BUSINESS
An ombudsman may protect Georgian consumers
26 December, 2013
An institute of Consumers Ombudsman is expected to be set up in Georgia after a new law on consumers’ protection becomes effective. The law is under consideration at the moment, but there are hopes it will be approved in Parliament by the end of this year.  Once sanitary inspection was canceled by the former government in 2005, as part of its liberal economic policy, some Georgian consumers may have felt that they were left at the mercy of god.
Some
sectors such as food, energy, and water, as well as communication service, were handed to separate regulatory bodies. The quality of the products and services was left to the discretion of producers and market regulation.
If a person eats a sausage and is poisoned, that person will not buy the sausage again - this was the idea of market control suggested by Kakha Bendukidze, an economic think-tank for the previous government and the initiator of its liberal economic policy. And although a food and veterinary product control agency was set up with the Agriculture Ministry, food poisoning cases tripled in the country after the former government suspended the law on food regulation until 2010. The explanation: to give small businesses a “time-out” to get stronger and re-equip enterprises in line with state-of-the-art standards.
“In unregulated sectors consumers remained completely unprotected in fact,” Madona Koidze, Chairperson of the non-governmental Association for Consumers Rights’ Protection, said to Georgian Journal. The product and service quality issue became acuter after EU offered to start negotiations with Georgia on a Deep and Comprehensive Trade Agreement in 2008.
Food and phytosanitary regulations have been improved, but consumers remained unprotected. The new government addressed the issue, and a working group including non-governmental watchdogs was set up under the initiative of the Parliamentary Committee for European Integration. The Group has been discussing a draft law on consumers’ rights protection that is expected to be passed by the end of this year.
Adoption of the institute of Consumers Ombudsman is built into the law. According to Vakhtang Kobaladze, Senior Program Manager at Eurasia Partnership Foundation, a participant in the working group, the Consumers’ Ombudsman very likely will help consumers to have direct access to the court, and will protect the aggrieved consumer there. Also, authors of the law want the Ombudsman to have a market monitoring function and be mandated to give obligatory recommendations to both government and the private sector alike.
“There has been no [state] institute that might have covered all possible sectors of goods and services,” Kobaladze told GJ. “Therefore there came the idea to establish an Ombudsman for consumers that will incorporate regulation of all products. Besides, there is no mechanism today in Georgia that enables consumers to appeal to the court directly if their rights are infringed. The Ombudsman will give such an opportunity and will also protect the interest of consumers at court.”
The Consumers’ Ombudsman is expected to be accountable to the Prime Minister and make reports twice per year at parliament. The Prime Minister will name the candidate for the post, and Parliament will be asked to approve.
Details are not finally agreed upon, but very likely the Ombudsman’s term will be 4 or 5 years, and a candidate may not be elected more than twice, Koidze elaborated. However, since the new law
is still outside the 2014 state budget, there is no funding of the Consumers’ Ombudsman as of yet. Kobaladze expects the law to be approved early next year, and the Ombudsman institute to become operational only in 2015.

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