Key Findings

• According to the amendments to the election legislation adopted by the Parliament of Georgia on July 2, 2020:
  • The election threshold required for parties to receive public funding decreased from 3% to 1%;
  • The rules for defining the amount of public funding was simplified and improved;
  • A sanction has been introduced for illegal expenses undertaken for the purposes of counter-campaigning;
  • Criteria were improved for donations by legal entities;
  • Vote-buying will be classified as criminal wrongdoing in all cases;
  • Documents related to the monitoring of party financing will be circulated electronically;
  • Personal data of donors will be more protected;
  • The definition of prohibited funding was expanded;
  • A sanction has been defined for such cases when an electoral subject places an advertisement of other electoral subjects within its allocated airtime.
• Out of 50 electoral subjects, 29 received donations from January 1, 2020, to October 15, 2020. The total sum of donations received by these subjects is GEL 35 376 394, out of which GEL 17 086 626 went to the ruling party Georgian Dream – Democratic Movement, GEL 5 075 844 to - Lelo for Georgia, while the parties making up the electoral bloc United National Movement, United Opposition – “Strength in Unity” _^[1]  received GEL 3 735 583.
• The ruling party Georgian Dream – Democratic Georgia received 48% of the total donations made to electoral subjects. To compare with data from previous years, the Georgian Dream received 66% of the total donations during the parliamentary election year in 2016 and 88% - during the local self-government election year in 2017. The reduction of the difference between the volume of donations received by the ruling and other parties can be explained by the fact that the party “Lelo for Georgia” and the electoral bloc “Giorgi Vashadze – the Builder Strategy” joined the list of traditionally financially-strong parties.
• 98% of the total donations received by 29 electoral subjects came from natural persons, while the remaining 2% - from legal entities. Nearly 1/3 of the political party donors contributed more than the average annual salary (GEL 11 040_^[2]) in Georgia. Approximately 82% of the total donations received by all parties are from such donors, which points to the dependency on large donors.
• Companies connected to the donors of the ruling party received approximately GEL 47 million from public tenders in 2020 (until October 1) and in exchange these donors contributed GEL 1.3 million to the Georgian Dream within the same time period. G & K Technology LLC is particularly worth mentioning that secured GEL 17.2 million from public tenders in 2020. Roman Abramishvili, the founder of this company, donated GEL 60 000 to the Georgian Dream. It is noteworthy that this company was mentioned for a similar case in Transparency International Georgia’s Report Georgia’s Political Finance in 2019._^[3] Another large public procurement contractor is L & K LLC that won public tenders worth GEL 8.1 million in 2020, while its owners contributed GEL 22 000 to the ruling party. Arsakidze-2000 LLC is also worth mentioning that got GEL 1.4 million from public tenders in 2020. The owners of this company are connected to Lilo-Mall LLC, which is a large business group whose partners have been one of the biggest political donors for years.
• In addition to tenders, the companies belonging to natural persons that have donated to the ruling party have a history of winning simplified public procurement contracts. Companies, which are directly or indirectly connected to persons who have contributed approximately GEL 2.2 million to the ruling party, received around GEL 3.8 million from simplified public procurement contracts until October 1, 2020. Kvarlis Edemi LLC is also worth mentioning, which is under the ownership of the business partner of Aleksandre Ivanishvili, the brother of the Chairperson of the ruling party Bidzina Ivanishvili. This company came to the attention of Transparency International Georgia in the spring of 2020 when in the period of the state of emergency, its owner secured a large simplified procurement contract days after making a political donation.
• A number of large groups have formed amongst the ruling party’s political donors, who make large contributions to the Georgian Dream during nearly every election. Three such groups continued to make large contributions in 2020. Namely, persons connected to Bidzina Ivanishvili donated a total of GEL 447 500 to the Georgian Dream. Persons connected to Lilo-Mall LLC donated a total of GEL 595 000 to the ruling party, while persons directly or indirectly connected to Service-Argo LLC contributed GEL 255 000 to the party.
• The contributions made by majoritarian candidates were a separate topic for research. Out of 30 majoritarian candidates from the ruling party Georgian Dream, seven (including their family members and business partners) donated GEL 1 035 000 to the party after January 2020, which represents 6% of the total donations received by the party in this period. All seven majoritarian candidates have large-scale businesses and are connected in various forms to a total of 127 companies. These candidates are: Zaal Dugladze, Anton Obolashvili, Gocha Enukidze, Zaza Lominadze, Irakli Khakhubia, Davit Songulashvili and Vasil Chigogidze. There were cases when the business partners of one majoritarian candidate donated the same amount of money on the same day to the ruling party.
• 15 out of the 25 majoritarian candidates (including their family members and business partners) from the electoral bloc “United National Movement, United Opposition – “Strength in Unity” donated GEL 565 670 to the parties in the electoral bloc after January 2020, which represents 15.1% of the total donations received by the parties united under the bloc in this period. GEL 105 000 out of this amount was donated on the same day – October 8 – by four business partners of majoritarian candidate Murtaz Zodelava (Dimitri Dzagnidze, Giorgi Chiviashvili, Giorgi Gelkhauri and Beka Basilaia).
• Seven out of 29 majoritarian candidates of the Alliance of Patriots of Georgia donated a total of GEL 421 990 to the party two months prior to the parliamentary elections, which represents 22.6% of the total donations received by the party in the same time period. GEL 185 000 out of these donations were made by four majoritarian candidates (Ioseb Shatberashvili, Kakhaber Dzagania, Paata Jibladze, Archil Benidze) on the same day on September 10.
• According to the State Audit Office, administrative proceedings were launched in 7 cases as a result of analyzing information obtained through the Office’s media monitoring efforts and information provided by political subjects. Out of these 7 proceedings, three were finalized and a notice of administrative violation were drafted for two cases. Two cases are still pending review, including one that was launched on the basis of a journalistic investigation that included information on the Alliance of Patriots of Georgia’s connection and financial links to the Kremlin. This report was published in two parts on August 24 and 31 by Dossier, which is a platform for investigative journalism. This case has once again made it clear that the State Audit Office does not have the respective authority and legal mechanisms to investigate such instances.
• Transparency International Georgia believes that an independent anti-corruption agency should be established. This agency will have investigative powers, as well as other functions, such as carrying out oversight of political party funding. Several Members of the Parliament have already registered a draft law in support of this initiative in the Parliament, but it has yet to be discussed.