and eServices) that host some import licensing procedures. Does Georgia 
intend to add the additional import licensing procedures to these centralized portals?  
 
Reply:  A project is underway to modernize these systems in cooperation with the EXBS -Nu Borders 
initiative. Any new import licensing procedure will be part of these platforms.  
 
Page 56, paragraph 3.62 : The report notes that Georgia has additional registration or  certification 
requirements outside of import licenses "under certain conditions" for a number of products. Can 
Georgia explain these procedures or note the location of their publication?  
 
Reply:  All information regarding registration or certification requ irements outside of import licenses 
for a number of products can be found on a webpage – www.rs.ge . 
 
Page 57, paragraph 3.70:  The Secretariat reports that in 2020 Georgia launched a subsidy 
program for wheat imports. According to the report, beneficiaries received a subsidy conditioned 
that they sell the flour obtained from processing the imported wheat at certain identified 
maximum  prices.  
• Please provide more information on the eligibility requirements, beneficiaries, and 
administration of this subsidy program.  
• Also, the Secretariat notes the program beneficiaries were natural or legal persons registered 
in Georgia who have purc hased and/or imported 5000 tons of wheats.  Please clarify if 
purchased wheat from Georgian producers was eligible for subsidies under this program.  
 
Reply:  Beneficiary eligibility requirements: Entrepreneur, natural or legal person registered in 
Georgia, w ho has purchased and/or imported at least 5,000 tons of wheat within one  calendar  year 
before submitting an application to the Agency, and with whom a subsidy agreement can be 
concluded within the framework of the program;  
 
The amount of the subsidy was th e equivalent of not more than $ 40 per ton of wheat in the national 
currency. Under the program, a subsidy was provided per beneficiary for not less than 2000 and 
not more than 40,000 tons of wheat.  
 
The subsidy agreement was concluded on the following pri nciple: First of all, the agreement was 
concluded with the potential beneficiary who had the lowest amount of subsidy in the application, 
calculated for each ton of wheat.  
 
In case the volume offered with the lowest amount did not meet the import quantity within the 
program, the contract was concluded with the next potential beneficiary with the lowest price and 
continued on the same principle until the quantity of wheat determined by the program was filled.  
 
The Beneficiary was obliged to sell the first qu ality flour received as a result of processing of imported 
wheat within the framework of the program within a maximum of GEL 51 per bag no later 
than three months after the date of concluding the subsidy agreement.  
 
The objective of the program was to stim ulate the creation of stocks of wheat and first grade wheat 
flour in the country, therefore only import subsidy was eligible.  WT/TPR/M/420/Add.1  
 
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  Page 63, Table 3.7: The Secretariat reports that Georgia's Ministry of Environmental Protection 
and Agriculture provided 243.5 million Georgian lari (GEL) in subsidies to the agricultural sector 
in 2020. Most notably GEL 85 million for development of viticulture and winemakin g and 
GEL 21 million for the 'Plant the Future' initiative. In Georgia's 2020 domestic support 
notification  (G/AG/N/GEO/25), dated 26 August 2021, Table DS: 1 only notified GEL  150.9  million 
in domestic support.  Georgia notified GEL 7 million in subsidies for winemaking and did not mention 
the 'Plant the Future' program.  Could Georgia please clarify how Georgia spent the other 
GEL 92 million  cited in the Secretariat report and explain why these programs were not notified in 
its 2020 domestic support (Table DS: 1) notification?  
 
Reply:  Georgia recognizes the importance of the obligations stemming from the WTO and intends 
to submit relevant notifications as soon as possible.  
 
Page 66, paragraph 3.104 : The report states that "companies that operate in priority 
economic  activities with export and import opportunities" are eligible for various incentives under 
the Universal Industrial Component of the Produce in Georgia Program, including loan/leasing 
co-financing, a credit guarantee scheme, and grants. Are these subsidies contingent upon export? 
Are the benefits under this program limited to exporters? Please explain how these incentives are 
consistent with Georgia's obligations not to provide subsidies contingent upon export, as provided 
under Article 3 of the Su bsides Agreement.  
 
Reply:  None of the programs implemented by Enterprise Georgia have contingency for beneficiaries 
to have to export and distribution of support is not related to the company's success in terms of 
export.  
 
Page 69 Paragraph 3.123:  The Secretariat report states that 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.  The Secretariat also 
notes that in Geor gia, there was a trend towards adopting more European standards in lieu of 
international standards as Georgia proceeded with DCFTA implementation. As Georgia integrates 
with EU  standards  and technical regulations, please explain how a shift away from using  international 
standards is consistent with Georgia's WTO TBT Agreement obligations.  
 
Reply: It should be mentioned, that considerable part of nationally adopted European standards are 
identical to international standards (EN ISO or EN IEC). Georgia as a member of 
international/European standards organizations periodically adopts international/regional standards 
as well as fulfils the obligations and membership  criteria of those organizations. Standards published 
by international and regional standardizati on organizations are available for any interested 
stakeholder via GEOSTM and usage depends upon the decision made by any interested party.  
 
Page 73, paragraph 3.136 : Please provide a list of the SPS legislation or other measures that 
Georgia has already ap proximated to the EU acquis  and corresponding notifications to the 
WTO SPS Committee.  
 
Reply:  Please see a list of the SPS legislation or other measures that Georgia has already 
approximated to the EU acquis  in the Secretariat Report page 162 (Table A3.5). As for the 
notifications, MEPA is working intensivly to further improve the notification process.  
 
Page 73, paragraph 3.139 : The report notes that Georgia has "worked on the National 
Phytosanitary Strategy,  but as [of] September 2021 it had not yet been approved. Furthermore, the 
National Food Safety Implementing Strategic Document was prepared during the review period; 
it was recently approved but not yet available for examination" . Can Georgia provide any update as 
to when it expects to approve the National Phytosanitary Strategy? Can Georgia also provide us with 
an update as to when the National Food Safety Implementing Strategic Document will be available 
for examination?  
 
Reply:  National Food Safety Impl ementing Strategic Document was adopted by the Minister of 
Environmental Protection and Agriculture in 2021. There are ongoing work on the National 
Phytosanitary Strategic document (programme) which will be adopted in the first quarter of  2022.   
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=t:/WT/TPR/M420A1 -02.pdf . WT/TPR/M/420/Add.1  
 
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  Page 77, paragraphs 3.152 and 153:  The Secretariat report notes that "The authorities 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".  
 
Please outline t he particular capacity constraints that have prevented Georgia from making relevant 
WTO notifications. Please explain the steps that Georgia is taking to ensure that measures, including 
SPS measures, which impact trade are notified  to the WTO. If any notif ication is outstanding, please 
provide a timeline as to when Georgia intends on notifying applicable measures.  
 
Reply:  We are taking steps to increase the capacity of the relevant institutions responsible for 
WTO notifications. In this regard, only in the last two years, overally more than 30  WTO notifications 
under the relevant Agreements were made by Georgia. In parallel to capacity building, Georgia 
intends to increase the number of WTO notifications.  
 
Page 83, Table 3.16: Please provide a list of all state-owned enterprises in the manufacturing 
sector and what goods they manufacture.  
 
Reply: Please see the list of SOE's under NASP.  
N°
. Entity  Area of activity  
1 Tbilisi Aircraft Manufacturing LTD  Design, manufacture, modernise civil and military 
machinery  
2 Kutaisi regional blood bank LTD  Manufacturing blood/blood components  
3 Kvemo Kartli regional blood transfusion station 
LTD Manufacturing blood/blood components  
4 Food manufacture company LTD  Food purchase/manufacture/distribution  
 
Page 84, paragraph 3.188 : The report notes Georgia indicates that it maintains a "white list" of 
confirmed suppliers who may have certain advantages during procurement procedures, such as 
providing smaller guarantees com pared to suppliers not registered in the list. Please elaborate on 
the process for a supplier to be included in the white list. Does Georgia allow for foreign  suppliers to 
be included in the white list if they do not have official representatives registered in Georgia?  
 
Reply: According to the law of Georgia "On Public Procurement", the procedures and conditions for 
maintaining the White List as well as the re levant requirements that shall be met by economic 
operators are defined by the subordinate normative act – by the decree N°.  2 of 
26 February  2016 of the Chairperson of the State Procurement Agency 
(http://www.procurement.gov.ge/ka/page/legalacts62ea792f -daaf-4102-ade8-f35b9885aa54 ). 
According to this decree, it is possible for the non -resident companies to be registered in the 
White  List. For this  purpose, t hey are obliged to submit the relevant information and documentation 
regarding their company. The list of the required information and documentation to be submitted to 
the State Procurement Agency is defined by the abovementioned decree of the Chairperson of the 
State Procurement Agency.  
 
Page 90, Section 3.3.7: The Secretariat's Report makes no reference  to trade secret protection. 
Please provide information on this topic.  
 
Reply: Relations regarding trade secret is regulated under General Administrative C ode of Georgia, 
Georgian law on Competition and Civil Code of Georgia.  
Under article 272 of the General Administrative Code of Georgia "Commercial secret is information 
on a plan, formula, process, or means of a commercial value, or any other information used for 
manufacturing, preparing, processing of goods or rendering services, and/or is a novelty or a 
significant result of technical activity, as well as other information that may prejudice the 
competitiveness of a person if disclosed".  
Under article 113 paragraph 1 and 2(e) of the Georgian law on Competition, "1. Unfair competition 
is prohibited. 2. For the purposes of this article, any action of undertakings that contradicts the 
norms of business ethics and infringes the interests of consum ers shall be regarded as unfair 
competition, in particular: e) receipt, use or dissemination of scientific -technological, production or 
trade information or commercial secrets without the consent of their owner".  
Under article 1105 of the Georgian Civil Co de, "1. an entrepreneur who possesses a trade secret 
(know -how) consisting of technological, organizational or commercial information of extraordinary 
importance, as evidenced by the necessary and adequate measures taken for keeping it secret, shall WT/TPR/M/420/Add.1  
 
- 18 - 
 
  have a n exclusive right to the information. 2. An exclusive right to know -how shall be protected 
under this Code and other legislative acts on industrial property".  
 
Page 90, paragraph 3.193 : The report states that Georgia has indicated that its accession proces s 
to the WTO Agreement on Government Procurement (GPA) has essentially stalled since 2003 -2004, 
without further response to outstanding GPA parties' questions. Does Georgia have plans in the 
upcoming review period to re -engage parties in its accession?  
 
Reply: We reiterate Georgia's strong adherence to its commitments undertaken within 
the WTO accession process and reassure the GPA members in Georgia's interest to continue the 
negotiations for membership in the WTO Government Procurement Agreement, as set o ut in the 
Working Party Report on Georgia's accession to the WTO.  
 
The Free Trade Agreement between Georgia and EFTA countries, which was signed in June 2016 and 
entered into force for Georgia on 1 September 2017, contains a special chapter devoted to 
government procurement, the provisions of which, are primarily based on WTO GPA  agreement. 
Accordingly, the government procurement provisions with EFTA countries are fully enforceable on 
the territory of Georgia.  
 
On 21 February 2020, draft amendments to the P ublic Procurement Law were submitted to the 
Parliament of Georgia for adoption, which provide for the establishment of an independent and 
impartial administrative review body in Georgia's public procurement system. Those legislative 
changes aim to meet Geo rgia's obligations under the EU – Georgia Association Agenda (AA), whereas 
the public procurement represents an important area to be addressed.  
 
The draft Law on Public Procurement has been prepared by Georgian side in close collaboration with 
EU experts a imed at ensuring full approximation of Georgia's public procurement landscape with 
latest EU public procurement directives thus entailing full compliance with the provisions of 
WTO revised GPA text. The draft law will be submitted to the Parliament soon.  
 
For the last 10 years Georgia's entire public procurement transactions are being carried out through 
electronic procurement platform and only in 2019, 1 977 companies from 77 countries have enjoyed 
unrestricted access to Georgia's open and liberal public p rocurement market.  
 
Currently, there are internal discussions to re -activate Georgia's stalled GPA accession negotiations.  
 
Page 90, paragraph 3.194:  The Secretariat Report states "[t]he 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".  
 
• Please describe the specific duties and scope of authority that the Chamber of Appeals 
possesse s in addition to what was mentioned in the Report?  
 
• Does the Chamber of Appeals have authority over all intellectual property matters (including 
patent, trademark, and copyright), civil and criminal? Have there been any decisions from 
the Chamber of Appeal s involving copyright or trademark infringement?  
 
Reply:  The Chamber of Appeals is established in accordance with the Article 9 of the "Patent Law of 
Georgia" as a dispute resolution authority operating at Sakpatenti, hearing disputes related to 
Sakpatenti decisions on intellectual property subject -matters as w ell as the criteria for their 
protection, granting patents and registration of other subject -matters of industrial property.  
The scope of authority of the Chamber is defined by the relevant laws and by the Statute of the 
Chamber of Appeals. It does not hav e authority over all intellectual property matters, but only over 
the trademark, designs, inventions, utility models and new species of plant and animal varieties. 
Furthermore, its scope is limited to the cases related to the office decisions (e.g decision  to grant 
patent, trademark, design; decision on refusal of trademark registration, granting patent etc.). Thus, 
there is no decision involving copyright or trademark infringement.  
 
Page 91, paragraph 3.197:  The Secretariat Report states "[w]ith an assista nce 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 WT/TPR/M/420/Add.1  
 
- 19 - 
 
  three  years from 1 January 2020…. Legislative acts in the areas of trademarks, designs, and 
copyright and related rights are expected to be revised and  new amendments adopted".  
 
• In addition to the actions and steps mentioned in paragraph 3.197, what other specific 
actions or steps have been or will be taken to further the goal of the EU -Georgia Intellectual 
Property Project?  
• Which legislative acts in the  area of copyright and related rights are expected to be revised? 
Paragraphs 3.209 and 3.210 mention one act, the Law on Copyright and Related Rights. Are 
there others?  
 
Reply: The EUGIPP projects as was mentioned aims to fully modernize trademarks, geogra phical 
indications and designs system. In addition, various actions are aimed to raise public awareness 
about IP in Georgia, among them educational programs between school children.  
 
During first two years legal amendments were drafted to the Trademarks, D esigns and Copyright 
and Related Rights laws. For Sakpatenti examiners and applicants were drafted trademark and 
design (already adopted) examination guidelines and implemented the EUIPN practice documents. 
During the project, special actions were aimed at  school teachers' retraining. Which gave us the 
possibility to deliver  lessons in creativity and intellectual property at the selected schools.  
 
Special attention will be given to raise knowledge and get special skills for the judges, prosecutors, 
investig ators, customs officers and other stakeholders, which are involved in the enforcement 
process. During the process of the implementation of the project special enforcement guidelines will 
be drafted in Georgian. In addition, important cases of the EU courts  will be translated into Georgian.  
 
Page 92, Paragraph 3.202 : The Secretariat's Report states that under the terms of the Agreement 
between the Government of Georgia and the European Patent Organization (EPO) on Validation of 
European Patents, "applicants will be able to validate their European patent applications and patents 
granted 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" . 
• Is there a date when the Agreement is expected to enter in force?  
 
Reply: The Validation Agreement shall enter in force after its ratification by the Parliament of 
Georgia, which is pending.  
 
• Are there possible challenges to implementation of the Agreement ? 
 
Reply: The implementation of the Agreement includes adopting amendments to the Patent Law of 
Georgia and to the Patent Instructions.  
 
• Will applicants have to request validation of EPO patents, or does it happen automatically?  
 
Reply:  The request for validation shall be deemed to be filed by the applicant with any European  
patent application filed on or after the date on which the Validation Agreement enters into force.  
 
• Are there limits on the technologies or number of EPO patents tha t can be validated?  
 
Reply: There are no limitations on technologies or number of patents that can be validated.  
 
• What happens if an EPO patent, after being validated  in Georgia, is invalidated  by the EPO?  
 
Reply:  A validated European patent and the Europea n patent application on which it is based shall 
be deemed ab initio not to have had any effects in Georgia to the extent that the patent has been 
revoked in opposition or central revocation proceedings or limited in limitation proceedings before 
the EPO.  
 WT/TPR/M/420/Add.1  
 
- 20 - 
 
  • What happens if that patent becomes invalid/unenforceable in only one or a few of the 
EPC countries but remains valid in other EPC countries?  
 
Reply:  If a patent becomes invalid/unenforceable in only one or a few of the EPC countries but 
remains valid in other EPC countries, this would not affect the validity of the validated European 
patent in Georgia.  
 
Page 94, paragraphs 3.209 and 3.210:  The Secreta riat Report discusses a judgment by the 
Constitutional Court regarding collective management provisions of the Law on Copyright and 
Related Rights being declared unconstitutional, and states that "[a]s a result of this case, changes 
are envisioned in the n ormative content of the specified Articles. According to the authorities, the 
amendments are expected to provide adequate guarantees for the confidentiality of the information" . 
 
• Where in this process are the changes or amendments to the relevant provisions that were 
declared unconstitutional by the Constitutional Court? What is the anticipated timeline of 
this amendment process?  Was confidentiality the only issue with these provisions?  
 
• What is the effect of the ruling on enforcement of the laws, prior to any amendment?  
 
Reply: In the mentioned case the plaintiffs argued that following Articles of The Law on Copyright 
and Related  Rights were unconstitutional:  
 
Article 21, paragraph 4: "The remuneration for the reproduction for personal use shall be paid by 
producers and importers of equipment (audio and video recorders and other equipment) and 
material carriers (audio and video ta pes, cassettes, laser disks, compact disks, and other material 
carriers)".  
 
Article 21, paragraph 5, third sentence: "The above -mentioned organizations {collective 
management organizations} are entitled to request from natural and legal persons, including 
governmental organizations and institutions, the information concerning production and importation 
of the equipment and material carriers referred to in Paragraph 4 of this Article".  
 
Article 64, paragraph 4: "The user of a subject -matter of copyright or r elated 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 rem uneration".  
 
Plaintiffs raised following issues in their constitutional claim:  
 
1. Plaintiffs argued that as the producers and importers of equipment and material carriers are 
not the ones who use abovementioned products to reproduce a work for their personal  use, 
they shall not pay remuneration and instead actual users of the products are the ones who 
are supposed to pay remuneration.  
2. Plaintiffs argued that the law does not define the amount of remuneration for the 
reproduction of the work for the personal u se and there might be unfairness in the calculation 
of the royalty fee.  
3. Plaintiffs argued that abovementioned Articles do not guarantee confidentiality of the 
personal information provided by the producers and importers of equipment and material 
carriers.  
 
On the first and second matters, Court did not declared abovementioned Articles unconstitutional. 
As for the third, Court recognized Article 21, paragraph 5, third sentence and Article 64, paragraph  4 
unconstitutional in the part where there is no enough guarantees for the confidentiality of the 
personal information.  
 
• Amendments for the relevant provisions is ready for the second hearing in Parliament of Georgia.  
According to the draft amendments, information defined in paragraph 5 of Article  21 is 
confidential and data proceedings shall be in accordance with Law of Georgia on Personal Data 
Protection. Violation of the rules related to the data processing will result administrative liability.  
• As for the enforcement, according to Article 20 of Organic  Law of Georgia on the Constitutional 
Court of Georgia, "recognition of a law or other normative act as unconstitutional shall not mean WT/TPR/M/420/Add.1  
 
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  annulment of judicial sentences and decisions previously adopted on the basis of this act but 
shall entail only suspensi on of their enforcement under the procedures established by the 
procedural legislation".  
 
Page 95, Paragraph 3.218: The Secretariat's Report notes that "Georgia's Law on Appellations of 
Origin of Goods and Geographical Indications provides that AOs and GIs  shall be protected by 
registration at Sakpatenti or on the basis of an international agreement" . 
 
• Please provide details about the registration system for GIs and AOs provided by Sakpatenti. 
For example, does it provide: an examination of an application; clear grounds for refusing 
protection based on a prior right or evidence of genericness in Georgia; publication of 
application details; and an opportunity to oppose an application and to invalidate a 
registration.  
 
Reply:  The relations linked with the regi stration, protection and use of appellations of origin of goods 
and geographical indications are regulated by the following normative acts:  
 
• The Law of Georgia "On Appellations of Origin of Goods and Geographical Indications";  
• Decree of the President of Georgia (N °. 88 of 28 February 2002) regarding measures related 
to the entry into force of the Law of Georgia "On Appellations of Origin of Goods and 
Geographical Indications".  
 
On an application filed with Sakpatenti, shall be carried out exa mination as to formal and substantive 
examination.  
At the stage of examination of formalities, Sakpatenti checks whether the application complies with 
the requirements of the law.  
At the stage of substantive examination: it is determined whether the sign o r a word at issue is 
a sign or a word the registration of which as geographical indication cannot be permitted;  
It is checked whether the data submitted by the documents attached to an application comply with 
the requirements of the legislation;  
 
Search is performed in the databases of trademarks, geographical indications in order to reveal a 
probable conflicting sign or name having earlier rights.  
According to Article 5 of the Law of Georgia "On Appellations of Origin of Goods and Geographical 
Indications":  
As an appellation of origin or a geographical indication shall not be registered the name or any other 
sign, which:  has become a generic name, although it relates to the geographical area where the 
goods were  produced, processed or prepared;is l ikely to mislead the public as to the true origin of 
the goods;  is contrary to the national dignity, religion, traditions and morality;  etc. 
 
If on the basis of substantive examination it is established that there do not exist grounds for refusal 
of the registration of a geographical indication, Sakpatenti publishes the application materials in the 
Bulletin, in one central and one local newspaper.  
 
If within three months after the publication of the application materials additional information is 
submitte d to Sakpatenti, this information shall be sent for consideration to the respective branch 
ministry.  
 
In case if no information is submitted within three months from the publication of the application 
materials, Sakpatenti takes the decision on the registr ation of the geographical indication, enters 
the data contained in the application materials in the Register and publishes the information about 
this in the Bulletin.  
 
According to Article 13 of the above -mentioned Law: Registration of an appellation of or igin or 
geographical indication may be cancelled if:  
 
(a) it has been registered in violation of the Law;  
(b) due to changing or disappearing of natural or human factors, specific for the given geographical  
area, becomes impossible to produce such goods wh ich would have the quality and features indicated 
in the Register.  
 WT/TPR/M/420/Add.1  
 
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  (2) Protection of the appellation of origin or geographical indication of a foreign country shall be  
terminated under the conditions of the international agreement.  
 
• What is the applicatio n filing  fee? 
 
Reply: Fee for the examination of application for appellation of origin and geographical indication of 
goods is USD 40 (equivalent in national currency) and fee for the registration of appellation of origin 
and geographical indication of goo ds, registration, issuing of certificate is USD 20 (equivalent in 
national currency).  
 
Page 95, paragraph 3.218 : The Secretariat's Report also notes that Georgia has concluded several 
bilateral agreements for the protection of GIs and that negotiations on other agreements are 
currently "in progress".  
 
• Are GIs that have been negotiated through a bilateral agreement, or GIs that will be part of 
a future agreement, reviewed in a similar process as if they were requested for protection 
directly via Sakpatenti's registration process?  
 
Reply: An appellation o f origin of goods or a geographical indication of a foreign country is protected 
on the basis of a bilateral agreement. At this stage, Georgian legislation does not allow foreign 
applicants to file applications directly at Sakpatenti. As for the process of  registration, it depends on 
the provisions of the bilateral agreement with that particular countries, however before granting the 
protection to foreign GIs on the bases of bilateral agreement, publication procedure for opposition 
is always guaranteed for third parties. As well as preliminary search to the databases of trademarks 
and geographical indications in order to reveal a probable conflicting sign or name having earlier 
rights is also performed.  
 
• Does Georgia require fees for any requests of protecti on of GIs made through a bilateral 
agreement?  
 
Reply: There are no fees prescribed for GIs through bilateral agreements.  
 
• Please explain how Georgia ensures transparency and procedural fairness in the process of 
any protection or recognition for GIs.  
 
Reply: Sakpatenti acts in the framework of Georgian legislation to ensure transparency and 
procedural fairness. Decisions regarding the registration of new GIs are published in official bulletin 
for the opposition period of three month and every interested per son is able to oppose the decision 
on the grounds provided by the law of Georgia on Appellations of Origin of Goods and Geographical 
Indications.  
 
• Are terms being considered for protection or recognition as a GI, including those pursuant 
to international a greements, subject to examination, opposition, and cancellation 
procedures?  
 
Reply: According to the Law the term for examination is not prescribed. As to the opposition it is 
stated that within three months after the publication of the application materia ls additional 
information can be submitted to Sakpatenti, this information shall be sent for consideration to the 
respective branch ministry. No term is prescribed for cancellation procedures too. The registration 
of a geographical indication is perpetual unless the other party requests the cancelations.  
 
• Where can interested parties find information about terms under consideration for 
GI protection  or recognition?  
 
Reply: Information is available on the website of Sakpatenti: 
https://sakpatenti.gov.ge/en/page/122/  
 
• Please explain how Georgia ensures that any protection or recognition does not violate prior 
intellectual property rights or deprive interested parties of the ability to use common names.  
 
Reply: In order to ensure the prior Intellectual property rights Sakpatenti performs searching in the 
databases of trademarks, geographical indications in order to reveal a probable conflicting sign or WT/TPR/M/420/Add.1  
 
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  name having earlier rights. Which means, that those applicant s or owners, which hold earlier rights 
and other interested parties have possibility to object after publication in official bulletin and in 
nationwide and regional newspapers.  
 
4. TRADE POLICIES BY SECTOR  
Page 102, Paragraph 4.16:  The Secretariat report states that the largest subsidy program is "the 
modernization of amelioration systems aimed at rehabilitating reservoirs, irrigation systems, and 
amelioration equipment". This program does not appear in Georgia's Table DS :1 notifica tion 
in G/AG/N/GEO/25 or other recent year notifications, although "modernization of amelioration 
system" did appear in the 2014, 2015, and 2016 notifications. Georgia has never submitted 
a Table  DS:2 notification for "New or modified domestic support meas ures exempt from reduction".  
 
• When does Georgia plan to notify in Table DS:1 expenditures for "modernization of 
amelioration system" program for the years 2017 through 2020?  
• When does Georgia plan to submit Table DS:2 notifications for all programs?  
 
Reply : Georgia intends to fullfil its outstanding agriculture notifications in the first half of 2022.  
 
Page 102, Paragraph 4.17:  The Secretariat report states that Georgia's main development 
program is the "Produce in Georgia" program, which provides loans to promote development of 
agricultural businesses. This program does not appear in Georgia's Table DS:1 notifications 
from 2014 through 2020. Georgia has never provided a Table DS:2 notification for any  
program  (Table  DS:2 is titled  "New or modified domestic support measures exempt from reduction" 
and a template appears on page 22 of G/AG/2).  
 
• Please explain whether Georgia considers the agricultural business loan component of the 
"Produce in Georgia" program to be a development program falling under the crite ria in 
Article 6.2 of the Agreement on Agriculture.  
• If so, when does Georgia plan to submit a Supporting Table DS:2 with details on 
Georgia's  development programs?  
• If not, how would Georgia classify this support in relation to its domestic support 
commitments, and when does Georgia plan to notify the program?  
 
Reply:  Georgia intends to fullfil its outstanding agriculture notifications upon capacity building of 
the relevant institutions and to send relevant notifications in the first half of 2022.  
 
Pages 102 and 103, Paragraph 4.18:  The Secretariat report indicates that Georgia's 'Plant the 
Future' initiative finances the purchase of trees and berry bushes, and that two of the aims of the 
program are enhancing export potential and import substitution.  This program does not appear in 
Georgia's domestic support notifications from 2014 through 2020. When does Georgia plan to notify 
this program?  
 
Reply: Georgia is ready to submit the respective notifications in the first half of 2022.  
 
Page 122, paragraph 4.94 : The report describes several subsidy programs to manufacturers, 
including elements of the Produce in Georgia Program and a credit guarantee mechanism. 
Paragraph  4.95 also discusses funding through the JSC Partnership. Please explain whether  any of 
these support programs include export or input substitution elements and indicate whether they are 
consistent with Georgia's obligations under Article 3 of the Subsides Agreement.  
 
Reply: None of the programs implemented by Enterprise Georgia have contingency for beneficiaries 
to have to export or be responsible for import substitution, and distribution of support is not related 
to the company's success in terms of export or import substitution.  
 
Enterprise Georgia simply identified a set of sector s which it believes has potential to increase 
existing production. It provides commercial loan co -financing, credit guarantee and grants programs, 
to the companies willing to manufacture these products, without any requirement for the company 
to be liable to export of these products or substitute imports.  
 WT/TPR/M/420/Add.1  
 
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  Part II. Questions based on the Government Report (WT/TPR/G/421)  
2. ECONOMIC SITUATION  
 
Page 5, paragraph 2.19: Please provide a list of the SPS legislation or other measures that Georgia 
has already approximated to the EU acquis  and corresponding notifications to the 
WTO SPS Committee.  
 
Reply:  Please see a list of the SPS legislation or other measures that Georgi a has already 
approximated to the EU acquis  in the Secretariat Report page 162 (Table A3.5). As for the 
notifications, MEPA is working intensivly to further improve the nitification process.  
 
Page 14, paragraph 2.11: Georgia's report makes no reference  to either criminal enforcement or 
trade secrets. Please provide information on these two topics.  
 
Reply:  Relations regarding trade secret is regulated under General Administrative Code of Georgia, 
Georgian law on Competition and Civil Code of Geo rgia. 
 
Under article 272 of the General Administrative Code of Georgia "Commercial secret is information 
on a plan, formula, process, or means of a commercial value, or any other information used for 
manufacturing, preparing, processing of goods or renderi ng services, and/or is a novelty or 
a significant result of technical activity, as well as other information that may prejudice the 
competitiveness of a person if disclosed".  
 
Under article 113 paragraph 1 and 2(e) of the Georgian law on Competition, "1. U nfair competition 
is prohibited. 2. For the purposes of this article, any action of undertakings that contradicts the 
norms of business ethics and infringes the interests of consumers shall be regarded as unfair 
competition, in particular: e) receipt, use or dissemination of scientific -technological, production or 
trade information or commercial secrets without the consent of their owner".  
 
Under article 1105 of the Georgian Civil Code, "1. an entrepreneur who possesses a trade 
secret  (know -how) consisting of technological, organizational or commercial information of 
extraordinary importance, as evidenced by the necessary and adequate measures taken for keeping 
it secret, shall have an exclusive right to the information. 2. An exclusive right to know -how sha ll be 
protected under this Code and other legislative acts on industrial property".  
 
