# INVESTMENT CLIMATE STATEMENT: GEORGIA 

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21JUNE 99
SOURCEUS EMBASSY TBILISI
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1.  BELOW IS SUBMISSION OF THE 1999INVESTMENT CLIMATE
STATEMENTFOR GEORGIA.
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SUMMARY
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GEORGIASUFFERED SEVERE POLITICAL AND ECONOMIC
TURBULENCEDURING THE YEARS FOLLOWING THE RE‑
ESTABLISHMENTOF ITS INDEPENDENCE IN 1991. ALTHOUGH
MANYPROBLEMS REMAIN, IT HAS ENJOYED STEADILY IMPROVING
POLITICALSTABILITY AND ECONOMIC GROWTH SINCE 1995. THE
CONFLICTIN THE PROVINCE OF ABKHAZIA, WHICH SEEKS TO BE
INDEPENDENTFROM GEORGIA, HAS YET TO BE FULLY RESOLVED.
ANOTHERAREA OF FORMER CONFLICT, SOUTH OSSETIA, HAS
BEENSTABLE FOR 4 YEARS, HOWEVER APPROXIMATELY 300,000
PEOPLEDISPLACED BY THESE CONFLICTS HAVE YET TO RETURN
TOHOME.
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SINCETHE MID 1990S, THE KEY AREAS OF ECONOMIC RECOVERY
INGEORGIA ARE AGRICULTURE, TRADE, AND TRANSPORT.
GEORGIAHAS EXPERIENCED MODEST BUT INCREASING FOREIGN
INVESTMENTIN RECENT YEARS, THE MAJORITY OF WHICH HAS
BEENDEVOTED TO PIPELINE AND RELATED PROJECTS, TO
TRANSPORTCASPIAN BASIN OIL.  FOREIGN DIRECTINVESTMENT
INGEORGIA HAS TOTALED ONLY USD 411 MILLION SINCE 1990,
WITHINVESTMENT INFLOWS IN 1998 EQUIVALENT TO 6.4
PERCENTOF GDP.  HOWEVER, THESE INFLOWSHAVE MORE THAN
DOUBLEDEACH YEAR SINCE 1995.  CURRENTLYTHE UNITED
STATESIS THE LARGEST INVESTOR IN GEORGIA.
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GEORGIAHAS CHOSEN TO EMBRACE OPEN MARKETS AND THE RULE
OFLAW AS A PATH TO ECONOMIC GROWTH, AND IT NOW STANDS
ASONE OF THE FINEST EXAMPLES IN THE FORMER SOVIET
UNIONOF A COUNTRY'S CONVERSION TO A DEMOCRATIC AND
FREEMARKET SYSTEM.  THE PACE OF REFORMIS
ACCELERATING,WITH EXTENSIVE ASSISTANCE BEING PROVIDED
BYTHE U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT AMONG
OTHERS.
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ARANGE OF WELL DRAFTED LAWS, AIMED AT CREATING AN OPEN
ANDTRANSPARENT INVESTMENT CLIMATE, WITH EQUITABLE
TREATMENTFOR FOREIGN INVESTORS HAS FOUND ITS WAY ONTO
THESTATUTE BOOKS.  FUNDAMENTALPROPERTY RIGHTS ARE
GUARANTEED.GEORGIAN LAW SPECIFIES EQUAL TREATMENT FOR
GEORGIANAND FOREIGN INVESTORS AND TO THAT END HAS
REVOKEDPREVIOUS INCENTIVES TO FOREIGN INVESTORS.
PERFORMANCEREQUIREMENTS ARE LARGELY NON‑EXISTENT.
THEREARE NO MINIMUM LOCAL OWNERSHIP REQUIREMENTS,
THOUGHFOREIGN INVESTMENT CAN BE LIMITED IN
INFRASTRUCTUREAND AGRICULTURAL LAND OWNERSHIP. GEORGIA
HASNO HISTORY OF DIRECT EXPROPRIATORY ACTIONS, NOR IS
SUCHACTION FORESEEN.  PRESIDENTSHEVARDNADZE HIMSELF
CHAIRSTHE FOREIGN INVESTMENT ADVISORY COUNCIL, WHICH
UNDERTAKESTO IMPROVE THE INVESTMENT CLIMATE AND
RESOLVEDISPUTES INVOLVING FOREIGN COMPANIES.
