The FINANCIAL — The Public Registry has simplified the procedures of starting business in Georgia. Registering as an entrepreneur is now available in both languages, Georgian and English.
The FINANCIAL — The Public Registry has simplified the procedures of starting business in Georgia. Registering as an entrepreneur is now available in both languages, Georgian and English.
Foreign businessmen and investors, international organizations, embassy employees and private entities now have the opportunity to get information from the Public Registry without having to spend extra on translation and notarization.
Until now public documents have only been available in Georgian. Some leading banks have started offering English versions of bank statements for free. Such documents are required by Schengen states when issuing Visas. English is now the unofficial second language in Georgia actively promoted by the government and local businesses. Russian is the second language in terms of use in communication between the non-Georgian speaking population in the country, which is mainly dominated by Armenians, Azeris, Russians and Greeks. Georgia is the only state language throughout the whole territory of the country, and Abkhazian as well in Abkhazia.
“I think the idea of providing English language regulations for starting a business is a very good idea,” said Betsy Haskell, former owner of Betsy’s Hotel. ”Providing the implications of the alternative forms of business, e.g. private entrepreneur, LLC etc are also explained in English. There are a number of English speaking people living in Georgia who would like to start a business. At the moment, they need to take a translator, who is expert in Georgian legal terminology, with them when they go to the registration office. This adds to the cost of registering and such a person is also difficult to find,” she added.
“English language extraction and its electronic version have the same legal force as the Georgian one,” said Tsira Pataraia, from the National Agency of the Public Registry. “Before starting this service an entity had to use an interpreter service and then had to confirm the translated document with the notary. This innovation will contribute to the development of the country’s business sector and will attract foreign investments in Georgia,” she added.
English language extraction at the Public Registry costs GEL 20. An entity can get it during the registration of an object. Extraction is available in the territorial offices of the Public Registry and in the branches of Liberty Bank. Public Registry plans to offer the same service just via internet so that business relationships can be simplified outside the country as well.
“Public Registry’s new initiative about giving documents in the English language is like throwing a pebble in the ocean,” said Tariel Zivzivadze, professional business trainer and consultant. “On the whole this initiative cannot make any visible changes in improving the business environment in Georgia, but will be effective in a specific segment. For example, this service will help those companies who have only foreign investors. In general, starting a business is quite simple in Georgia. Every person has the opportunity to register a company without having to spend too much time or energy,” he added.
“Unfortunately, what was done to simplify the business environment in Georgia, was done only by the government and not by the business subjects. Credit is expensive. This means that one of the greatest resources for improving the business environment is still not being properly activated. To make credit cheaper it would be desirable for at least two strong international banks to enter Georgia,” added Zivzivadze.
“I am not sure that this new service will significantly improve the process of starting a business,” said Irakli Galdava, Research Fellow. “Though improving the service is good for the representatives of the foreign companies. But it will not be an obstacle for foreign investors if such a service is not available to them,” he added.
“The registration procedures of business are significantly simplified in Georgia. But as for the other factors, such as expensive credit, creative ideas or skills are still very problematic. Starting a business is simple but then running it is more difficult,” Galdava added.
Doing business in a More Transparent World assesses the regulations affecting domestic firms in 183 economies and ranks the economies in ten areas of business regulation, such as starting a business, resolving insolvency and trading across borders. Georgia is leader in the region. Azerbaijan (66th rank) has the worse rank out of Southern Caucasus countries while Georgia has by far the highest ranking of the regional countries, 16th, and Armenia ranks 55th.
It is possible to register a business in one day in Georgia. The only thing is to carefully choose the legal organizational form of the company before registering it. The allowed organizational legal statuses of private law for profit-making organizations in Georgia are Limited Liability Company, Joint Stock Company, Joint Liability Company, Limited Partnership, Cooperative, and Individual Entrepreneur.
GEL 100 (regular registration) or GEL 200 (expedited registration) plus GEL 1 (bank charges) are the business registration fee in Georgia.
According to the Doing Business Project, for the registration process, an applicant should submit the following documents: Application for the Registration and Document evidencing payment of a registration fee. The application must be signed by all founding partners of the company. The application may be executed either in the registration agency itself or before a public notary. The applicant must submit a document confirming lawful occupation of the premises to be used as a legal address of the company and the written consent of the appointed director to serve at this position. All documents to be submitted to the registration agency must be certified by the notary preliminarily.
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