Pursuant to the Georgian legislation infringement of rights on IP objects along with civil and 
administrative responsibilities, shall also cause criminal responsibilities.  In particular, infringement 
of industrial property right, copyright, related rights of performers, right of makers of databases, 
trademark or other illegal use of commercial indications pursuant to the Criminal Code of Georgia 
incurs a fine and corrective  labor on infringer, as well as socially useful work and in special cases 
restriction of freedom and even an imprisonment.  
  WT/TPR/M/420/Add.1  
 
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  UNITED STATES – FOLLOW -UP 
Follow -up Questions Based on Questions and Answers  (RD/TPR/1374)  
Follow Up Questions 1 -5: (RD/TPR /1374, p.15)  
 
Page 69 Paragraph 3.123:  The Secretariat report states that 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.  The Secretariat also 
notes that in Georgia, there was a trend towards adopting more European standards in lieu of 
international standards as Georgia proceeded with DCFTA implementation.  As Georgia integrates 
with EU standards  and technical regulations, plea se explain how a shift away from using international 
standards is consistent with Georgia 's WTO TBT Agreement obligations.  
 
Reply: It should be mentioned, that considerable part of nationally adopted European standards are 
identical to international standards (EN ISO or EN IEC). Georgia as a member of 
international/European standards organizations periodically adopts international/regional standards 
as well as fulfils the obligations and membership  criteria of those organizations. Standa rds published 
by international and regional standardization organizations are available for any interested 
stakeholder via GEOSTM and usage depends upon the decision made by any interested party.  
 
U.S. Follow Up Questions:  
 
• Of the European standards (inclu ding harmonized standards) that have been adopted by 
Georgia, how many are EN ISO or EN IEC?  
 
Reply:  Out of the adopted European standards, EN ISO are 1459 and EN IEC 384.  
 
• What process exists to determine whether harmonized European standards adopted by 
Georgia are international standards?  
 
Reply: Our determinant whether harmonized European standards adopted by Georgia are 
international standards, is that the standards are adopted by European Standardisation 
Organisations without modification (endorsement note of respective EN standards are checked).  
 
• Does Georgia have a process by which producers can submit alternative international 
standards for approval and recognition, to demonstrate that products meeting those 
standards will meet regulatory requirements?  If so, please describe the process.  
 
Reply:  According to the Georgian law on "Code on safety and Free Movement of Product ", product 
must comply with requirements defined in technical regulation. In general, standards are voluntary.  
 
In addition, according to the governmental decree N50 there is a list of countries  (including the US) 
where products produced in those countries, with respective conformity assessment 
documents  (marks) are recognized by Georgia and allowed to be placed on Geo rgian market without 
additional procedures.  
 
• If Georgia accepts alternative international standards, in addition to the harmonized 
European  standards, please explain whether the alternative international standards are 
afforded the same presumption of confo rmity with the regulation as the European standard.  
 
Reply: Georgia recognizes technical regulations and related conformity assessment documents of  
countries listed in the Governmental decree N °. 50. 
  WT/TPR/M/420/Add.1  
 
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  EUROPEAN UNION  
WT/TPR/S/420 – WTO Secretariat Report  
1 ECONOMIC ENVIRONMENT  
1.3 Developments in Trade and Investment  
1.3.1 Trends and patterns in merchandise and services trade  
1.3.1.1 Merchandise trade  
Paragraph 1.27, p. 23 (WT/TPR/S/420)  
 
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 
signific ant increase in copper ore and concentrate exports (Table A1.2).20 Exports of manufactured 
goods remained overshadowed by primary product exports (food and mining) during the 
period  21 Chemicals and iron and steel exports in particular faced a decline like ly due to lower 
external demand during the pandemic. However, a gradual and significant increase in 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 Europe, its sea ports, and its simplified customs procedures 
for vehicle imports (Table A1.1 and A1.2). 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 accounting 
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 Azerbaijan over the same period (Chart 1.2, 
Tables  A1.3 and A1.4).  
EU Question No 1: As the export value of the EU increased  2015 -2020, from 625 to 695  M 
according to the data provided, this statement appears not to be factually correct (in case 
it is based on the data provided in chart 1.2). Also the sentence relates to number of goods 
while the chart shows export value in USD  and shows the share of goods rather than 
number of products.  
Reply to Question No 1: Georgia agrees to the statement given in the first sentence of the 
question. Export from Georgia to the EU expressed in value is definitely increased.  
2 TRADE AND INVESTM ENT REGIMES  
2.3 Trade Agreements and Arrangements  
2.3.1 WTO  
Paragraph 2.21, p. 33 (WT/TPR/S/420)  
1.21. During the period January 2016 -June 2021, Georgia submitted 53 notifications to WTO bodies 
covering agriculture, anti -dumping, import licensing, regional trade 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 3 0 June 2021, several notifications 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 . 
and 
3.1.6 Import prohibitions, restrictions, and licensing  
3.1.6.2 Import restrictions and licensing  
Paragraph 3.57 -3.58, p. 55 (WT/TPR/S/420)  
3.57. Georgia restricts the imports of a selected number of products through a system of 
(nonautomatic) licences and permits based on health, se curity, and environmental considerations. WT/TPR/M/420/Add.1  
 
- 27 - 
 
  The legal framework 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 lis t of activities and goods subject to a licence or permit, which intends to 
capture and consolidate all licence and permit requirements contained in various issue -specific laws, 
resolutions, or other legal instruments. According to the Law on Licences and P ermits, 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 disti nguishes 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 conditions laid out by the Law, while a per mit gives 
the right to carry out an action for a definite or indefinite period, and relates to an object.  
3.58. The list of goods subject to an import licence or permit consists of 17 product categories 
(Table  A3.4). 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 for security reasons, and 
in 2017, it i ntroduced an import licence for hazardous waste and removed the import licence for 
materials of limited circulation. These changes have not been yet notified to the WTO Secretariat.  
EU Question No 2: Could Georgia please explain why the above -mentioned cha nges have 
not yet been notified to WTO and whether the import licenses are still valid/current and, 
if so, when it will be notified ? 
Reply to Question No 2:  Import licenses are still valid in Georgia. We will notify on the mentioned 
changes through the overall notification on Import Licensing no later than January 2022.  
2.3.2 Regional and preferential agreements  
2.3.2.1 European Union  
Paragraph 2.26, p. 34 (WT/TPR/S/420)  
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 2014 -20, awareness of Georgian products in the European Union increased 
significantly, and new products such a s 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.  
EU Question No 3: Could Georgia explain what "awareness" means in this context? Does 
it refer to awareness by EU businesses that such goods can be imported from Georgia or 
does it refer to awareness by consumers that read the origin of products on the 
packaging?  
Reply to Question No 3: The word "awareness" in this context means the both. The demand on 
Geo products in the EU market has increased over these years, which implies that EU businesses 
acquired more under standing on Geo products, which in itself ensures the enhanced positioning of 
GEO products on EU market. Accordingly, more EU consumers read the GEO origin on the packaging.  
EU Question No 4: Second, is this sentence (that seems to imply that EU imports fr om 
Georgia are now more varied) not contradictory with the one that follows and that states 
the opposite, or does the latter statement refer to product groups rather than individual 
products? This being said,  it can be argued that it is still early days to  judge whether the WT/TPR/M/420/Add.1  
 
- 28 - 
 
  DCFTA has contributed to the diversification of Georgia's exports to the EU given that 
trade patterns take quite a while to adjust.  
Reply to Question No 4: Since the enactment of the DCFTA, the number of new products have 
entered to the EU market,  however, it is still early to assess the overall results of the DCFTA, because 
the process of approximation is yet underway. Only after the approximation process is finalized, we 
will be able fully to evaluate the benefits Georgia has gained.  
Paragraph 3.42, p.50 (WT/TPR/S/420)  
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 importa nt 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 and excise tax on imported goods 
generated 30.7% and 13.3%, respectively, of total tax revenue.  
EU Question No 5: According to information provided by EU exporters of tobacco products, 
Georgia applies excise duty on fine cut -tobacco twice, once upon importation and a second 
time upon release for consumpt ion. This contradicts with the text in the Trade policy 
review document, saying that taxation applies equally to imported goods and domestic 
goods. Could you please clarify and explain how Georgia justifies this policy choice?  
Reply to Question  No 5: Afore mentioned decision is part of Healthcare policy of Georgian 
Government. This decision was made in order to reduce addiction to tobacco products and limit 
access to it. Besides, it should be taken into account that market share of locally produced fine cut 
tobacco is insignificant as it is mostly produced by households. Therefore, current taxation regime 
cannot have major effect on other participants of the market.  
 
3.3.1.1 Subsidies and incentives  
Table 3.7, p. 63 and Paragraph 3.111, p. 67 (WT/TPR/S/420)  
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 ent erprises operating in certain 
zones,  e.g. FIZs (see Section 3.1).  
EU Question No 6: Could the Georgian authorities indicate whether the figures provided 
in the Table 3.7 also include any state aid granted in the form of tax advantages in the  FIZ? 
Could the Georgian authorities indicate the yearly amount of such advantages in the  FIZ? 
Reply to Question No 6: The figures provided in the Table 3.7 do not include any state aid granted 
in the form of tax advantages. The source of the figures are annual state budgets of 
Georgia  (as indicated bellow the table) and these figures depict budget payments.  
 
3. TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.1 Incentives  
3.3.1.1 Subsidies and incentives  
Paragraph 3.113, p .68 (WT/TPR/S/420)  
3.113. For the 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 me dical clothing, in Georgia. 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 ta x and income tax may also apply to the hotel enterprise for a period of up to 60  calendar  days WT/TPR/M/420/Add.1  
 
- 29 - 
 
  for services provided to hotel owners. International financial companies with source income from 
Georgia also have tax breaks, such as exemption from income taxe s on profits from financial 
operations/services and sale of securities.  
EU Question No 7: How does the tax incentives for medical technology equipment 
producers apply in case of foreign producers? Is it necessary to start physically producing 
the equipment in Georgia?  
Reply to Question No 7: Import of medical products determined by a joint order of the Minister of 
Displaced Persons from the Occupied Territories, Labor, Health and Social Affairs of Georgia and the 
Minister of Finance of Georgia are exempted from VAT.  
 
3.3.1.2 Rules on state aid  
Table 3.7, p.63 and Paragraphs 3.116 and 3.117, p. 68 (WT/TPR/S/420)  
3.116. Georgia's rules on state aid or subsidies are contained in its Law on Competition and related 
Resolution on Approval of the Insignifi cant Amount of Individual State Aid and the General Rule of 
State Aid.141 The Law on Competition 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 f or 
individual social allowances, natural disasters and force majeure events, and environmental 
protection activities, if it fulfils obligations under Georgian law or international agreements, for an 
insignificant amount, or is intended to implement an impo rtant state project. State aid is also 
permissible if the Georgian National Competition Agency 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 def ines 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 deferra ls; 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 a re to be followed  when providing state aid. In order for the 
Georgian National 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 A gency 
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 on e economic entity, for a total of 
three  consecutive fiscal years. However, for 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.  
EU Question No 8: Could the Georgian authorities explain how they obtain information on 
all state aid granted, i.e. aid granted at local, regional and central government level, and 
including aid that does n ot have to be notified to the Competition Authority?  
Reply to Question No 8: According to the Georgian law on Competition the entity providing the 
insignificant amount of individual state aid is obliged to provide the Agency with the information on 
the ins ignificant amount of individual state aid granted, the term of granting and the receiving 
undertaking/undertakings by the first of February of the year following the reporting year. 
GNCA  enters the information in the registry of individual state aid. Accor dingly, GNCA monitors 
granting of the state aid which does not need the contest of the Agency and if it exceeds the 
insignificant amount of individual state aid defined by the legislation of Georgia - prepares an 
appropriate report and sends it to the stat e aid providing entity, as well as to its 
superior  body (if any).  WT/TPR/M/420/Add.1  
 
- 30 - 
 
  3.3.4 Competition policy and price controls  
3.3.4.1 Competition policy  
Box 3.4, p. 79 (WT/TPR/S/420)  
 
EU Question No 9: Could the Georgian authorities explain how state aid control is 
implemented  in the regulated sectors and which body/agency is responsible for the 
implementation?  
Reply to Question No 9: The requirements concerning the State aid control ar e promulgated by 
the Law of Georgia on Competition.  According to Art. 4(1) of the Law, the Competition Agency is in 
charge of enforcement of the competition law, including the State aid rules. Furthermore, Art.  4(2) of 
the Law states that in cases explicitly provided for by the Law, regulatory bodies (such as GNERC, 
GNCC and NBG) shall have the power to enforce the Law within their respective regulated sectors.  
The competencies of regulatory bodies regarding enforcement of the competition rules are specified 
in Art. 31 of the Law of Georgia on Competition, and they do not include enforcement of the State 
aid rules. Hence, regulatory bodies has no authority to enforce the State aid rules as envisaged by 
the Law of Georgia on Competition.  
Therefore, ac cording to the Georgian Competition legislation, ex ante control of State aid is limited 
in the regulated sectors, but State aid which hinders competition shall be the subject of judicial 
control.  
 
4. TRADE POLICIES BY SECTOR  
4.4 Services  
4.4.3 Transportat ion 
Paragraph 4.153, p. 136 (WT/TPR/S/420)  
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 thr ough 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 under the BR I framework. 
Once completed, the BRI improvements in Georgia and across other BRI participants 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.  
and 
4.4.3.4 Ports  
paragraph 4.168 , p. 141 (WT/TPR/S/420)  
4.168. Georgia maintains four sea ports , at Batumi, Poti, Supsa, and Kulevi  on the Black Sea. These 
ports are important for Georgia 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 traffic, 
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 ope rator 
has been undertaking improvements to expand its off -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 with 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 undertaken  for a new 
investor in the project.  WT/TPR/M/420/Add.1  
 
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  EU Question No 10: Could Georgia provide more information on the status of the 
Anaklia  port project within the Belt and Road Initiative? Will any specific co nditions apply 
to the tendering procedure as a result  of its inclusion in the BRI?  
Reply to Question No 10: As it was mentioned above, in May 2021 the Anaklia Deep Sea 
Port Development Agency of the MOESD hired well known Dutch consulting company - MTBS fo r 
updating feasibility study of the project. MTBS already completed the updated document, which 
includes new traffic study for Anaklia port, updated financial model, marketing strategy, as well as 
recommendations on new PPP structure.  
 
Recently, the MTBS was also hired by the MOESD for elaborating Georgian Port Sector Development 
Strategy. Document is almost completed. Based on the findings of updated feasibility and the 
strategy, new Investor selection proceedings will be announced in the beginning o f 2022.  
 
Please note, that we have no plans to include BRI related provisions in the Investor selection 
proceedings.  
 
EU Question No 11:  What did the updated feasibility study on the port at Anaklia find?  
 
Reply to Question No 11: Based on the findings of the feasibility study, the new investor selection 
proceedings will be announced under the different model of public private partnership. The Feasibility 
study will become public for all stakeholders after announcement of investor selection proceedings.  
 
EU Question No 12:  What are the next steps of the process?  
 
Reply to Question No 12:  
• In early 2022 the Government of Georgia shall announce Expression of Interest (EOI) for 
selecting new Investor;  
• Interested Candidates will be requested to submit legal documents, as well as information 
related to their experience and financial standing;  
• After evaluation of EOIs, the GoG shall select shortlisted Candidates ; 
• The GoG shall announce Request for Proposal (RFP) for shortlisted companies. RFP will be 
evaluated on the basis of technical, commercial and financial criteria. Preferred Bidders may 
be invited to submit their Best and Final Offers (BAFO);  
• Based on the BAFO result, the GoG shall select the winner and sign the Investment 
Agreement.  
 
EU Question No 13:  If the port will become operational, when will this be expected ? 
 
Reply to Question No 13: We expect that port shall become operational by 2025 taking into 
consideration submittion of BAFO result.  
 
4.4.3.3 Maritime  
Paragraph 4.165, p. 140 (WT/TPR /S/420)  
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 compani es 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%, while dividends will be tax exempt.  WT/TPR/M/420/Add.1  
 
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  EU Question No 14:  What are the conditions that foreign shipowners/companies must 
fulfil in order to apply to the status of international companies in Georgia?  
Reply to Question No 14:  The status of international company may be granted in any of the 
following cases to a Geo rgian enterprise:  
a) which has at least two years experience in carrying out the permitted activities as 
per the amendments;  
b) which is a representative of a non -resident enterprise in Georgia, if the non -resident 
enterprise has at least two years experience in  the permitted activities provided for by 
Annex  2 to this Ordinance, which are carried out by a Georgian enterprise and on the basis 
of which it applies to obtain the status;  
c) of which more than 50% of shares are owned by partner enterprises independently ( each 
partner separately), and which has at least two years of experience in the permitted activities 
provided for by Annex 2 to this Ordinance, which are carried out by a Georgian enterprise 
and on the basis of which it applies to obtain the status.  
 
An enterprise intending to be granted the status of international company must carry out activities 
permitted under the status in Georgia. Accordingly, a person with the status shall carry out basic 
income -generating activities in Georgia and have adequate hu man resources to carry out such 
activities, with the necessary qualifications, and shall ensure the coverage of appropriate operating 
costs.  
 
The status of international company may be granted only to a person with the object of profit 
taxation as provided  for by Article 97(1) of the Tax Code of Georgia.  
In order to obtain the status of international company, an interested person shall apply to the legal 
entity under public law called the Revenue Service (the Revenue Service) under the Ministry of 
Finance o f Georgia, by submitting an application in the form (in writing or electronically) established 
by the Minister of Finance of Georgia.  
EU Question No 15:  What does the new maritime tax incentive scheme for shipowners and 
ship-management companies foresee? W hat kind of lower tax regime is applicable?  
EU Question No 16:  What is the reduction in terms of taxation and what are other 
economic benefits under such scheme?  
Replies to Questions No 15 and No 16:  
Tax Incentives for Maritime Businesses who are granted "International Company Status":  
 
• 5% Profit tax on distributed earnings  
• 5% Personal Income Tax  
• 0% Property Tax  
Additionally , Dividends  issued by an international company are non -taxable at the source of 
payment and are not included in the gross income of the person receiving the  dividend.  
Paragraph 4.169, p. 141 (WT/TPR/S/420)  
Paragraph 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 mandat e 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 operat ed through a freehold arrangement, and the 
last 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.  WT/TPR/M/420/Add.1  
 
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  EU Question No 17: Given the concerns on the fragmented situation of governance over 
Georgian ports, is Georgia planning to introduce any reform?  
Reply to Question No 17: Currently operational ports in Georgia are either owned or managed by 
the private companies, this indeed decreases effective levers for Georgian government to govern 
these ports. However, besides obligations taken under Association Agreement which is mostly for 
safety direction, government does not  intend to introduce significant reform that will impact privately 
held or managed ports.  
 
4.4.3.2 Roads  
Paragraph 4.159, p. 139  
4.159. Road transport in Georgia is regulated by the Law on Road Transport, which determines legal, 
economic, and organizationa l bases for road transport activities.  The MESD is responsible for 
elaboration 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 implementation 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 intern ational agreements, treaties, and the national 
legislation of Georgia.  
EU Question No 18: Does Georgia have any strategy or national plan to develop the 
Intelligent Transport Systems (ITS)?  
Reply to Question No 18: Draft National Transport and Logistics St rategy of Georgia puts 
emphases on importance on developing Intelligent Transport Systems (ITS). This is aimed to 
improve decision -making process for the state as well as for the private sector. Specificities of 
practical application and implementation of ITS in the country is yet to be elaborated. hence In view 
of the above, in the long run it may be necessary to develop a policy document on intelligent 
transport systems in order to increase the capacity of the Georgian transport network, improve its 
plann ing capabilities and optimize revenues from investments in road infrastructure.  
As for Tbilisi, pre -feasibility study has already been conducted and there is a plan to develop detailed 
application and action plan for implementation of ITS in 2022.  
WT/TPR/G /420 – Government Report  
1. INTRODUCTION  
Paragraph 1.3, p. 3 (WT/TPR/G/420)  
1.3. The basic objectives of Georgia's trade policy are defined  as follows:  
 
• Integration into the world economy, including the implementation of WTO membership 
obligations and obligations under other international agreements;  
• Trade policy liberalization, including simplification of export and import procedures and tariff 
and non -tariff regulation;  
• Diversification of trade relations by establishing preferential re gimes with main trade and 
regional partner countries;  
• Enhancement of transparency in the policy -making process.  
 WT/TPR/M/420/Add.1  
 
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  EU Question No 19: Which formal document describes the main elements of trade policy? 
Does Georgia plan to adopt a strategy in the near future,  or are the basic objectives 
described here defined  in a formal document? Is additional information available on 
Georgia's export diversification strategy and what it entails?  
Reply to Question No 19: These objectives are entailed  in the Government Programs. One of the 
primary directions is to enhance the scope of countries with which Georgia will form free trade 
agreements. As of now, Georgia enjoys free trade regime with countries covering 1/3 of world 
population, including prefe rential agreements with the EU, China, EFTA States, Turkey, CIS states, 
Hong Kong, China . We also work to form additional FTAs with the State of Israel, Republic of India, 
Republic of Korea, and United Arab Emirates.  
2. RECENT ECONOMIC DEVELOPMENTS AND REF ORMS  
2.1 Macroeconomic Overview  
Paragraph 2.2 -2.3, p. 4 (WT/TPR/G/420)  
2.2. After the economic contraction in 2020, significant recovery was observed  since February and 
the economy shows broad -based recovery driven by improvement in domestic and external d emand. 
Georgia's  economic recovery has gained surprising momentum, in January -September economic 
growth amounted to 11.3% and economic activity significantly exceeded (by 5.7%) prepandemic 
level as well. The preliminary results of economic activity in 2021  are more positive than previously 
forecasted by IFI's, far exceeding expectations. Government of Georgia expects 9.5% economic 
growth in 2021.  
2.3. According to IMF projections, Georgia will ensure fastest economic recovery in medium term 
among regional a nd European countries, amounting to 5.8%, supported by infrastructure spending 
and sustained  structural reforms to increase productivity and enhance private sector -led growth.  
EU Question No 20: Can the government refer to any specific policy or decisions that might 
have helped the significant recovery and growth of the national economy?  
Reply to Question No 20: Firstly it was the re -opening the economy after lockdown, as well tourism 
recovery, full recovery and increase of export of goods to pre -pandemic l evel, business support 
programs, automatic VAT refunds, accelerated privatization and increasing business confidence.  
An in-depth overview shows a well -balanced pattern of the recent growth, with a robust growth in 
remittances and exports, a faster than expected rebound in the hospitality sector, strong growth in 
the manufacturing sector and improved trade which was supported by the recovery in regional 
economies. Furthermore, public infrastructure spending supported the economic growth. According 
to IMF the sharp and quicker than expected recovery could not have occurred without the sound 
macroeconomic policies that Georgia have carried out before and during the COVID -19 crisis.  
2.2 Agriculture  
Paragraph 2.21, p. 6 (WT/TPR/G/420)  
2.21. The overall strate gic goals of Georgian agriculture and rural development for next seven  years, 
according to the "Strategy for Agriculture and Rural Development in Georgia 2021 -27", is to 
diversify/develop economic opportunities in rural areas based on the sustainable devel opment 
principles, improve social condition and quality of life. Strategy goals are as follows: competitive 
agricultural and non -agricultural sectors; sustainable usage of natural resources, retaining the 
eco-system, adaptation to climate change; effective  systems of food/feed safety, veterinary and 
plant protection.  WT/TPR/M/420/Add.1  
 
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  EU Question No 21: Would it be possible to refer here to the 2023 UNFCCC (United Nations 
Framework Convention on Climate Change) stocktaking in order to ensure a reduction of 
emissions and incl ude a target of climate neutrality by 2050 in the Long Term Strategy, 
planned for adoption in 2022?  
Reply to Question No 21: At the moment, until the stocktaking process is not finished, there is no 
immediate need to underline this process. As to the Long Term LEDS, climate neutrality as a 
conditional target is already included in the draft document, planned for adoption in 2022. However, 
the draft of the Long Term LEDS needs to be considered by the Climate Change Council first and 
then approved by the Gove rnment.  
2.3 Energy  
Paragraph 2.26, p. 6 (WT/TPR/G/420)  
2.26. Georgia implemented the Law on Encouraging the production and use of energy from 
renewable sources (hereafter "The Law on RES") on 20 December 2019. The Law on RES defines 
the national target for renewable energy at 35% of total final consumption by 2030. It also grants 
the discretion to choose the support schemes to achieve the above -mentioned national target.  
EU Question No 22: Did the government articulate any aspirations or a timeline for 
achieving complete carbon neutrality?  
Reply to Question No 22: Georgia is actively working on the adoption of green technologies and 
in line existing priorities and decarbonization objectives. Georgia fully supported the Energy 
Community Minis terial Council, in adopting the Clean Energy for all Europeans package in 
November  2021. Decarbonization is an important direction for the energy sector of the country and 
is actively pursued in strategic documents, such as the NECP (where an additional ch apter is 
allocated for the dimension). Georgia will further continue to implement measures directed towards 
carbon emission reduction.  
2.5 Transport  
Paragraph 2.39, p. 8 (WT/TPR/G/420)  
2.39 Ministry of Economy and Sustainable Development of Georgia has ela borated the National 
Transport and Logistics Strategy (2021 -30) and its Action Plan (2021 -22). It aims at further 
developing Georgia's transport and logistics sector through increased coordination, enhancing 
transport connectivity, developing reliable, eff ective and fast logistics services as well as increasing 
human capital in transport and logistics. The document shall be adopted by the Government in the 
nearest future.  Its implementation will greatly contribute to increasing competitiveness of the 
transp ort and logistics sector in Georgia.  
EU Question No 23: What does the National Transport and Logistics Strategy foresee as 
regards maritime transport and logistics services?  
 
Reply to Question No 23:  
Draft National Transport and Logistics Strategy focuses on both hard and soft infrastructure 
development for the maritime sector.  
• Development of existing as well as new port infrastructure is one of the priorities of the 
Government of Georgia;  
• Possibility of Introduction of flexible regulation and monit oring of the port sector activities 
(Anaklia port development; possibility of introduction of light regulation) ; 
• Increasing the reliability of the Georgian port sector ; 
• Digitization of maritime services (introduction of Maritime Single Window) ; 
• Development  of navigation (promotion of Georgian Flag registration for vessels) . 
 WT/TPR/M/420/Add.1  
 
- 36 - 
 
  EU Question No 24: When is it expected to be adopted ? 
 
Reply to Question No 24: National Transport and Logistics Strategy is planned to be adopted 
in 2022.  
 
Paragraph 2.42, p. 8 (WT/ TPR/G/420)  
2.42. 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. The infrastructure elements include the rail extension of Baku -Tbilisi -Kars. 
Once completed, the BRI infrastructure improvements in Georgia and across other BRI participants 
is 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 like many of its neighbours . 
EU Question No 25: Is the government aware of the risk in terms of accumulation of debt 
when financing the more substantive  BRI projects? What precautions did the government 
take to address this risk?  
Reply to Question No 25: In order to encrease Georgia's transite role Georgia implements several 
Transport and Logistics infrastructure projects such as east -west highway project, railway 
modernization project, Bak u-Tbilisi -Kars new railway line project, Batumi port carbamide terminal 
project, Poti port expansion and Pace terminal project. These projects are forseen for different 
initiatives including BRI to encrease cargo flow through Georgia. Georgia conducts robu st 
due diligence and feasibility studies on implementation of Transport and Logistics projects.  
Paragraph 2.43 p. 8. (WT/TPR/G/420)  
2.48 Georgia is one of Eastern Partnership countries and stronger connectivity has been declared as 
one of the top priorities within the Eastern Partnership. Enhanced physical connectivity between 
Georgia and the EU would help better use of the DCFTA and increase country's transit and logistic 
potential and it is also of high relevance in the context of Euro -Asia conne ctivity. Joint Staff working 
Document "Recovery, resilience and reform: post 2020 Eastern Partnership Priorities" was 
elaborated by European Commission and it establishes flagship initiatives for the EU partnership 
countries, one of the initiatives include  the improvement of Black Sea Transport Connectivity. This 
flagship will involve developing new ferry/feeder services on the Black Sea Legislation in the 
transport sector for Georgia is elaborated by  various transport codes for most modes of transport.  
 
EU Question No 26: Pursuant to the Flagship initiative, when are the new ferry/feeder 
services expected to start operations?  
 
Reply to Question No 26: In 2019 Ministry of Economy and Sustainable Development of Georgia 
hired KPMG to conduct Feasibility study for the development of ferry & container feeder services 
between ports of Georgia, Bulgaria, Romania and Ukraine. Due to fact that in 2020 COVID -19 virus 
caused pandemic globally hence dramatically change market circumstances in maritime sector and 
regiona l trade we would like to have an updated study which will show current strategies for 
developing ferry/feeder services.  
 
EU Question No 27: On which lines will these services be running?  
 
Reply to Question No 27: updated feasibility study will identify lines in which the services will 
running.  
 WT/TPR/M/420/Add.1  
 
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  EU Question No 28: Will access to these new services be open on non -discriminatory terms 
to EU shipowners?  
 
Reply to Question No 28: Non of the studies conducted regarding the development of direct 
feeder/ferry services on the black sea from Georgia to EU envisaged actions discriminating against 
EU shipowners, indeed services should be open on non -discriminatory terms to EU shipowners.  
 
Paragraph 2.48, p. 9 (WT/TPR/G/420)  
2.48. 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 early 2021, work was 
on-going  to develop a Maritime Strategy document, expected in 2021.  
 
EU Question No 29:  Has Georgia already issued the Maritime Strategy? If not, when do 
you plan to do so?  
 
Reply to Question No 29: Maritime Strategy is planned to be adopted in 2022.  
 
EU Question No 30: What does/will the Maritime Strategy foresee as regards maritime 
transport services?  
 
Reply to Question No 30:  Under the draft Maritime Transport Strategy the following actions and 
measures are envisaged to promote the participation of foreign operators in the transport:  
 
• Increasing access to finance and promoting inves tment attraction: Conduct a feasibility 
study on market place analysis in Georgia for the shipbuilding and ship repair industries and 
develop investment proposals for the development of shipbuilding and ship repair industries 
in order to attract investment  in this sector ; 
• Analysis of financial instruments promoting cruise tourism and developing a scheme of 
possible incentive mechanisms to promote the Black Sea Coastline of Georgia for possible 
investments ; 
• Promote and increase the capabilities of the Ship S tate Registry of Georgia in order to attract 
shipowners ; 
• Attracting International Shipping (maritime) companies to relocate to Georgia to use it as 
their place of business. New amendments to the tax regime makes possible for such 
companies to get the statu s of International Company in Georgia and therefore to take 
advantage of tax reductions.  
 