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PROGRESSIN ECONOMIC REFORM TO DATE IS REAL AND WILL
PROBABLYBE SUSTAINED.  HOWEVER, WHILE THELEGAL
FRAMEWORKTO SUPPORT PRIVATE BUSINESS IS LARGELY IN
PLACE,ENFORCEMENT BY THE COURTS HAS BEEN PROBLEMATIC.
WORKIS WELL ADVANCED ON JUDICIAL REFORM, WITH THE GOAL
OFIMPROVING THE STANDARD AND COMPETENCE OF GEORGIA'S
JUDGES,AND THE QUALITY OF THEIR DECISIONS.
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ANUMBER OF CONDITIONS WITHIN GEORGIA, HOWEVER, HAVE
INHIBITEDFOREIGN INVESTMENT AND IMPEDED SUCCESSFUL
JOINTVENTURES: PERVASIVE CORRUPTION; UNEXPECTED
CHANGESTO REGULATIONS, OR THEIR ARBITRARY APPLICATION
ANDENFORCEMENT; NON‑ENFORCEMENT OF LAWS; AND LACK OF
IMPARTIALITYAND OBJECTIVITY IN THE JUDICIAL SYSTEM,
CREATINGDIFFICULTIES IN DISPUTE RESOLUTION. THOUGH
THEGOVERNMENT OF GEORGIA HAS INITIATED STEPS TO
ADDRESSTHESE AND OTHER SHORTCOMINGS, THEY CONTINUE TO
REPRESENTA SERIOUS IMPEDIMENT TO FOREIGN INVESTMENT.
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1.  OPENNESS TO FOREIGN INVESTMENT
THELEGISLATIVE FRAMEWORK OF GEORGIA CONFORMS TO
INTERNATIONALLYACCEPTED NORMS AND PRINCIPLES.
LEGISLATIONGOVERNING FOREIGN INVESTMENT HAS EVOLVED
RAPIDLYIN GEORGIA SINCE 1995 AND IS NOW LARGELY IN
PLACE.THIS LEGISLATION, IN CONCERT WITH THE
GOVERNMENT'SECONOMIC STRATEGY, AIMS TO ESTABLISH
FAVORABLECONDITIONS, BUT NOT PREFERENTIAL TREATMENT,
FORFOREIGN INVESTORS.  AN EARLY LAWGRANTING A TAX
HOLIDAYTO FOREIGN INVESTORS WAS REPEALED IN 1996 IN
FAVOROF A REGIME GUARANTEEING NATIONAL TREATMENT IN
ALLBUT A VERY LIMITED NUMBER OF CASES.
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THEPRINCIPAL LEGISLATION IMPACTING ON THE INVESTMENT
CLIMATEINCLUDES THE CONSTITUTION (1995), THE CIVIL
CODE(1997), THE TAX CODE (1997), AND THE CUSTOMS CODE.
THELAW ON NORMATIVE ACTS PROVIDES THAT INTERNATIONAL
AGREEMENTSDO NOT CONFLICT WITH THE CONSTITUTION.
OTHERLEGISLATION AIMED AT ENSURING THE FREE AND
EFFICIENTOPERATION OF BUSINESS ENTITIES INCLUDES: THE
LAWON ENTREPRENEURS (AS AMENDED IN 1999); THE LAW ON
PROMOTIONAND GUARANTEES OF INVESTMENT ACTIVITY (1996);
THEBANKRUPTCY LAW; THE LAW ON COURTS AND GENERAL
JURISDICTION;THE LAW ON LIMITATION OF MONOPOLISTIC
ACTIVITY;THE LAW ON CUSTOMS TARIFFS AND DUTIES; THE
ACCOUNTINGLAW (1999); AND THE STOCK MARKET LAW.
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THELEGAL FRAMEWORK GOVERNING OWNERSHIP AND
PRIVATIZATIONIS PROVIDED BY THE FOLLOWING ACTS: THE
CIVILCODE; THE LAW ON OWNERSHIP OF AGRICULTURAL LAND
(1996);THE LAW ON PRIVATE OWNERSHIP OF NON‑
AGRICULTURALLAND (1998); THE LAW ON MANAGEMENT OF
STATE‑OWNEDNON‑AGRICULTURAL LAND (1998); AND THE LAW
ONPRIVATIZATION OF STATE PROPERTY (1997).   PROPERTY
RIGHTSIN THE EXTRACTIVE INDUSTRIES ARE GOVERNED BY THE
LAWON CONCESSIONS, THE LAW ON DEPOSITS, AND THE LAW ON
OIL& GAS (1999). INTELLECTUAL PROPERTY RIGHTS ARE
PROTECTEDUNDER THE CIVIL CODE, AND BY THE LAWS ON
PATENTSAND TRADEMARKS.  FINANCIAL SECTORLEGISLATION
INCLUDESTHE LAW ON COMMERCIAL BANKS, THE LAW ON
NATIONALBANKS, AND THE LAW ON INSURANCE ACTIVITIES
(1999).
