Consumer vs. company
30 September, 2010
Consumer vs. company

Georgian regulatory body for electricity, gas and water is authorized to bring misappropriation lawsuits. Only court was responsible for settling the questioned suits before.

Government believes the initiative will discharge the court that abounds with the cases of energy misuse, as well as ensure better protection of consumers’ rights. Some experts think the new protection mechanism can achieve its goal only if it is well-advertized, otherwise uninformed consumers can miss their chances. 
Georgian courts swarm with the lawsuits between consumers and

companies that provide communal service such as supplying gas, water and electricity. According to Valeri Pkhakadze, Ombudsman with Georgian National Energy, Gas and Water Regulatory Commission (GNERC), headquartered in Kutaisi, in this city alone court studies litigation disputes between consumers and companies 2-3 times per week and each court session includes about 8-12 cases of consumers vs. companies. Statistics is much bigger in Tbilisi where over million people live. The point is that a gas, electricity and water distribution company had an obligation to write a protocol on each suspicious misappropriation case and send it to court for final approval. And only after court’s decision companies had a right to impose a penalty on delinquent consumers. And as much as high penalty rates fixed for misappropriation cases enticed monopolist distribution companies to accuse as much people as possible in misuse of gas, electricity and water they do not miss a chance to write a protocol of administrative felony on each petty misdemeanor. As a result number of litigation procedures [between consumers and companies] only increases each year bespeaking that situation needs better regulation, Pkakadze said.
Georgian government found courts encumbered by company-vs.-consumer case. To discharge courts from piling files and discourage companies to file lawsuits on each insignificant issue, government decided to cut down penalty rates and enlarge the role of GNERC as of an impartial referee.

 


Georgian parliament initiated an amendment in this past July according to which, starting September 1st, 2010 companies are mandated to make protocols on administrative felonies and impose penalties at their own discretion. However penalties imposed for the first misappropriation cases [amounting to GEL 600 and GEL 5 thousand for physical and legal entities respectively] are revoked and distribution companies have to warn suspects initially. Culprits can be fined only for repeated crime and by much reduced penalty rates: the earlier active GEL 1200 and GEL 15 thousand [imposed on physical and legal entities respectively for repeated crime] are cut down to GEL 100 and GEL 5 thousand.
To insure protection of consumers’ rights [companies still interested in yielding financial tolls can misuse of their authority] government allows consumers to appeal to court and GNERC alike if they disagree with the company’s claim. And all claims and penalties are suspended till the final court/GNERC verdict is drawn up.
New amendment apparently makes consumers more vulnerable as leaves them tete-a-tete to companies that are enticed to abuse their power so as to enjoy higher tolls, and replaces court from the central position to the end of the chain that complicates litigation procedures, but mandating GNERC with the court functions guarantees protection of consumers rights better than before, Pkhakadze believes.


Malkhaz Dzidzikashvili, ex-Ombudsman at GNERC and active Head of Legal Department at GNERC at the moment, shuns commenting whether or not the amendment complicates or eases the situation from consumers’ rights protection point of view.
“I prefer to refrain from expressing my private opinion respective to this issue,” He told Georgian Journal.
Davit Ebralidze, another ex-ombudsman at GNERC, believes the new amendment cuts much ice with companies rather than consumers’ interests.


“This amendment was initiated to woo companies’ interests in fact and not to discharge courts. There is a huge difference. According to old regulation, companies could not practice any fine till the protocol was not approved by court. Now companies can act at their own discretion and their action can be prohibited only if a consumer lodges a complaint against its protocol. That obviously complicates the situation for consumers the more so that bigger part of population is not informed of their rights to appeal to court/GNERC,” He explained to Georgian Journal.  
Pkakadze counters that companies have an obligation to inform the suspected consumers on their rights that they can lodge a complaint against company at court/GNERC. If they do not provide the pursued consumers by full information on their rights, companies will get a warning paper for the first time, and will be fined by GEL 5 thousand for repeated misdemeanor. The penalty increases to GEL 15 thousand and GEL 45 thousand afterwards, and if the company does not observe the demanded regulations it can lose a license ultimately.
“Besides courts are related with extra payment imposed on filing lawsuits and frequently have been drawing unfair decisions, whilst empowering the GNERC with court rights can spare consumers from extra outlays and insure impartial judgment,” Pkhakadze said.


Ebralidze thumbs up that the GNERC is equalized with the court that really can guarantee better protection of consumers’ rights and draw impartial verdicts, but he believes that this novelty can work only if awareness in population will be raised.
“It is one thing when companies are obliged to inform their consumers of their rights that bigger part of consumers cannot or will not use as far as GNERC is not available to entire Georgian population from distance point of view. On the other hand consumers were automatically informed and involved in the litigation procedures when the court was positioned between company and consumer. Court [when discussing a protocol approval case] is responsible to inform the consumer to attend the court session and keeps them in course of affairs,” Ebralidze said. 