2.6 Telecommunication, Innovation and Technology Development  
Paragraph 2.57, p. 10 (WT/TPR/G/420)  
2.57 According to the decision made by the Government of Georgia in 2020, IT companies with 
international status will enjoy significant tax benefits, which include a reduction of both income and 
profit tax, as well as the abolition of 5% dividend tax and p roperty tax. According to the government 
decree, this status can be obtained by companies that have been directly providing IT serv ices for 
the last two years or their founding company was engaged in these activities.  
EU Question No 31: Do these tax benefi ts apply to any IT companies with international 
status that operate in Georgia for the specified period? What are the exact parameters of 
the necessary involvement of the IT companies that would consider applying for the tax 
break?  
Reply to Question No 31:  
In 2020 "International Company Status" was introduced in Georgia which grants the opportunity for 
certain types of companies providing services to nonresidents in the  IT Sector, to qualify for tax 
breaks  if they base their companies in Georgia.  WT/TPR/M/420/Add.1  
 
- 38 - 
 
   
Income fr om employment in an international company shall be taxed at 5% instead of 20%. The 
corporate income tax rate of an international company shall be 5% as well instead of 15%.  Dividend 
and Property (except for land) tax – 0%. Granting the status requires at l east two years of experience 
in the permitted activities, which can be possessed by the interested company or its founder.  
 
A person with the status of international company has the right to provide the following services:  
1. software release;  
2. releasing  of computer games;  
3. releasing of other software;  
4. computer programming, consulting and related activities;  
5. computer programming activities;  
6. consulting activities in the field of computer technology;  
7. computer management activities;  
8. other activities related to information technologies and computer services;  
9. production and/or delivery of digital products, including software support  and delivery 
of updated versions of software;  
10. website development and/or delivery;  
11. web host ing, remote maintenance of software and hardware;  
12. software and related updates;  
13. provide images, texts and information to ensure access to a database;  
14. remote system administration;  
15. online delivery of allocated memory capacity;  
16. online delivery of allocated memory capacity;  
17. grant access to or download software (including purchasing/accounting software or 
antivirus software) and updates;  
18. banner ads blocking  programmes;  
19. download drivers, such as software that connect s computers to peripherals (such as 
a printer);  
20. automatic online installation of filters on websites;  
21. automatic online installation of firewalls . 
 
The procedure for granting and revoking the status of international company for an entity, and the 
types of activities allowed for an international company is determined by the Government of Georgia.  
The status is granted by the Government of Georgia after submitting the application in the prescribed 
form and submitting the attached materials to the Reven ue Service. The Government of Georgia will 
issue an ordinance on granting the status of an international company to an entity 
indefinitely  (for life). 
 
In the current period, the status of an international company is already being claimed by number of 
business. Information about the companies who have  already been granted the status is available 
on the Revenue Service website:  https://rs.ge/InternationalOrgStatus . 
2.7 Technical Barriers to Tra de 
Paragraph 2.59, p. 10 (WT/TPR/G/420)  
2.59. Georgia continues to maintain open markets and has acknowledged that technical regulations 
have a significant role in promoting free trade. Recent policy initiatives have emphasized facilitating 
export development and promoting integration with international and European markets. Georgian 
legislation on TBT follows international best practices and norms and significant steps have been 
taken to devel op the national quality infrastructure to the level of t he EU acquis.  
EU Question No 32: Which TBT issues does Georgia intend to work on in the future?  
Reply to Question No 32:  Georgia will continue legal approximation process with the EU  acquis  
according to the DCFTA. In particular, approximation in TBT field will continue according to Annex III 
of the DCFTA agreement.  WT/TPR/M/420/Add.1  
 
- 39 - 
 
  EU Question No 33: What strategy does the Government follow in assessing the 
certification market for industrial products and food safety?  
Reply to Question No 33:  Certification market for the industrial and food products are developing 
year by year in parallel with the approximation to EU acquis . 
Certification of the industrial products are performed by accredited certification bodies, which are 
accredited according  to ISO/IEC 17065 by Georgian Accreditation Center - GAC. 
Quality Certification for the food products are also done by accredited certification bodies, which are 
accredited according to ISO/IEC 17065. Such certificates as Sanitary Certificates, Phyto Sanitary 
Certificates and Veterinary Certificates are issued by Food Agency, while wine certification 
is performed by the Wine Agency.  
EU Question No 34: How does the government intend to increase the number of conformity 
assessment bod ies (private and public) that are able and entitled to test products 
according to EU standards and international specifications?  
Reply to Question No 34: One of the most acute challenges relates to the development of the 
relevant infrastructure for conform ity assessment. Most laboratories in Georgia do not have the 
ability to conduct tests in regulated fields according to European or International standards. It is 
highly costly to receive these services from abroad, making our export products less competiti ve 
and making it expensive to undertake market surveillance activities by state. In order to tackle this 
challenge first step have already been taken, namely, with the support from EU funded 
project  – AA Facility, Georgia has initiated a study that will as sess current conformity assessment 
capacities in Georgia and will suggest a market based assessment on needs.  
 
The specific objective of the assignment is to analyze market needs and failures in the conformity 
assessment as a basis for identification of th e priority areas/sectors where the demand is the highest 
and/or has the biggest potential, assess the relevant Georgian laboratories, CABs for equipment 
and human resources while identifying crucial gaps as a basis for evaluation of needed financial 
resour ces to meet the required standards.  
 
This study will then give a clear picture on which directions have to be concentrated in order to 
create needed laboratory infrastructure in Georgia. We hope that the study would be a good basis 
for the future donor ass istance in creating local laboratory capacity.  
 
EU Question No 35: Does the government provide a platform for conformity assessment 
bodies, private companies and state institutions to exchange and agree on priority sectors 
and products that should be integ rated  into EU/international conformity standards?  
Reply to Question No 35: There are several formal platforms for exchange, first of 
all - accreditation council, according to article 100 of the law of Georgia  Code on Safety and 
Free Movement of Products, w ithin the accreditation system were created accreditation council wich 
consists by the representatives of the accreditation stakeholders, including representatives of the 
conformity assessment bodies. Creation and operation of the accreditation council is regulated by 
the order (N1 -1/403, 30.12.2014) of Minister of the Economy and Sustainable Development of 
Georgia  on Creation and Operation Rules for Accreditation Council.  
The council meetings are conducting twice a year and all issues related to the accred itation system 
and further development of the system are being discussed.  
Another platform for exchange is DCFTA Advisory Group  the Advisory Group  was established in  2015 
under the umbrela of the Ministry of Economy and Sustainable Development of Georgia, in order to 
ensure involvement of civil society in the process of effective implementation of the DCFTA.  
 WT/TPR/M/420/Add.1  
 
- 40 - 
 
  The functions and objectives of the Advisory Group include: Reviewing implemented reforms related 
to the DCFTA; Consulting on planned and ong oing reforms, and legislative and institutional changes 
related to the DCFTA implementation process; Consulting on the employers, employees, and 
consumers adaptation processes to the DCFTA requirements; Reviewing DCFTA's implementation 
Action Plan and rele vant reports.  
Paragraph 2.71, p. 11 (WT/TPR/G/420)  
2.71. In the beginning of 2020, due to the importance of the field, the sole responsible authority for 
market surveillance – the Market Surveillance Agency (MSA) was established under the Ministry of 
Econo my and Sustainable Development of Georgia. The mission of the MSA is to prevent and ensure 
that hazardous products are not placed on Georgia's Market in order to protect the health and safety 
of citizens, as well as the environment and the property. The MS A conducts market surveillance on 
certain non -food products for which relevant technical regulations have been adopted. The list of 
products include: Lifts; Cableways; Hot Water Boilers; Pressure Equipment; Simple Pressure 
Vessels; Construction Products (c ement, cables, plastic pipes, reinforcing steel, gypsum 
plasterboard); Child -resistant lighters; Products appearing to be other than they are, Toys, 
Machinery, Equipment and protective systems for use in potentially explosive atmospheres, Personal 
protecti ve equipment, Appliances burning gaseous fuels. It is expected that other products will be 
added to the mandate  of the MSA as per AA approximation agenda.  
EU Question No 36: How does the government evaluate the MSA's capacity to detect 
inferior quality goo ds and counterfeits on the Georgian market (especially for the cement 
and construction industry in general)? What enforcement actions have been implemented  
so far? Have there been cases of imposing a fine on substandard products?  
Reply to Question No 36: MSA conducts market surveillance by means of documentary or technical 
inspections (physical and laboratory checks) where appropriate, proactively - based on the risk 
analysis and the pre -determined market surveillance plans or reac tively – taking into consideration 
received information or the reasonable doubt about the risk or hazard of the product. Currently, 
along other approximated products, MSA conducts market surveillance on the following construction 
products: cement, cables, plastic pipes, reinforcing steel, gypsum plasterboard. From January  2020 
onwards, technical documentation of 12369 type construction products have been inspected. Out of 
the whole number, 1858 construction products did not meet the requirements, therefore,  they were 
not allowed to enter the Georgian market. What's more, 117 types of construction products of 
113 economic operators have been inspected on the market. In terms of enforcement actions taken 
or the incompliances detected, MSA regularly reports to the government; Currently, MSA's capacity 
to detect incompliant products has been deemed effective. However, by the end of 2022, MSA is 
supposed to have approximated other construction products, as well as electrical equipment 
designed for use within certa in voltage limits. Considering this, further strengthening of the 
MSA capacity will be necessitated.  
 
In terms of sanctioning non -compliant products, MSA is not responsible to impose monetary fines. 
In case of documental incompliance or incompliance which does not endanger life, health, property 
and/or the environment, MSA sets a reasonable period for the economic operator to eliminate this 
non-compliance. Otherwise, selling of the product will be suspended. In case of incompliance, where 
product contains h azard or a serious hazard, MSA requires the relevant economic operator to recall 
or withdraw the incompliant product.  
 WT/TPR/M/420/Add.1  
 
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  In case the economic operators do not eliminate incompliant products from the market, according 
to the Law of Georgia Product Safety and Free Movement Code, courts are entrusted with the power 
to impose monetary fines.  
 
Also, market surwailance is conducted at the border where if imported products are not incompliance 
to the market requirements those products are not allowed to enter on the market.  
 
2.10 Public Procurement  
Paragraph 2.92, p. 14 (WT/TPR/G/420)  
2.92. In July 2020, the Parliament of Georgia adopted the amendments to the Law of Georgia on 
public procurement legal framework. According to the amendments, new impartial and indep endent 
administrative review body/tribunal has launched its operations with new institutional arrangements 
from the 1 January 2021. With these changes, Georgia has successfully completed first phase of 
approximation under the AA/DCFTA. EU Commission has po sitively evaluated completed reforms 
and relevant draft decision of EU -Georgia Association Council were prepared for adoption, which 
would grant market access on EU central government level.  
EU Question No 37: According to our information, a new law on Pub lic Procurement is 
planned.  Could you please comment on timelines and main elements?  
Reply to Question No 37: State Procurement Agency completed elaboration of new Draft Law on 
"Public Procurement". The Draft Law was submitted to the Government of Georgia for comments. 
After intensive work, SPA has reflected all relevant feedbacks and remarks in the final version. 
Currently draft law has to be officially adopted by the Government and submitted to the Parliament. 
In parallel, according to the 2022 plan of th e Parliament, draft law on "Public Procurement" is 
officially put in the pipeline for the 2022 spring (February -June) session of the Parliament.  
2.11 Intellectual Property Right  
Paragraph 2.93, p. 14 (WT/TPR/G/420)  
2.93. Georgia has made number of amendments to its IP legislation during the review period in 
order to harmonize Georgian legislation in the intellectual property field with the EU standards.  
EU Question No 38: What concrete IPR enforcement and plans will Georgia follow to 
enhance the fig ht against counterfeiting in the country?  
Reply to Question No 3 8: As was mentioned in the report, a project named EU -Georgia Intellectual 
Property Project (EUGIPP) is being operational in Georgia with the assistance of the EU. One of the 
most important components of the project is enforcement direction. This component aims at full 
improvement of the IPR enforcement system in Georgia. Namely, all relevant stakeholders judges, 
prosecutors, investigators, customs officers etc are involved in the p rocess. For them special 
literature guidelines and brochures are being created. In addition, representatives of the relevant 
IPR enforcement authorities are raising their knowledge and introducing with the EU best practices.  
3. MAIN TRADE AGREEMENTS  
3.3 Pe ople's Republic of China  
Paragraph 3.5, p. 15 (WT/TPR/G/420)  
3.5. On 13 May 2017, Georgia signed a Free Trade Agreement with the People's Republic of China. 
This makes Georgia the first country in the region, which has the FTA with both China and the  EU. 
The Agreement covers Trade in Goods, as well as Trade in Services. Along other spheres, other 
chapters regulate Customs Procedures and Trade Facilitation; SPS; TBT; Trade remedies; 
Environment and Trade; Competition and IPR. It is noteworthy, that nego tiations between China 
and Georgia were concluded  in 7 months. Since 1 January 2018, the agreement is in force.  WT/TPR/M/420/Add.1  
 
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  EU Question No 39: Could you please provide further details on the structure of the trade 
relations with China since the entry into force of the  Free Trade Area (FTA)? Mainly, which 
are the main products traded? Is the trade balance positive or negative? Do you expect 
an inflow of FDIs in the coming years, especially in the framework of the BRI?  
Reply to Question No 39: Since the FTA is in force, the export from Georgia to China increased 
by 140% as compared to 2020. The export of wine to China has significantly increased since the  FTA 
been enacted, taking 3d position among top wine export destinations. The main products are: copper 
ores, medical e quipment, precious metal ores, aluminium, copper scrap, heating equipment, spirit 
drinks, wine, and etc. Trade balance is negative.  
 
Georgia is the only country in the region enjoying free trade with both China and the EU, which can 
be an effective tool fo r attracting investments in the country.  
 
  WT/TPR/M/420/Add.1  
 
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  EUROPEAN  UNION  – FOLLOW -UP 
WT/TPR/S/420 – WTO Secretariat report  
2 TRADE AND INVESTMENT REGIMES  
2.3 Trade Agreements and Arrangements  
2.3.2 Regional and preferential agreements  
2.3.2.1 European Union  
Paragraph 2.26, p. 34 (WT/TPR/S/420)  
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 3 1% 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 2014 -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.  
EU Question No  4: Second, is this sentence (that seems to imply that EU imports from Georgia are 
now more varied) not contradictory with the one that follows and that states the opposite, or does 
the latter statement refer to product groups rather than individual produc ts? This being said, it can 
be argued that it is still early days to judge whether the DCFTA has contributed to the diversification 
of Georgia 's exports to the EU given that trade patterns take quite a while to adjust.  
Reply to Question No 4 : Since the ena ctment of the DCFTA, the number of new products have 
entered to the EU market, however, it is still early to assess the overall results of the DCFTA, because 
the process of approximation is yet underway. Only after the approximation process is finalized, 
we will be able fully to evaluate the benefits Georgia has gained.  
EU follow -up question : Could you please elaborate further how the DCFTA has contributed to the 
diversification of Georgian exports?  
Reply to follow -up question:  It is important to note that in addition to the new products including 
animal origin products, which have entered to the EU market, the share of domestic export (export 
without re -export)  to the EU has increased. In this regard, the domestic export to the EU in  2020 
has increased by 5 3% as compared to 2014. In the same period, the share of domestic export made 
from Georgia to the EU increased from 68% up to 89%. Accordingly, the share of the reexport 
decreased from 32% to 11% wherefrom it 's well reflected that the DCFTA yields positive  results 
where the EU represents the growing export market for Georgia.  
 
3. TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.1.2 Rules on state aid  
Table 3.7, p.63 and Paragraphs 3.116 and 3.117, p. 68 (WT/TPR /S/420)  
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 Competition prohibits s tate 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 environmental 
protection ac tivities, 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 Agency 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; p roviding WT/TPR/M/420/Add.1  
 
- 44 - 
 
  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 National Competition Agency to determi ne 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 
exemptio n 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, for entities operating in the lan d cargo transport or agriculture 
sectors, the maximum amount is GEL  200,000.  142 Disputes relating to state aid may be 
consider ebly the applicable court for competition matters . 
 
EU Question No 8 : Could the Georgian authorities explain how they obtain info rmation on all state  aid 
granted, i.e. aid granted at local, regional and central government level, and including aid that does 
not have to be notified to the Competition Authority?  
 
Reply to Question No 8 : According to the Georgian law on Competition the entity providing the 
insignificant amount of individual state aid is obliged to provide the Agency with the information on 
the insignificant amount of individual state aid granted, the term of granting and the receiving 
undertaking/undertakings by the firs t of February of the year following the reporting year.  
GNCA  enters the information in the registry of individual state aid. Accordingly, GNCA monitors 
granting of the state aid which does not need the contest of the Agency and if it exceeds the 
insignific ant amount of individual state aid defined by the legislation of Georgia - prepares 
an appropriate report and sends it to the state aid providing entity, as well as to its superior body  (if 
any) 
 
EU follow -up question : We thank the Georgian authorities for their reply to our Question 8 
explaining how they monitor the granting of insignificant amounts of state aid. Could the Georgian 
authorities please also clarify what is the procedure for monitoring the granting of sta te aid in case 
of state aid exceeding GEL 400,000 and/or granted for other goals than the economic development 
of certain regions or to preserve culture or cultural heritage? In other words, could the Georgian 
authorities indicate how they obtain informati on on all state aid granted that is not notified e x ante 
to the Competition Authority?  
Reply to follow -up question: According to the law of Georgia "On Competition " (art. 14) the body 
providing the insignificant amount of individual state aid is obliged to  provide the Agency with the 
information on the insignificant amount of individual state aid granted, the term of granting and the 
receiving undertaking/undertakings by the first of February of the year following the reporting year.  
GNCA enters the informa tion in the register of individual state aid and if it is granted  to the same 
undertaking during three fiscal years and the amount is exceeding individual limit, GNCA prepares 
an appropriate report and sends it to the state aid providing body.  
In practice,  GNCA, for its own part, also requests  information from the authorities (especially, from 
municipal authorities) and asks them to provide data related to the state aid. To provide the 
requested information  is mandatory for the public authorities, therefore , GNCA, will receive 
information and monitor granting the state aid, also in case if the body providing state aid has not 
submitted report by the first of February.  
On the monitoring of granted state aid for other goals than the economic development of cer tain 
regions or to preserve culture or cultural heritage – according to law of Georgia 
"On Competition " (art. 12(3)) GNCA only examines granting the state aid for the purposes of 
mentioned goals (economic development of the region and culture) – therefore,  only the monitoring 
of those particular areas are under the GNCA 's competence.  
It must be noted, that law (art. 12(2)), also, foresees legal conditions, when granting state aid is 
generally permitted and does not need the consent of the agency (for example, if it is foreseen by 
the law, intends to carry out environmental protection a ctivities and etc.) All other State aids that 
hinder or endanger competition is prohibited  and granting such kind of state aids shall be the subject 
of the judicial control. In particular - the person who has suffered damages as a result of such 
distortion  or violation may appeal to court against the state aid granted (art. 15).  WT/TPR/M/420/Add.1  
 
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  WT/TPR/G/420 – Government Report  
1 INTRODUCTION  
Paragraph 1.3, p. 3 (WT/TPR/G/420)  
1.3. The basic objectives of Georgia's trade policy are defined  as follows:  
• Integration into the world economy, including the implementation of WTO membership 
obligations and obligations under other international agreements;  
• Trade policy liberalization, in cluding simplification of export and import procedures and tariff 
and non -tariff regulation;  
• Diversification of trade relations by establishing preferential regimes with main trade and 
regional partner countries;  
• Enhancement of transparency in the policy -making process.  
 
EU Question No 19 : Which formal document describes the main elements of trade policy? Does 
Georgia plan to adopt a strategy in the near future, or are the basic objectives described here defined  
in a formal document? Is additional information available on Georgia 's export diversification strategy 
and what it entails?  
Reply to Question No 19 : These objectives are entailed in the Government Programs. One of the 
primary directions is to enhance the scope of countries with which Georgia will form free trade 
agreements. As of now, Georgia enjoys free trade regime with countries covering 1/3 of world 
population, including preferential agreements with the EU, China, EFTA States, Turkey, CIS states, 
Hong Kong, China . We also work to form additional FTAs with the State of Israel, Republic of India, 
Republic  of Korea, and United Arab Emirates.  
EU follow -up question : Could you please provide the documents of the Government programs, in 
which the objectives of  the export diversification strategy are entailed ? 
Reply to follow -up question:  The requested documents can be seen on the links below:  
http://www.econom y.ge/uploads/files/2017/ek__politika/eng_sme_development_strategy.pdf  
https://www.gov.ge/files/41_78149_280277_GP.pdf  
 
2. RECENT ECONOMIC DEVELOPMENTS AND REFORMS  
2.5 Transport  
Paragraph 2.43 p. 8. (WT/TPR/G/420)  
2.48 Georgia is one of Eastern Partnership countries and stronger connectivity has been declared as 
one of the top priorities within the Eastern Partnership. Enhanced physical connectivity 
between  Georgia and the EU would help better use of the DCFTA and increase country 's transit and 
logistic potential and it is also of high relevance in the context of Euro -Asia connectivity. Joint Staff 
working D ocument "Recovery, resilience and reform: post 2020 Eastern Partnership Priorities " was 
elaborated by European Commission and it establishes flagship initiatives for the EU partnership 
countries, one of the initiatives include the improvement of Black Sea Transport Connectivity. This 
flagship will involve developing new ferry/feeder services on the Black Sea Legislation in the 
transport sector for Georgia is elaborated  by various transport codes for most modes of transport.  
 
EU Question No 26 : Pursuant to the Flagship initiative, when are the new ferry/feeder services 
expected to start operations?  
 
Reply to Question No 26 : In 2019 , Ministry of Economy and Sustainable Development of Georgia 
hired KPMG to conduct Feasibility study for the developm ent of ferry & container feeder services 
between ports of Georgia, Bulgaria, Romania and Ukraine. Due to fact that in 2020 COVID -19 virus 
caused pandemic globally hence dramatically change market circumstances in maritime sector and 
regional trade we would  like to have an updated study which will show current strategies for 
developing ferry/feeder services ". 
 WT/TPR/M/420/Add.1  
 
- 46 - 
 
  EU follow -up question : When is the Feasibility Study expected to be completed ? 
 
Reply to follow -up question: Georgia is working closely with the EU delegation in Georgia to 
adjust the Terms of Reference to the current market conditions in the Black Sea region. According 
to our information the study will be funded  by EU in 2022.  
 
2.7 Technical Barriers to Trade  
Paragraph 2.59, p. 10 (WT/TPR/G/420)  
 
2.59. Georgia continues to maintain open markets and has acknowledged that technical regulations 
have a significant role in promoting free trade.  Recent policy initiatives have emphasized facilitating 
export development and promoting integration with international and European markets. 
Georgian  legislation on TBT follows international best practices and norms and significant steps have 
been taken  to develop the national quality infrastructure to the level of the EU acquis. 
EU Question No 34 : How does the government intend to increase the number of conformity 
assessment bodies (private and public) that are able and entitled to test products accordi ng to 
EU standards and international specifications?  
Reply to Question No 34 : One of the most acute challenges relates to the development of the 
relevant infrastructure for conformity assessment. Most laboratories in Georgia do not have the 
ability to cond uct tests in regulated fields according to European or International standards. It is 
highly costly to receive these services from abroad, making our export products less competitive 
and making it expensive to undertake market surveillance activities by st ate. In order to tackle this 
challenge first step have already been taken , namely, with the support from EU funded 
project  – AA Facility, Georgia has initiated a study that will assess current conformity assessment 
capacities in Georgia and will suggest a market based assessment on needs.  
 
EU follow -up question : Could Georgia elaborate more on the costs receiving the testing services 
from abroad?  
 
Reply to follow -up question: It should be noted that the testing cost itself varies. There are also 
costs related to transportation  and time expenditure.  
As it indicated above, the final results of the study will be available at the end of February 2022 and 
we will provide additional information about the results.  
  WT/TPR/M/420/Add.1  
 
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  SINGAPORE  
PART I: QUESTIONS REGARDING THE SECRETARIAT REPORT  
QUESTION:  
3.1.1.2 Customs Valuation  
Page 41 (Para 3.14.)  
 
1. The WTO Secretariat Report notes that "During the [customs] review period, Georgia modified 
the legal format and some of the wording of the customs valuation legi slation but maintained the 
essence of its content, which largely mirrors the WTO Customs Valuation Agreement" . Would Georgia 
provide more information on the modification of the wording of the customs valuation legislation 
with reference to any changes in t he language employed?  
 
Reply:  Changes saw the introduction of the Customs valuation procedure manual designed to better 
accommodate the relevant procedures and allowing for higher degree of transparency for traders 
dealing with the valuation matters. The m anual provides a detailed guide for customs officers 
enabling better adherence to the appropriate WTO provisions as required.  
 
4.1.1 Agriculture  
Page 97 (Para 4.3.)  
 
2. The WTO Secretariat Report states that "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 ownership of agricultural land by 
prohibiting foreign ownership" . Could Georgia share any instances in which foreign ownership of 
agricultural land was permitted outside of the two exceptions of inheritance and foreign parties' 
registration as legal entities of private law?  
 
Reply : In accordance with the organic law of Georgia "On Agricultural Land Ownership", agricultural 
land may be in the ownership of an alien if the land was inherited by the alien; in the ownership of 
a legal entity under private law registered in Georgia, whose dominant partner is an alien and/or a 
legal entity  registered abroad or whose dominant partner cannot be established under the law, on 
the basis of an investment plan, according to the decision of the Government of Georgia.  
 
PART II: QUESTIONS REGARDING THE GOVERNMENT REPORT  
QUESTION:  
 
2.6 Telecommunicati on, Innovation and Technology Development  
Page 10 (Para 2.58.)  
 
3. The WTO Secretariat Report notes that "Georgia has the ambition to host a regional digital hub" 
and that "the Government of Georgia explores the possibility to host the regional digital hub and 
attract investments in the development of Digital Corridor and data centres, which could serve as a 
regional hub for South Caucasus and gateway of the EU and Asia" . Has Georgia started discussions 
or collaborated with EU/Asian trade partner s, and is there a timeline Georgia would be able to share 
regarding its plans to set up this regional digital hub?  
 
Reply:  The Development of a digital hub in Georgia is one of the priority directions of the "National 
Broadband Development Strategy for 202 0-2025" and is derived from it. The MoESD is working with 
the World Bank on the concept paper and action plan to explore potential and identify activities for 
the development of a digital corridor connecting Europe and Asia through Georgia to host a region al 
digital hub in Georgia. It will describe the general state of development of the international Internet 
connection in the region, its development trends, activities to be implemented by the state and the 
private sector to develop the potential of digita l transit corridor and regional data centers in Georgia.  
 
  WT/TPR/M/420/Add.1  
 
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  HONG KONG, CHINA  
QUESTIONS REGARDING THE SECRETARIAT AND GOVERNMENT  REPORTS  
 
Trade Policies and Practices by Measure  
State trading, state -owned enterprises, and privatization  
(WT/TPR/S/420: Pages 17 -18, para 1.10; Page 21, para 1.21; Page 32, paras 2.17 -2.18; Page 83, 
para 3.176)  
 
The authorities indicate that the broad objectives of Georgia's trade policy remain largely unchanged 
from the previous Review, including continued trade policy lib eralization. In its new 
10-years development strategy, Economy 2030, reforms are planned  for state -owned 
enterprises  (SOEs). The Economy 2030 initiative contains initiatives on SOEs and plans for further 
privatization during 2021 -30. 
 
Question:  
1. Could Georg ia share with us more details about the plans it has regarding reforms for 
state-owned enterprises, in particular the plans for further privatization under the 
Economy  2030 initiative?  
 
Reply to Question 1:  The Government of Georgia started the reform of s tate owned enterprises 
which among others aims to reduce the number of SOEs. In April 2020, the process of classification 
of state -owned enterprises was completed, under which were identified state corporations and 
general government enterprises. The menti oned process transparently revealed all the enterprises 
that are non -commercial and constantly dependent on subsidies and enterprises that are fully 
commercial or have potential to become the commercial enterprises.  
The Government of Georgia started the re form on state owned enterprises. Under the reform 
government will strengthen corporate governance of state owned enterprises based on 
OECD  principles to ensure that the governance of public corporations is transparent and accountable 
and complies with high -quality corporate governance standards.  
The government elaborated and approved the ordinance on the Code of Corporate Governance of 
State Owned Enterprises. The Code provisions fully complies with OECD guidelines on corporate 
governance of state owned ent erprises. According to the mentioned ordinance, Enterprises will 
ensure gradual compliance with the principles set out in the Code within the defined timeframe.  
As well, it is planned to adopt the public corporation reform strategy in line with OECD princi ples, 
including by ensuring clear separation between the state's shareholder and policymaking functions. 
The strategy will reflect OECD principles and IMF TA recommendations to ensure that the governance 
of public corporations is transparent and accountabl e and complies with high -quality corporate 
governance standards. The legal and regulatory framework for public corporations will provide a 
level playing field and fair competition in the marketplace. Based on the adopted strategy 
government will also adopt  a framework law for public corporations.  
Based on adopted framework law, an existing public corporation will be liquidated if it is not 
commercially viable and no longer the most efficient option for meeting the policy objective; 
Converted into a Legal En tity of Public Law (LEPL) if it is not commercially viable, but remains the 
most efficient option for meeting the policy objective; Privatized if it is commercially viable, but no 
longer the most efficient option for meeting the policy objective and Retain ed as a public corporation 
if it is commercially viable and remains the most efficient option for meeting the policy objective.  
 
Trade Policies by Sector  
Telecommunications  
(WT/TPR/S/420: Page 128, para 4.120 ; Page 130, para 4.122)  
 
While concrete steps were taken to implement 5G and further develop its infrastructure, in particular 
broadband, there was a steady decline in capital investment by telecom operators during the period.  
 
Shares of the main companies on the market (MagtiCom, Geocell/Silkne t, and Veon) are owned by 
Georgians jointly with foreigners.  
 WT/TPR/M/420/Add.1  
 
- 49 - 
 
  Question:  
2. In view of the steady decline in capital investment by telecom operators in spite of 
government's  efforts in promoting the development of the telecom sector, we would like to 
know the major reasons for the decline in capital investment. We note the major 
telecom  companies are jointly owned by Georgians and foreigners. Please share with us 
whether there are any specific measures to encourage foreign capital investment in the 
telecom  sector . 
 
