Competition law - a victim of politics
19 December, 2013
Competition law - a victim of politics
The long expected competition law and the Anti-Trust Agency will become effective no later than this coming spring, the Georgian government promised recently. But a year ago it similarly promised that that would take place in spring 2013. Besides, a bill of amendments on competition law implying creation of a separate anti-trust body is still pending in parliament, leaving the market in the hands of monopolies. Sector pundits believe the competition law is a victim of political struggles caused by
cohabitation, but now that that has ended with the presidential elections this past October, analysts hope that this time the promise will be kept.
The heavy monopolization of the market was a stumbling block for economists during the eight years the former government was in office; it canceled an anti-trust law together with the regulatory body in 2005, and restored both only in 2010 when the EU required proper competition regulation as one of the four major preconditions to start negotiations on a Deep and Comprehensive Free Trade Agreement (DCFTA) with Georgia. However, the new Competition Agency was amalgamated with the State Procurement early in 2012, which posed many questions about the independence and effectiveness of the regulatory body. The EU also questioned the effectiveness of the competition law itself, and was reluctant to start negotiation on free trade unless both it and the regulatory body became effective. Therefore the adoption of fair market rules was among the key pre-election promises of Georgian Dream.
Shortly after Georgian Dream gained power authorities trumpeted that a bill amending the competition law would enter Parliament, and a separate Anti-Trust Agency would be set up as soon as the bill was approved (by this spring at the latest). However, the bill has languished up to this day, and the economy suffers.
The lack of fair competition is one of the key reasons the Georgian economy slowed this year by more than 50%, Ditrikh Muller, an analyst with Georgian Investment Group +, believes. Privileged market players, who enjoyed the former government’s patronage and preferences during state procurement tenders, or looser control, still retain their old positions and spoil the market.
Muller elaborated: “Let’s take banks for example. Banks have a monopoly in the market after they have been allowed to expand their shares in non-profile businesses. They enter almost all sectors and finance only their own businesses [by preferential credits], while withholding credits to competitors. As a result they spoil the market because the bank affiliated enterprises who have guaranteed financial resources are not effective. They do not need to bother to improve management skills to get a credit, whereas their competitors cannot get credits and develop, even if they have better business plans. If there was a proper competition law restricting banks to financing their own businesses, the Georgian economy would have been growing much faster, by all means.”
But since the competition law has languished for so long, Muller wonders if there is the political will to foster better competition, or even if the new parliament is incompetent.
Demur Giorkhelidze, an economic analyst, thinks that there are underlying struggles between the interested groups which hamper the competition law.
“There are fights behind the scenes both inside and outside the parliament. The old interest groups who used privileges during the former government, and new groups who want to enjoy privileges, now create setbacks to competition law,” he said.

Other Stories
Anaklia Port and its importance for Georgia
In 2016, Anaklia Development Consortium was authorized to launch the construction of Anaklia Port.
Cryptocurrency mining threatens electrical network in Abkhazia
In the breakaway region of Akbhazia rampant cryptocurrency mining is threatening the shaky electrical network, reports an article of the news portal EuroNet.
Caucasus Wine University to be opened in Gurjaani
In the Kakheti region a new viticulture campus of the Caucasus University is in the process of planning.
Photos describing life of the poorest in Georgia
Fight with poverty should be among top priorities of every government in every country.
Training farmers to rescue the organic hazelnut production in Georgia
Even drizzling rain and unpleasant gusts of wind can’t prevent the farmers from coming and participating in the agricultural training.
Bleak times for organic farmers in Georgia – but there is hope
Organic hazelnut production is a delicate plant in Georgia that has emerged just a couple of years ago. Various pests, among them the Asian stink bug Parosana, trouble hazelnut farmers and menace their livelihood – even before their businesses could really take off.
Hybrid car imports are going through the roof in Georgia
Thanks to their fuel economy, the popularity of hybrid cars is increasing in Georgia, where fuel affordability is low and prices for fuel are unstable.
The New Year offer from MAQRO Construction - Apartments with unbelievable discounts and the parking spaces for FREE!
Location, green yard, spaces for various needs, experience of the construction company and parking space are the main important criteria for potential buyers of apartments.
Interview with the co-founder of Kiwi Vegan Café – the first vegan place in Tbilisi
Behind the Kiwi Vegan Café stands a group of activists who wants to raise Georgian’s awareness for animal rights and welfare.
Biblusi opens first shop for tourists - Georgian
The largest book shop in Georgia Biblusi opens the first shop specially designated to the needs and interests of tourists and named it Georgian.
Georgia improves by five ranks in the Prosperity Index
In the overall Prosperity Index rankings, Georgia has climbed by 5 positions from 85 to 80 when compared to last year. As such, Georgia is the best performing country in the CIS zone.
The future is bright for electric cars in Georgia
The numerous hybrid cars in the streets of Tbilisi cannot be overlooked. Entrepreneur Sulkhan Gvalia calls them “pagers”, referring to the predecessor of mobile phones.
Georgia’s fight against the big tiny enemy – Asian Parosana
It’s a tiny creature, but the harm it did to the Georgian agriculture sector was and still is immense.
New cable route: from Kobi to Gudauri in 15 minutes
On the 15th of December, cable transport is scheduled to be opened connecting Kobi and Gudauri.
Tourist boom in Gudauri – majority of hotels are booked by foreigners
Gudauri is among the most popular winter resorts in Georgia.
Medical tourism increases in Georgia
In the last 9 months, Georgia was visited by 19 500 foreigners for medical and recovery purposes.
Doing business in Georgia has become easier than in America
According to the Doing Business 2019 report published by the World Bank, Georgia ranked 6th among 190 countries in terms of simplicity of doing business. This was an improvement over two ranks compared to last year.
Problems that foreigners frequently face in Georgia
The importance of Georgia as a tourism hub is growing year after year.
Tbilisi TV Broadcasting Tower – Better than the Eiffel Tower?
It is planned to renovate the Tbilisi TV Broadcasting Tower, one of the landmarks in the capital.
Georgian Fusion Menu by The Biltmore Hotel Tbilisi
5,895,914 international visitors have visited Georgia between January and August of 2018. Compared to the previous year the number has increased by 12.2 per cent.
Advertising of gambling and lucrative games may become banned in Georgia
Advertising of gambling and lucrative games may become banned in Georgia. Those who violate the new rule would be fined GEL 10 000.
Lebanese café-lounge Beirut opens in Tbilisi
What is necessary to organize an unforgettable event? – Fun, emotions, lots of surprises, good music and delicious menu.
Georgia second among the fastest growing tourist destinations in Europe
Georgia is among the fastest growing tourist destinations in Europe. The data is published by the UN World Tourism Organization.
Bitmain launches world digital mining summit in Tbilisi, Georgia
Bitmain CEO Jihan Wu and Roger Ver, CEO of Head Speaker List featuring Circle, and Genesis Mining when Digital Mining Leaders Convene In Tbilisi on September 21-23
TBC Bank and Gazelle Finance have teamed-up to support Medical City, a leading healthcare provider in the western region of Georgia to launch the Western Regional Center Of Modern Medical Technologies.

Exchange Rates
GEL Exchange Rate
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
January 2019
Mon Tue Wed Thu Fri Sat Sun
1 2 3 4 5 6
7 8 9 10 11 12 13
14 15 16 17 18 19 20
21 22 23 24 25 26 27
28 29 30 31