Adverse Impact on Agri Land Ban for Foreign Farmers - საერთაშორისო გამჭვირვალობა - საქართველო

Adverse Impact on Agri Land Ban for Foreign Farmers

03 July, 2014

On the July 1, the short documentary movie Adverse Impact on Agri Land Ban for Foreign Farmers was screened to the public, which was followed by a short discussion held at Europe House in Tbilisi.

The movie concerned the difficulties faced by many investors, due to the ban on the land acquisition of foreigners.

In fact, in 2013, the government without any consultations decided to ban foreigners from purchasing on inheriting agricultural land, a ban that was to remain in place until the end of 2014. Even companies held by Georgian citizens that have at least one foreign national as a minority shareholder were affected by the ban. An example of such companies is Chateau Mukhrani Wines, which was banned from expanding its operations because of the very piece of legislation.

Foreign nationals currently hold up to 19,000 ha of agricultural land in Georgia, which represents about 0,7% of the total of agricultural lands. This indicates that introducing such a ban was premature. Transparency International Georgia spoke with two of the largest foreign-owned farms in Georgia and filmed the short documentary to highlight how their operations were affected by the ban. The documentary also shows how their business and staff expansion was slowed down following to the ban.

After the screening of the movie, a discussion was held and participants of the discussion, which was moderated by Ted Jonas, Partner at DLA Piper and Chairman of the American Chamber of Commerce Commercial law and tax committee. Panelists included Fady Asly, Chairman of the Board of the International Chamber of Commerce and President and CEO of Agritechnics Holding, Eka Bokuchava, Senior Lawyer of Transparency International Georgia, MP Nodar Ebanoidze, First Deputy Chair of the Finance and Budget Committee, MP Gigla Agulashvili, Chair of the Agriculture Committee and Otar Iashaghashvili, Deputy Head of the Legal Department, Ministry of Economy.

According to Eka Gigauri, “the government had planned an Agricultural land inventory and nothing has been done in this direction. We think that an agricultural land inventory is important.  There is a need of reasonable regulations when it comes to land registration.”

Fady Asly considers it appropriate to remove restrictions on the decision and stated that “transparency and predictability is of great importance to business. The fact that the law changes so quickly has a huge impact on investor´s interests. That is why they are becoming less and less interested in Georgia.”

According to Zurab Japaridze, one of the leaders of the Parliamentary minority, shady deals do not have anything to do with the sale of land to foreigners: “If it is said that someone captured the land in a corrupt way and then sold it, this can still be done by Georgians and foreigners. Talking about the ban of land sales to foreigners as a solution to this problem is absurd.”

In his comments to the media, Gigla Agulashvili stated that “those who do not take care of their land, do not protect it from erosion and etc, should also respond to the state. If you have a car you can damage it with a hammer, but the state policy on the treatment of land must be such that we will protect it. Unfortunately, neither our citizens nor the foreigners take care of this property.”

Photos: movie screening / discussion