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THEBODY OF LAWS IS COMPLEMENTED FROM TIME TO TIME BY A
NUMBEROF  PRESIDENTIAL DECREES WHICHGENERALLY ADHERE
TOTHE REFORMIST CHARACTER OF THE LEGISLATION.
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MUCHOF THE LEGAL FRAMEWORK GOVERNING COMMERCIAL
ACTIVITIESIN GEORGIA HAS BEEN ENACTED ONLY VERY
RECENTLY.  MANY OF THE LAWS WERE DRAFTED WITH THE
ASSISTANCEOF TECHNICAL ADVISORS FROM THE UNITED STATES
ANDWESTERN EUROPE AND ARE SUPPORTIVE OF A LIBERAL
INVESTMENTREGIME.  HOWEVER, THE TRUE TEST OFGEORGIA'S
COMMITMENTTO OPENNESS AND TRANSPARENCY AND THE
EQUITABLETREATMENT OF FOREIGN INVESTORS WILL BE
THROUGHTHE IMPLEMENTATION AND ENFORCEMENT OF THESE
LAWS.
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OWNERSHIPOF PROPERTY CAN BE GAINED THROUGH
ACQUISITION,MERGER, TAKEOVER, OR GREENFIELD
INVESTMENT.OWNERSHIP MAY BE IN THE FORM OF AN
INDIVIDUALENTERPRISE, A GENERAL PARTNERSHIP, A LIMITED
PARTNERSHIP,A LIMITED LIABILITY COMPANY, A JOINT STOCK
COMPANYOR A COOPERATIVE.  UNDER GEORGIANINVESTMENT
LAW,FOREIGNERS MAY BUY, INVEST OR PURCHASE INTERESTS
INSTOCKS, BONDS, COMPANIES, BUILDINGS, INTELLECTUAL
PROPERTY,NATURAL RESOURCE DEVELOPMENT LICENSES, AND
"ANYOTHER FORM OF PROPERTY RECOGNIZED BY LAW."  THERE
ISNO REQUIREMENT FOR LOCAL PARTICIPATION IN OWNERSHIP,
MANAGEMENT,CONTRACTING OR PROCUREMENT.
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GEORGIANLAW ALLOWS UNLIMITED FOREIGN OWNERSHIP IN MOST
SECTORS,BUT IT HAS LIMITED FOREIGN INVESTMENT IN SOME
INFRASTRUCTUREPROJECTS.  RECENT LEGISLATIONALLOWS
NON‑GEORGIANSTO OWN NON‑AGRICULTURAL LAND INDIRECTLY,
THROUGHA LEGAL ENTITY REGISTERED UNDER THE LAWS OF
GEORGIA.HOWEVER, FOREIGNERS ARE NOT PERMITTED TO OWN
AGRICULTURALLAND.
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THELAW ON PROMOTION AND GUARANTEES OF INVESTMENT
ACTIVITIESOF NOVEMBER 1996, AND AMENDED IN JUNE 1998,
DEFINESTHE LEGAL PRINCIPLES GOVERNING FOREIGN AND
DOMESTICINVESTMENTS IN GEORGIA AND PROVIDES INVESTMENT
PROTECTIONGUARANTEES.  IT PROVIDES THAT THERIGHTS AND
GUARANTEESOF A FOREIGN INVESTOR CANNOT BE LESS THAN
THERIGHTS AND GUARANTEES OF GEORGIAN INDIVIDUALS OR
LEGALPERSONS.  IN THE EVENT OF THEADOPTION OF NEW
LEGISLATION,WHICH MIGHT ADVERSELY AFFECT THE
CONDITIONSFOR FOREIGN INVESTMENT, THE PROVISIONS OF
THELAW ON PROMOTION AND GUARANTEES OF INVESTMENT
ACTIVITIESWILL CONTINUE TO GOVERN FOR A PERIOD OF TEN
YEARSFROM THE DATE OF ENACTMENT OF THE NEW
LEGISLATION.