Reply to Question 2: YoY decline of Capital investments in telecom sector are mainly affected by 
the company Magticom's input in total sector investments.  
Main prerequisite of above described deviations was the company Magticom's network expansion  
plan (strategy) that was declared predominantly – the company was planning to complete the fiber 
network expansion by the end of year 2019. In accordance with Magticom's strategy, company 
considered fast -paced network expansion after the acquisition of th e retail unit of Caucasus Online. 
The plan was majorly executed in 2019, respectively in 2020 company showing modest network 
upgrade activities (respectively modest investments).  
As for another major market player - Silknet, the company sustained investmen t in 2020. The 
company replaces its old copper infrastructure by fiber technology and is upgrading 4G  mobile 
network, as well. The third main mobile player, Veon Georgia also conducted several network 
upgrades and modernization of its 4G network,based on a nnounced plans, will be extended also 
in 2022.  
As of incentives to the foreign capital investments in Telco, we may name the following: the 
harmonization and simplification of regulatory frameworks, also reflected in this report by WTO, 
ongoing steps to mo re participatory regulatory approaches on the market proposed by ComCom, 
also, simplified and transparent authorization and licensing processes and procedures. On top of 
this, ComCom is always open to dialogue and to sharing its expertise to accommodate th e queries 
from interested parties, in the best interest of sector and the country.  
 
In order to support capital investments and development of telecom sector, the Government of 
Georgia (GoG) adopted the National Broadband Development Strategy (NBDS) on 10  January  2020. 
The key objectives of the NBDS are to enhance the legal and regulatory framework for broadband 
development in line with the EU norms and overcome the digital divide across urban and rural areas. 
Targets of NBDS are in line with the  EU's Gigab it Society objectives 2025. For the implementation 
of the NBDS, the Government of Georgia with the World Bank started Log -in Georgia Project.  
 
The project supports the construction and activation of the fiber networks under the "State 
Programme for Broadba nd Infrastructure Development" that will bring high quality, high -capacity 
wholesale services to the selected rural settlements "white zones" and will support competition 
development and capital investment in telecommunications retail market in the selecte d rural 
settlements.  
 
Log-in Georgia Project also will help to boost the use of digitally enabled services through training 
and capacity building programs across the country, under this component will improve the enabling 
environment for digital development and attraction of capital investment, including foreign capital 
investment in the telecom market.  
 
E-commerce  
(WT/TPR/S/420: Page 134, para 4.142 ) 
 
During the review period, the Ministry of Economy and Sustainable Development (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 it is inherently 
linked to the adoption of the new consu mer 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 the D eep 
and Comprehensive Free Trade Area (DCFTA) commitments, Georgia was working towards 
identification of Internet exchange point (IXP) liabilities in its legislation.  
 WT/TPR/M/420/Add.1  
 
- 50 - 
 
  Question:  
3. What is the current status  of the draft law on e -commerce? What is the time frame  for the 
adoption of the draft law on e -commerce? Is the identification of IXP liabilities one of the issues 
pending clarification?  
 
Reply to Question 3:  To ensure further development of eCommerce, the draft law of Georgia on 
e-commerce has been prepared by the MoESD. The draft law will be submitted to the Government 
of Georgia for initiation in the Parliament of Georgia in 2022. The law will regulate the rights and 
obligations of intermediary service providers (ISP), as well as protect consumers by making 
information services more transparent and standardized.  
 
Transportation  
(WT/TPR/S/420: Page 136, para 4.151)  
 
The MESD 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 Georgia's transport and logistics sector through improved coordination, 
enhanced transpo rt connectivity, and faster logistics, as well as increased human capital in transport 
and logistics. The implementation of the strategy is expected to contribute to increased 
competitiveness of the transport and logistics sector. Moreover, work was ongoin g on the Maritime 
Transport Strategy document that was also not yet approved  as of October 2021.  
 
Question:  
4. What is the current status  of the National Transport and Logistics Strategy (2021 -30) and 
Action  Plan (2021 -22), as well as the Maritime Transport Strategy document, which were not 
yet formally approved  as at October 2021? Please share with us in particular any measures to 
promote the participation of foreign operators in the transport and logistics market under 
these  strategies.  
 
Reply to Question 4: Drafts of the National Transport and Logistics Strate gy (2021 -2022) and its 
Action Plan (2021 -2022) have already been prepared although it is not adopted yet. The same status 
is for Maritime Transport Strategy. National Transport and Logistics Strategy envisages 
dissemination of information on transport and logistics projects such as logistics centers, seaports, 
airports etc. through international exhibitions, forums and conferences to show benefits that can be 
attained through investing in Georgia.  
 
Under the draft Maritime Transport Strategy the following a ctions and measures are envisaged to 
promote the participation of foreign operators in the transport:  
 
Increasing access to finance and promoting investment attraction: Conduct a feasibility study on  
market place analysis in Georgia for the shipbuilding an d ship repair industries and develop 
investment proposals for the development of shipbuilding and ship repair industries in order to 
attract investment in this sector.  
Analysis of financial instruments promoting cruise tourism and developing a scheme of po ssible 
incentive mechanisms to promote the Black Sea Coastline of Georgia for possible investments.  
Promote and increase the capabilities of the Ship State Registry of Georgia in order to attract 
shipowners.  
Attracting International Shipping (maritime) com panies to relocate to Georgia to use it as their place 
of business. New amendments to the tax regime makes possible for such companies to get the status 
of International Company in Georgia and therefore to take advantage of tax reductions.  WT/TPR/M/420/Add.1  
 
- 51 - 
 
  Tourism  
(WT/TPR/ S/420: Page 143, para 4.177)  
 
The main legislation in this sector is the Law on Tourism and Resorts, adopted in 1997 and last 
amended in 2019, which is currently in the process of being updated.  
 
Question:  
5. Please  share with us more details of the 2019 amendments to the Law on Touris m and Resorts 
and further updates being contemplated . 
 
Reply to Question 5:  The LEPL Georgian National Tourism Administration is cooperating with the 
Parliament of Georgia and the private sector representatives in order to approximate national 
legislation to the following EU Directives: Directive (EU) 2015/2302 of the European Pa rliament and 
of the Council of 25 November  2015 on package travel and linked travel arrangements, amending 
Regulation (EC) N °. 2006/2004 and Directive (EU) 2015/2302 of the European Parliament and of 
the Council of 25 November  2015 on package travel and linked travel arrangements, amending 
Regulation  (EC) N °.2006/. On the current stage the document is undergoing the process of 
elaboration and the final amendments have not been completed . 
 
  WT/TPR/M/420/Add.1  
 
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  UNITED KINGDOM  
SECRETARIAT REPORT (S420)  
Summary  
Paragraph  17 (Su bsidies and COVID -19) 
UK Question 1 : The Secretariat report states that, "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".  Could Georgia please explain what assessment it has made as to whether 
its COVID -19 pandemic -related subsidies have the potential to distort trade with WTO Members?  
 
Reply to Quest ion 1: The government support programs are oriented on the improvement of 
access to finance for small and medium sized enterprises and reduction of market failures. Georgia 
notes that any of these support measures which promotes business sector competitive ness hadno 
trade distortion effect.  
 
UK Question 2 : Could Georgia please provide information outlining what it has done, or is proposing 
to do, to phase out or mitigate any trade -distorting effects relating to or resulting from its COVID -19 
pandemic -relate d subsidies?  
 
Reply to Question 2: The Government provided support measures to the sectors, which were 
considered  to be vulnerable  to Covid -19 related effects. These support measures have been provided  
solely for the social ends,  hence they had no potentia l to distort trade.  
 
SECRETARIAT REPORT (S420)  
SUMMARY  
Paragraph  20 
UK Question 3 : The Secretariat Report states that, " State -owned enterprises (SOEs) remained 
a significant part of the economy during the review period. Plus, during the review period, there 
were more enterprises nationalized than privatized". Can Georgia elaborate on its plans for reducing 
SOEs participation in the economy over the next few years a nd indicate which sectors will 
be targeted?  
 
Reply to Question 3: The Government of Georgia started the reform of state owned enterprises, 
which among others aims to reduce the number of SOEs. In April 2020, the process of classification 
of state -owned ent erprises was completed, under which were identified state corporations and 
general government enterprises. The mentioned process transparently revealed all the enterprises 
that are non -commercial and constantly dependent on subsidies and enterprises that a re fully 
commercial or have potential to become the commercial enterprises.  
The Government of Georgia started the reform on state owned enterprises. Under the reform 
government will strengthen corporate governance of state owned enterprises based on 
OECD  principles to ensure that the governance of public corporations is transparent and accountable 
and complies with high -quality corporate governance standards.  
The government elaborated and approved the ordinance on the Code of Corporate Governance of 
State O wned Enterprises. The Code provisions fully complies with OECD guidelines on corporate 
governance of state owned enterprises. According to the mentioned ordinance, Enterprises will 
ensure gradual compliance with the principles set out in the Code within th e defined timeframe.  
As well, it is planned to adopt the public corporation reform strategy in line with OECD principles, 
including by ensuring clear separation between the state's shareholder and policymaking functions. 
The strategy will reflect OECD prin ciples and IMF TA recommendations to ensure that the governance 
of public corporations is transparent and accountable and complies with high -quality corporate 
governance standards. The legal and regulatory framework for public corporations will provide a 
level playing field and fair competition in the marketplace. Based on the adopted strategy 
government will also adopt a framework law for public corporations.  
Based on adopted framework law, an existing public corporation will be liquidated if it is not 
commercially viable and no longer the most efficient option for meeting the policy objective; 
Converted into a Legal Entity of Public Law (LEPL) if it is not commercially viable, but remains the 
most efficient option for meeting the policy objective; Priva tized if it is commercially viable, but no 
longer the most efficient option for meeting the policy objective and Retained as a public corporation 
if it is commercially viable and remains the most efficient option for meeting the policy objective.  
 WT/TPR/M/420/Add.1  
 
- 53 - 
 
  SECRETAR IAT REPORT (S420)  
SUMMARY  
Paragraph  21 
UK Question 4 : The Secretariat Report states that, " Competitive tendering is generally low. Efforts 
to expand more open competitive tendering have been initiated through 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". Can Georgia provide additional 
information in relation to what steps they will be taking to increase competitive tendering 
participation in government procurement over the next few years?  
 
Reply to Question 4: 
In order to decrease single source procurement and increase competitive tendering, in 2015 SPA  has 
initiated changes to the law, according to which, in order to proceed with direct procurement, 
procuring entity has to apply for the special permission from the  SPA and justify direct procurement 
decision. This measure significantly reduced single source procurement (see figures below).  
 
 E-Procurement 
(in GEL)   % Direct 
Procurement 
(in GEL)  % Total 
amount(in  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  
 
Besides abovementioned, Georgian e -Procurement system is open for any interested parties. In 
order to participate in Georgian public procurement, economic operator must be registered in 
the e-Procurement system, which is very simple and straightforward process. Once economic 
operator  is registered in the system, there is no restriction to participate in the competitive tender 
process despite geographical location. Georgian e -Procurement system also allows registered 
economic operator to c hoose potential favourite CPV codes and get notified automatically on new 
tender notices on these CPV codes. This option ensures that economic operator will not miss tenders 
on pre -selected CPV codes.  
 
In order to further promote competition in the governm ent procurement, SPA is actively engaged in 
the dialog process with business communities. With this regard, it is important to underline 
public -private dialogue (PPD) with large business associations, such as European Business 
Association Georgia, Georgian  Chamber of Commerce and Industry etc. In 2022, SPA plans several 
PPD meetings with leading business associations.  
 
SECRETARIAT REPORT (S420)  
2 TRADE AND INVESTMENT REGIMES  
2.3 Trade Agreements and Arrangements  
2.3.1  WTO  
Paragraph  2.21 
UK Question 5:  Can G eorgia inform on their timings for submitting the outstanding 
WTO notifications?  
 
Reply to Question 5: Georgia intends to submit its outstanding notifications upon capacity building 
of the relevant institutions and to send relevant notifications in the fir st half of 2022.  
 WT/TPR/M/420/Add.1  
 
- 54 - 
 
  SECRETARIAT REPORT (S420)  
3 Trade Policies and Practices by Measure  
3.3 Measures Affecting Production and Trade  
3.3.1  Incentives  
3.3.1.1  Subsidies and incentives  
Paragraph  3.97 (Government Subsidies and Sectors)  
UK Question 6 : The Secretariat Report states that, "the Government provides subsidies to many 
sectors of its economy, but in particular education, research, healthcare, cultural and religious 
activities, transportation infrastructure, energy, regional development, indu stry, and agriculture are 
the most prominent". Could Georgia please explain what steps it has taken or is taking to ensure 
that these subsidies do not distort trade with WTO Members?  
 
Reply to Question 6: These subsidies are in full compliance to the WTO L aw and thus do not distort 
trade with other members.  
 
SECRETARIAT REPORT (S420)  
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 requireme nts 
Paragraph  3.12 
UK Question 7:  The Authorized Economic Operator (AEO) Program covers customs but also security 
and safety procedures. Can Georgia provide information regarding the product coverage of this 
programme? In particular, does this programme cover safety checks on pharmaceutical re -exports 
from other countries?  
 
Reply to Question 7: The program does not cover specific types of products and is subject to 
evaluation on individual basis and in compliance with the regulatory framework.  
 
SECRETARIAT REPORT (S420)  
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.1 Measures Directly Affecting Imports  
3.1.8  Other measures affecting import  
UK Question 8:  The Secretariat Report states that, " 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 w ith international food price fluctuations 
triggered by the introduction 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 (und er the MEPA), and neither was notified to the WTO". 
Can Georgia elaborate on the temporary import subsidies and when Georgia will notify the WTO?  Is 
Georgia planning to initiate any additional import subsidies and if so when and in relation to what 
product s? 
 
Reply to Question 8: These programs were implemented in 2020 to maintain market pricing under 
the COVID -19 pandemic and currently, are not operational.  
 
SECRETARIAT REPORT (S420)  
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.2 Measures Directly Affecting Exports  
3.2.5  Export finance, insurance, and guarantees  
Paragraph  3.96 
UK Question 9:  The Secretariat Report states that, " While no exporter support programme is in place 
at the moment, this may change under the new framework of the Economic Deve lopment 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 a nd leases, credit guarantees, and grants".  
Can Georgia provide details on the support mechanisms for export promotion and 
import -substitution under the Economic Development Strategy 2020 -30? 
 
Reply to Question 9:  The work on the elaboration of the Economic  Development Strategy 2020 -30 
is still underway and has not yet been finalized. Georgia confirms that the Strategy entails the WT/TPR/M/420/Add.1  
 
- 55 - 
 
  mechanisms related to export promotion. Furthermore, programs related to export promotion are 
officially published which can be s een on the following links:  
 
http://www.enterprisegeorgia.gov.ge/files/1/eng%20 -%209.pdf  
 
http://www.enterprisegeorgia.gov.ge/en/business -development/business -export  
 
SECRETARIAT REPORT (S420)  
3 Trade Policies and Practices by Measure  
3.3 Measures Affectin g Production and Trade  
3.3.4  Competition policy and price controls  
3.3.4.1  Competition policy  
Paragraph  3.159  
UK Question 10 : The Secretariat Report states that an anticompetitive merger can be fined 
"up to 5% of the previous year's annual turnover of the parties concerned" . Could Georgia please 
clarify whether this is 5% of the undertakings' turnover within Georgia, or worldwide?  
 
Reply to Question 10: According to the Competition legislation and the Guidelines on Setting the 
Fines, for the purpose of calc ulating turnover of the undertaking, worldwide turnover is taken into 
account.  
 
SECRETARIAT REPORT (S420)  
3 Trade Policies and Practices by Measure  
3.3 Measures Affecting Production and Trade  
3.3.4  Competition policy and price controls  
3.3.4.1  Competition policy  
Box 3.4 Main 2020 reform elements of the Law on Competition  
UK Question 11 : The Secretariat Report states that the Georgian National Competition Agency has 
new powers to "carry out unannounced on -site inspections"  of undertakings, subjec t to a court 
decision. Could Georgia please explain in which context would such inspections take place?  
 
Reply to Question 11: According to the Georgian competition legislation, on the basis of the 
decision of a court, in the process of investigation, GNCA  is authorised to carry out unannounced 
on-site inspection of a relevant undertaking. Inspection implies - access to documents related to the 
activities of the undertaking, including financial and economic documents, irrespective of their 
confidentiality a nd retention  procedures (which include electronical devices, computers and etc); 
Making copie of documents; Receiving explanations on the site;Accessing the place where 
an undertaking  conducts  its legal and actual  activities.  
 
UK Question 12 : Could Georgia  please clarify if these would be similar to 'dawn raids' and only used 
in competition enforcement investigations? Or would these powers allow the Georgian National 
Competition Agency to inspect businesses for market investigation and merger control purpos es? 
 
Reply to Question 12: Unannounced on -site inspections is term, which is foreseen in the 
legislation, but essentially it is similar to "dawn raid" and is only used in competition enforcement 
investigations and not in the process of merger control and m arket monitoring.  
 
UK Question 13 : Could Georgia please provide information on which sectors and/or industries have 
separate sector regulators under a concurrency regime, if any?  
 
Reply to Question 13: Georgia has three sector regulators – National Bank, N ational Energy and 
Water Supply Regulatory Commission and Communications Commission. Regulated sectors are 
financial sector (banks, investment funds, brokerage companies and etc.), electronic 
communication, broadcasting, energy and water supply and etc. In  particular, it includes sectors 
which are under the supervising power of the sector regulators. As concerns to the competition 
legislation, according to the Georgian Law "On Competition", in specific circumstances, in 
competition field sector regulators e nforce this particular law (for example, if all investigation or 
merger parties are acting in the same regulated sector).  
 WT/TPR/M/420/Add.1  
 
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  SECRETARIAT REPORT (S420)  
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.6  Government procurement  
Paragraph  3.189  
UK Question 14:  Can Georgia provide information on if and how they are planning to further 
encourage foreign participation in government procurement? Also, please provide information 
on progress made to publishing ten ders in English.  
 
Reply to Question 14: In order to implement the relevant legal provisions defined by the 
Association Agreement, such as Directive 2014/24/EU of the European Parliament and of the Council 
of 26  February  2014 on public procurement and repealing Directive 2004/18/EC and Council 
Directive 89/665/EEC of 21 December 1989 on the coordination of the laws, regulations and 
administrative provisions relating to the application of review procedures to the award of public 
supply an d public works contracts, the State Procurement Agency has elaborated the draft Law of 
Georgia "On Public Procurement". The main goal of the draft law of Georgia "On Public Procurement" 
is to reflect more effective public procurement legal provisions defin ed by the relevant EU directives 
and regulations. Thus, adoption of the draft law of Georgia "On Public Procurement" will facilitate 
the access of non -resident companies to Georgian market.  
 
It should also be noted that there are a number of legal provisio ns in Georgian public procurement 
legislation that promotes the participation of non -resident companies in Georgian public procurement 
procedures. For instance, according to the law of Georgia "On Public Procurement", when conducting 
an electronic tender, a tender committee shall, on behalf of a contracting authority, post an 
electronic tender notice and tender documentation in georgian in the Unified Electronic System of 
Public Procurement. By decision of a contracting authority, an electronic tender notic e may also be 
posted in the Unified Electronic System of Public Procurement in english. If an estimated value of 
goods or services to be procured exceeds the monetary thresholds defined by the EU directives, 
posting of an electronic tender notice in the Un ified Electronic System of Public Procurement in 
english shall be mandatory. It is worth to mention that Unified Electronic System of 
Public  Procurement is available in english as well.  
 
SECRETARIAT REPORT (S420)  
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.6  Government Procurement  
Paragraph  3.193  
UK Question 15 : Georgia has been an observer to the WTO Committee on Government Procurement 
(GPA) since 1999. Georgia has an Association Agreement in place with the EU and is approximating 
to the European Union acquis  in areas such as public procurement. In addition, Ge orgia has a 
Free Trade Agreement (FTA) with the EFTA states and the UK which include substantial procurement 
commitments, many of which mirror the standards set out in the GPA. Considering the above, 
the UK would welcome an update on Georgia's ambition and  progress towards GPA accession.  
 
Reply to Question 15: We reiterate Georgia's strong adherence to its commitments undertaken 
within the WTO accession process and reassure the GPA members in Georgia's interest to continue 
the negotiations for membership in  the WTO Government Procurement Agreement, as set out in the 
Working Party Report on Georgia's accession to the WTO.  
 
The Free Trade Agreement between Georgia and EFTA countries, which was signed in June 2016 and 
entered into force for Georgia on 1 Septemb er 2017, contains a special chapter devoted to 
government procurement, the provisions of which, are primarily based on WTO GPA agreement. 
Accordingly, the government procurement provisions with EFTA countries are fully enforceable on 
the territory of Georg ia. 
 
On 21 February 2020, draft amendments to the Public Procurement Law were submitted to the 
Parliament of Georgia for adoption, which provide for the establishment of an independent and 
impartial administrative review body in Georgia's public procuremen t system. Those legislative 
changes aim to meet Georgia's obligations under the EU – Georgia Association Agenda (AA), whereas 
the public procurement represents an important area to be addressed.  
 WT/TPR/M/420/Add.1  
 
- 57 - 
 
  The draft Law on Public Procurement has been prepared by Geo rgian side in close collaboration with 
EU experts aimed at ensuring full approximation of Georgia's public procurement landscape with 
latest EU public procurement directives thus entailing full compliance with the provisions of 
WTO revised GPA text. The dr aft law will be submitted to the Parliament soon.  
 
For the last 10 years Georgia's entire public procurement transactions are being carried out through 
electronic procurement platform and only in 2019, 1 977 companies from 77 countries have enjoyed 
unrestr icted access to Georgia's open and liberal public procurement market.  
 
Currently, there are internal discussions to re -activate Georgia's stalled GPA accession negotiations.  
 
SECRETARIAT REPORT (S420)  
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.6  Government Procurement  
Paragraph  3.188  
UK Question 16 : As part of its procurement legislation, Georgia maintains a so -called "Black  List" 
and "White List". In table 3.21 Georgia lists the main elements of the legal framework for 
procurement where it discloses the laws for the production of the "Black List" and "White List". Please 
can Georgia elaborate on the criteria for determining how a supplier is put on the "Black List" and 
the 'White  List"? Under what cir cumstances would a supplier be placed on the "Black List" and under 
what circumstances would a supplier be placed on the "White List"?  
 
Reply to Question 16:  
In accordance with the Law of Georgia "On Public Procurement" and according to  the relevant 
by-laws adopted based on this law, an economic operator is registered in the Black List if it commits 
dishonest activity (mala fide participant) or does not fulfill the contractual obligation defined by the 
relevant public procurement contract. According to the  Georgian legislation, an example of such 
action is when economic operators  as competitors had decided beforehand who will win in the 
specific procurement procedure or when competitors agree on the discounts to be offered, or on a 
minimum price that all th e bidders will observe.  
 
As for the register of qualified suppliers participating in procurements ("the White List"), specific 
requirements that shall be met by an economic operator who wishes to be registered in the White  List 
are defined by the subordina te normative act – by the decree of the chairperson of the 
State  Procurement Agency. Among other requirements, according to this decree, an economic 
operator shall not have tax debt before the State Budget; the director of the economic operator shall 
not be convicted because of financial or economic crimes; the economic operator shall have at least 
a turnover of GEL 1,000,000 over the last three years and a turnover of at least GEL  200,000 in 
the last year. It should also be noted that non -resident companie s, foreign enterprises as well as 
branches of a foreign enterprise are also eligible to be registered in the White List. They should 
submit the required information and documentation to the State Procurement 
Agency  of Georgia.  The list of the relevant info rmation and documentation to be submitted 
to the SPA is defined by the subordinate normative act.  
https://matsne.gov.ge/document/view/3203619?publication=3  
 
SECRETARIAT REPORT (S420)  
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production and Trade  
3.3.7 Intellectual property rights  
Paragraph 3.3.7.4 Designs  
UK Question 17 : The Secretariat Report states that, "As of 2020, work was ongoing on draft 
amendments to the Law on Design....As at September 2021, the amendments to the Law remained 
pending". When does Georgia foresee amendments to the Law on Designs being made and 
implemented?  
 
Reply to Question 17:  The w orking process on draft amendments to the Law of Design now is on 
final stage. We foresee to start necessary internal procedures for adoption in 2022.  
 WT/TPR/M/420/Add.1  
 
- 58 - 
 
  SECRETARIAT REPORT (S420)  
3 TRADE POLICIES AND PRACTICES BY MEASURE  
3.3 Measures Affecting Production an d Trade  
3.3.7 Intellectual Property Rights  
3.3.7.7  Enforcement  
Paragraph  3.223  
 
UK Question 18 : The Secretariat Report states that, "Georgia's customs officers are authorized to 
carry out ex officio IP enforcement action at the borders, which is expected t o result in a further 
increase in the number of counterfeit goods detained". How does Georgia enforce compliance of 
protected geographical indication rights within Georgia?  
 
Reply to Question 18: Tax Monitoring officers of the Georgia Revenue Service condu ct compliance 
monitoring operations based either on relevant referral/application or the ex officio principle.  
 
SECRETARIAT REPORT (S420)  
4 TRADE POLICIES BY SECTOR  
4.2.2  Energy  
Paragraph  4.66 
UK Question 19 : The Secretariat Report states that, "The Government continues to have a significant 
presence in the energy sector through SOEs. As of September 2021, according to the authorities, 
seven partially or fully state -owned companies operated in this sector, al l managed by the MESD". 
Can Georgia provide information in relation to the current share of SOEs in the energy sector? For 
instance, is Georgia considering privatisation of its energy sector?  
 
Reply to Question 19:  
State owned companies mainly represent ne twork activities (TSOs) as well as market 
operators  (day-ahead, intra -day and balancing and ancillary services market operators) in both 
electricity and natural gas sectors. At the same time, state owns two hydro power plants 
(Enguri  HPP and Vardnili HPP) and TPP (Gardabani TPP). Their share in the total installed capacity is 
about 39%.  
In addition, It should be also mentioned, that according to the directives of Electricity  (2009/72/EC) 
and natural gas internal market (2009/73/EC) the relevant reformes hav e already been carried out 
in energy sector. As per one of the foregoing reforms, relevant energy companies should be managed 
by the state owned company called Partnership Fund in a way that unbundling principles are 
maintained and achieved.  
 
SECRETARIAT R EPORT (S420)  
4 TRADE POLICIES BY SECTOR  
4.3 Manufacturing  
Paragraph  4.94 
UK Question 20:  Can Georgia provide additional information in relation to the new iteration of the 
Produce in Georgia Program? What type of financial support will be made available un der the new 
programme, and will it be equally accessible to both national and international businesses?  
 
Reply to Question 20:  
In relation to the "Produce in Georgia Program" new mechanisms for supporting SMEs (small and 
medium enterprises) have been launc hed: 
Business Universal:  
The program provides co -financing and collateral guarantee on commercial loans issued by banks 
for SMEs.  
Component  Parameter  
Loan interest co -financing  Refinancing rate minus 5%  
Credit guarantee mechanism  60% guarantee of the loan amount  
Duration  Full term loan  
 WT/TPR/M/420/Add.1  
 
- 59 - 
 
  Business Export  
The program provides co -financing, collateral guarantee and a small grant on commercial loans 
issued by banks for SMEs.  
 
 
Component   
Parameter  
Loan interest co -financing  Refinancing rate minus 5%  
Credit guarantee mechanism  60% guarantee of the loan amount  
Grant  15% of the loan amount (no more than GEL 500,000)  
Duration  Full term loan  
 
The aforementioned programs are available to any company registered in Georgia, without regard 
to its ownership.  
 
SECRETARIAT REPORT (S420)  
4 TRADE POLICIES BY SECTOR  
4.4  
4.4.2   
4.4.2.3  Legal framework  
Paragraph 4.138  
UK Question 21 : Can Georgia please provide information regarding the current state of the draft  Law 
on Critical Infrastructure?  
 
Reply to Question 21: There is an ongoing process of drafting the Law on Critical Infrastructure.  
 
SECRETARIAT REPORT (S420)  
4 TRADE POLICIES BY SECTOR  
4.4 Services  
4.4.2   
4.4.2.4  E-Commerce  
Paragraph  4.142  
UK Question 22 : When does Georgia anticipate developing and implementing e -commerce laws 
and/or policies including new consumer protection law?  
 
Reply to Question 22:  The draft law of Georgia on e -commerce has been prepared, which will be 
submitted to the Government of Georgia for initiati on in the Parliament of Georgia in 2022. The law, 
will regulate the rights and obligations of intermediary service providers (ISP), as well as protect 
consumers by making information services more transparent and standardized.  
 
UK Question 23 : Is there any  plan to build on the 2017 Law on Electronic Documents and 
Electronic  Trust Services in relation to electronic document flow systems and the use of electronic 
signatures?  
 
Reply to Question 23: Qualified electronic signatures and seals are broadly used in Georgia on the 
basis of the law of Georgia on Electronic Documents and Electronic Trust Services. According to the 
law, administrative bodies shall be obligated to put a qualified electronic signature and/or a qualified 
electronic seal on an electronic doc ument and also, if  a natural person or a legal entity under private 
law chooses an electronic form to communicate with administrative bodies and the submitted 
document requires a signature and/or a seal, it shall be mandatory to put a qualified electronic 
signature and/or a qualified electronic seal on the document. The law does not include any provisions 
regarding electronic identification and authentication, but the agency is planning to implement this 
services and the further adoption of respective legis lative framework (for example, amendments to 
the law of Georgia on Electronic Documents and Electronic Trust Services ) shall be needed. The 
abovementioned services might also be used for e -commerce purposes.  
 
UK Question 24 : What plans does Georgia have f or expanding the mobile e -commerce market in 
Georgia given the move to digitalisation arising from the C OVID -19 pandemic?  
 
Reply to Question 24:  Please refer to reply to question 22.  
 WT/TPR/M/420/Add.1  
 
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  GOVERNMENT REPORT  (G420)  
2 RECENT ECONOMIC DEVELOPMENTS AND REFORMS  
2.3 Energy  
Paragraph  2.26 and 2.27  
UK Question 25:  How does the Law on Encouraging the production and use of energy from renewable 
sources  (RES) work in practice and what is the progress achieved since it was implemented?  
 
