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Mar 23, 2020

Legal Framework of Covid-19

Legal Framework of Covid-19
While Georgia, together with the rest of the world, tries to subdue and put in a cage one of the biggest challenges of the 21st century – Cobid19, it is important to assess its legal framework and analyze what might be its impact on business and consequently on the interests of the country.


Contractual Relationships
Civil Code of Georgia entails the concept of unconquerable force, which is commonly known among lawyers as Force-majeure. It may represent a legal ground for suspending statute of limitations, termination of long-term or short-term contractual relationships or avoiding the civil liability.
According to international instruments, Force-majeure is:
a) An impediment of an extraordinary nature
b) It is beyond the parties’ control
c) It is unforeseeable
d) It renders the performance objectively impossible
According to the established practice of the courts of Georgia, force-majeure is an impediment that cannot be avoided. In addition, it is important to assess whether it was indeed impossible due to the circumstances beyond the parties’ control to avoid such impediment. In case of existence of such circumstance a party to a contract may terminate the agreement without following the established notice period. On 30th January 2020, the World Health Organization announced the Public Health Emergency of International Concern, on 11 March 2020, the world pandemic was declared. The fact that it was unavoidable by the efforts of the parties of any contractual relationship is undisputed; however, according to the decision of the Supreme Court of Georgia, the existence of force-majeure does not automatically render the performance impossible. The causal link between the force-majeure and non-performance needs to be proved. And it does not per se represent a ground for freeing from liability. Thus, it is important to assess the impacts of Cobid19 on your business. Furthermore, it should be noted that the wording of contract should be checked thoroughly.


Adjustment of the contract to the changed circumstances
According to Article 398, in case of changing the circumstances that represent a ground for forming the agreement, the party may request adjustment of the agreement to the changed circumstances. Accordingly, if Covid19 has made fulfilment of your contractual obligations substantially difficult, you may request renegotiation of the terms of the contract. In this case, it is of utmost importance to direct the negotiation process duly.
According to the definitions of the Supreme Court of Georgia, in case of existence below given preconditions, the request to adjust the agreement to the changed circumstances may be legally grounded. Namely:
1. The changed circumstances should render the performance of the contractual obligations substantially difficult.
2. The circumstances should be changed after forming the contract.
3. The change of circumstances should not have been foreseeable at the time of forming the agreement, i.e. the change should be beyond the parties’ control.
4. The agreement should not already have put the risk on the side of one of the parties. Otherwise, the contractual term applies.
5. The substantial difficulty of performing the contractual obligations should be caused by the change of circumstances.


Labour Relationships
It is important that the business is aware of its corporate social responsibility and the interests of its employees. However, Covid19 has fully stopped or made substantially difficult the operation of some of the businesses. In which case, regardless the company’s willingness to maintain the employees and provide them with monthly salary, the business might be compelled to terminate/suspend labour relationships.
Possible ways of suspending the labour contracts are paid or unpaid leave. The Labour Code of Georgia provides for 24 working days of paid leave, and additionally minimal 15 working days of unpaid leave to each employee. It is recommendable to negotiate with the employees in regard to taking the leave, so that both interests of the employee and employer are protected.
The suspension of labour contracts represents a better alternative than the termination. As in former case, on the one side, the employee loses the job, and on the other side, the employer has to pay the compensation if the termination is caused by the economic circumstances, which compel the company to dismiss the personnel.


Processual Relationships
Although, it is true that in certain circumstances, Covid19 might suspend the running of the statute of limitations, however, it must be noted that the force-majeure does not automatically represent the ground for such suspension and related outcomes; rather this is assessed according to objective criteria. As of today, it is possible to submit the claim electronically, through the website of e-court. This allows us to submit the claims to the court during the announced state of emergency.


Our law firm remains at your disposal remotely, if you need a legal advice. Please, do not hesitate to contact us if you have any questions.


Wish you a good health.
Chargeishvili Law Inn
The brochure is prepared by Attorney of Chargeishvili Law Inn Tamta Jgarkava.

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Mar 22, 2020

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Jul 11, 2019

Akaki Chargeishvili's comment in connection with the country's private capital market.

Managing partner of Chargeishvili Law Inn, Akaki Chargeishvili, as the expert of business law and analyst, the interview was taken by the BusinessPressNews in connection with the country's private capital market.