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UNDERTHE LAW ON PROMOTION AND GUARANTEES OF INVESTMENT
ACTIVITY,AND ITS AMENDMENTS, THE GOVERNMENT MUST
RETAINA CONTROLLING INTEREST IN AIR TRAFFIC CONTROL,
SHIPPINGTRAFFIC CONTROL, RAILROAD CONTROL SYSTEMS,
DEFENSEAND WEAPONS INDUSTRIES, AND NUCLEAR ENERGY.
ONLYTHE STATE MAY ISSUE CURRENCY AND BANKNOTES,
PRODUCEGOODS FROM PRECIOUS METALS, IMPORT NARCOTICS
FORMEDICAL PURPOSES, OR PRODUCE CONTROL SYSTEMS IN THE
ENERGYSECTOR.  INVESTMENT IN CERTAINSECTORS IS
PROHIBITEDOR SUBJECT TO LICENSING. THESE ARE
PRODUCTIONOF WEAPONS AND EXPLOSIVE'S, NARCOTICS,
POISONOUSAND PHARMACEUTICAL SUBSTANCES; EXPLORATION
ANDEXPLOITATION OF RENEWABLE OR NON‑RENEWABLE
SUBSTANCES;EXPLOITATION OF DEPOSITS OF NATURAL
RESOURCES;ESTABLISHMENT OF CASINOS AND GAMBLING HOUSES
ANDTHE ORGANIZATION OF GAMES AND LOTTERIES; BANKING;
INSURANCE;ISSUANCES OF SECURITIES; WIRELESS
COMMUNICATIONSERVICES; AND THE ESTABLISHMENT OF RADIO
ANDTELEVISION CHANNELS.
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APREVIOUS FOREIGN INVESTOR REGISTRATION REQUIREMENT
WASABOLISHED BY THE AMENDMENTS TO THE LAW IN JUNE OF
1996.  HOWEVER, THE LAW ON ENTREPRENEURSHIPSTIPULATES
THEFOLLOWING REQUIREMENTS FOR THE REGISTRATION OF ALL
COMPANIESWITH THE COURT: FOUNDER AND FIRM PRINCIPALS'
NAMES,DATES AND PLACES OF BIRTH, OCCUPATIONS, AND
PLACESOF RESIDENCE; INCORPORATION DOCUMENTS; AREA OF
ACTIVITY;AND CHARTER CAPITAL.  THISINFORMATION,
STATEDON A REGISTRATION CARD, IS SUBJECT TO
PUBLICATION.  ANY PERSON MAY REQUEST AND REVIEW
ENTERPRISEREGISTER EXTRACTS.
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WHILETHE REGISTRATION PROCESS IS NOT GENERALLY
CONSIDEREDTO BE ONEROUS, THE LICENSING REQUIREMENTS
HAVEBEEN THE SUBJECT OF SIGNIFICANT DISSATISFACTION
AMONGFOREIGN INVESTORS.  INVESTORSCOMPLAIN THAT THE
LARGENUMBER OF BUSINESS LICENSES CURRENTLY REQUIRED IS
UNNECESSARILYBURDENSOME.
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ANEARLY VERSION OF THE DRAFT LAW ON LICENSING OF
ENTREPRENEURIALACTIVITIES HAD MANDATED LICENSING OF A
WIDERANGE OF BUSINESS ACTIVITIES AND HAD GRANTED
AUTHORITYTO ISSUE LICENSES TO NUMEROUS AGENCIES. THE
STATEDPURPOSE WAS TO ENSURE THAT ONLY RESPONSIBLE AND
LEGITIMATEFIRMS WERE ABLE TO OPERATE. HOWEVER, THE
INTERNATIONALCHAMBER OF COMMERCE IN GEORGIA COMPLAINED
VOCALLYTHAT THE DRAFT LAW WOULD UNNECESSARILY OBSTRUCT
BUSINESSDEVELOPMENT AND FACILITATE OFFICIAL CORRUPTION
ONA WIDER SCALE.  IN RESPONSE TOTHESE COMPLAINTS, THE
DRAFTLAW WAS REVISED TO REDUCE THE SCOPE OF LICENSING
REQUIREMENTSTO COVER ACTIVITIES IMPACTING ON PUBLIC
HEALTH,NATIONAL SECURITY AND THE FINANCIAL SECTOR, AND
REDUCEDTHE NUMBER OF AGENCIES GRANTED LICENSE‑ISSUING
AUTHORITY.