Reply to Question 25: Since the adoption of the RE law in December 2019, Georgia has strived to 
define and implement secondary legislation and bylaws to foster growth of the renewable energy 
sector. Much work has been done in this regard, with 7 bylaws in place already. For exampl e, one  of 
them is adoption of support schemes. The support scheme for HPPs higher 5 MW was adopted 
on 2 July 2020 by the Ordinance of the Government of Georgia Amendment made in January  2021 
states that support scheme is available for all renewables higher  5 MW. This support scheme will be 
activated in parallel with market opening and energy exchange gets functioning in the 
first half of 2022.  
At the same time, MoESD and other stakeholders also have been actively working on the guarantees 
of origin, with th e assistance from the Energy Community Secretariat, which is working on regional 
project of guarantees of origin which will promoted renewable energy in the region and Georgia 
is one of the participants. In this regards, in December 2021 , Georgian Nationa l Energy and Water 
Supply Regulatory Commission based on relevant requirement by RES Law adopted "Rule for 
Issuance of Guarantees of Origin for Electricity from Renewable Sources" which is the first step in 
the direction of Guarantees of Origin.  
It should be also mentioned that RES Law obliges certification schemes for RE installers, this is a 
new topic for Georgia which wasn't in place before, which will create more job opportunities, promote 
renewable energy and increase the quality of workers and service. This certification program have 
already been drafted, in partnership with the Ministry of Education and Science of Georgia and the 
Georgian Technical University. The Certification program is planned to be in place since 2022.  
Also, based on the La w "Legal act regulating ecologic labeling, as well as ecologic criteria for labeling 
electric, gas and gas absorption heat pumps" was adopted by the Government of Georgia earlier 
this year. Currently, the country aims to continue the adoption of legislativ e and strategic documents 
and finalise the ongoing energy sector and market reforms.  
 
UK Question 26:  What is Georgia's position on hydrogen energy as a source of renewable energy 
and is it foreseen by the RES?  
 
Reply to Question 26: Georgia has expressed great interest in green hydrogen technologies. 
Georgian energy legislation and the draft NECP (including a separate measure to be implemented in 
the future) already include provisions which will facilitate the integration of hydrogen into the sec tor. 
Some practical steps have already been taken, in November 2021, MoESD and German Development 
Bank (KfW) have signed a declaration of intent. The main goals of the Declaration signed are as 
follows:  
• Assessment of the prospects and benefits of green hyd rogen in Georgia;  
• Implementation of the first pilot project, which will provide benefits to the economy and, 
consequently, help to attract investment to the country to develop clean and renewable 
energy;  
• Reduce dependence on imported gas and increase secur ity of supply;  
• Increase the pace of development of renewable energy projects, mitigate carbon emissions 
and create export opportunities for the country.  
GOVERNMENT REPORT  (G420)  
2 RECENT ECONOMIC DEVELOPMENTS AND REFORMS  
2.5 Transport  
Paragraph  2.40 and 2. 50 
UK Question 27:  Was the Maritime Strategy adopted and what are the key priorities?  
 
Reply to Question 27:  
The Maritime Transport Strategy is still a draft document and is under consideration and will be 
adopted in the near future.  
It will include key priority areas such as:  
• Introduction of Digital Solutions in the port sector such as Single Window and Port Community 
System;  
• Increasing the capabilities of the Ship's State Registry of Georgia;  WT/TPR/M/420/Add.1  
 
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  • Supporting the development of ferry connections in the Black Sea; 
• Increasing the capabilities of Maritime Education and Research;  
• Promotion of Cruise Tourism on the Georgian coastline;  
• Increase the access to Ship finance;  
• Introduction of a National Port Development Strategy;  
• Supporting and creating opportunities for the employment of Georgia seafarers.  
 
UK Question 28:  Can Georgia share information on the recent developments in the construction of 
Anaklia Deep Sea Port, building on from Georgia's information in their 2015 Government Report to 
the WTO ? 
 
Reply to Question 28:  
Georgian Government strives to enhance development of port infrastructure. For this purpose, 
particular importance is attached to the construction of the New Deep Sea port in Anaklia. 
In August  2014 the Government of Georgia announ ced the Invitation for the Expression of 
Interest  ("EOI") for the construction and development of the Anaklia New Deep Water Black 
Sea Port. On 8  February  2016 LTD Anaklia Development Consortium was selected as the winner 
by the Governmental Commission. On 3 October  2016 Investment Agreement was signed with the 
Investor  - LTD Anaklia Development Consortium (ADC).  
The Government of Georgia provided unprecedented support to the project, through extending 
deadlines of ongoing obl igations on Investor's request for multiple times (The deadlines for material 
obligations were postponed for 3 times). Moreover the GoG purchased the Investment area from 
the private owners (the value of which was GEL 58 milion) and transferred the respect ive land to 
the investor. In addition, the GoG undertook to procure the construction of Rail and Road 
Infrastructure. The GoG also agreed to provide subordinated loan in an amount of USD  100 milion, 
subject to Investor achieving financial close.  
Unfortunat ely, the investor failed to meet multiple obligations under the Investment Agreement, 
despite the fact that the Government had extended unprecedented support to the investor. Namely, 
the Investor failed to procure necessary equity and loan in an amount of USD 400 milion. For this 
reason on 9 January 2020 the Government of Georgia terminated the Investment agreement and 
investment area was handed back to the state property.  
Despite of the termination of Investment Agreement, the Anaklia deep see Port remains  the priority 
of the Government of Georgia and respectively, the works for elaborating new tender procedures 
are in progress.  
In May 2021 the Anaklia Deep Sea Port Development Agency of the MOESD hired well known 
Dutch  consulting company - MTBS for updatin g feasibility study of the project. MTBS recently 
completed the updated document, which includes new traffic study for Anaklia port, updated financial 
model, marketing strategy, as well as recommendations on new PPP structure.  
The MTBS was hired by the MOE SD for elaborating Georgian Port Sector Development Strategy, 
which shall be completed by January 2022.  
Based on the findings of the feasibility study as well as the Strategy, 2014 tender conditions should 
be revised and updated, in consideration of curren t situation and challenges in the region and the 
world. New tender for selection of the new investor for the project will likely to be announced by the 
beginning of 2022.  
 
GOVERNMENT REPORT (G420)  
2 RECENT ECONOMIC DEVELOPMENTS AND REFORMS  
2.11 Intellectua l Property Rights  
Paragraph  2.96 
UK Question 29 : The Government Report states that , "Georgian legislation on IPR is moving towards 
the EU  acquis and a number of other EU norms are expected to be approximated in the future" . 
Which norms is Georgia consideri ng adopting?  
 
Reply to Question 29:  During implementation of the EU -Georgia Intellectual Property 
Project  (EUGIPP) Georgian Trademarks, Designs and Copyright system will be fully modernised, 
modern approaches defined by the EU Directives and Regulations will be implemented. These 
normative a cts are for instance: Regulation (EU) 2017/1001 of the European Parliament and of the 
Council of 14 June 2017 on the European Union trademark and Directive (EU) 2015/2436 of 
the European Parliament and of the Council of 16 December 2015 to approximate the laws of the 
Member States relating to trademarks. In addition, as was mentioned in the report with the help of 
the EU, Georgia got a significant support through the TWINNING project, which aimed at improving WT/TPR/M/420/Add.1  
 
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  Geographical Indications system. Under this proj ect numerous laws and by laws were drafted using 
the best approaches defined by the EU Directives and Regulations.  
 
GOVERNMENT REPORT (G420)  
2 RECENT ECONOMIC DEVELOPMENTS AND REFORMS  
2.11 Intellectual Property Rights  
Paragraph 2.96  
UK Question 30 : The Government Report states that,  "The new law also allows for the possibility of 
proactive application of intellectual property measures on the border through an ex -officio process" . 
What does this process involve?  
 
Reply to Question 30:  In the scope of DCFT A agreement between Georgia and EU, Georgia took 
obligation to approximate its law on "Border measures related to intellectual property rights" to the 
corresponding EU regulation N608/2013. Corresponding legislative amendments introduced at the 
end of 2017  stipulate all IP objects to be protected at the border, namely, including Designs, Patents, 
Utility Models, Topographies of Integrated Circuits, New Breeds of Animals and Varieties of Plants. 
Furthermore, according to the new amendments, customs authority  are entitled to take ex -officio 
actions at the border and detain suspected IP rights infringing goods, even if they are not registered 
in the Registry of Intellectual Property Objects of the Revenue Service. Under the amendments, 
entered into force in 201 9, the customs authorities were given the authority to ex officio suspend 
the movement of the goods at the border.In particular according to the amended "Border measures 
related to intellectual property rights" if the Customs Service has grounds to believe  that goods 
moved within the customs territory of Georgia have been produced through the infringement of 
intellectual property rights which are protected in Georgia, but which rights have not been entered 
in the Register, the Service shall be authorised to  make a decision to suspend the movement of such 
goods(exceptforperishablegoods),and/or  the procedures  provided  for by the customs  legislation  of 
Georgia,or  three  working  days. Also If, at the time of the movement of goods in the customs 
territory of Georg ia, the Customs Service has grounds to believe that goods have been produced 
through the infringement of intellectual property rights which are protected in Georgia and which 
have been entered into the Register, the Service shall make a decision to suspend  the movement of 
such goods ('the suspension of goods'), and/or the procedures provided for by the customs 
legislation of Georgia.  
 
  WT/TPR/M/420/Add.1  
 
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  UKRAINE  
PART I: QUESTIONS REGARDING THE SECRETARIAT REPORT (WT/TPR/S/420)  
1 ECONOMIC ENVIRONMENT  
1.2 Recent Economic Developments  
Pages 16 -17 (Para 1.9)  
The Report describes a number of substantial economic reforms, which were adopted during the 
review period, including dollarization reform (Box 1.1).  
Question:  
1. Ukraine would appreciate to know more regarding  strategies and concrete measures, which were 
implemented  under the dollarization reform.  
 
Reply to Question 1: Please see the NBG Macroprudential Policy Strategy  document 
(https://nbg.gov.ge/en/page/macroprudential -policy -strategy ). 
Regarding the instruments used, this is the short list of the main tools to support dedollarization in 
Georgia:  
• Currency Induced Credit Risk (CICR) Buffer – Additional capital requirement in Pillar 2: 
additional 75% risk -weight applies to unhedged foreign currency exposures;  
• Liquidity Coverage Ratio (LCR) requirement differentiate d by currency: 75% in GEL, 
100%  in FX (total ratio in all currencies should exceed 100%);  
• Minimum reserve requirement differentiated by currency: 5% in GEL, 10% -25% in FX;  
• Open currency position limit for banks: 20% of tier 1 capital;  
• Loan-to-Value (LTV) r atio limit for retail credit: 85% in GEL, 70% in FX;  
• Payment -to-Income (PTI) ratio for retail credit: <50% in GEL, <30% in FX;  
• Maximum maturity of mortgage loans allowed: 20 year for GEL, 10 years for FX;  
• Loans amounting < GEL 200,000 equivalent cannot be issued in FX (banned in Civil Code);  
• Deposit insurance premium is different in national and foreign currency – 0.067% of the 
compensable volume of the deposits insured in the national currency. The insured deposit 
of the depositor shall be compensated in the national currency if the depositor has a deposit 
in foreign currency.  
1.2.1 Impact of COVID ‑19, mitigation measures by the Government, and outlook  
Page 18 (Para 1.12)  
According to the Report, the Government introduced a wheat subsidy tha t was discontinued  recently, 
resulting in about a 10% increase in the price of bread in July 2021.  
Questions:  
2. Could Georgia kindly elaborate on measures encompassed within "wheat subsidy"?  
3. Would Georgia also indicate whether these measures were notified to the WTO?  
 
Replies to Questions 2 and 3:  
1. The purpose of the state program for subsidizing wheat imports is to maintain the retail selling  
price of non -forage wheat and first grade whe at flour.  
 
2. The objective of the program is to stimulate the creation of stocks of wheat and first grade  wheat 
flour in the country.  
 
Beneficiary eligibility requirements: Entrepreneur, natural or legal person registered in Georgia, who 
has purchased and /or imported at least 5,000 tons of wheat within one calendar year before 
submitting an application to the Agency, and with whom a subsidy agreement can be concluded 
within the framework of the program;  WT/TPR/M/420/Add.1  
 
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  The amount of the subsidy was the equivalent of not m ore than $ 40 per ton of wheat in the national 
currency. Under the program, a subsidy was provided per beneficiary for not less than 2000 and 
not more than 40,000 tons of wheat.  
 
The subsidy agreement was concluded on the following principle: First of all,  the agreement was 
concluded with the potential beneficiary who had the lowest amount of subsidy in the application, 
calculated for each ton of wheat. In case the volume offered with the lowest amount did not meet 
the import quantity within the program, th e contract was concluded with the next potential 
beneficiary with the lowest price and continued on the same principle until the quantity of wheat 
determined by the program was filled. The Beneficiary was obliged to sell the first quality flour 
received as  a result of processing of imported wheat within the framework of the program within a 
maximum of GEL 51 per bag no later than 3 months after the date of concluding the subsidy 
agreement.  
 
2 TRADE AND INVESTMENT REGIMES  
2.2 Trade Policy Formulation and Obj ectives  
Page 32 (Para 2.18)  
The Report notes that, the Government presented a 10 -year economic development strategy called 
Economy 2030 in July 2021. To maintain a high rate of economic growth, the strategy aims to 
increase domestic production and export s. Specifically, the new strategy aims to double exports in 
the next five years and increase self -sufficiency by at least 20%.  
Question:  
4. Could Georgia kindly elaborate on measures that are foreseen in Economy 2030 Strategy relevant 
to the agricultural sector?  
 
Reply to Question 4 : Nowadays, MEPA follows the Agriculture and Rural Development Strategy of 
Georgia 2021 - 2027, but in current year the Ministry presented the main components of 
Economy  2030 Strategy development of agricultural sec tor: Self -sufficiency ratio enhancement for 
food security and Fostering greater utilization of export potential for Georgia's agro -production.  
 
2.3 Trade Agreements and Arrangements  
2.3.2 Regional and preferential agreements  
2.3.2.1 Georgia  
Page 33 (Para 2 .25)  
The Report states that the DCFTA requires 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 phy tosanitary measures; customs law; trade 
in services; and public procurement.  
Questions:  
5. Could Georgia, please, provide information on the process of approximation its legislation to the 
EU acquis in the areas of technical regulations, standards, and con formity assessment ; sanitary and 
phytosanitary measures?  
 
Reply to Question 5: Legal approximation of Georgian legal system to EU legislation is done by 
adoption of new legal acts or by making amendments in existing ones.  
 
At the first stage, relevant mini stries and state agencies prepare the draft documents in coordination 
with the experts from interested state institutions and/or donor organisations' technical support 
projects.  
 
When the drafts are finalised, they are made available for public discussion. Draft documents are 
uploaded for comments on DCFTA.gov.ge webpage, also on the official webpages of the relevant 
state institutions. In cases, where t he new regulations are expected to have a significant impact on 
private sector, Regulatory Imp act Assessments are prepared, drafts are disseminated to the  
business associations through the DCFTA Advisory Group or directly. Parallel to these, meetings with 
the stakeholders are organised if needed.  
 WT/TPR/M/420/Add.1  
 
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  At the final stage, the draft is sent to the releva nt Ministries and comments are collected from all of 
them for further development of the final draft of the decree. As working documents becomes 
adaptable for all of the related Ministries and stakeholders, it is uploaded to the 
government  (by electronic m eans) for adoption, or goes through the relevant legislative process in 
case of the draft law or the draft amendment to the law.  
 
Also, in order to help the business operators and stakeholders to adapt to new requirements, the 
government launches an inform ation campaign, which envisages numerous trainings, informative 
meetings across the country with the business sector, as well as with other stakeholders.  
 
6. Would Georgia also clarify whether the Action Plan for the Implementation of DCFTA 2018 -20 has 
been fulfilled ? 
 
Reply to Question 6: Yes, it has been fulfilled. Georgia annually participates in Trade Configuration 
Committee examining reforms implemented under this action plan, which was very positively 
evaluated. Furthermore, the action plan is examine d annually under respective committees in the 
Parliament.  
 
3. TRADE POLICIES AND PRACTICES BY MEASURE  
3.1 Measures Directly Affecting Imports  
3.1.5 Other charges affecting imports  
3.1.5.1 Customs fees  
Page 51 (Para 3.43)  
The report indicates that fees for customs -related operations range between GEL 100 and GEL  400, 
depending on the value of the goods.  
Question:  
7. Could Georgia, please, clarify whether and how such customs fees comply with the requirements 
of Article VIII of the GATT 1994?  
 
Reply to Qu estion 7: The amount of customs fees are calculated by taking into account the 
necessity for infrastructural environment made available to economic operators as it is required for 
applicable customs procedures and operations. Upkeep and maintenance of Cust oms 
Clearance  Zones (which are specially designated areas equipped by necessary warehousing, parking 
and servicing facilities) along with additional services provided by clearance officers provides an 
alternative to customs brokers and private warehousing establishments while incurring the 
appropriate economic obligations. The arrangement greatly reduces the proliferation of corruption 
in customs authority while at the same time provides a more efficient option to the economic 
operators when it comes to cus toms related operation handling/clearance formality processing.  
 
3.1.5.2 Value added tax  
Pages 51 -52 (Para 3.44)  
The Report informs on VAT reform and its implications for cross -border trade in services. It is 
mentioned in Box 3.2 that the reform was aimed , inter alia , on facilitation of cross -border services, 
including e -commerce.  
Question:  
8. Could Georgia elucidate if there is a special VAT taxation regime for electronic services provided 
via the Internet by foreign suppliers (non -residents) that are not  registered as VAT payers in the 
territory of Georgia to residents (natural persons) of Georgia?  
 
Reply to Question 8: A special scheme was established for digitally supplied services starting 
from 1 October  2021.  Under this special scheme, a foreign taxable person, who is not established 
or has no habitual residence in Georgia, or has no fixed establishment in Georgia, providing digital 
services to natural persons in the territory of Georgia, shall report and pay Value Added Tax (VAT) 
on digit al services. With that end in view, the Georgian tax administration has designed a special 
platform for a simplified registration, reporting and payment - https://nr.rs.ge /. (the relevant details 
can be obtaine d on this platform/webpage)  
 WT/TPR/M/420/Add.1  
 
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  Page 52 (Para 3.45)  
According to the Report the list of goods exempted from VAT includes unprocessed agricultural goods 
produced in Georgia (except for eggs and poultry), as well as certain meat products and 
cheeses  made from l ocal inputs and animals living in Georgia.  
Questions:  
9. Could Georgia inform what additional preferences are provided in the agricultural sector, if any 
(for example, special VAT taxation regime), excluding VAT exemption for agricultural goods?  
 
Reply to Question 9 : Additional incentives applicable to the Agricultural sector are exemptions 
from income and profit taxes. Namely, pursuant to the Article 82 of the Tax Code of Georgia:  
"1. The following types of income of natural persons shall be exempt from in come tax: k) taxable 
income earned from the primary supply of agricultural products produced in Georgia by a natural 
person engaged in agricultural production until 1 January 2023 if the gross income earned by the 
natural person from such supply during the  calendar year does not exceed GEL 200 000;  
 
1) salary paid by a person engaged in agricultural production before 1 January 2023 within the scope 
of that activity, if the employer's gross income received from that activity does not exceed 
GEL 200 000;" And according to the Article 99 of the Tax Code of Georgia: "1. The following shall 
be exempt from profit tax:  
 
e) profit earned by a person engaged in agricultural production from the primary supply of 
agricultural products made in Georgia before their industrial processing (changing of commodity 
code) before 1 January 2018 or distribution of profit, and expenses incurred/disbursements made 
within the scope of the same activity that are provided for in Article 97(1)(b -d) of this Code  if the 
income gained from such supply during a calendar year does not exceed GEL 200 000;  
 
10. Would Georgia also share its view how VAT exemption, that depends on the goods` origin and 
applies for domestic agricultural products, corresponds with requirem ents of Article III of the 
GATT  1994?  
 
Reply to Question 10 : The purpose of VAT exemptions applicable to the domestic agricultural 
products was to promote domestic agricultural sector.  
 
3.1.5.3 Excise tax  
Page 53 (Para 3.48)  
The Report states, "During the review period, Georgia expanded the list of excisable goods and 
modified some its rates based on health 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) 
including 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 ". 
Question:  
11. Could Georgia inform if there is any possibility to be acquainted with full list of excisable goods 
in Georgia and its excise rates (please, provide a web -link with appropriate information in English, 
if possible)?  
 
Reply to Question 11 : This information is available on this weblink:  
https://matsne.gov.ge/ka/document/view/1043717?impose=translateEn&publication=175  
 
Page 53 (Para 3.49)  
Under the Report, Georgia also increased its excise tax on alcoholic beverages an d tobacco in  2015 
and 2016, and adopted a retail tax of 5% for cigarettes in addition to the existing excise tax. The 
excise tax applies to all alcoholic beverages except for wine (HS 2204), thus providing some 
additional support to this sector, which alre ady benefits from some tariff protection.  WT/TPR/M/420/Add.1  
 
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  Questions:  
12. Could Georgia kindly clarify if there is a difference in excise rates on filter and non -filter cigarettes 
according to its legislation?  
 
Reply to Question 12: There is no difference in excise rates o n filter and non -filter cigarettes.  
 
13. Would Georgia share its opinion regarding consideration of exemption from the excise tax for 
wine as additional support in favour of domestic wine producers, given that wine remained the 
largest export category in agriculture (6.3% of total merchandise exports in 2020)? Is Georgia going 
to notify such support measures to the WTO?  
 
Reply to Question 13: Wine is not subject to the excise tax since 2008.  
 
3.2 Measures Directly Affecting Exports  
3.2.4 Export support and promotion  
3.2.4.2 Free Industrial Zones  
Page 62 (Para 3.91)  
Under the Report, companies located in free industrial zones (FIZs) are exempted, inter alia , from 
duties on their imports. At the same time, the goods entirely produced within the FIZ and exported 
from FIZ to Georgia (i.e. outside the FIZ) are exempted f rom import duties.  
Question:  
14. Could Georgia, please, describe the mechanism for preventing the imports into the customs 
territory of Georgia of such duty -exempted imported goo ds or goods produced using them under 
the guise of the goods fully produced in FIZs?  
 
Reply to Question 14:  All FIZs  are subject to relevant Customs control ensuring the proper 
application of necessary customs processing operations as required. This is regulated  by the 
Government resolution N°.  263 issued on 13 August 2015.  
 
3.3 Measures Affecting Production and Trade  
3.3.1 Incentives  
3.3.1.1 Subsidies and incentives  
Pages 64 and 102 (Para 3.98 and Para 4.16)  
Under paragraph 3.98 of the Report, there were subsidies on production and imports of 
GEL 267.2  million in 2019, accounting for about 0.5% of GDP. The majority of s ubsidies on products 
(GEL 184 million ) was in the agricultural, forestry and fishing sector, and GEL 33.8 million was on 
imports.  
We kindly note that Georgia's last DS:1  notification for 2020 indicates a decrease in the support 
provided compared to 2019.  
Question:  
15. Given due regard to paragraphs 3.98 and 4.16 of the Report, could Georgia elaborate further on 
the types of subsidies provided and whether these measures were notified to the WTO?  
 
Reply to Question 15: Most of the measures had been notified under DS:1 notification to the 
WTO including in 2020. The types of subsidies provided can be seen on the following link: 
https://docs.wto.org/dol2fe/Pages/FE_Search/FE_S_S006.aspx?Query=(%20@Symbol=%20g/ag/
n/geo/*)&Language=ENGLISH&Context=FomerScriptedSearch&languageUIChanged=true#  
 WT/TPR/M/420/Add.1  
 
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  3.3.7 Inte llectual property rights  
Page 92 (Para 3.201)  
The Report mentions, that Georgia accepted the Protocol Amending the TRIPS  Agreement 
in November 2018.  
Question:  
16. Could Georgia kindly inform whether Georgia has changed its national legislation after the 
acceptance of the Protocol Amending the TRIPS Agreement in order to implement and to put its 
provisions in place (please, describe legislative amendments, if any)?  
 
Reply to Question 16:  Article 185 (Patents and public health) of the DCFTA Agreement provid es 
that the Parties recognize the importance of the Declaration on the TRIPS Agreement and 
Public  Health adopted on 14 November  2001 by Ministerial Conference of the WTO and that the 
Parties shall respect the Decision of the WTO General Council of 30 August  2003 on Paragraph  6 of 
the Declaration on the TRIPS Agreement and Public Health, and they shall contribute to its 
implementation.  
According to the above mentioned provision, one of the amendments applies to the Patent Law of 
Georgia which provides f or introduction of the compulsory licensing system in Georgia. Namely, in 
special cases, on the basis of the consent of competent authority, a compulsory license for use of a 
patented invention and/or utility model within the territory of Georgia may be gr anted. A decision 
on granting a compulsory license will be taken by the Standing Council which is created under the 
Ministry of Economy and Sustainable Development of Georgia. According to the Law, its structure is 
defined by the Resolution of the Governme nt of Georgia . 
 
3.3.7.1 Patents and utility models  
Page 93 (Para 3.205)  
Under the Report, "New Georgian legislation re -introduced compulsory licensing in the Patent Law 
in 2018 and since that period no compulsory licence has been requested. In conjunction with this 
change, the associated rules were approved  in Resolution N °. 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 De cision -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 ministr ies in addition to Sakpatenti".  
Questions:  
17. Could Georgia kindly inform on its reasons for the re -introduction of compulsory licensing in the 
Patent Law in 2018? Was the need for such re -introduction caused by the acceptance of the Protocol 
Amending the  TRIPS Agreement?  
 
Reply to Question 17:  The need for such re -introduction caused not only the acceptance of the 
Protocol Amending the TRIPS Agreement but the AA also addressed this issue.  
 
18. Ukraine would also appreciate if Georgia could shortly describe its procedure of compulsory 
licensing set out by Resolution N °. 586 of 17 September 2020, including main tasks of the Permanent 
Decision -making Board for Issuing Compulsory Licences (if available, please, provide a web -link to 
the text of the Reso lution in English).  
 
Reply to Question 18:  According to the resolution a decision on granting a compulsory license for 
the use of a patented invention and/or utility model (hereinafter – a compulsory license) is taken by 
the Standing Council in charge for taking a Decision on Granting a Compulsory License, functioning 
at the Ministry of Economy and Sustainable Development of Georgia. Members of the Standing 
Council are: Minister of Economy and Sustainable Development of Georgia; Minister of Defence  of 
Georg ia; Minister of Environment Protection and Agriculture of Georgia; Deputy head of the 
Administration of the Government of Georgia; Deputy Minister of Internal Affairs of Georgia; Deputy 
Minister of Internally Displaced Persons From the Occupied Territories , Labour, Health and Social 
Affairs of Georgia; Chairperson of National Intellectual Property Center of Georgia "Sakpatenti". Any 
natural person or legal person or governmental entity can submit a request for granting a compulsory 
license  to the Standing C ouncil. The applicant (the presumable recipient of the compulsory licensing) 
before requesting the license shall conduct prior negotiations in order to obtain authorization from 
the right holder on a patent. In the case of unsuccessful negotiations, an app licant is entitled to WT/TPR/M/420/Add.1  
 
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  submit a request to the Standing Council. Request for granting a compulsory license is submitted to 
the Ministry of Economy and Sustainable Development of Georgia or National Intellectual Property 
Center of Georgia "Sakpatenti". Withi n three working days after receiving a request for granting a 
compulsory license, relevant notification is sent to the right holder. Notification is sent before 
granting a compulsory license. It is possible to grant a compulsory license without notificatio n in the 
case of extreme urgency. Notification about granting the compulsory license is sent to the right 
holder on the patent immediately after granting the compulsory license. Request for granting a 
compulsory license is submitted to the Ministry of Econ omy and Sustainable Development of Georgia 
or National Intellectual Property Center of Georgia "Sakpatenti" Within three working days after 
receiving a request for granting a compulsory license, relevant notification is sent to the right holder. 
Notificati on is sent before granting a compulsory license. Within two months after submitting a 
request, Standing Council makes a decision about granting a compulsory license. In case of extreme 
urgency, Standing Council makes a decision about granting a compulsory license immediately. 
Standing Council shall make a decision in writing. Standing Council decides by majority of votes. 
Decision of the Standing Council shall be deemed adopted when 2/3 of the council members take 
part in the decision -making process. If one  of the members of the Standing Council requests the 
granting of the compulsory license, it shall not take part in decision -making process. Such 
governmental body should be replaced by other governmental institution in accordance with the 
decision of the S tanding Council. The decision of the Standing Council on granting the compulsory 
license enters into force upon its adoption. The decision of the Standing Council on granting the 
compulsory license is published immediately. The decision of the Standing Cou ncil on granting the 
compulsory license can be appealed in the court. Standing Council also makes a decision on the 
amount of the compensation. Once in two years owner of the compulsory license shall submit the 
evidence to the Standing Council proofing tha t the grounds for compulsory licensing still exist. 
Standing Council shall terminate the compulsory license if the circumstances that led to the grant of 
the license no longer exist.  
For further details please see the following link of the Resolution N°.  586 on Georgian language. - 
https://matsne.gov.ge/ka/document/view/4995577?publication=0  
 
4. TRADE POLICIES BY SECTOR  
4.1 Agriculture, Forestry, and Fisheries  
4.1.1 Agriculture  
4.1.1.3 Policy and support measures  
Page 101 (Para 4.13)  
The Report states, "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 create an environment that will 
increase competitiveness in agro -food sector, pro mote stable growth of high -quality agricultural 
production, ensure food safety and security, and eliminate rural poverty through sustainable 
development of agriculture and rural areas".  
Question:  
19. Could Georgia kindly elaborate on the results achieved during implementation of the Strategy 
for Agricultural Development in Georgia (2015 -20)? 
 
Reply to Question 19: In accordance with the targeted policy of Georgia's Agricultural 
Development Strategy 2015 -2020 the Strategy results of the Agriculture , Forestry and Fisheries 
sector are the following:  
 
• In 2020 compared to 2015 Gross output in Agriculture, Forestry and Fisheries sector 
increased by GEL 1.5 billion (35%) and amounted to GEL 5.8 billion. At the same time, the 
total output of products obtai ned from the processing of agricultural products increased by 
GEL 1.7 billion  (38%) and amounted to GEL 6.3 billion.  
• According to 2020, the Gross Domestic Product created in Agriculture, Forestry and Fisheries 
sector at current prices, is GEL 3.6 billion, which is GEL 939.3 million (35%) more than the 
same figures for 2015. According to 2020, the share of GDP created in Agriculture, Forestry 
and fisheries in GDP is 8.3%.  WT/TPR/M/420/Add.1  
 
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  • In the period of 2015 -2020, Gross Domestic Product in Agriculture, Forestry and Fisheri es 
sector per employee in the same sector increased by 65% and amounted to GEL 14,519.  
• The average monthly nominal earnings of employees in Agriculture, Forestry and Fisheries 
sector increased by GEL 231 (39%) in 2015 -2020 and amounted to GEL 819.  
• In the p eriod of 2015 -2020, the value of exports of agri -food products amounted to 
USD 942 million, which is USD 330 million (54%) higher than in 2015. During this period, 
the negative foreign trade balance of agri -food products decreased by 46%.  
Page 103 (Para 4. 19) 
The Report informs that the State Program for Support of Viticulture Agricultural Cooperatives 
provides grape processing and wine production equipment for cooperatives at subsidized prices. 
Under this Program, up to 90% of the equipment is financed  per certain conditions, but, as 
at September 2021, applications under the Program were suspended.  
Question:  
20. Could Georgia, please, explain why applications under the State Program for Support of 
Viticulture Agricultural Cooperatives were suspended?  
 
