GEO

Bill on Eminent Domain Fails to Strike Balance between Public and Private Interests

08 June, 2017

On April 5, 2017, the Georgian Parliament registered a bill of the Georgian Government in relation to the rules of eminent domain. According to the explanatory note of the bill, the intent of the bill is to improve the legislation, and make the measures used for taking property by the Government more complete, clear and transparent. In addition, it intends to address the shortcomings in the legislation that have been identified as a result of past expropriation measures, aiming to better protect the rights of property owners as well as to meet set deadlines when undertaking projects and works of state-level importance.

Transparency International – Georgia, on the one hand, supports the Government’s initiative to simplify procedures for eminent domain measures. However, we believe that the proposed bill will not be able to strike the balance between private and public interests. The noted balance requires that, on the one hand, the owner whose property is expropriated by the state, must receive advance, full and fair compensation for the taken property, and, on the other hand, the taken property must be used for necessary public purposes.

The bill:

  • Provides a complete list of instances where necessary public purpose exists – which permits property-taking.
  • Provides rules for mutually agreed and involuntary relocation. Specifically, in case of an agreement, the agency expropriating the property takes the property as agreed with the owner under the purchase agreement. In case of involuntary relocation, the Government will take property after obtaining a court order on expropriation.
  • The procedure of eminent domain is divided into three stages: pre-expropriation, obtaining the right to expropriate and undertaking expropriation.
  • During the stage of undertaking expropriation, the agency implementing the work and/or project registers the property ownership and gives time to the former owner to vacate the premises.
  • The owner has the right to litigate the fairness of compensation by filing with the appropriate court in accordance with the Civil Code of Georgia.

Risks associated with the bill are:

  • Introducing the so-called police-enforced eviction puts citizens and the state in unequal positions – giving the state advantage. According to the bill, the expropriator will be given the right to present the law enforcement agencies a document proving the ownership of property and request an eviction of the wrongful occupant. The explanatory note of the bill states that this is due to the fact that the expropriator has already been granted the right to take property under a court order, which means that the ownership interest transferred to the expropriator. Therefore, it should not require to re-litigate on the same property. On the other hand, it should be noted that the so-called “police-enforced eviction” has been repealed by the 2012-2016 Parliament, which we have critically assessed. Under the current proposed bill, unlike any other owner, only the state, acting as an expropriator, has the right to use this measure. Private owners on the other hand have to refer this issue to the court which requires additional time and resources.
  • Disputes on fair compensation may last for unreasonably long periods of time for citizens – the bill does not provide for an accelerated procedure for the citizens to protect their rights in fair compensation disputes, whereas the procedure for granting the right to expropriate is decided in the shortest period of time.
  • Rules on useless property after expropriation – it is possible that expropriation divides property in such a way that plots of land created as a result of the expropriation become not fit for use. The bill does not contain a procedure as to which court the owner should petition to request compensation for the useless property (in case the parties cannot agree on this issue).

Our Recommendations

  • If the so-called police-enforced eviction is introduced, the same rights should be granted to other owners as well;
  • For fair compensation disputes, the bill and its implementing legislation must provide for a possibility of fast-track procedure of dispute resolution on fair compensation;
  • It is necessary to provide language on the competent agency/court and the procedures for fair compensation disputes for the property that is left after division of property by expropriation measures.

Considering the above shortcomings, we believe the bill requires improvements in order to provide equal protections for the state, as the expropriator, and the citizens’ property rights. It is necessary that projects of public importance are carried out without obstacles and obstructions. However, it should be noted that the proposed bill must ensure providing full and fair compensation for the legitimate interests of property owners.