According to Akaki Chargeishvili’s announcement, there are a lot of years no one financial institution based on private capital cannot settled in reality, inasmuch as, only banks are developed in the financial sector of the country’s. In reality, even Georgian Stock Exchange (Tbilisi Stock Exchange) by its own infrastructure is under the control by the Georgian Banks. Despite the fact, there is existing demand on private capital’s funds and it has serious perspective in the future.  

At the same time, Akaki Chargeishvili has given example of the companies’ names which are developed by the private capital. Such companies are: Apple, Microsoft-ი, Bosch, Siemens and etc. by this act, he emphasize importance of start of works in this direction. He pays attention about “Synergy Capital” which is carrying out on the market and its’ business is object of monitoring by the analysts. If “Synergy Capital” keep positions and it will develop more than now, it will be example for the government, to show banks, that exists demands on the private capital funds. He gives positive feedback to the “Synergy Capital” and said: the organization in its business and on the market is strengthened by uses managerial possibilities. Unfortunately, in Georgia nothing is happens regardless this, about private capital funds. He announced, that developing this market, for financial sector of country’s’, for business and citizens are very important.

For more information.

https://www.bpn.ge/article/57896-tuki-sinerji-kapitali-upro-ganvitardeba-ikneba-magaliti-xelisuplebistvis-achvenos-bankebs-rom-kerzo-kapitalis-pondebze-motxovna-arsebobs

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Jun 4, 2018

Assessment of the reasons that have caused the growth of customer costs

Akaki Chargeishvili, as the expert of business law, was invited to the radio “Commersant” to discuss the reasons of growth of customer costs.
According to him, numbers and statistics that show that there is trend of raising customer costs represent the situation as it is today, thus, it is important to assess the actions taken in the past that have led to this. When electricity tariffs started to rise, experts said that this would lead to the non-immediate growth of customer costs in different sectors.  As rehabilitative works are mandatory in electro energetic sector and the equipment thereof has to be bought abroad,  these purchases are directly connected to the exchange rate of dollar in the country, moreover, 6 wind power plants were bought as well. Inflation of Georgian Lari in regard to US Dollar has grown the costs that are necessary in electricity sector. As electricity is used by small, medium and large Georgian businesses, higher energy tariffs have affected end-product prices. When you provide the electricity to the enterprises at a higher rate it causes objective growth of the costs of production and accordingly of the end-product, for example: the food.
Furthermore, gas tariffs are higher for enterprises than for individual customers; therefore, the businesses that utilize gas in their production have to raise the price of the products, as the profit has to be proportionate to the costs. Another reason of growth of prices is the excise tax on fuel, which has grown the budget income of the country indeed, but has also grown the price of the end-products that require fuel to be produced.

Akaki Chargeishvili also noted that even though the problems existing in business law have been identified, they are being discussed and there is enthusiasm to solve them, , the real actions that would resolve them have to be taken and not merely discussed.  

Please, follow the link below, for more information:

https://www.youtube.com/watch?v=9DsH1vufaOc  

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May 27, 2018

Assessment of country's economic state

As an expert of economic law, Akaki Chargeisvhili was invited to the TV-show “Obiektivi Morning” to assess economic situation in the country.

According to his comment, unfortunately, nowadays most of economic sectors have become passive; attention of the society has weakened, even of the people, who are really interested in growing the welfare in particular directions. This is caused by inactivity and futility of the efforts made and held discussions.  It is regrettable that major share of state’s economy is under banks’ disposal, which are now legally entitled to own actives in non-banking sector. As a result of which, banks own interests in comparably stronger fields of business. In addition to this, problems of other sectors, where the business is still free, are not investigated as due; furthermore, the state tries to regulate these sectors without studying the interests of the subjects of these new regulations.  

Akaki Chargeishvili noted that, even though, interest of investors has grown positively in agriculture, other fields that are just as important, such as: industry, small business, service development, constructive development, etc. are left beyond the attention.
Due to the interest of society, Akaki chargeishvili was asked to discuss the situation created around the financial company “Sakartvelo”. According to him, it is regrettable that regardless the number of fatal outcomes and the amount of time that the government is aware of problem’s existence, governmental bodies do not show enough interest and attention towards the case and because of this still unknown number of trespassed depositors has to wait for the solution of problem in grave conditions.