Reply  to Question 20: Nowadays the wine sector is quite developed and therefore, it was decided 
to suspend the mentioned State Program.  
 
Pages 103 -104 (Para 4.20)  
Table 4.5 presents information on the main support programmes on agriculture implemented during 
the review period. Agro Insurance is one of such programmes that aims to develop the insurance 
market in the agricultural sector, promote agricultural activitie s, retain the income for individuals 
employed in mentioned activities, and reduce risks.  
Questions:  
21. Did Georgia implement the agricultural insurance system with the state support?  
22. What are the procedure and form for its implementation?  
Replies to Q uestion 21 and 22: The Rural Development Agency implements a state 
agro-insurance program, which finances up to 5 ha (30 ha in the case of wheat) at 70% of 
the insurance policy of any crop (50% in the case of vines). The potential beneficiary applies to th e 
insurance companies involved in the program and enters into a contract, on the basis of 
which  he/she is automatically involved in the program.  
 
4.1.1.4 Key subsectors  
4.1.1.4.1 Wine  
Page 106 (paragraphs 4.29 and 4.30)  
Ukraine notes that Georgia`s wine industry exhibited significant increases in the production of 
grapes and strong value growth in wine exports during the period 2015 -2019 with a small decline in 
wine exports in 2020 compared to previous year.  
Question:  
23. Would Georgia, ple ase, provide information on the quantity of exports of wine that was produced  
under various state support programs and on the level of state budget outlays associated with each 
programs for the period 2015 -2020?  
 
Reply to Question 23: Georgia does not prov ided any type of subsidies on the export of wine. All 
the state programs aimed at wine promotion are notified to the WTO.  
 
PART II: QUESTIONS REGARDING THE REPORT  BY GEORGIA (WT/TPR/G/420)  
2 RECENT ECONOMIC DEVELOPMENTS AND REFORMS  
2.2 Agriculture  
Page 6 (Para 2.21)  
The Report alludes to the "Strategy for Agriculture and Rural Development in Georgia 2021 -27" and 
lists several strategy goals, one of which is adaptation to climate change.  WT/TPR/M/420/Add.1  
 
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  Question:  
24. Could Georgia, please, provide  data o n measures of programmes in the field of adaptation to 
climate change, if any, clarifying what funds are used or planned to be used to support 
implementation of this policy?  
 
Reply to Question 24 : Preparation of the National Adaptation Plan (NAP) of Georgi a is at an early 
stage. A project proposal for the NAP preparation was developed, with the help of UN  Environmental 
Programme (UNEP). For funding on the NAP preparations Georgia applied to Green Climate 
Fund (GCF).  
 
2.11 Intellectual Property Rights  
Page 1 5 (Para 2.96)  
The Report states, that Georgian legislation on IPR is moving towards the EU acquis  and a number 
of other EU norms are expected to be approximated  in the future.  
Question:  
25. Could Georgia, please, elaborate on the next steps envisaged by Georgia to approximate its 
legislation to the EU acquis  in the IP sphere?  
 
Reply to Question 25 :EU-Georgia DCFTA doesn't envisage legal approximation to EU's legal acts 
in the IPR sphere. on 23th of December 2017 Georgia adopted a package of legislative amendments 
drafted by Sakpatenti, which aimed strengthening the intellectual property protection measures and 
introduced their effective enforcement mechanisms. Namely, amendments were relat ed to the 
following legislative acts: Patent Law of Georgia; Trademark Law of Georgia; Law of Georgia on 
Copyright and Related Rights; Law of Georgia on Design; Law of Georgia on Drugs and 
Pharmaceutical Activity; Law of Georgia on Pesticides and Agrochemi cals; The Civil Procedure Code 
of Georgia. With these amendments Georgia fully met all the minimal standards envisaged by the 
Chapter 9 (Intellectual Property Rights) of the DCFTA.  
 
Furthermore, with an assistance of the European Union, Georgia is particip ating in the EU -Georgia 
Intellectual Property Project (EUGIPP). 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 reachin g an effective level of protection and enforcement of IP rights in 
accordance with the commitments of the DCFTA. An ongoing EUGIPP project is strengthening 
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.  
 
  WT/TPR/M/420/Add.1  
 
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  CANADA  
QUESTIONS REGARDING THE SECRETARIAT REPORT  
SUMMARY  
 
Page 8, Paragraph 6  
In July 2021,  the Government  presented  a 10-year economic  development  strategy,  Economy  2030.  
To maintain  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  constitutional  amendments  during  the period  
under  review.  
 
1. Does the development strategy, Economy 2030, include any programs or initiatives that 
focus on addressing and/or ensuring inclusive growth for  women -owned businesses or 
SMEs?  
 
Reply to Question 1: Women economic empowerment, being an essential prerequisite for inclusive 
and sustainable development, is one of the most significant directions in the Georgian 
Government's  economic policy agenda.  
Government of Georgia has taken important steps to ensure effective supporting mechanisms 
for further strengthening of women economic potential, including encouraging women 
entrepreneurship in order to enhance women contribution to the development and impr ovement of 
the country's  economic performance.  
High importance of the issue has become the determining factor of addressing women 
entrepreneurship as one of the strategic direction in the "Small and Medium Entrepreneurship 
Development Strategy of Georgia 2 021-2025"  adopted by the Government of Georgia.  
"Promotion of Women Entrepreneurship"  is a focused pillar and one of the main supported direction 
among priority directions envisaged by the Strategy.  
Under the priority direction  "Promotion of Women Entrepre neurship",  various targeted activities are 
provided and objectives need to be achieved are defined, including popularization of 
"Women  Empowerment Principles", Encouraging women participation in state programs, 
Strengthening digital skills of women entrepr eneurs, Support capacity development of state 
institutions for the development of gender -based approaches, etc.  
Page 9, Paragraph 8  
 
The Government recently launched several new initiatives that prioritize certain sectors for 
investment promotion and incen tives, based on criteria such as alignment with Georgia's overall 
economic strategy, export orientation, and contribution to knowledge and know -how. 
2. Does the Government  of Georgia  collect  sex disaggregated  data on these  sectors  that the 
government  has prioritized  invest ment towards ? 
 
Reply to Question 2:  National Statistics Office of Georgia (GEOSTAT) disseminates annual 
statistical publication "Women and Men in Georgia". Among various indicators related to gender 
statistics, the publication also contains data on number of newly registered business entities in 
Georgia by kind of economic activity and gender. The publication is available on the following link:  
https://www.geostat.ge/en/single -categories/115/gender -statistics . 
 
Page 10, Paragraph 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.  
3. Do women -owned  businesses  or SMEs  face any barriers  in accessing  these  programs?  
 
Reply  to Question  3: Similar to most other countries in the world, there are unique challenges that 
women entrepreneurs face, when examining business opportunities. For this reason, with the 
suppo rt of UN Women, Enterprise Georgia had developed a strategy to identify most pressing WT/TPR/M/420/Add.1  
 
- 73 - 
 
  challenges and address them accordingly. The title of the Strategy is "Strategy for Gender Equality 
and Action Plan" which can be seen  at the inserted document in Georgia n: 
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=t:/WT/TPR/M420A1 -03.docx  
 
The core principles of the Strategy are:  
 
✓ Empowerement and Protection of Gender Equality;  
✓ Prevention and Eradication of Discrimination including Sexual Harassment;  
 
One of the significant outcomes of this process has already been the achievement of 50%/50%  (male 
and female entrepreneurs) distribution in the micro grants program implemented by the agency. 
With this, the agency had begun collecting gender -segregated data for Enterprise 
Georgia's  programs, to identify other potential bottlenecks.  
 
Furthermore, in general, all t he programs are equally accessible for everyone and there are 
no separate rules or procedures for male or female entrepreneurs.  
 
4. As part of the development  strategy,  Georgia  has plans  to double  exports  in the next 
five years.  As it is the case, does Georgia  have plans  to develop  financial  support  
programmes  designed  specifically  for women -owned  businesses  or SMEs . 
 
Reply  to Question  4: The strategy developed through Enterprise Georgia with the support of 
UN women identified important issues as challenges for women entrepreneurs.  
For example, even though the micro grants program implemented by the agency provides a 
priority/bonus point to women entrepreneurs, the awareness about the micro -grants programs was 
relatively lower in women when compared to men. Thus, Enterprise Georgia worked closely with 
UN Women and regional women's issues focused association to raise aw areness about the grants 
program.  
 
One of the significant outcomes of this process has already been the achievement of 50%/50%  (male 
and female entrepreneurs) distribution in the micro grants program implemented by the agency.  
In accordance with this signi ficant result, at current stage it was decided to keep with the 
micro  grants program as it proved to be successful. This is a process that Enterprise Georgia 
monitors constantly and as more data and a specific need should arise, a consideration for tailore d 
program might be put on the table.  
 
PART 1 – ECONOMIC ENVIRONMENT: 1.1 – MAIN FEATURES OF THE ECONOMY  
 
Page 13, Paragraph 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.  
5. Does Georgia collect sex disaggregated  data on indicators related to economic growth such 
as the unemployment rate and poverty?  
Reply to Question 5 : National Statistics Office of Georgia collects and publishes data on 
unemployment and poverty disaggregated by sex. Most of the indicators subject to 
sex disaggregation are publicly available on the web site of National Statistic office of Georgia.  
The data is available at:  http://gender.geostat.ge/gender/index.php?lang=en . 
Page 13, Paragraph 1.4  
Georgia is expected  to focus on three key areas: enhancing inclusive growth and competitiveness, 
investing in human capital, and building resilience.  
6. How does Georgia  define  inclusive  growth?  
 
Reply  to Question  6: Inclusive  growth  is economic  growth  that is distributed  fairly across  society  
and creates  opportunities  for all. It is quite complex,  however,  if in line with economic  growth,  
poverty  rate and income  inequality  reduces,  it implies  on inclusive  growth.  That was a case in 
Georgia.  As well, economic  growth  before  the pandemic  was broad  based,  supported  by as domestic  
as well as external  demand.  WT/TPR/M/420/Add.1  
 
- 74 - 
 
  PART 2 - TRADE AND INVESTMENT REGIME: 2.3 – TRADE AGREEMENTS AND 
ARRANGEMENTS  
 
Page 32, Paragraph 2.2  
The report notes Geor gia's engagement in the Joint Statement Initiatives on micro, small and 
medium -sized enterprises, reporting as well the adoption of a strategic document on the 
development of SMEs, which stipulates a detailed action plan and scope of activities. In respect  of 
the SME segment of Georgia's business community:  
 
7. How are SMEs (MSMEs) defined for the purposes of statistical and policy analysis?  
 
Reply to Question 7 : Since 2017 size of enterprises is determined by the following methodology:  
 
✓ Small size enterprises are all enterprises of organizational -legal form, where average annual 
number of employed does not exceed 50 persons and average annual 
turnover  – GEL 12 million;  
✓ Medium size enterprises are all enterprises of organizational -legal form, where 
average  annual number of employed ranges from 50 to 250 persons or average annual 
turnover  – from GEL 12 million to GEL 60 million;  
 
Large enterprise is an enterprise, where average annual number of employed exceeds 249  persons 
or volume of average annual t urnover - GEL 60 million.  
 
For the purposes of Enterprise Georgia's programs, an SME is defined as an entity that belongs to 
third and fourth category in IFRS standard (accounting standard), more precisely an entity which 
does not have turnover of more tha n USD 7 mln. per year.  
 
8. Please provide any readily available statistics on the role of SMEs in Georgia's economy and 
participation in international trade: (i) total number of SMEs in Georgia; (ii)  percentage of 
businesses that are SMEs; (iii) employment profile of SMEs, e.g. percentage of total 
employment generated by SMEs; (iv) export and imports by SMEs, e.g. percentage of all 
exports and imports for SMEs, total number of SMEs that are exporting and importing.  
 
9. Does Georgia collect statistics  on SME ownership by diverse groups (e.g., women, 
youth,  etc.)? If so, please provide this information.  
 
Replies to Questions 8 and 9:  
Statistical data on SMEs produced by National Statistics Office of Georgia (GEOSTAT) are presented 
in the enclosed MS. Excel files as follows:  
 
✓ File "Business sector" – turnover, production value, value added, number of employed 
persons, number of active enterprises by types of economic activities and size;  
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=t:/WT/TPR/M420A1 -
04.xlsx  
✓ File "Business Register" - number of business entities by gender of founders and size; 
number of founders/partners of bus iness entities by gender and size of enterprises; number 
of SMEs by kind of economic activities and size; number of founders of business entities 
registered in Georgia aged  15-29; 
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=t:/WT/TPR/M420A1 -
05.xlsx  
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=t:/WT/TPR/M420A1 -
06.xlsx  
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=t:/WT/TPR/M420A1 -07.xls  
✓ File "External traders" – number of external traders of Georgia by size classes;  
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=t:/WT/TPR/M420A1 -
08.xlsx  WT/TPR/M/420/Add.1  
 
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  ✓ File "Import -size" – data on imports of Georgia by size classes of traders;  
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=t:/WT/TPR/M420A1 -
09.xlsx  
✓ File "Export -size" - data on exports of Georgia by size classes of traders.  
https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=t:/WT/TPR/M420A1 -
10.xlsx  
 
10. Does Georgia include provisions in its Regional Trade Agreements in support of SMEs in 
cross-border trade, e.g. cooperation, investment? If so, please provide an overview of these 
provisions.  
 
Reply to Question 10 : Georgia hasn't included any provision in support of SMEs in cross-border 
trade in its RTAs.  
 
PART 3 – TRADE POLICIES AND PRACTICES BY MEASURE: 3.2 – MEASURES DIRECTLY 
AFFECTING EXPORTS  
 
Page 63, paragraph  3.96 
It is noted  that the Economic Development Strategy (2020 -2030) includes future plans  by Georgia 
to introdu ce export -oriented and import -substitution support mechanisms in the form of subsidized 
interest rates on loans and leases, credit guarantees and grants.  
 
11. Could Georgia provide more detail on these support mechanisms, including whether there 
is a timeline for implementing these policies? Will they be limited to certain sectors?  
 
Reply to Question 11 : Starting from 2022, LEPL Enterprise Georgia will implement new program 
aimed at supporting enhancing export potential of Georgian companies.  
The program entails following major components:  
a) Product Licensing/Certification;  
Under this component the program will support the companies to conduct Enterprise audit, 
obtain international certificate and/or licensing of produced goods.  
b) Branding/Product Packaging;  
The companies will be supported to create brand and develop strategy (vizualization – name, 
logo, brandbook, corporate colors, fonts, creation of brand's message box including slogans).  
c) Entry fee to international chains;  
The companies will be provided with subsidy to enter in international chains, which operate 
in minimum 3 countries and/or has more than 50 branches in one country.  
 
Companies of the following sectors are eligible to participate in this program: Clothing, Leather and 
leather goods, shoes, toy s, production of ready -made animal feed, furniture production, 
manufacture of jewellery and related goods, manufacture of artificial jewellery and related articles, 
packaging materials.  
At the end of 2021, Enterprise Georgia introduced a new program named "Business Export" the 
program has identified over 50 NACE codes (economic activities), which are considered to be 
important as export products, the program participants can take advantage of three support 
mechanisms jointly: credit co -financing, cred it guarantee, and grant, the program offer support on 
loans issued by commercial banks from USD 17,000 to USD 3.3 milion (loans can only be issued 
in GEL). The program is only available for companies that belong to third and fourth category by 
IFRS standar d (having less than USD 7 milion. in turnover). Full list of sectors supported under the 
program can be found on the link below:  
http://www.enterprisegeorgia.gov.ge/files/1/eng%20 -%209.pdf  
More details about the program on the link below:  
http://www.enterprisegeorgia.gov.ge/en/business -development/business -export  
 
12. How would these supports dif fer from the ones currently provided by Enterprise Georgia or 
the Produce in Georgia program?  
 
Reply to Question 12 : Before this point, Enterprise Georgia was able to provide loan co -financing 
and credit guarantee mechanism separately for companies. Through this new program, companies WT/TPR/M/420/Add.1  
 
- 76 - 
 
  can take advantage of both co -financing and credit guarantee mechanisms at the same tim e, as well 
as be eligible for a grant.  
 
PART 3 – TRADE POLICIES AND PRACTICES BY MEASURE: 3.3 – MEASURES AFFECTING 
PRODCUTION AND TRADE  
Page 66, Paragraph 3.104  
It is noted  that the Universal Industrial 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.  
 
13. Can Georgia elaborate on the priority e conomic activities as it relates to export 
pportunities?  
 
Reply to Question 13 : Full list of sectors supported under the program (Business 
Universal - Export) for export opportunities can be found on the link below:  
http://www.enterprisegeorgia.gov.ge/files/1/eng%20 -%209.pdf  
 
14. What is the eligibility criteria tor receiving funding under the program?  
 
Reply to Question 14 : Eligibility  criteria  for receiving  funding  include:  
As the program  is a loan co-financing  mechanism,  the company  need to get a loan from a commercial  
bank in Georgia  in Georgian  currency  (Lari),  with this: 
 
• Economic  activity  should  be included  in the list of priorities  approved  by the Government  of 
Georgia  under  this program  (around  50 economic  activates  are approved);  
• An entity  shall meet the requirements  towards  the 3rd or 4th category  enterprises  according  to 
the Law of Georgia  on Accounting,  Reporting  and Auditing  only in the revenue  
component  (not having  turnover  of more than USD 7 milion. annually);  
• The borrower's  total obligations  (at the time of borrowing)  shall not exceed  GEL 12 million;  
• All beneficiaries  are obliged  to ensure  unimpeded  access  of persons  with disabilities  to 
administrative  building  using  ramps  and/or  similar  facilities.  
Page 70, Paragraph  3.122  
It is noted that "[i]n order to have a recognized standard in Georgia, a draft standard can be 
developed by any interested person. They 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 t he relevant TC, which 
would decide by consensus on the appropriateness of the standard" . 
 
15. Could Georgia explain how standards developed by any interested person may be developed 
in accordance with the provisions of TBT Agreement's Annex 3, Code of Good Pra ctice for 
the Preparation, Adoption, and Application of Standards?  
 
Reply to Question 15 : National legislations allow  all types of stakeholders (NGO, Industry and 
commerce, Consumer and trade federations, scientific sectors/academies, public sector, standards 
users, etc.) to submit proposal for development of pure national standard. Submitted proposal is 
assessed by GEOSTM and relevant TCs according to the requirements of the Code of Good 
Practice,  Annex 3 WTO "TBT Agreement". Thus, for avoiding dupli cation and ensuring fulfillment of 
the requirements of "Code of Good Practice" the evaluation of the scope of the proposal with 
published international or regional standards is carried out. If the existing standards (or  their drafts) 
are similar to the sco pe of the proposal, the national standard development will not continue.  
If relevant International or regional standards do not exist or the existing ones are ineffective for 
the some reasons (country's climatic, geographical or fundamental technological f actors, etc.), pure 
national standard development will proceed in respective standardization technical committee.  
Information about adopted standards are promptly published on the Georgian standards electronic 
platform (sst.geostm.gov.ge).  
At the same time  for increasing stakeholders  involvement GEOSTM periodically publishes 
standardization work programmes.  
 WT/TPR/M/420/Add.1  
 
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  PART 3 – TRADE POLICIES AND PRACTICES BY MEASURE: 3.3.3 – SANITARY AND 
PHYTOSANITARY REQUIREMENTS  
Pages 73 to 77, Paragraphs 3.136 to 3.153  
The report notes the main legislation covering SPS measures, including legislation relating to 
sanitary and phytosanitary measures and the main sanitary and phytosanitary requirements and 
procedures.  
 
16. Does Georgia have any planned upcoming sanitary and phytosanitary regulatory initiatives 
not referenced in the TPR reports?  
 
Reply to Question 16 : Georgia has an obligation to approximate its SPS legislation with EU  acquis  
in line with EU -Georgia DCFTA Annex 11b. Further details can be found on the following link: 
http://dcfta.economy.ge/assets/uploads/agreement/sanitary/ANNEX%20IV -XII.PDF  
 
PART 3 – TRADE POLICIES AND PRACTICES BY MEASURE: 3.3.6 - GOVERNMENT 
PROCUREMENT  
Page 90, Paragraph 3.193  
It is noted  that Georgia's process to accede to the GPA has essentially stalled as not all questions 
from GPA parties on Georgia's initial offer have been replied  to and no further offers have been 
made . 
 
17. Does Georgia have any intention  or plans to become a full party to the GPA and, if not, would 
Georgia be able to share the reasoning behind its desire not to accede to the GPA?  
 
Reply to Question 17: We reiterate Georgia's strong adherence to its commitments undertaken 
within the WTO ac cession process and reassure the GPA members in Georgia's interest to continue 
the negotiations for membership in the WTO Government Procurement Agreement, as set out in the 
Working Party Report on Georgia's accession to the WTO.  
 
The Free Trade Agreement between Georgia and EFTA countries, which was signed in June  2016 and 
entered into force for Georgia on 1 September 2017, contains a special chapter devoted to 
government procurement, the provisions of which, are primarily based on WTO GPA agreement. 
Accor dingly, the government procurement provisions with EFTA countries are fully enforceable on 
the territory of Georgia.  
 
On 21  February  2020, draft amendments to the Public Procurement Law were submitted to the 
Parliament of Georgia for adoption, which provid e for the establishment of an independent and 
impartial administrative review body in Georgia's public procurement system. Those legislative 
changes aim to meet Georgia's obligations under the EU – Georgia Association Agenda (AA), whereas 
the public procur ement represents an important area to be addressed.  
 
The draft Law on Public Procurement has been prepared by Georgian side in close collaboration with 
EU experts aimed at ensuring full approximation of Georgia's public procurement landscape with 
latest EU  public procurement directives thus entailing full compliance with the provisions of 
WTO revised GPA text. The draft law will be submitted to the Parliament soon.  
 
For the last 10 years Georgia's entire public procurement transactions are being carried out  through 
electronic procurement platform and only in 2019, 1 977 companies from 77 countries have enjoyed 
unrestricted access to Georgia's open and liberal public procurement market.  
 
Currently, there are internal discussions to re -activate Georgia's stall ed GPA accession negotiations.  
 
PART 3 - TRADE POLICIES AND PRACTICES BY MEASURE: INTELLECTUAL PROPERTY 
RIGHTS (IPRs)  
Page 91, Paragraph 3.198  
 
The Secretariat Report describes the Twinning Project, a project done in cooperation with the 
European Union "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" . Launched in November 2019,  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 WT/TPR/M/420/Add.1  
 
- 78 - 
 
  strengthen capacity of the local stakeholders a nd national institutions to implement and adopt 
EU best practices".  
 
18. Can Georgia offer any additional information on how this project has progressed since its 
inception in 2019?  
 
Reply to Question 18 : The work performed during the project has delivered a huge array of legal 
documents, amendments to the primary and secondary legislation, technical materials, guidelines, 
recommendations, etc.  
The primary beneficiary of the project - Georgian National Intellectual Property Center Sakpatenti 
along with other stakeholders and representatives of the private sector started the adoption and 
practical implementation process. However, the pandemic situation, which affected the whole world, 
has changed the timeline of the project implementation process.  
In order to achieve the goals of the project several actions are ongoing. The first step is adoption of 
the amendments to the Law on Appellations of Origin of Goods and Geographical Indications.  
The draft law is currently undergoing the internal procedures i n the relevant ministries of the 
Government of Georgia. This fundamental step would pave the way for the adoption of remaining 
primary and secondary normative acts, which will enable the Geographical Indications system to be 
operational according to the EU  standards in Georgia.  
In parallel, in the format of working groups with relevant stakeholders and representatives of the 
private sector, all actions will be taken gradually in order to start practical implementation of 
GI control mechanisms, as well as pl anning the further activities to increase the role of 
GI Associations and continue raising knowledge and corresponding skills in relevant public sector.  
Additional activities, namely, training of producers, public awareness raising campaigns, etc. have 
been provided in order to increase the involvement of the private sector (GI producers, farmers  etc.). 
Yet, expected result of an increased awareness raising activities about the GI control mechanisms 
and the management of existing GIs by the  private sector, provided within the project is to enhance 
private sectors' interest and capacity to manage GI assets and to take over the role of GI protection 
from the state.  
 
19. Has Georgia gathered any preliminary data, or received any feedback from stakeholders 
on this i nitiative?  
 
Reply to Question 19 : Before starting of this project, relevant information was gathered from both 
the representatives of the private and public sector. Based on this information and needs Georgian 
Government asked for the assistance to EU to f inance specific project regarding development of the 
Geographical Indications system in Georgia. All these programs which are aimed at developing of 
the spheres of the Intellectual Property are specially tailored for the needs of the users and feedback 
received from them is of utmost importance for the Government of Georgia and the project's primary 
beneficiary Georgian National Intellectual Property Center Sakpatenti.  
 
PART 4. - TRADE POLICIES BY SECTOR: 4.1 – AGRICULTURE, FORESTRY, AND FISHERIES  
 
Page 102 , Paragraph 4.17  
The Secretariat Report discusses the agricultural component to the Produce in Georgia Program, 
which gives loans to start -up enterprises in various agricultural industries.  
 
20. Can Georgia share, in total, how much money the Produce in Georgi a Program provided in 
loans to agricultural enterprises during the review period and provide the allocation to the 
different sectors mentioned in the report?  
 
Reply to Question 20 : Please see : 
Year/Sector  Number of loans 
issued by the banks  Amount of the loan  
2016  2 5,047,076  
Processing of vegetables  1 1,501,045  
Storage refrigerators  1 3,546,031  
2017  6 15,723,181  
Processing of vegetables  1 1,136,431  
Fish processing  1 3,594,100  
Animal husbandry  1 3,000,000  WT/TPR/M/420/Add.1  
 
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  Year/Sector  Number of loans 
issued by the banks  Amount of the loan  
Storage refrigerators  1 1,700,000  
mixed  1 5,000,000  
Animal feed production  1 1,292,650  
2018  3 8,493,442  
Gardening  1 4,224,442  
Storage refrigerators  1 2,700,000  
Fruit processing  1 1,569,000  
2019  9 36,623,782  
Oil production  1 5,000,000  
Gardening  2 7,605,442  
Viticulture  4 15,131,877  
Poultry sector  1 5,000,000  
Storage refrigerators  1 3,886,463  
2020  25 100,769,992  
Fish processing  2 10,000,000  
Production of brandy  1 1,510,000  
Production of pasta  1 2,400,000  
Pig production  1 8,900,000  
Bred products  3 10,500,000  
Milk processing  1 3,165,000  
Winemaking  8 19,374,346  
Mixed  6 28,920,646  
Animal feed production  1 6,000,000  
Meat processing  1 10,000,000  
Total  45 166,657,474  
 
Page 103, Paragraph 4.18  
The Secretariat Report states that support via subsidies under the Plant the Future Initiative varies 
by crop.  
 
21. Can Georgia clarify how the level of support per crop is determined?  
 
Reply to Question 21 : The several state agencies are involved in this process, the 
Scientific -Research Center of MEPA determines the minimum number of seedlings per  hectar 
according to the crops and the price is determined by the Levan Samkharauli National Forensics 
Bureau.This is regulated by Government Resolution N°. 56 of 12 February  2015, which can be seen 
on the link below:  
https://www.matsne.gov.ge/document/view/5184246?publication=0  
 
PART 4. - TRADE POLICIES BY SECTOR: 4.2 – MINING AND ENERGY  
Page 114, Paragraph 4.60  
The report states that 45% of Georgia's energy source is natural gas, followed by oil products at  26% 
and hydropower at 15%. Georgia's main priority is to increase energy security and gradually reduce 
its dependence on energy imports through  maximizing the use of internal resources and promoting 
greater investment in the energy sector.  
 
22. Can Georgia provide information on how they plan to offset the emissions generated through 
their various energy sources in reference to their recent commitmen ts made at COP26, to 
reduce their greenhouse gas emissions levels by 2030 by 50% of 1990 levels?  
 
Reply to Question 22 : Georgia is fully committed to an unconditional limiting target of 35% below 
the 1990 level of its domestic total greenhouse gas emission s by 2030 and to a conditional target 
of 50-57% of its total greenhouse gas emissions by 2030 compared to 1990, in case of international 
support. Thus, 50% reduction is a conditional target of Georgia reflected in the updated NDC of the 
country.  
Moreover, Georgia has started development of a Climate Finance Roadmap for NDC that will identify 
the required financial needs and pinpoint the specific projects to support the achievement of 
NDC's  conditional commitments.  WT/TPR/M/420/Add.1  
 
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  PART 4 . - TRADE POLICIES BY SECTOR: 4.1 – SERVICES  
Page 126, Paragraph  4.109   
The Corporate Governance Code for Commercial Banks is desi gned to follow internationally accepted 
requirements and standards, including regarding the composition of a bank's supervisory board, 
ensuring the inclusion of independent members and maintaining gender balance.  
 
23. Can Georgia  provide  additional  information  on the implementation  of the Corporate  
Governance  Code for Commercial  banks  on gender  balance  in the composition  of the bank's  
supervisory  board?  
 
Reply to Question 23:  In September 2018, NBG has approved the Regulation on Corporate 
Governance Code for Commercial Banks in line with Basel Standards and EU dire ctives (including 
board representation and requirements, remuneration standards, risk management etc.). Relevant 
amendments were done in 2021 in the Code to strengthen board independence criteria. Together 
with other standards, the Code prescribes that at least 20% (minimum 1 member) of the supervisory 
board should consist of opposite gender members that is successfully implemented by the banking 
sector that ensures gender diversity in the sector. Moreover internationally active banks strive to be 
compliant  with market best practice and compose more gender diverse boards - including at 
least 30% female members.  
 
