The development of a business environment in Georgia is characterized by a positive trend, which is influenced by many factors. Georgia is a gateway between Europe and Central Asia, where businessmen have good opportunities for making a successful business.
Georgia and the European Union have a free trade area that includes trade in various commodities, energies, and services.
Since 2014, there has been an “Association Agreement” signed between Georgia and the EU aimed at integrating the Georgian economy with the EU economy. The country has also signed free trade agreements with different countries.
From 2014, Georgia has a new government program “Enterprise in Georgia.” The program is promoting an entrepreneurial culture throughout the country by stimulating the establishment of new enterprise and supporting the expansion of existing operations. The Investment division’s primary role is to attract, promote, and develop direct foreign investment in Georgia. “Enterprise in Georgia” works with three directions:
According to A World Bank Group Flagship Report, Doing Business 2019, Georgia ranks 6th as a result of the reforms in the institutional and regulatory environment.
Start a business
The simplification has led to the possibility of voluntary registration of VAT payments for businesses in 2019. It was also important to have a so-called, expanding the “one-stop-shop” principle, which implies starting a company with one procedure.
Since 2016, procedures for issuing a building permit have been streamlined in the country and the time required has been reduced.
Since 2017, land administration has improved with the mapping of privately owned parcels in Tbilisi.
Protection of minority investor rights
Since 2017, the protection of small investors has been enhanced by enhancing shareholder rights and roles in key corporate decision-making and by clearly identifying ownership and control structures.
Since 2018, investor protection has been strengthened by simplifying lawsuits against directors in cases involving damages between the parties. The rights and role of small shareholders have also increased in the process of major corporate decision-making and clearly identifying owners and controlling structures.
Since 2013, amendments to the Civil Code have strengthened the system of secured transactions and it has led to the proliferation of collateral and the replacement of collateral.
The adoption of the Personal Data Protection Act improved the credit information system.
Payment of taxes
Payments are simplified using the electronic system and the introduction of additional services.
Since 2017, the Supplement to the Income Tax Return has been abolished, and the effectiveness of the online system for submitting VAT declarations has improved. In the same year, retained earnings were exempt from income tax and it reduced the share of the total tax burden on gross profit and the time spent on business tax payments.
Since 2013, the time required for export and import has been reduced. Moreover, the electronic processing system has been improved, and it allows for the faster submission of export and import documents. The opportunity to submit preliminary electronic documents was also introduced.
Enforcement of contracts
Contract enforcement is simplified in the country:
• Speeding up commercial litigation
• Introducing an electronic appeal system
Since 2013, procedures related to insolvency proceedings have been accelerated. At the same time, the quality of the creditor’s authority and the debtor’s authority have increased and creditors have been able to participate more in the litigation process.