New law must ensure institutional independence of Business Ombudsman - საერთაშორისო გამჭვირვალობა - საქართველო

New law must ensure institutional independence of Business Ombudsman

06 April, 2015


The Government of Georgia has registered a new draft Law on the Business Ombudsman of Georgia in the Bureau of the Parliament of Georgia on February 23, authored by the Tax Ombudsman’s administration.

Last week the parliamentary Financial-Budgetary Committee examined the draft Law at the first hearing and approved its submission to the first plenary session, which is to hear the draft Law in the coming days.

Transparency International  Georgia argues that these legislative amendments must be more than simple technical amendments. They should substantively increase the institution’s supervisory mechanisms and its role in protecting rights. The Tax (Business) Ombudsman’s Institute discharges its statutory functions effectively. However, it requires greater autonomy and powers in order to improve its effectiveness in discharging these activities. We believe it would be useful to amend the procedure for appointing the Business Ombudsman in a way that would improve the agency’s institutional sustainability and equip it with more guarantees of independence and public accountability. Transparency International  Georgia believes it would be reasonable to achieve this, as a priority, by making this institute accountable before the Parliament and electing the Ombudsman to office for a fixed term.

Currently Article 42 of the Tax Code of Georgia and the 23 February 2011 Resolution N92 of the Government of Georgia “on the Powers and Key Principles and Forms of Activities of Tax Ombudsman” define the Tax Ombudsman’s powers, and key principles and forms of its activities. The current draft Law’s explanatory note states that practical analysis has demonstrated the need to improve number of statutory rights and duties of the Tax Ombudsman to secure the institute’s effective functioning.

Pursuant to the draft, the term “Tax Ombudsman” is replaced with “Business Ombudsman”. The submitted draft was also built on the Government Resolution N92 and mainly reiterates its norms.

Transparency International Georgia welcomes new statutory regulation of the Business Ombudsman’s activities. Yet, we believe replacing a resolution with a law and amending the Tax Ombudsman’s position terminologically is not sufficient to improve the Institute’s effective function. It is crucial that the law provides guarantees for the Business Ombudsman’s appointment, dismissal and accountability, which would warrant its institutional independence.

Transparency International  Georgia has the following comments and opinions in respect of the draft Law, and particularly in relation to the Business Ombudsman’s independence guarantees:

1. Under the submitted draft Law, the Prime Minister of Georgia appoints and dismisses the Business Ombudsman. The Prime Minister decides on appointment in agreement with the Chairperson of the Parliament. However, the Prime Minister needs neither consent of the Chairperson of Parliament nor justification of specific circumstances in order to dismiss the Business Ombudsman.

Functionally, Business Ombudsman is not a part of the executive authorities. The Business Ombudsman oversees the protection of rights and legal interests associated with pursuit of economic activities by persons in the territory of Georgia, identifies breaches of these rights by administrative agencies, and assists in restoration of breached rights. By placing the appointment and dismissal of the Business Ombudsman at the will of the head of government, there independence of the position is significantly undermined There is a risk of political capture, and the effectiveness of the any investigation of breaches of rights by administrative authorities becomes questionable. Ther Business Ombudsman should not only mediate between administrative agencies and persons pursuing economic activities, but should also advocate and protect the rights of the latter, even or especially against the government.

It is practical that the representative body of Georgia elects Business Ombudsman for a definite term and enjoys the privilege to dismiss him/her. Independent controlling and human rights officials (including State Audit Office, Public Defender, Personal Data Protection Inspector) are elected by and accountable before the Parliament. For the Business Ombudsman’s communication with the Government members to be effective, s/he should enjoy the Government’s trust as well. Hence, it is preferable that the Business Ombudsman is elected by the Parliament on submission by the Prime Minister, and that his/her powers may only be terminated prematurely by the Parliament’s decision. The Business Ombudsman should enjoy immunity. Parliament’s consent must be provided prior to criminal charges being made, detaining or arresting, and searching him/her personally or his/her apartment, car, or workplace.

2. Pursuant to the draft Law, Business Ombudsman’s operations are funded from the state budget, and his/her remuneration is determined by the Prime Minister.

To ensure independence of the Business Ombudsman’s activities and effective functioning of this institute, it is necessary that the Business Ombudsman submits draft expenses pursuant to the procedure established by law, and that the assignments required for operations of the Business Ombudsman and the administration are defined under a separate code of the state budget of Georgia.

3. Submitted draft Law stipulates that the Business Ombudsman submits an annual activity report to the Government of Georgia and the parliamentary Financial-Budgetary Committee.

The Business Ombudsman supervises the protection of rights and legal interests associated with pursuit of economic activities by persons in the territory of Georgia, identifies breaches of these rights by administrative agencies, and assists in restoration of breached rights. His/her activities are directly linked with protection of economic rights recognized by the Constitution of Georgia and identification of breach of these rights by an administrative agency.

Thus, the Business Ombudsman should submit a report to the Government and the Parliament – and not one concrete Committee – because apart from the financial-budgetary issues, his/her report may cover violations of economic rights as well.

4. According to the draft Law, a citizen of Georgia with higher economic and legal education may be appointed as the Business Ombudsman.

Given the importance of the Business Ombudsman’s functions, it would be sensible that a potential nominee for the Business Ombudsman has a 5-year work experience in business or the human rights sector and relevant business and moral qualities.

Author: TI Georgia