24. Can Georgia  share  some  of the achievements  of the Corporative  Governance  Code regarding  
ensuring  more diverse  representation  in the banks'  supervisory  boards?  
 
Reply to Question 24: Accord ing to the Corporate Governance Code a bank should ensure that the 
Supervisory Board is staffed in such a way that maintains a balance of diversity of opinion. This 
means staffing the board with people with different skills, qualifications, and experience.  In practice, 
gender diversity has been more or less provided but the challenges still exist in these terms. In other 
terms considering the increasing importance of ESG and FinTech, banks are attracting new board 
members with relevant qualifications.  
 
25. Moving  forward,  how does Georgia  plan to integrate  these  gender  balance  policies  in 
other  sectors?  
 
Reply to Question 25: The process of elaboration of the second national human rights strategy is 
now being finished. It is priority to take the gender equality aspects into account in the 
various directions that the strategy addresses when drafting this document. The strategy represents 
the principal document defining the country's human rights policy. After its adoption,  the priorities 
reflected in the strategy will have to be fulfilled mandat orily. That in turn implies the reflection of 
the certain principles in the work of the state agencies and their labour protocols/regulatory acts.  
 
QUESTIONS  REGARDING  THE GOVERNMENT  OF GEORGIA  REPORT  
INTRODUCTION  
Page 3, Paragraph  1.6 
 
Strategic  document  – Government  Program  2021-24 – Toward  Building  a European  State  – adopted  
in December  2020,  among  other  vital issues,  concentrates  on economic  development,  in particular  
with the challenges  posed  in the aftermath  of COVID -19 pandemic.  
 
26. Many  of the vulnerable  groups  including  women  and SMEs  have been disproportionately  
affected  by the COVID -19 pandemic.  As one of the objectives  of the Government  Program  
2021-24 is to address  challenges  posed  in the aftermath  of the pandemic,  does Toward  
Building  an European  State  include  a gender  perspective?  Are there  any other  perspectives  
incorporated  to address  those  who are more vulnerable  in the face of the on-going  
pandemic?  
 
Reply  to Question  26: Government Program 2021 -24 – Toward Building a European State 
highlights that the measures will be taken to strengthen gender equality in every area of social life. 
Rapid and effective response will be provided to every case of gender -based challenges  
 
The Document also stresses the importance of taking effective measures to continue toward the 
implementation of the right to equality and to eliminate all forms of discrimination. These measures 
refer to all vulnerable groups that might have been more severely affected by the Pandemic including WT/TPR/M/420/Add.1  
 
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  children, persons with disabilities, social worker s and etc. For more details please see the link to the 
Document:  https://www.gov.ge/files/41_78149_280277_GP.pdf  
 
27. If so, can Georgia  provide  more information  on these  initiatives  and policies  included  in 
Toward  Building  a European  State?  
 
Reply  to Question  27: Further details on the initiatives and policies can be seen on the following 
link: https://www.gov.ge/files/41_78149_280277_GP.pdf  
 
  WT/TPR/M/420/Add.1  
 
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  JAPAN  
Report by the Secretariat  
2 TRADE AND INVESTMENT REGIMES  
2.3 Trade Agreements and Arr angements  
2.3.1 WTO  
 
Q1. Paragraph 2.2 (Page 32)  
Japan would like to further hear  from Georgia on its engagement with regard to the Joint Statement 
Initiatives on services domestic regulation.  
Reply: Georgia positively considers the accession to this Initiative. Currently, there are internal 
discussions underway and presumably, we will have our decision in the near future.  
 
3. TRADE POLICIES AND PRACTICES BY MEASURE  
3.1 Measures Directly Affecting Imports  
3.1.4 Tariff exemptions and reductions  
 
Q2. Par agraph 3.37 (Page 48)  
In order to ensure predictability for investors, Japan would like to request Georgia to provide with 
the details regarding its plan and timeline of emission regulation that will be strengthened  up 
to EURO 5 and its system to inform it to the investors.  
Reply: According to the 2021 -2023 Action Plan of Georgia 's 2030 Climate Strategy, emission 
standards for vehicles will be set before the end of 2022. The relevant technical regulation, which 
aims to introduce EURO 5 standards for vehicles and set restrictions for import of improper vehicles, 
has been developed  and is being discussed  with stakeholders. Tentative target year for entering the 
new regulation into force is considered  to be 2024 . Interested parties from private sectors such as 
Business Association of Georgia, as well as Japanese company Toyota Caucasus  and other 
car importers are well informed and consulted on the upcoming legislation.  
3.3 Measures Affecting Production and Trade  
3.3.6 Government procurement  
 
Q3. Paragraph 3.182 (Page 85)  
According to the Report by the Secretariat, the 2005 Law of Georgi a on State Procurement has 
undergone regular updating with 79 sets of amendments.  
If there are any amendments , which intend to promote Quality Infrastructure Investment, 
could  Georgia explain it?  
Reply:  SPA 
According to the amendment to the law of May 21, 2020 on "State Procurement ", one of the basis 
of the law was determined by the newly adopted law on "Energy Efficiency ". Law on 
"Energy  Efficiency " states that "The Legal entity - State Procurement Agency sh all elaborate rules 
and guidelines on implementation of Energy Efficiency in the public procurement, considering 
consistency with cost -effectiveness, economical feasibility, wider sustainability, technical suitability, 
as well as sufficient competition " and the work by the SPA on the elaboration of rules and guidelines 
is underway.  
3.3.7 Intellectual property rights  
Q4. Paragraph 3.222 (Page 96)  
According to Table 3.29, the number of counterfeit goods detected by the Investigation Service of 
the Ministry of Finance in 2020 is significantly higher than the numbers in 2017 -2019. What is the 
reason for such significant increase?  
Reply: There has been no increase in the number of cases in 2020. The increase in numbers of the 
counterfeited goods were pr econditioned by the number of packages and labels seized.  WT/TPR/M/420/Add.1  
 
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  4. TRADE POLICIES BY SECTOR  
4.1 Agriculture, Forestry, and Fisheries  
4.1.5 Forestry  
 
Q5 Table 4.7 (page. 108)  
Table 4.7 of the report describes the volume of "Illegally obtained wood " and the number of "Illegal 
logging violations ". 
Please provide the following information.  
1. How the government identified these volume and number of violations.  
2. Measures taken by the government to address the illegal logging.  
Reply:  Environmental Supervision Department of MEPA ensures implementation of state control 
over the use of environmental and natural resources. The main objectives of the Department are 
prevention, d etection, and elimination of illegal use of natural resources including forest resources.  
For the purpose of fulfilling the functions under the legislation, the Department has the right to make 
up the administrative protocol, discuss the administrative law  cases and to adopt a resolution 
imposing an administrative punishment, determine (calculate) the damage caused to the 
environment, the claim for damages or violation of protocol, in case of detecting the criminal offense 
marks, send the case materials to relevant bodies;  
Type of violations are defined by the Laws of administrative code and criminal code. The Department 
provides planned and unplanned inspections, environmental patrol, and urgent response is provided  
to prevent, detect and eliminate illegal use of natural resources including forest resources.  
Increasing capacity of the Department (equipment, training, improving working conditions, use of 
new technologies)  
• Control of timber extraction, transportation, and processing sites (sawmills).  
• Creat ing alternative heating sources, such as making briquettes, gasifying village.  
Q6 Paragraph 4.39, 4.40 (page. 109)  
According to para 4.39 and 4.40, the Forest Code entered into force on 1 January 2021 and the new 
development strategy and action plan were established  in June 2021.  
Please explain how these Code, strategy and action plan provide for securing timber legality and 
combatting illegal logging.  
Reply:  According to the Forest Code of Georgia, timber production and transportation by the forest 
managem ent body will be carried out directly, or through state procurement of relevant services. 
Accordingly, it is forbidden for other persons to enter the forest in order to produce timber. This 
approach ensures that the violation is easily detected, which will  make it more effective to control 
the illegal extraction of timber in the forest.  
In order to implement the principles of sustainable forest management of Georgia 
(before  1 January  2025), the forest management body shall ensure an annual increase in the 
number of foresters in such a way as to ensure the exercise of authority in the forest by at least 1 
person on no more than 3500 ha, including the issuance of a relevant administrative offence protocol 
to the offender in the event of an administrative offence. This innovation provides for more effective 
protection and control of the forest.  
The new Forest Code makes it possible to implement multi -purpose forest use, such as: commercial 
production of non -timber forest resources, use of forests for recrea tional and resort purposes, etc. 
A similar approach would provide a source of additional income for the local population, with the 
emergence of new revenues from the forest,which will have positive effect on the reduction of 
illegal  logging.  WT/TPR/M/420/Add.1  
 
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  The state cont rol in the field of forest protection of Georgia is exercised by the Department of 
Environmental Supervision under the Ministry of Environmental Protection and Agriculture. In order 
to improve the state environmental control, the following measures were ta ken: 
• Criminal liability introduced ; 
• Unregistered (illegal) sawmill for arranging a workshop;  
• After illegal logging or repeated violations of transportation rules;  
• For illegal cutting of trees and plants protected by the Red List of Georgia;  
• Tightening requirements for sawmills (to take effect in 2020) ; 
• Requirements for sawmill placement have been tightened ; 
• Introduction of electronic timber control mechanisms ; 
• Existing electronic timber control mechanisms will be improved;  
• Strengthen the capacity of the Department of Environmental Supervision ; 
• Environmental Patrol and Rapid Response Crews Increased to Cover All Municipalities ; 
• Specialized units for forest patrolling have been set up ; 
• Provide the necessary measures for effective functioning . 
  WT/TPR/M/420/Add.1  
 
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  TURKEY  
THE GOVERNMENT REPORT  
 
2.5 Transport  
2.46. Georgia has achieved significant progress in a wide area of road transport related activities 
in the course of implementation of the DCFTA. In particular, Georgia has implemented the legislation 
concerning the carriage of dangerous goods, reinstated periodic technical inspection of vehicles, 
introduced EU requirements concerning the weights and dimens ion 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 ECMT, BSEC and TRACECA permit systems.  
2.47. In total, Georgia has 31 bilateral road transport agreements. Since 2015, bilater al agreements 
on international road transport have been concluded with Bosnia and Herzegovina, China, Estonia, 
Kazakhstan, Slovenia, Slovakia, and Turkmenistan. Georgia is also party to three international road 
conventions.  p.9 
Question: Georgia has MFN Exe mption List under GATS; however Georgia 's commitments of 
Freight  transportation Services (CPC 7123) under its Schedule of Specific Commitment is "none". 
Could  Georgia explain if these bilateral road agreements on transport are compatible with their 
Schedul e of Specific Commitments? If yes, on which ground?  
Reply:  Georgia abides to the commitments taken under the World Trade Organization including the 
Freight transportation Services (CPC 7123). It is important to mention that Georgia has listed 
exemption rel ated to Bilateral road transport agreements on the basis of reciprocity, which allow the 
respective countries to carry out international transportation of passengers and cargo. This 
agreements are focused on Improvement of relations in transport sector, pr otection of environment, 
regulation of traffic rights and increase road safety on the territory of Georgia. In addition to this as 
Bilateral road transport agreements level playing field for local and the other party of the agreement 
and as World Trade Org anization is thriving to allow member countries for fair conditions there is no 
discrepancy between these two. Moreover, so far we have signed above mentioned agreements with 
more than 30 countries which are also members of the World Trade Organization.  
2.6 Telecommunication, Innovation and Technology Development  
2.55. The adoption of the Law of Georgia on Information Technology Zones resulted the creation of 
an attractive environment for persons carrying out the economic activities in the field of Inform ation 
Technology. Acquiring virtual zone person status is needed to start activates in the IT virtual zones. 
Since software product is created, status holders will be exempted from: i)  Profit tax on product 
deliveries outside of Georgia; ii) VAT on product  deliveries outside of Georgia; iii)  Export tax for 
export leaving Georgian customs territory.  p.10 
Question: Could Georgia provide detailed information and requirements of the status of virtual zone 
person?  
Reply:  The status of a virtual zone person is granted to an interested person by  the LEPL Financial 
Analytical Service of the Ministry of Finance of Georgia within 10 working days from the submission 
of the application. Electronic application should be submitted through the Electronic Declaration 
system (www.newzone.mof.ge ). 
 
TAn electronic certificate that proves the status of virtual zone person shall be issued not later 
than two working days after the status of a virtual zone person is granted.  
Activities in the virtual zone shall comprise the economic activities of legal persons (Including foreign 
entities registered in Georgia)  related to the production of IT products in the te rritory of Georgia.  
 WT/TPR/M/420/Add.1  
 
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  2.7 Technical Barriers to Trade, pg. 11, 2.70  
 
It is stated  in the Government Report that  "Important reforms have been carried out regarding the 
establishment of the market surveillance system on non -food products. At first, market sur veillance 
in Georgia was conducted by the LEPL Technical and Construction Supervision Agency. In  2018, 
relevant amendments have been introduced in the Law of Georgia Product Safety and 
Free Movement Code, prescribing principal market surveillance procedure s". 
 
Question:  Could Georgia explain why food products are not in the scope of the Market Surveillance 
Agency  (MSA) inspections?  
 
Reply:  According to the Food/Animal Feed Safety, Veterinary and Plant Protection Code of Georgia  
the LEPL National Food Agency is a responsible entity that carries out state control of food/animal 
feed safety, veterinary state control and phytosanitary state control. Thus, inspection on food 
products is under the National Food Agency.  
 
2.7 Technical Barriers to Trade, pg. 1 2, 2.71  
 
It is stated  in the Government Report that  "In the beginning of 2020, due to the importance of the 
field, the sole responsible authority for market surveillance – the Market Surveillance Agency  (MSA ) 
was established under the Ministry of Economy and Sustainable Development of Georgia. The 
mission of the MSA is to prevent and ensure that hazardous products are not placed on 
Georgia's  Market in order to protect the health and safety of citizens, as wel l as the environment 
and the property. The MSA conducts market surveillance on certain non -food products for which 
relevant technical regulations have been adopted. The list of products include: Lifts; Cableways; 
Hot Water Boilers; Pressure Equipment; Simp le Pressure Vessels; Construction Products (cement, 
cables, plastic pipes, reinforcing steel, gypsum plasterboard); Child -resistant lighters; Products 
appearing to be other than they are, Toys, Machinery, Equipment and protective systems for use in 
potenti ally explosive atmospheres, Personal protective equipment, Appliances burning 
gaseous  fuels. It is expected that other products will be added to the mandate of the MSA as per 
AA approximation agenda ". 
 
Question:  Could Georgia give information about whether  the MSA also prepare legislations?  
 
Reply: MSA is engaged in the preparation of draft technical regulations, which is coordinated by the 
Ministry of Economy and Sustainable development of Georgia.  
 
Question:  Does the MSA have local units or work only from central  units?  
 
Reply:  Currently, the MSA is operating from the central unit located in the capital city and is carrying 
out market surveillance on the entire territory of Georgia.  
 
Question:  Does the inspections involve import controls?  
 
Reply:  Based on the risk analysis, MSA checks the documentary compliance of the imported 
products through the joint e -platform of the MSA and the Customs department of the Revenue 
Service. Inspection at the customs might also involve technical inspections in certain cases.  
 
Question:  How the MSA define "consumer products "? What are the criteria for consumer  products?  
 
Reply:  MSA conducts market surveillance on non -food products for which relevant technical 
regulations have been adopted in line with the DCFTA.  
 
Question:  Could Georgia give information about the administrative organization of MSA regarding 
inspectors? Are the inspectors assigned by their local units or the central unit?  Do they report to 
local or central units?  
Reply:  MSA is comprised with two separate dep artments responsible for market surveillance: 
Department of Market Surveillance on Industrial and Construction Products; Department of Market 
Surveillance on Consumer Products;  
As there are no local units of MSA, market surveillance inspectors are assigned  by the central unit 
and they report to the head of department and head of the MSA respectively.  WT/TPR/M/420/Add.1  
 
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  Question:  What are the specialization and educational background of the inspectors (engineer, 
chemist, laboratory specialist etc.)?  
Reply:  The Agency pursues the transparent recruiting process setting relevant criteria on the 
qualifications for professional as well as the educational experiences based on which the recruiting 
is done. After the recruiting process is completed, the Agency conducts  specifi c trainings for the 
inspectors both internally as well as through the various EU -funded projects. Thus, irrespective of 
their specialization, they are equipped with the knowledge of the product -specific fields.  
Question:  What are the specialization and edu cational background of the inspectors (engineer, 
chemist, laboratory specialist etc.)?  
Reply:  Refer to question 6.  
Question:  Does the MSA  also inspect online market surveillance? If yes, is there any software  tool 
in order to monitor the online market for non -compliant/ unsafe products or to trace the responsible 
economic operators who sell these products online? If yes, what kind of functi ons does this 
tool have?  
 
Reply:  Currently, there is no specific tool for monitoring the online market for non -compliant/ unsafe 
products or for tracing the responsible economic operators.  
 
Question:  Does the MSA carry out market surveillance activities when products are sold online to 
the consumers directly from a third country? If so, how is it incorporated to the legal framework?  
 
Reply:  Products sold online to the consumers directly from a third country are subject to market 
surveillance wi th the same requirements as to imported products.  
 
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 l aw, 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.  p.134  
Question:  Could Georgia provide information with regard to the draft law on e -commerce and the 
consumer protection law? Does the consumer protection law include a mechanism for cross -border 
online  consumer protection?  
Reply:  The draft law of Georgia on e -commerce has been prepared by the MoESD, which wil l be 
submitted to the Government of Georgia for initiation in the Parliament in 2022. The draft law 
of Georgia on Consumer protection  has been elaborated and initiated by the Parliament of Georgia. 
At this stage, the law has not been adopted yet. The both drafts regulate consumer protection rights. 
Draft Law on Consumer Protection was elaborated in the process of legal approximation to the 
EU legislation, among others, it is also approximated with the Directive 2011/83/EU of the 
European  Parliament and of t he Council of 25 October 2011 on consumer rights, including the 
provisions on the protection of consumers in respect of distance contracts.  WT/TPR/M/420/Add.1  
 
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  THE SECRETARIAT REPORT  
 
2.3.2.2 Agreements with other partners  
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 barriers to trade, sanitary and phytosanitary measures, 
trade remedies, electronic commerce, establishment, intellectual property, competition, trade and 
environment, transparency, institutional provisions, and dispute settlement . p.35  
Question:  Could Georgia provide information if the FTA between Georgia and Hong Ko ng, China 
includes trade in services provisions? If yes, could you provide detailed information with regard to 
the schedule of specific commitments of construction and related engineering services?  
Reply:  Yes, the FTA between Georgia and Hong Kong, China c overs trade in services. With regard 
to Construction and Related Engineering Services  (CPC 512, 513, 514+516, 517, 511, 515, 51) 
Annex  8-1 (Georgia 's Schedule of Specific Commitments) of that Agreement repeats 
Georgia 's commitments under the GATS (GATS/SC/ 129). Only National Treatment limitation for the 
whole sector with regard to the membership of joint stock company 's board of directors being 
Georgian nationals resident in the country has been removed.  
 
3.2.2 Taxes, charges, and levies , pg.59, 3. 78 
 
It is stated  in the Secretariat Report that '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 produc ts were (fee in parentheses): (i)  scrap 
and 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 proc essed scrap of ferrous metal (GEL 10/tonne). '' 
 
Question: Could Georgia provide detailed information about the legal basis of customs service fee 
for the exports of certain types of ferrous and non -ferrous scraps and inform whether and when this 
implementa tion will cease to apply.  
 
Reply:  Customs service fees are determined by the Resolution N41 issued by the Government of 
Georgia on  8 February  2012.  
 
3.1.1.2 Customs valuation , pg. 42, 3.15, 3.16  
 
It is stated  in the Secretariat Report that ''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 identica l goods; (ii)  transaction value 
of similar goods; (iii) unit price of goods; (iv) computed value; and (v) the reserve method. When  the 
reserve 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. '' and '' 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 .'' 
 
Question:  Could Georgia provide detailed informati on about the legal basis of the transaction value 
of identical goods and transaction value of similar goods to determine the value of  imported goods 
and when this implementation will cease to apply, and inform whether there is a minimum customs 
values for goods valuation.  
 
Reply: Specific legal basis for Customs valuation of goods is provided for in the Chapter VI of the 
Customs Code of Georgia. The legal basis states that – "The customs valuation of goods shall be 
carried out in accordance with this Code a nd the procedures laid down in the Agreement on 
Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 ". (Article 37).  
 WT/TPR/M/420/Add.1  
 
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  While the Paragraph 6 of the Article specifies that – "6. The customs valuation of imported goods 
shall be carried out based on the following methods:  
 
a) based on the transaction value (the first method);  
b) based on the transaction value of identical goods (the second method);  
c) based on the transaction value of similar goods (the third method);  
d) based on the unit pri ce of goods (the fourth method);  
e) based on the computed value (the fifth method);  
f) based on the reserve method (the sixth method)  ". 
 
Please note that "Each method of customs valuation of goods provided for by paragraph  6 of 
this article shall be proceeded s equentially where the previous method cannot be reasonably applied. 
The declarant shall have the right to change the order of application of the methods of customs 
valuation of goods provided for by paragraph 6(d) and (e) of this article ". 
As being in compliance with the relevant WTO requirements there are no plans to reevaluate 
the application of the rules. Additionally, there are no minimum customs values for goods provided 
for under the relevant regulatory framework.  
  WT/TPR/M/420/Add.1  
 
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  CHINA  
PART I: QUESTIONS REGARDI NG THE SECRETARIAT REPORT  
Page 9, Para. 12 of Summary  
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 health 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 VA T 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 source 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.  
1. Question:  Please specify the tax exemption policy on tobacco  products (including e -cigarettes) 
and its validity period under the Association Agreement.  
Reply to Question 1 : The VAT and Excise tax exemptions apply only to limited quantities of tobacco 
products. Such as 200 cigarettes or 50 cigars or 50 cigarillos, o r 200 pieces of tobacco product 
provided for under Harmonized System code 2403 99 900 02 or 10 units of capsules provided for 
under  Harmonized System code 2403 99 900 01 and similar products, or 250  grams of another 
tobacco product, or a collection of sort s of tobacco product specified in this sub -paragraph if the sum 
of percentage values (a percentage value in relation to the respective limited amount) of portions of 
each sort of tobacco product contained therein  does not exceed 100, or 50 ml of goods prov ided for 
under Harmonized System code 3824 90 980 01. Exemption policy is in line with association 
agreement and is not limited in time.  
Page 62, Para. 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. As of September 2021, Georgia hosted four FI Zs, the same 
number as at the time of the previous Review.  
2. Question:Does Georgia implement any higher -level environmental regulatory policies in the FIZs? 
If yes, please provide details.  
Reply to Question 2 : Georgia doesn 't implement any different envir onmental regulatory policies in 
the FIZs.  
Page 63, Para. 3.97  
The Government provides subsidies to many sectors of its economy, but in particular education, 
research, healthcare, cultural and religious activities, transportation infrastructure, energy, reg ional 
development, industry, and agriculture are the most prominent. 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, a nd infrastructure programs, whereas 29% was for agriculture and the 
environment  (Table 3.7). The remainder, about 22%, was in the social sphere, e.g. health, medical 
services, education, culture, and the like.  
3. Question:Please elaborate on the considerat ions for granting various environment -related 
subsidies and the subsidy criteria.  
Reply to Question 3:  In 2014 -2021, the LEPL Agency of Protected Areas, with the funding of the 
German Reconstruction Credit Bank (KfW) implemented the project "Protected Area s Support WT/TPR/M/420/Add.1  
 
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  Program in the Caucasus - Georgia", within the framework of which, the "GFA Consulting Group " 
implemented several important initiatives at the target protected areas in order to develop 
biodiversity and strengthen the system.  In addition, the pro gram envisaged a component that 
provided funding for socio -economic projects for the population living near the target protected 
areas  (Kazbegi, Algeti, Kintrishi, Pshav -Khevsureti), including small grants to finance various 
initiatives, such as rehabilita tion of drinking water supply network, storage construction/buildings 
for hay, development of traditional weaving culture, promotion of cattle breeding, purchase of 
beehives and equipment, purchase of inventory for a local gym, arrangement of recreation sq uare, 
purchase of wool cutting machine, arrangement of icon painting shop, expanding the aquaculture 
farm, afforestation of avalanche zones and other projects that have helped to improve the 
socio-economic conditions of the local population.  
Page 70, Para.  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 standar ds in lieu of international standards 
in recent years as Georgia proceeded with DCFTA implementation.  
4. Question:  It is mentioned that "0.13% national standards were adopted as Georgian standards ". 
Could Georgia kindly explain which countries do these nat ional standards adopted by Georgia 
refer to? 
Reply to Question 4:  Statistical data presented in the report, reflect the percentage share between 
adopted international (e.g. ISO, IEC), regional (e.g. EN, ETSI) and purely national standards. 
0.13%  of national standards indicated in the report do not refer to any other coun tries' standards 
and are purely Georgian standards.  
Page 93, Para. 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. In conjunction with this 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 Boar d 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.  
5. Question:  Please elaborate on the considerations for canceling compulsory licensing in the 
previous Patent Law and reintroducing it in the Patent Law in 2018.  
Reply to Question 5 : According to the amendments in previous Patent Law on 2010 c ompulsory 
license was canceled due to a government decision. In 2018 an amendment was made to the 
recent  Patent Law in order to bring it into line with the TRIPS Agreement. The need for such 
re-introduction caused not only the acceptance of the Protocol Am ending the TRIPS Agreement but 
the DCFTA also addressed this issue.  
Page 94, Para. 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 wit h 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 published European Union Intellectual Property 
Network  (EUIPN) practice papers on the Common Communication on the Distinctiveness – Figurative 
Marks containing descriptive/non -distinctive 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.  WT/TPR/M/420/Add.1  
 
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  6. Question:  Please specify major contents of the five amendments to the 1999 Trademark Law.  
Reply to Question 6:  As was mentioned in the report, several amendments were introduced to the 
Trademark Law of Georgia since its adoption in 1999.  
Firstly, in the law were clarified absolute and relative grounds for refusal and specific procedures in 
connection with the Madrid Protocol requirements.  
Next amendments introduced the accelerated procedure of registration; as well as, the obligatory 
requirement of appointment of patent att orneys for foreign applicants was removed.  
Besides, in 2018 amendments, deriving from the Georgia - EU AA were introduced, which 
harmonized Georgian Trademark Law 's enforcement procedures with the EU legislation.In  addition, 
those amendments filled some problematic gaps in examination procedure explored during practice.  
Page 95, Para. 3.218  
Georgia 's Law on Appellations of Origin of Goods and Geographical Indications provides 
that Aos and GIs shall be protected by r egistration 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. 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 GI s are given 
protection in Armenia, Azerbaijan, Belarus, China, the European Union, Kazakhstan, the 
Kyrgyz  Republic, the Russian Federation, Switzerland, Ukraine, and the United States. These are on 
the basis of the four bilateral agreements in force, or in  other cases, protection is based on 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.  
7. Question:  Please tell the differences between AOs and GIs protected by Georgia ' s Law on 
Appellations of Origin of Goods and Geographical Indications.  
Reply to Question 7 : According to the Par. 1 Art. 3 of the Law of Georgia on Appellations of Origin 
of Go ods and Geographical Indications:  
(1) An appellation of origin is a modern or historical name of a geographical place, region or, in 
exceptional cases, a name of a country (hereinafter "geographical area "), used to designate the 
goods:  
(a) originating with in the given geographical area;  
(b) the specific quality and features of which are essentially or exclusively due to a particular 
geographical environment and human factors;  
(c) production, processing and preparation of which take place within the geograph ical area . 
(2) Geographical indication is the name or any other sign, which indicates a geographical area and 
is used to designate the goods:  
(a) originating in that geographical area;  
(b) specific quality, reputation, or other characteristics of which are  attributable to that 
geographical area;  
(c) production or processing or preparation of which takes place in the geographical area.  
(3) If a traditional geographical or non -geographical name conveys an impression that 
goods  originate from given geographical area, and the requirements of paragraph (1) are fulfilled, 
said name may be considered as an appellation of origin of goods.  
(4) By way of derogation from paragraph (1), as an appellation of origin may be considered the 
name of a geographical area where raw materials of the goods come from the area larger than or WT/TPR/M/420/Add.1  
 
- 93 - 
 
  different from said geographical area, if: – the different boundaries of the geographical area and 
conditions for raw material production are determined; – there are inspection arrange ments 
to ensure that those conditions are adhered to.  
(5) For the purposes of paragraph (4), only live animals, meat and milk may be considered as raw 
materials.  
Thus, the notion of geographical indication is more general and it fully covers the notion of 
appellation of origin.  
PART II:  QUESTIONS REGARDING THE GOVERNMENT REPORT  
Page 11, Para. 2.62  
During the review period, the Agency established a new electronic platform ( sst.geostm.gov.ge ) 
which was created in 2020 to increase access to Georgian standards and simplify the existing 
procedures, including the purchase of Georgian standards in electronic format. There have been 
several other developments during the period such as the establishment of an 8th standardization 
Technical Committee  (TC) for Standardi zation " Road Traffic Safety " in 2020 by GEOSTM. Main role 
of TCs is to review drafts of Georgian standards in the area of their responsibility. The technical 
committees shall not consider a development of Georgian standard in case of following 
two conditi ons: a) in a field where there is an international standard; b) in a field where there is 
no high demand for a standard.  
8. Question:  How many TCs are there in Georgia? Which fields do they belong to?  
Reply to Question 8 : There are following national standardization TCs, which are established based 
on national economy 's sectorial priorities and stakeholders ' interest:  
• Electro technical Committee (TC 1);  
• Management and Conformity Assessment (TC 2);  
• Food and Food Produc ts (TC 3);  
• Tourism and Related Services (TC 4);  
• Construction and Increased Hazardous Products (TC 5);  
• Natural Gas (TC 6 );  
• Energy Efficiency (TC 7 );  
• Vehicle Road and Road Traffic Safety (TC 8).  
 
  WT/TPR/M/420/Add.1  
 
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  CHINA  – FOLLOW -UP 
PART I: QUESTIONS REGARDING THE SECRETARIAT REPORT  
Page 9, Para. 12 of Summary  
 
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 mo dified 
some of its rates based on health 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 source 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.  
 
Question 1.  Please give more details about the reform of indirec t tax regime.  
 
Reply to Q1:  Within the framework of Association Agreement between Georgia and European  Union, 
Georgian tax legislation was harmonized with Council Directive 2006/112/EC of 28  November  2006 
on the common system of value added tax.  As a resul t of amendments, which entered into  force 
from 1 January 2021, new VAT legislation was adopted. Changes were also introduced in the relevant 
secondary legislation. While positively affecting the taxpayers, the new VAT system introduced 
new regulatory provi sions including new rules related to place of supply of services, international 
cargo, VAT taxable amount, taxation. For more details please see the link below: 
https://old.rs.ge/4775 . 
 