Print
Other Stories
The World Digital Mining Summit to be held in Georgia
The summit is scheduled to take place between 21st-23rd September in the Hualing Hotel, Tbilisi, Georgia.
Galt and Taggart - Tourism Boom Continues in Georgia
Tourism has become one of the key drivers for the Georgian economy. Galt and Taggart has recently published research about the Georgian tourism sector in the first half of 2018.
"The worst dream for Putin is that Russians want to live in Georgia"
This year, visitors to the Adjara region would notice that there is a boom in construction in and around Batumi.
Underground gas storage facility to be built in Georgia
KfW, a German government-owned development bank signed a EUR 150 million promotional loan with the state-owned Georgian Oil and Gas Corporation (GOGC) for the construction of the first underground gas storage facility in Georgia.
New gambling rules for Georgia
Georgian lawmakers are preparing a new draft law relating to online-casinos and gambling that will seek to curb gambling addiction in Georgia.
How expensive is it to visit Georgia?
The Georgian Lari (GEL) is the official currency of Georgia and is the only legal means of payment in the entire territory of Georgia.
Trade with the EU and the Commonwealth of Independent States (CIS) has grown significantly
Trade with the EU and the CIS has grown by 26% and 33.5 % respectively, says GeoStat, the Georgian National Statistics Office.
The unemployment rate decreases in Georgia
The unemployment rate decreased in Georgia by 1,9% and amounted to 12.1% in the 2nd quarter of 2018 compared with the previous quarter,
Memorandum of Understanding to be signed between Georgia and Malaysia
According to the Georgian Ambassador to Malaysia Nikoloz Apkhazava, Georgia plans to sign a Memorandum of Understanding (MoU) with Malaysia.
“Blauenstein Georgia” due to expand in Georgia
“Blauenstein Georgia” is planning to open more shops in Georgia. It is an agriculture company that sells meat products, meat and convenience food.
The amount of Direct Foreign Investment rises in Georgia
According to the information of the National Statistics Office of Georgia, the amount of direct foreign investment in Georgia has risen
It’s going to get  harder for foreigners to get residence permit in Georgia
It’s going to get harder for foreigners to get permit of residence in Georgia.
Mziuri Park in Tbilisi to be renovated soon
It was the dream of prominent Georgian writer Nodar Dumbadze that when the original Mziuri park was constructed and opened in 1892 that it should be a park for children,
Winemakers to produce Kvanchkara in its place of origin - Racha
Khvanchakara is a semi-sweet Georgian red wine which originates from Racha, in the western part of Georgia. Kvanchkara is made of two types of grape Mujuretuli and Aleksandrouli.
The level of Georgian wine and Chacha exported has increased
The National Wine Agency of Georgia has recently published statistical information about the level of Georgian wine and Chacha exported between January and July, 2018.
New fire engines to be Manufactured in Georgia
The Acting Head of the Emergency Management Agency Shalva Khutsishvili said that the old Zili fire engines (which were made in the USSR) will be phased out and replaced with new ones, manufactured in Georgia.
Georgia witnesses a record number of tourists
The Georgian National Tourism Administration publishes statistical information about international visits to Georgia.
Canadian businessman plans to build a hotel in Bakhmaro
Canadian businessman Vadim Malishev plans to build a hotel in Bakhmaro resort, Guria, in the western part of Georgia.
Coffee Factory will open in Tbilisi in October
The first coffee factory (which will be located on the Kakheti highway) in Tbilisi will open in October.
Places in Georgia where real estate is the most expensive
The real estate market in Georgia is growing annually. In Tbilisi as well as other regions of Georgia new developments are increasingly taking place.
How much does a vacation cost in Tbilisi?
It is the middle of summer and those who have not yet taken a vacation are looking for an appropriate place for sure!
The price for extreme sports in Georgia
Georgia offers a variety of options to extreme sport lovers.
The number of Georgians who own property abroad increases
The number of foreign properties owned by Georgians is increasing.
How much does Taxi cost in Tbilisi?
Stories how Taxi drivers try to deceive passengers and charge them with more money than they should pay are known for everybody all over the world.
What are the highest paid areas in Georgia
According to the data collected by the National Statistics Office of Georgia in the first quarter of 2018 the highest paid jobs in Georgia are found in the financial and insurance fields.
PHOTO OF THE DAY
Exchange Rates
GEL Exchange Rate
Convertor
21.09.2018
22.09.2018
USD
1
USD
2.6193
2.6216
EUR
1
EUR
3.0693
3.0854
GBP
1
GBP
3.4651
3.4584
RUB
100
RUB
3.9538
3.9340
Other Stories
Recently Toyota rolled out Global Campaign under this slogan that reflects the Olympic and Paralympic Spirit of Encouragement,
A couple from Switzerland combines Swiss tradition and technology with Georgian products. Their cheese is made in the Georgian mountains and sold in local stores and hotels.
It has been more than five years since the residents of Lilo village, near Tbilisi, cannot open their windows.
63 000 GEL was received by the Georgian Agro Export Group which is just a small part of the European Neighbourhood Programme for Agricultural and Rural development.
Georgian entrepreneur Guka Tavberidze, who runs his own business in the UK and does it quite well, has been invited by BBC
The grand opening of 7-star The Biltmore Hotel Tbilisi took place in Georgia’s capital on July 31.
DUSHETI, Georgia – The Georgian government and the World Bank will allocate USD 5.6 million (12 million GEL) to fund
A new Georgian clothing brand named Person has emerged in Georgian market.
Georgia is in the midst of an economic maelstrom, Euronews reports.
Situation at Georgia’s mineral water market is interesting: over the last year, the volume of export has grown by 56 percent. According to “GeoStat”, over $114 million worth of mineral water was sold
GEL Exchange
USD
1
USD
2.6216
EUR
1
EUR
3.0854
GBP
1
GBP
3.4584
RUB
100
RUB
3.9340