 

Please, follow the link below, for more information: 

https://www.youtube.com/watch?v=rkHWHevN33E&feature=share 

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Apr 23, 2018

Comment on the recent meetings of representatives of government with commercial banks and businesses.

Akaki Chargeishvili was invited to TV show Business Code, as the expert of Business law, to assess the recent meetings of representatives of government with commercial banks and businesses. According to Mr. Akaki, one of the signs of democratic society is development of institutions in the state. In Georgia the matters related to commercial banks are regulated by the National bank of Georgia, which is accountable to the Parliament of Georgia, whereas with government it may have relations that bear the nature of recommendations, which is a well-known practice in the world. The National Bank of Georgia has a huge autonomy in regard to commercial banks, thus, if there is a problem it has a competence to get involved in the matter.  As to businesses, there are number of institutions and platforms where matter related thereto can be discussed. Of course, the door of the government should always be open to businesses; however, this concerns the bodies that have a necessary competence by law. Taking this into account, non-hierarchical involvement of government members in the matters that belong to the competence of other bodies can be damaging to the country and its investment climate and creates questions in the society.

 

Please, follow the link below, for more information: 

https://www.youtube.com/watch?v=y40IZrWPTOg&feature=share 

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Apr 10, 2018

Akaki Chargeishvili's comment on the new initiative of Government of Georgia related to occupied territories

The specialist of Economic Law of Conflicts, advocate and economist Akaki Chargeishvili commented on new initiative of government of Georgia, according to which trade should be encouraged near the border line to occupied Georgian regions. Akaki Chargeishvili believes that this is a real possibility not to Governmental and political activists, but to ordinary people to develop real relationships. According to his information endless amount of  social and economic relations actually exist as shadow economy. People actually move through the border and transfer the goods and it would be of utmost importance to put these relations into a legal frame.

Please, follow the link below, for more information:

https://commersant.ge/?view=post&id=141423&lang_id=ge

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Dec 30, 2017

Summary of year 2017

Mr. Akaki Chargeishvili summed up country’s economic situation in 2017 and made a prognosis for the year 2018 from the point of view of expert of economics. Mr. Akaki talked about altered rate of exchange of Georgian Lari and discussed internal and foreign affairs that affect stability of national currency.  In the TV show Mr. Akaki as a representative of victims of financial company Georgia, discussed the problems related thereto and activities that should be taken by Georgian government to solve them.

Please, follow the link below, for more information:

https://www.youtube.com/watch?v=GGJnaYYQgjY&t=511s

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Nov 8, 2017

Akaki Chargeishvili commented on the premiere minister’s initiative via public broadcaster.

According to Premiere minister’s initiative, the shares of Wind Power Plants that were built in 2016 will be publicly available for purchase. Mr. Akaki’s, as business law specialist’s, assessment was overall positive, however, only in case of carrying out necessary legislative reforms, that will create the possibility to fulfill the initiative effectively and ensure unlimited purchase of shares. Mr. Akaki also talked about the functions of National Bank of Georgia, in regard to banking sector, as well as stock, insurance and other regulated sectors.

Please, follow the link below, for more information:

https://www.youtube.com/watch?v=gaa4vmfO95s

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Sep 13, 2017

Comment on the decision of High council of Justice of Georgia

According to the decision of High council of Justice of Georgia business law and investment disputes above 500 000 GEL will be ruled by 4 judges of civil law panel. Mr. Akaki Chargeshvili was invited to the TV show Business Code to assess legal outcomes of the decision. Mr. Akaki talked about the faults of the decision that might cause vagueness of the proceedings, as for example there is no legal definition of Business law and investment disputes. Mr. Akaki pointed out that on the opposite to all the expenses that country incurred to promote and encourage small and medium business, disputes of such enterprises will remain time consuming, which hinders the development of small and medium business.

Please, follow the link below, for more information:

https://www.youtube.com/watch?v=j4fdo0mJQBM

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May 25, 2017

Akaki Chargeishvili's questions to the president of National Bank of Georgia

Mr. Akaki Chargeishvili asked questions to Mr. Koba Gvenetadze – the president of National Bank of Georgia, during his annual report to the Parliament of Georgia. The questions were related to the National Bank’s regulatory functions.