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THESTATE TAX SERVICE IS THE ONLY BODY LEGALLY
EMPOWEREDTO INSPECT THE TAX‑PAYMENT STATUS OF AN
ENTERPRISE.  THE TAX SERVICE'S REGULATIONS DO NOT
DISCRIMINATEBETWEEN FOREIGN AND LOCAL ENTERPRISES.
TAXINSPECTORS SOMETIMES EXCEED THEIR AUTHORITY,
HOWEVER,AND ACT ARBITRARILY.  MOREOVER,INVESTORS
REPORTDIFFICULTIES IN ASCERTAINING EXACTLY WHAT TAX
RATESAPPLY TO A GIVEN ACTIVITY.  SOMEHAVE ENCOUNTERED
DIFFICULTIESWITH CHANGING TAX RATES AND TAX‑PAYMENT
INSTRUCTIONS.
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THEGOVERNMENT HAS NOT GENERALLY UNDERTAKEN
DISCRIMINATORYACTIONS AGAINST FOREIGN INVESTORS.
HOWEVER,SEVERAL EXCEPTIONS OCCURRED IN COMMUNICATIONS.
UNDERTHE MANAGEMENT OF A FORMER MINISTER, THE MINISTRY
OFCOMMUNICATIONS SUSPENDED, AND LATER RESTORED, A
U.S.‑GEORGIANCOMMUNICATION COMPANY'S CONNECTION TO THE
CITYCOMMUNICATION NETWORK.  ANOTHERCONFLICT BETWEEN
AMERICANINVESTORS AND THE MINISTRY OF COMMUNICATIONS
OCCURREDWHEN THE MINISTRY REVOKED EXCLUSIVE RIGHTS IT
HADPREVIOUSLY GRANTED TO A GROUP OF AMERICAN
COMPANIES.  RECEPTIVENESS BY THIS POWERFUL MINISTRYTO
FOREIGNINVESTMENT WAS CONSIDERED TO BE LOW.
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CONFLICTOF INTEREST ISSUES HAVE BEEN REPORTED WITHIN
THEMINISTRY OF COMMUNICATIONS AS EMPLOYEES HAVE
ENGAGEDIN PRIVATE COMMUNICATIONS BUSINESSES, AND
TELECOMMUNICATIONSLICENSES HAVE BEEN AWARDED TO FAMILY
MEMBERSOF SENIOR MINISTRY OFFICIALS. FOREIGN
INVESTORSHAVE ALSO REPORTED THAT THEY HAVE BEEN
ADVISEDBY OFFICIALS TO TAKE FAMILY MEMBERS AS PARTNERS
ANDEMPLOYEES.  SUCH PRACTICES ARE NOTUNIQUE TO THE
MINISTRYOF COMMUNICATIONS.
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 IN AUGUST 1998, THE PRESIDENT REPLACEDTHE MINISTER OF
COMMUNICATIONS.  THERE ARE SIGNS THAT THE SITUATION IS
IMPROVING.  AT THE TIME OF THIS WRITING, SOMETWENTY
PERCENTOF THE EMPLOYEES OF THE MINISTRY HAVE BEEN
REPLACEDOR DISMISSED.  IN ADDITION, A DRAFTLAW ON
COMMUNICATIONS,CURRENTLY UNDER CONSIDERATION BY THE
GOVERNMENT,PROPOSES TRANSFERRING THE POWER TO REGULATE
THESECTOR AND GRANT OPERATING LICENSES, FROM THE
MINISTRYTO AN INDEPENDENT REGULATORY COMMISSION. MUCH
OFTELECOMMUNICATIONS SECTOR IS EXPECTED TO BE
PRIVATIZEDOVER THE NEXT YEAR.
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PRIVATIZATIONOF STATE‑OWNED PROPERTY BEGAN IN 1992
WITHTHE LAW ON PRIVATIZATION OF STATE ENTERPRISES AND
THESTATE PROGRAM OF PRIVATIZATION.  BYMID‑1997, A
TOTALOF 1,149 MEDIUM‑SIZED AND  LARGEENTERPRISES HAD
BEENPRIVATIZED.  BY THAT TIME THEPRIVATIZATION OF
SMALLENTERPRISES HAD BEEN LARGELY ACCOMPLISHED.