Page 11, Para. 26 of Summary  
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). Other 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 ch anges in the organization and structure of the electricity and natural  gas 
markets, and their gradual opening, including the unbundling of transmission and distribution 
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 January 2022. For the natural gas market, which is 
highly concentrated and is dominated by forei gn-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 transit corridor for oil transportation.  
 
Questions:  
2. Does Georgia plan to diversify natural gas suppliers?  
3. Could Georgia describe the main features of the changes in the market structure of the natural 
gas beyond 2023?  
4. Could Georgia briefly describe the expected effects of the coming natural gas trading platform?  
 
Replies questions Q2; Q3; Q4:In July 2021, the Memorandum of Understanding was signed 
between the representatives of the Energy Community Secretariat, EBRD, Ministry of Economy and 
Sustainable Development of Georgia, JSC Georgian Oil and Gas Corporation (G OGC) and Georgian 
Gas Transportation Company LLC (GGTC) for cooperation to form the Gas exchange in Georgia.  
On 15 October  2021, Georgian Gas Exchange LLC (GGEX) was established as a subsidiary of 
GOGC  and GGTC to carry out the functions of a gas market op erator. On top of that, elaboration of 
gas market reform is underway, which will allow the gas market participants to engage in day -ahead 
and intraday trading activities. Full -fledged activation of the new gas market model is planned 
for early 2023.  
The be nefits stemming from the natural gas trading platform are versatile, as it serves the purpose 
of forming a competitive and liberalized Georgian gas market, which will entirely operate digitally. 
The new trading platform will facilitate trading processes' b y providing the most liquid electronic 
marketplace for natural gas and reliable clearing, as well as settlement services. The natural  gas WT/TPR/M/420/Add.1  
 
- 95 - 
 
  prices will be arranged based on a free market principle. In addition, the formation of the spot 
market and introducti on of the gas derivatives will be productive not only for balancing purposes, 
but will play a positive role in the progress of the gas sector and the economy in general. 
Furthermore, the quotations of gas exchange can become market price indicators, utiliz ed by the 
state authorities, market participants, as well as international and national organizations.  
 
Page 16, Para. 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 
competiti veness, foster economic diversification, and boost economic growth and job creation. The 
reform on dollarization was also seen as an important step to stabilize the Georgian economy as 
Georgia has traditionally had a high rate of dollarization that was con sidered a significant weakness. 
Thus, in 2017 Georgia enhanced the process of larization, which is expected to increase monetary 
policy flexibilities as well as reduce the impact of external shocks.  
 
Question  5. How does Georgia view its reform of reducing  dollarization? What are the main barriers 
during the reform of dollarization?  
 
Reply to Q5:  Please see the NBG Macroprudential Policy Strategy document 
(https://nbg.gov.ge/en/page/ macroprudential -policy -strategy ). Regarding the instruments used, 
this is the short list of the main tools to support dedollarization in Georgia:  
 
• Currency Induced Credit Risk (CICR) Buffer – Additional capital requirement in 
Pillar 2: additional 75% risk -weight applies to unhedged foreign currency exposures;  
• Liquidity Coverage Ratio (LCR) requirement differentiated by currency: 75% in GEL, 100%  in 
FX (total ratio in all currencies should exceed 100%);  
• Minimum reserve requirement differentiated by currency:  5% in GEL, 10% -25% in FX;  
• Open currency position limit for banks: 20% of tier 1 capital;  
• Loan-to-Value (LTV) ratio limit for retail credit: 85% in GEL, 70% in FX;  
• Payment -to-Income (PTI) ratio for retail credit: <50% in GEL, <30% in FX;  
• Maximum maturity o f mortgage loans allowed: 20 year for GEL, 10 years for FX;  
• Loans amounting <  GEL 200,000 equivalent cannot be issued in FX (banned in Civil Code).  
• Deposit insurance premium is different in national and foreign currency – 0.067% of the  
compensable volume o f the deposits insured in the national currency. The insured deposit 
of the depositor shall be compensated in the national currency if the depositor has a deposit 
in foreign currency.  
 
Page 27, Para. 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. The FDI grant programme through Enterprise Georgia 
offers cash back of up to GEL 1 million to enterprises in targeted sec tors that invest at least 
GEL 10 million and create a minimum of 150 jobs. 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 programme is also a tool to raise more awareness among investors about 
the potential of Georgia in the targeted sectors.  
 
Question  6. Could the Government provide more information on the FDI grant programme? How 
does the Government define the targeted sectors?  
 
Reply to Q6 : FDI Grant program is designed for companies registered in Georgia, which represent 
subsidiaries of legal entities that have operations outside Georgia and invest foreign capital in 
the country. In particular, companies must meet the following criteria in order to participate in 
the program:  
 
• A company is registered in accordance with the legislation of Georgia and is subsidiary of 
the legal entity (parent company) registered outside the Georgia, in which the parent 
company owns 50% or more of the voting sh ares and controls the subsidiary company;  
• At least 50% of the Investment obligation of the company must be secured by the foreign 
investment;  
• The company invests in the eligible sectors of economy defined by the program;  WT/TPR/M/420/Add.1  
 
- 96 - 
 
  • The parent company has at least two  years of experience in the eligible sectors of economy 
that must be confirmed by the appropriate documents;  
• Subsidiary company in Georgia and parent company outside the Georgia must operate within 
the same eligible sectors of economy.  
 
Eligible Sectors of  Economy:  
 
• Production of electrical and electronic engineering products;  
• Manufacturing of aircraft parts and components;  
• Manufacturing of vehicles and equipment, as well as their parts;  
• Export of business services/ business process outsourcing (BPO);  
• Developing Warehouses and logistic centers;  
• Aircraft repair and maintenance (MRO).  
 
Through the program, investors that invest more than GEL 10 m ilion., are eligible for up to 
GEL 1 milion. cashback rebate.  
 
Question 7. Could the Government elaborate on ho w the programme will bring an inflow of 
technology? What kind of achievements have been made so far?  
 
Reply to Q7:  The program primarily targets sectors, which are not well developed in Georgia, but 
are emerging, thus through the program, Georgia aims to a ttract more investments in the sectors.  
FDI grant was only launched recently (about a year ago) it has been a good tool in terms of 
negotiating with investors and has become a topic of discussion with them in terms of entering the 
market. We expect that in  2022/2023 we will have first beneficiaries of the program.  
 
Page 32, Para. 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. Specifically, 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 the 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 produc ts; chemical production; manufacture of some building materials; 
production 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.  
 
Question  8. How does Georgia implement New Business Export and Import -Replacement Program? 
Is it fallen into the Prohibited Subsidies (Article 3) of the Agreement on Subsidies and Countervailing 
Measures?  
 
Reply to Q8:  The program is an access to financing mechanism for SMEs, it does not subsidizes 
any activities or actions of SMEs, but simply provides co -financing, collateral guarantee and a grant 
for the loans that SMEs might get from commercial banks in Georgia.  
Under the program, SMEs don 't have any obligation to export and being an exporter is not a 
precondition to recei ve the loan support. Accordingly, these support mechanisms do not fall under 
the prohibited subsidies as per the SCM Agreement.  
 
Page 33, Para. 2.24  
The Association Agreement concluded in 2014 between Georgia and the European Union and 
its member States ha s as one of the 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.  
 WT/TPR/M/420/Add.1  
 
- 97 - 
 
  Question  9. How does Georgia benefit from its gradual economic integration into the EU  Internal 
Market? How does foreign enterprises trading with Georgia benefit from this process?  
 
Reply to Q9:  The first succe ssful example set by Georgia in terms of diversification of export 
markets and development of trade regimes was the introduction of a free trade regime with the 
EU in 2014. It is important that EU for Georgia represents market for locally produced products , 
namely, in 2021, compared to 2014, the share of local exports (Georgian originating products) in 
total exports from Georgia to the EU increased by 21% to 89%, while the share of re -exports 
decreased from 32% to 11%.  
  
In addition to the fact that the EU represents the consumer market of Georgian origin products, 
DCFTA has also facilitated the growth of exports of certain types of positions, as well as the creation 
of new export positions. In particular, compared to 2014, exports of the following commoditi es 
increased: wine - 104%, mineral water - 69%, canned fruits and vegetables - 25%, nitrogen 
fertilizers - 46.4%, non -alcoholic beverages - 300%. In 2014 -2021, not only the awareness of 
Georgian products on the EU market increased significantly, but also n ew products such as kiwi, 
dried lemon, persimmon, black currant, blueberry, apple, quince, fruit jam, fruit leather, 
churchkhela, animal furniture, glass bottles, plastic utensils, honey, fish flour, entered the 
EU market.  
 
In addition, the DCFTA also cont ributed to development of new sectors. New products, which had 
not been produced before, they are manufactured and exported to the EU: pet furniture, animal 
feed, toys, etc. Georgian designer products also gained popularity - about 30 Georgian clothing 
companies export the following products to the EU: clothes, shoes, accessories, bags and 
baby clothes.  
 
We have good examples of foreign companies reallocating their production to Georgia. As the 
awareness on Georgia 's free trade regimes grow, more foreign co mpanies are interested to invest, 
manufacture and then export to the EU market under the free trade regime. Georgia is a perfect 
foothold for foreign companies to enter the wider region, acting as a gateway and trade hub for 
free access to a variety of markets, including the EU. In addition, Georgia 's business environment 
has been proven to be strong, with low taxes and low levels of corruption, as proven by international 
ratings. Thus, the foreign companies that would like to enjoy the preferential trad e regime with 
the EU are invited to invest in Georgia.  
 
Page 55, Para. 3.60  
Importers willing to apply for one of these licenses or permits must submit their application to the 
corresponding ministry or agency. Currently, there are six institutions respons ible for issuing 
licenses/permits: (i) Ministry of Environmental Protection and Agriculture (MEPA); (ii)  Ministry of 
Defense; (iii)  Ministry of Internal Affairs; (iv) Ministry of IDP from the Occupied Territories, Labor, 
Health and Social Affairs; (v) Reve nue 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 license are fixed and 
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).  
 
Question  10. How do the importers apply for the licenses? Which docum ents shall be provided during 
the application? Are there any operating instructions for the importers and exporters to follow?  
 
Reply to Q10:  The paragraph above explains the process for application for the licenses and permits 
as required for by the Natio nal Legislation in place and for the purposes of importation of goods to 
the Customs territory of Georgia. As such there is no one exhaustive list of requirements for 
all possible nomenclatures subject to import licensing, specific requirements are availab le on 
the "HS Codes " search tool on the GRS webpage ( https://www.rs.ge/CommodityCodes -
en?cat=1&tab=1 ). The tool allows to identify specific requirements along with issuing agencies and 
relevan t formal procedures for each commodity code subject to license, while allowing to lodge the 
application straight from the webpage. The page provides general user guide as well as some specific 
tips on license/permit application issues, while GRS is current ly working on evaluating the scope of 
adding additional instructions for the application process.  
 WT/TPR/M/420/Add.1  
 
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  Page 97, Para. 4.2  
The sector also suffers from low labor  productivity – the lowest among all sectors, thus a 
large percentage of farmers ' remains in poverty. 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 o f 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.  
 
Question  11. What are the main obsta cles to the development of large -scale farming and the 
associated economies of scale?  
 
Reply to Q11:  Since 2012 and significant reforms and activities have been carried out in 
Agriculture  sector. MEPA initiated different assistance mechanisms for the priva te sector, such as 
the preferential agro -credit program, Co -financing project for the processing and storage 
enterprises, program plant the future and etc. Assistance is also being provided to support the 
expansion of farmers. It is noteworthy that the int erest of business representatives in the agricultural 
sector is growing in the country.  
 
We observed many success stories during these years, herewith, let me share some of the notable 
figures and trends of the official statistics demonstrating the achieve ments of the sector in Georgia.  
In accordance with the targeted policy of Georgia's Agricultural Development Strategy 2015 -2020 
the Strategy results of the Agriculture, Forestry and Fisheries sector are the following:  
 
• In 2020 compared to 2015 Gross output  in Agriculture, Forestry and Fisheries  sector 
increased by 35% and amounted to 5.8 billion GEL. At the same time, the total output of 
products obtained from the processing of agricultural products increased by 38%.  
• According to 2020 data, the Gross Domestic Product created in Agriculture, Forestry and 
Fisheries sector at current prices is 35% more than the same figures of 2015. According 
to 2020, the share of GDP created in Agriculture, Forestry and fisheries in GDP is 8.3%.  
• In the period of 2015 -2020, Gross Domestic Product in Agriculture, Forestry and Fisheries 
sector per employee in the same sector increased by 65 %. 
• Exports of agr ი-food products are growing every year, In the period of 2015 -2020, the 
value  of exports of agri -food products increased  by 54%. During this period, the negative 
foreign trade balance of agri -food products decreased by 46%.  
• In the period of 2015 -2020, the turnover of the business sector in Agriculture, Forestry and 
Fisheries sector increased by 97%. In 2015 -2020, the averag e annual growth rate of this 
indicator is 16%.  
• It is important to note the dynamics of the average production value in the business sector, 
per employee Agriculture, Forestry and Fisheries sector. From 2015 to 2020, this figure 
increased by 96%. During the  same period, the average annual growth rate of this 
indicator  is 15%.  
 
PART II: OTHER QUESTIONS  
 
Question  12. Could Georgia elaborate on the legislating background and purpose of the 
Olympic  Games Promotion Law passed at the Georgian Parliament in May 202 1? Is there any plan 
to amend the Law in the near future?  
 
Reply to Q12 : Law of Georgia on supporting an Olympic Movement was adopted in May 2012. This 
law determines the legal basis for making investments for supporting an Olympic movement in the 
territor y of Georgia and guarantees the protection of such investments.  
 
  WT/TPR/M/420/Add.1  
 
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  ICELAND  
Question  1: What is the participation of women in the economy of Georgia?  
 
Reply:  As for official statistics data on women participation rate in economic performance of the 
country, according to Georgian National Statistics Office (Geostat) and its available data for 2020, 
the participation rate (activity) of women in the labour force is 40.4%. The share of women in the 
total number of employed persons in Georgia comprises 44 %. With regard to the percentage data 
of hired employees, notable, that in 2020, the gap between hired women and men was quite low in 
favour of men, in particular, share of hired women is 49%, while for men the data amounts to 51%. 
As to the data for busin ess sector, share of women employed in business sector is 41%, while the 
same data for men comprised 59%.  
 
Concerning the business activity, the owners of newly registered enterprises are mostly men. 
According to the data for 2020, the number of men foundi ng businesses is almost twice as high as 
the number of women in the same category. As to the economic sectors, a relatively small number 
of women business owners are found  in the mining industry, construction, transport and 
warehousing, and agriculture. On  the other hand, the number of female owners is much higher than 
the number of male owners in areas of activity such as education, health and social services and 
other services.  
 
At the same time, the participation rate of women in state -funded projects fo r 2020 is as follows: 
the share of female beneficiaries in the state program "Produce in Georgia " (implemented by the 
Agency ''Enterprise Georgia " with the aim to support financial and technical capacities of SMEs in 
the country) Micro and Small business s upport component is up to 50%. Noteworthy, that as a result 
of implemented supportive measures the data characterized by highly progressive dynamics and it 
is worth mentioning, that in 2018, the share of women beneficiaries comprised 45% in total number, 
while the same indicator was 32% in 2015. As regards the same data for state -funded programs 
(aiming at developing innovative businesses) provided by the Georgian Innovation and Technology 
Agency (GITA) female beneficiaries rate amounts to 30% in total bene ficiaries of the programs.  
 
The Georgian Government will continue to ensure targeted supportive mechanisms in order to 
address the challenges facing women entrepreneurs, to support them in order to apply their 
untapped economic potential and increase their  participation rate in generating economic value in 
the country.  
 
Question:  2 Have specific barriers that limit women 's participation in trade been identified?  
 
Reply:  Notwithstanding the progressive steps that have resulted in positive changes in terms of 
improving women economic performance, still remains some barriers/challenges facing women that 
needs to be addressed.  
 
Real estate ownership by women can be mentioned as one of the barriers that hinders women 
participation in entrepreneurial activ ities. In particular, it is known that the indicator of real estate 
ownership by women, including land, is significantly lower than the same indicator for men. More 
specifically, only 16% of the documented owners of agricultural land are women. Consequentl y, 
when it comes to access to finance and in case of bank loans, the issue of collateral is important, 
that significantly limits the access of women to financial resources. Therefore, female entrepreneurs 
are forced to rely heavily on personal finances. Th is problem is especially acute in the regions.  
 
Also, there are some practical aspects as well that are identified as obstacles for women participation 
in country 's economy.  Due to several factors, access to state support programs for women remains 
problem atic in the regions. Among these factors insufficient level of awareness on ongoing programs, 
lack of certain skills, incl. digital skills can be mentioned as challenge. In response to that, technical 
support component (awareness raising campaign, special trainings on startups, as well as expanding 
existing businesses) along with financial assistance are envisaged in the programs for the benefit of 
women.  
 WT/TPR/M/420/Add.1  
 
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  Accordingly, in the process of developing state support programs, we attach particular importance  
to identifying specific problems/needs/challenges related to women participation in entrepreneurship 
and expand the existing programs and develop tailored programs with relevant methodology/tools. 
Please see more details on the link below:   
http://www.economy.ge/?page=ecopolitic&s=45&lang=ge . 
 
Question  3 : Has Georgia implemented any specific measures to encourage women 's participation  
in trade and promote women 's entrepreneurship, or are such measures being developed?  
 
Reply:  The Government of Georgia acknowledges the potential and importance of women 
participation in country 's economic performance, especially, in small and medium -sized 
enterprises  (SMEs). Accord ingly, Women economic empowerment is one of the focused and 
well-supported directions in Government 's economic policy agenda being an essential prerequisite 
for inclusive and sustainable development.  
 
The Government of Georgia has taken important steps to ensure effective supporting mechanisms 
for further strengthening women economic potential, including encouraging women 
entrepreneurship in order to enhance women contribution to the improvement and development of 
country 's economic performance.  
 
Noteworthy  that women entrepreneurship is one of the priority direction in the "Small and Medium 
Entrepreneurship Development Strategy of Georgia 2021 -2025" adopted by the Government of 
Georgia. In particular,  "Promotion of Women Entrepreneurship " is a focused pilla r among the 
seven  priority directions envisaged by the Strategy. Under the direction,  relevant objectives and 
activities are envisaged  in order to develop women entrepreneurship, including popularization of 
"Women Empowerment Principles " (WEPs), encouraging women participation in state programs, 
strengthening digital skills of women entrepreneurs, support capacity development of state 
institutions for the development of gender -based approaches, etc.  
 
It is also important to emphasize, that women entrepreneurship is one of the well -addressed 
directions within the activities implemented by the State Agency "Enterprise Georgia ". The Agency 
was established  in 2014 and it is one of the first governmental institutions in Georgia intending to 
improve the entrepreneurial environment, develop the private sector, enhance its competitiveness, 
promoting export -oriented production, popularization of Ge orgia's favourable investment climate 
and encouragement of FDI attraction.  
 
Notable, that the Micro and Small Entrepreneurship Support Program under the Agency envisages 
the targeted incentives for stimulating women active involvement in entrepreneurial ac tivities and 
contributing to the creation of economic value by women. The program sets certain priorities and 
one of them is encouraging women start -ups and develop existing businesses.  
 
As a result of implemented supportive measures highly positive dynami cs were indicated  and that 
in 2020, women beneficiaries of the program achieved up to 50% of total beneficiaries of the 
program. In 2018, the share of women beneficiaries amounted to 45% in total number of 
beneficiaries, while the same indicator was 32% in  2015. This positive dynamic is an obvious 
confirmation of the efficiency of the SME supportive policy of the country.  
 
It is also significant to note, that clear evidence of the effectiveness of implemented activities aiming 
at the promotion of women entr epreneurship is not only an internal evaluation by the country, but 
also what is especially important, the significant progress/progressive steps are well-recognized  and 
verified by international partners as well.  In particular, Women Entrepreneurship has been 
recognized as one of the successful directions and its score in 2020 improved up to  4.24, 
compared  to 2.70 in 2016 in the assessment of the OECD „SME Policy Index 2020 ". It should be 
mentioned,  that, according to mentioned assessment Georgia achieved unprecedented success in 
regard to  the SME supportive policy. The rating evaluates the Georgia and the other 
Eastern  Partnership countries (Armenia, Azerbaijan, Ukraine, Belarus, Moldova ) in terms of 
SME support policy and its compliance with the European Small Business Act (SBA).  
 
Question  4: Are the effects of trade policy on women and men measured and monitored, and 
if so how? 
 
Reply: Currently, there is no mechanism in place in Georgia, which would measure or monitor 
trade policy effects on women and men.   WT/TPR/M/420/Add.1  
 
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  THAILAND  
WT/TPR/S/420  box 1.1 Page  16 
 
Question  1: What are the main elements of the new Law on Entrepreneurs? What are the key 
changes from the previous law?  
 
Reply:  The new Law of Georgia "On Entrepreneurs " was adopted by the Parliament of Georgia 
on 2 August  2021 aiming at improving entrepreneurial env ironment, upgrading legal framework 
on corporate law, better regulate internal corporate relations and while promoting entrepreneurial 
freedom, increase transparency, efficiency and competition in this area.  
 
It is worth mentioning, that the new law entirely replaced the previous law on entrepreneurs, which 
created some obstacles, could not properly respond new reality, existing needs, and challenges 
identified. All of mentioned created the solid basis for the adoption of a new law, rather than merely  
amending it.  
 
Noteworthy that the new law was based on the fulfilment of EU directives envisaged 
by the Association Agreement between Georgia and the EU and contributes to harmonization of the 
Georgian legislative framework to the EU  acquis . 
 
The new law "On Entrepreneurs " introduces many fundamental changes to the existing regulations, 
rectifying shortfalls in the existing law. One of the declared objectives of the new law is to better 
protect the interests of creditors and minority shareholders, introduc ing a number of amendments 
concerning the formation, maintenance and protection of the capital of an entity. It also regulates 
the issues related to the conflict of interest of business managers, the obligation of good faith, the 
fulfilment of obligations of the entrepreneurial company, reorganization and liquidation of the 
company.  
 
The new law introduces also rules that will allow business parties to better regulate corporate 
relations, and in cases of non -regulation of a separate issue, there will be a n ormative basis to 
overcome difficulties that the parties face as well as the court to properly resolve the disputes.  
 
Question  2: Does the new Law on Entrepreneurs contain any rules, procedures, rights, or 
obligations relating to foreign entrepreneurs or i nvestors?  
 
Reply:  Notably, that the new law of Georgia "On Entrepreneurs " brings Georgian corporate 
legislation closer to European standards (incl. foundation and further operation of 
entrepreneurial  company), which ensures increased compliance with European norms and creates 
more attractiveness in regard of foreign investors interest to invest in Georgia and develop 
partnerships with Georgian companies.  
 
Furthermore, the law provides a strictly written norms and solid guarantees for minority 
shareholders, which will be interested in raising capital. This, in turn, will be converted into investors ' 
increased interest and their intention to invest in the company.  
 
It should also be highlighted, that the new law ensures better regulated and more explicit norms, 
including internal corporate relations, which increases the predictability of processes while 
decreasing the potential disputes and cases at court. Noteworthy that the mentioned components 
are crucial criteria based on which foreign investo r makes the evidence -based decision to invest in 
the country.  
 
New law enables foreign investors to be better aware of how to develop the relations between 
partners within the company.  
 
In view of all abovementioned and while ensuring conducive business cl imate in the country, new 
law will be a good signal for foreign investors having a positive impact on entrepreneurial 
environment in the country.  
 WT/TPR/M/420/Add.1  
 
- 102 - 
 
  WT/TPR/S/420  Para 1.35 Page  27-28 
 
Question  3: Are there any qualifications or conditions that foreign investors must fulfill to be eligible 
for the cash back scheme under the new FDI promotion programme of Georgia other than investing 
at least GEL 10 million in the targeted sectors and creating a min imum of 150 jobs?  
 
Reply:  The companies need to be operating in target sectors, namely: auto parts manufacturing, 
electronic parts manufacturing, aerospace parts manufacturing, business process outsourcing, 
logistics. The companies need to be co -owned by t he foreign investor, and minimum 50% of capital 
required for investment must come from abroad.  
 
WT/TPR/S/420  Para 2.25 Page  33-34 
 
Question  4: When is the deadline for Georgia to complete all commitments on approximation of 
legislations with the EU under the DCFTA?  
 
Reply:  Under the EU -Georgia DCFTA, the deadline for Georgia to complete all commitments on  
approximation of legislations with the EU  is 2027.  
 
Question  5: On trade in services, what is the extent of market access commitments that Georgia 
currently provides to the EU and what sectors/aspects  does Georgia need to approximate 
her legislations with the EU acquis ? 
 
Reply:  Georgia 's market a ccess commitments on services under the EU -Georgia DCFTA are set  out 
in the Annex XIV. These include commitments on cross -border supply of services; reservations on 
establishment; reservations on key personnel, graduate trainees and business sellers and 
reservations on contractual services suppliers and independent professionals.  
 
Georgia took commitments on legal approximation under the Chapter 6 (Establishment, Trade in 
Services and Electric Commerce) in four sectors: financial services, telecommunication  services, 
postal and courier services, international maritime transport.  
 
WT/TPR/S/420  Para 2.38 Page  37 
 
Question  6: When does Georgia plan to start reformation or amendment of her foreign investment 
legislation, and what is the expected timeframe to complete such procedures?  
 
Question  7: What are the main elements of the foreign investment legislation that Georgia expects 
to improve?  
 
Replies to Questions  6 and 7 : In its commitment to improve investment  landscape, Georgia 
continues to actively amend its legal framework pertaining  to portfolio investment environment. To 
that end and with no capital control in  place, capital market development -related reform measures 
are agnostic towards  the foreign status of an investor, hen ce the only relevant implication for  foreign 
investor regarding instruments offered for local portfolio investments  (debt and equity instruments) 
is investor 's tax status. Capital market reform  is significantly driven by the EU Georgia Association 
Agreemen t, where Georgia  has an obligation to approximate its securities market laws to 
EU directives  and regulations. As of January 2022, significant amendments have been made to  the 
Securities Market Law of Georgia, namely Transparency and Market Abuse  directive s have been 
transposed into  local laws. New transparency and reporting  rules will improve investor trust, while 
prohibition on insider -trading will protect  investors and market integrity. Additionally, adoption 
of Financial Collateral, Netting  and Derivati ves Law of Georgia paved the way for financial collateral 
system that is similar  to that of  EU and additionally created mechanisms to hedge foreign 
currency  exposures that foreign investors might bear when entering into local currency  positions. 
In 2020, d uring pandemic, a complete overhaul of Investment Funds Law of Georgia  took place, 
new framework is now aligned with both  UCITS and AIFM Directives.  This will stimulate the 
development of local investment fund and asset  management industry and give Georgia  an 
opportunity to first position itself as  a regional financial center that is in line with best international 
standards  and second to offer international  investors an investment fund and asset  management 
environment that they are already familiar with an d that provides  them already well -known 
protections, consequently decreasing industry -related  legal entry costs. Additionally, Dematerialized 
Securities Holding draft -law that reforms  securities market infrastructure has been introduced to WT/TPR/M/420/Add.1  
 
- 103 - 
 
  the parliament. This law streamlines securities settlement system and grants investors  the rights 
that are very much alike the ones they enjoy in EU through CSD Regulation.  Regarding available 
instruments, legislation on Covered Bonds as well as  on Securitization will be introduced to the 
parliament in 2022. Both instruments  will give investors exposure to high yield passive  instruments 
and in case of Covered Bonds, possibly exposure to a debt instrument with  rating higher than 
sovereign. Implementation of MiFID (ii) and I ORP (ii) are still  undergoing, giving local market some 
room to find its own proper set -up. Lastly, it has to be said that local  capital market is still shallow, 
with only government debt securities being  actively offered and giving foreign investors risk -free 
opportunity to gain exposure to  the Georgian  market. This, along with some occasional 
high-yield USD-denominated corporate debt instrument offerings,  placed either locally or on foreign 
exchanges, give foreign  investors good exposure to the Georgian g rowth.  
 
WT/TPR/S/420  Para 4.182  Page 144 
 
Question  8: What  exactly are the free tourism zones? What are their coverages?  
Question  9: What are the conditions and privileges for the construction and operation of hotels in 
the free tourism zone? Are conditions and privileges applied  equally to local and foreign investors?  
 
Reply to above Questions  8 and 9 : Free tourism zone refers to the t erritories, where specific 
tax exemptions and other benefits are applied to the companies. More specifically, investors are 
exempted from:  
• Property and profit tax  
• Construction  permit  fee 
Apart from the tax incentives mentioned above, relevant land is trans ferred to the investor for 
symbolic price of  GEL 1. 
These benefits are applied equally for local and foreign investors.  
For your referrence please see below  the Law of Georgia on Supporting the Development of Free 
Tourism Zones: On Supporting the Development of Free Tourism Zones | სსიპ "საქართველოს  
საკანონმდებლო  მაცნე" (matsne.gov.g e) 
 
WT/TPR/S/ 420 Para  3.53  Page  54 
 
Question  10: Please elaborate on the types of hazardous waste that fall under these categories?  
 
Reply:  According to the Law "On Import, Export and Transit of Waste " for purpose of this law 
hazardous waste is:  
 
a) Waste categories as defined in annex I to the Basel Convention ; 
b) Groups of waste categories specified in annex II to the Basel Convention ; 
c) Waste specified in annex VIII to the Basel Convention ; 
d) Waste identified as hazardous waste in accordance with national list of waste (list of waste 
is in compliance whit EU list of waste) . 
 
WT/TPR/S/ 420 Para  3.196  Page  91 
 
Question  11: According to border measures related to intellectual property rights, Thailand wo uld 
like to seek clarification on how Georgia practically enforces rights provided for appellations of origin, 
geographical indications, and plant varieties at the borders.  
 
Reply:  Appellations of origin and Geographical indications are afforded the same practical 
enforcement procedures as trademark - provided they are registered in the Customs Registry of 
Intelectual Property Objects or are subject to ex oficio control. The control  is carried out through all 
available customs avenues, including but not limited to risk profiling and suspicion based checks 
when applicable. While the regulations for plant variety are in place to apply accordingly if such a 
case is to arise.  
 
 
_________ _