Corruption risk in Akhaltsikhe: The City Hall acquires parking lot spaces from former high-ranking officials at a price that exceeds its actual value by 1.1 million - საერთაშორისო გამჭვირვალობა - საქართველო

Corruption risk in Akhaltsikhe: The City Hall acquires parking lot spaces from former high-ranking officials at a price that exceeds its actual value by 1.1 million

28 November, 2023

Akhaltsikhe City Hall intends to purchase a bus stop space for 2,600,000 GEL from Silk Road Engineering LLC. It is noteworthy that this company is owned by Paata Shekeladze, the former director of "Mechanizator" LLC in the Ministry of Agriculture, and Temur Tsutskiridze, the former procurement manager of the same company. In March 2022, this company acquired an area of 18,030 sq.m. with buildings on it in Akhaltsikhe. Notably, the purchase was made without competition from the subsidiary company of "Mechanizator" LLC, and the transaction amounted to 1,471,000 GEL. A year and a half later, the former officials of "Mechanizator" LLC stand to make a profit of 1,129,000 GEL by selling this space.

From 2015 to 2019, Paata Shekeladze served as the director of "Mechanizator"[1] LLC and subsequently took on the same role for its 100% owner, the state-founded NNLE "Agriculture Project Management Agency." During the period from 2015 to 2018, Temur Tsutskiridze held the position of procurement manager at "Mechanizator" LLC.

Before 2020, "Mechanizator" LLC operated 13 regional service centers across Georgia, providing support to farmers with agricultural equipment. The  "Agriculture Project Management Agency" focused on projects aiding small-land farmers during spring works. Starting at the close of 2020, the service centers of "Mechanizator" LLC underwent consolidation, and in January 2021, the process of selling a portion of their property in the regions commenced.

In January 2020, Temur Tsutskiridze, together with Giorgi Giorgobiani, the brother of Paata Shekeladze's wife, established "Silk Road Engineering" LLC. Two years later, in January 2022, the company acquired a parcel of agricultural machinery spanning 18,030 square meters in the baggage station settlement of Akhaltsikhe. This purchase, comprising a parking lot with accompanying buildings, was secured through a competition-free auction for a sum of 1,471,000 GEL. The Samkharauli Expertise Bureau evaluated the property at a value of 1,463,408 GEL.

During that period, Ekaterine Giorgobiani, the mother-in-law of the former director of Mechanizator LLC, Paata Shekeladze, held a 50% ownership stake in Silk Road Engineering LLC. This share was initially allocated to her by her son, Giorgi Giorgobiani. Within three months, Ekaterine Giorgobiani transferred this ownership portion to her daughter, Anna Giorgobiani. Subsequently, Anna Giorgobiani also passed on a 50% share to her husband, Paata Shekeladze, within the same three-month timeframe.

In 2022, "Silk Road Engineering" LLC acquired 11,263 square meters of land in Gurjaani and another 17,155 square meters in Marneuli, both of which were previously owned by "Mechanizator" LLC.

During the Akhaltsikhe Municipality City Council meeting on October 23, it was revealed that Akhaltsikhe City Hall is planning to acquire a parcel of land measuring 18,030 square meters located at the baggage station from "Silk Road Engineering" LLC. The proposed purchase price for this space is 2,600,000 GEL. The City Hall intends to utilize this area for the development of parking lots for 18 new buses. During the session, Mayor Irakli Lazarashvili mentioned that the Levan Samkharauli Expertise Bureau assessed the property at 1,700,000 GEL, yet the owner is offering it for sale at 2,600,000 GEL. The mayor highlighted that, based on his statements, constructing a new parking lot in any other location, including within the municipality's own territory, would incur higher costs, although he did not specify the exact amount of this increased expense. The mayor is awaiting approval from the council to proceed with the purchase of the parking lot.

It's noteworthy to mention that Paata Shekeladze, the potential seller of the property to Akhaltsikhe City Hall, made a donation of 7,000 GEL to the "Georgian Dream" party in 2016.

"Transparency International - Georgia" calls on the Akhaltsikhe City Hall and City Council to mitigate potential corruption risks by making a decision on the acquisition of the land for the municipal parking lot only after conducting a thorough research. This evaluation should encompass a detailed comparison of all costs associated with the development and construction of the bus parking lot, considering both the privately owned property and the state-owned territory.


[1] Since January 2019, "Mechanizator" LLC underwent a name change and has been known as "Agricultural Logistics and Services Company" up to the present time.