CURRENTLYSCHEDULED FOR PRIVATIZATION ARE: ENERGY AND
FUELENTERPRISES; TELECOMMUNICATIONS ENTERPRISES, WITH
THEEXCEPTION OF STATE‑OWNED CABLE AND BROADCASTING
SERVICESCONSIDERED OF STRATEGIC IMPORTANCE (SOME
PRIVATEBROADCASTING STATIONS ALREADY EXIST); CERTAIN
MANUFACTURINGENTERPRISES; AGRICULTURAL AND FOOD
PROCESSINGENTERPRISES, WITH THE EXCEPTION OF CERTAIN
RESEARCHINSTITUTES; CONSTRUCTION ENTERPRISES, EXCEPT
FORWATER AND SEWAGE UTILITIES; HEALTH SERVICES, WITH
THEEXCEPTION OF MEDICAL ESTABLISHMENTS OF VITAL
IMPORTANCE;TRANSPORT ENTERPRISES, EXCEPT FOR THE
NATIONALAIR TRAFFIC NAVIGATION SYSTEM; AND EDUCATIONAL
SERVICES.
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LEGISLATIONPROVIDES FOR NATIONAL TREATMENT OF BOTH
FOREIGNAND LOCAL INVESTORS SEEKING TO PARTICIPATE IN
THEPRIVATIZATION PROCESS.  THE ONLYLIMITATION IS THAT
ENTERPRISESIN WHICH THE GOVERNMENT OWNS MORE THAT 51
PERCENTMAY NOT BID FOR PROPERTIES BEING PRIVATIZED.
THELAW ON PRIVATIZATION OF STATE PROPERTY, ADOPTED IN
MAY1997, RECOGNIZES FOUR FORMS OF PRIVATIZATION:
TENDER,AUCTION, LEASE BUY‑OUT AND DIRECT SALE.
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THEREIS NO DIRECT EVIDENCE TO SUGGEST THAT FOREIGN
INVESTORSARE TREATED DIFFERENTLY THAN GEORGIAN
INVESTORSIN THE PRIVATIZATION PROCESS. HOWEVER, THE
PERIODBETWEEN THE ANNOUNCEMENT OF THE REQUEST FOR
TENDERSAND THE CLOSING DATE FOR TENDERS CAN BE
RELATIVELYSHORT ‑ ONE MONTH IN RECENT CASES OF LARGE
PRIVATIZATIONS‑ WHICH TENDS TO FAVOR LOCALLY‑PRESENT
INVESTORS.  IN ADDITION, SUCCESSFUL FOREIGN BIDDERS
HAVEREPORTED THAT THE PERIOD IMMEDIATELY FOLLOWING THE
AWARDOF A CONTRACT TO BE FAR FROM SMOOTH
ADMINISTRATIVELYAND OPERATIONALLY, PARTICULARLY WITH
REGARDTO RELATIONS WITH THE TAX SERVICE. IN PART,
THISCAN BE ATTRIBUTED TO POOR COORDINATION AMONG
GOVERNMENTAGENCIES INVOLVED IN PRIVATIZATIONS.
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INAT LEAST TWO KNOWN INCIDENCES, FOREIGN INVESTORS
HAVEBEEN INFORMED SUBSEQUENT TO THEIR GOOD‑FAITH
PURCHASEAT PRIVATIZATION AUCTIONS, THAT THE PROCESS
WASNOT HANDLED IN ACCORDANCE WITH CORRECT LEGAL FORM
BYTHE GEORGIAN AUTHORITIES, AND THE RESULTS OF THE
PRIVATIZATIONCANCELED.  IN BOTH CASE CONSIDERABLELOSS
ANDINCONVENIENCE HAVE ULTIMATELY BEEN INCURRED BY THE
INVESTORS.
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2.  CONVERSION AND TRANSFER POLICIES
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FOREIGNINVESTORS MAY CONVERT OR TRANSFER INTO HARD
CURRENCYANY AMOUNT OF FUNDS ASSOCIATED WITH AN
INVESTMENT.  FOREIGN INVESTORS HAVE THE RIGHT TOHOLD
FOREIGNCURRENCY ACCOUNTS WITH AUTHORIZED LOCAL BANKS.
THESOLE LEGAL TENDER IN GEORGIA IS THE LARI, WHICH IS
TRADEDON THE TBILISI INTERBANK CURRENCY EXCHANGE, AS
WELLAS THE FOREIGN EXCHANGE BUREAU MARKET. THE FORMER