The FINANCIAL — A speedy implementation of over 300 regulations with which Georgia will have to comply, in line with the EU Association Agreement to be signed this summer, may create problems for local businesses, ICC Georgia believes.“What the Government wants to do is implement all the regulations within a very short period of time, this is being done in a hurry partially because some of those regulations could generate quick income,” ICC Chairman Fady Asly told The FINANCIAL.
The EU-Georgia Association Agreement will be signed in August 2014, confirmed European Commission President Jose Manuel Barroso, who expressed hope that the accord would be signed no later than August. The signing of the Association Agreement with the EU includes a DCFTA document as well. The Georgian Government has between six months and twelve years to implement all the regulations.
“There are some challenges regarding the implementation of the DCFTA that need to be solved in cooperation with the Government,” Fady Asly, Chairman of the International Chamber of Commerce of Georgia, told The FINANCIAL. “There are more than 300 regulations that need to be introduced, some of them within a year but most of them within a period of several years. What the Government wants to do is implement all the regulations within a year. If the DCFTA/ is implemented in August 2014, then that is fine as long as after that Georgia has time to implement the regulations step by step. However, the Georgian Government is in a hurry because some of those regulations generate quick income for them. Another reason is that the Government wants to be able to say that everything is finished and that they have implemented all the required regulations in a very short period of time which would give a favourable impression of Georgia being a ‘good student’,” he said.
“Those regulations will affect businesses that need to learn and adjust to the new legislation and the DCFTA agreement gives governments in many instances plenty of time to comply. However, the Georgian Government wishes to incorporate all the regulations in the law as soon as possible. This is a serious challenge for businesses which need time to adapt,”Asly said.
Another challenge is the lack of precision in some instances in the Georgian translation which is creating serious problems in terms of its interpretation by the regulations, and this lack of clarity could result in tremendous financial costs for some sectors of the economy, according to ICC.
“I would suggest implementing the regulations in the time frame agreed with the EU and not before. The best way is for the Government and businesses to have a joint working group and filter each and every issue to make sure that things are being implemented calmly and with the least possible damage. It is vital to have the business community involved in the discussions with the Government to consult on the most appropriate ways to comply with the terms of the DCFTA with the minimum possible hassle for businesses,” Asly said.
On 28 February ICC inaugurated its new branch in Adjara where ICC membership is growing substantially. “Our major goal for 2014 is to focus on our Youth Branch and provide our 200 young members with a broad education about doing ethical and proper business in addition to securing several of them with internships in Georgia and abroad.
ICC introduced the newest Consultative Board member, H.E. Mr. Z. Levent Gümrükçü, Ambassador of Turkey, who is a full-fledged member of the ICC Consultative Board which comprises seven ambassadors in addition to the heads of the UN, World Bank, EBRD and IMF.
“The role of the Consultative Board is to meet once a quarter with our Executive Board to discuss issues relating to the business and investment environments as well as the economy and the best ways to solve the various challenges. This time our Consultative Board was briefed by major business leaders of the current challenges to the business environment and, more particularly, the politically motivated harassment of some businesses and the very aggressive audit by the Revenue Service of many businesses. Our Consultative Board is a unique structure in Georgia that helps give major stakeholders in the country a global vision about doing business in Georgia,” Asly said.
The ICC Consultative Board is the only body of its kind in the business community in Georgia, comprised of the ICC Executive Board, ICC Youth Board and the ambassadors of France, Germany, the United Kingdom (Observer), Italy, the Netherlands and Turkey, the Head of the Delegation of the European Commission to Georgia, the UNDP Resident Representative in Georgia (Observer), the World Bank Country Director, the Director of the European Bank for Reconstruction and Development and the IMF Resident Representative (Observer). The purpose of the Consultative Board is to bring together members of the diplomatic and business communities on a quarterly basis to discuss the business and investment climate in the country. The issues raised are subsequently advocated to the Government through a multi-pronged approach by ICC stakeholders to effect positive change in the business and investment climate.
The International Chamber of Commerce is the largest business organization in the world which includes hundreds of thousands of businesses and chambers of commerce. ICC consults regularly at a global level with the G8, G20, the World Bank, WTO, WCO and the UN. In Georgia the ICC includes 15 major business organizations in addition to corporate and university members. The ICC Youth Project consists of over 200 members and is aimed at exposing students and young professionals to best business practices and providing them with business-related training.
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