Please, follow the link below, for more information:

https://www.youtube.com/watch?v=XViAa9KBA1k

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Apr 10, 2017

Advocates of Chargeishvili Law Inn represent shareholders of Georgian Stock Exchange in court

The partners of “Chargeishvili Law Inn” advocates Ucha Kiria and Akaki Chargeishvili represented interests of shareholders of JSC "Georgian Stock Exchange" against National Bank of Georgia in regard to the license issued to JSC "Tbilisi Stock Exchange". Due to the big interest of society towards the case, the law suit was recorded by TV show “Business Code”.

Please, follow the link below, for more information:

https://www.facebook.com/iberiatvbusinesscode/videos/1537723929572105/ 

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Feb 18, 2017

Training course on Entrepreneurial Law

The training session on Entrepreneurial law was held for “Legal Aid Service” advocates on 18 February 2017. The training session was conducted by Expert of “Association of Georgian Law Firms”, Partner of “Chargeishvili Law Inn” Ucha Kiria.  The geographic area of training sessions covered West and East Georgia. The subject of the training was chosen according to the study made by Legal Aid Service. The study showed that attorneys of Legal Aid Service, taking into account their expanded mandate, require broadening their knowledge in following civil law fields: Family law, Law of Obligation, Law of succession, Tax law, Entrepreneur Law, Civil Law Proceedings in first instance courts. The training course was held with the support of United Nations International Children's Emergency Fund (UNICEF) and United Nations Development Program (UNDP) and European Union.

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Nov 18, 2016

Training course on Tax Law

The training course on Tax legislation was arranged by Association of Georgian Law Firms (AGLF) on 12 and 18 November 2016. The training course was conducted by AGLF expert of Tax Law Mr. Akaki Chargeishvili.

The training courses were held in east and west Georgia for the duration of five months. The subject of the training was chosen according to the study made by Legal Aid Service. The study showed that attorneys of Legal Aid Service, taking into account their expanded mandate, require broadening their knowledge in following civil law fields: Family law, Law of Obligation, Law of succession, Tax law, Entrepreneur Law, Civil Law Proceedings in first instance courts. The training course was held with the support of United Nations International Children's Emergency Fund (UNICEF) and United Nations Development Group (UNDG) and European Union.

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Mar 24, 2015

The meeting on amendments to Civil Procedure Code of Georgia

On 24th of March 2015 working meeting with judges was held in hotel “Ambasador”, organized by the “Association of Law Firms of Georgia”. The meeting aimed discussion of amendments of Civil Procedural Code of Georgia. Members of Chargeisvhili Law Inn together with lawyers of other law firms, which are members of “Association of Law Firms of Georgia”, have been working on these amendments since October 2014.  Rory D. Bahadur, professor of Washburn University and the guest expert of National Business Center of Free University of Tbilisi stated his opinion and made comments on the draft project of amendments. The initiative to amend the civil procedure code of Georgia was arisen to ensure adversary between the parties. Offered amendments will make the litigation less time consuming.  With the aims amendments refine the rules of: explanation of parties, examination of a witness, and procedure of appointing expert. It is also offered to use a model of temporary and basic provisional measures from Civil Procedural Code of USA. Members of Association have initiative that only advocates should have the right to represent party in the court of first instance. Except the case when a party wants to stand before the court by itself or wants to be represented by its family member. Members also think that if a party is represented in court with an advocate and the party approves advocates right of representation it has to be enough for a judge to establish free will of the party and authority of the advocate. Thus, there should not be need of any additional power of attorney approved by a notary to be provided before the court. The amendment project also involves specification of advocate’s fees, regulations about the process renew in case of default judgment; it is planned to improve articles regarding mediation and settlement as well. It is important to discuss the draft project with judges, as their comments and ideas need to be considered to improve the prepared draft project of amendments by advocates.  Members of “Association of Law Firms of Georgia” are continuing working on the draft project, which will be later on presented to private law reform enforcing consulting council of Ministry of Justice of Georgia, to the team working on procedural law matters. On a working meeting the draft project of amendments in Civil Procedural Code of Georgia was supported by USAID and JILEP.

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