Constitutional Court Ruling on Foreign Individuals Acquiring Farmland

Some of you may have been following our occasional coverage of this issue.

Aus Vineyard

Over the past year, Transparency International Georgia has been engaged in a lawsuit against in the Georgian government in the Constitutional Court of Georgia, with TI employee and Austrian national Matthias Huter as litigant against the state.

Recently the Georgian Constitutional Court ruled that banning foreign individuals from purchasing or inheriting farmland was indeed contrary to Georgia’s constitution. At this stage the Constitutional Court has made no ruling on the constitutionality of foreign-invested Georgian enterprises being banned from buying farmland.

Unintended consequences of the ban included Georgian landowning enterprises being unable to raise capital through stake sales to foreign-invested firms, and foreign-invested firms being unable to expand their landholdings from mid-sized semi-commercial trial projects to serious vertically integrated commercial enterprises.

TI Georgia recently held a screening of a short film concerning two foreign-invested enterprises, both significant employers of Georgian labour, where business executives discussed the negative implications of the ban on their enterprises.

Panel discussion afterwards was lively. Chairman of the Parliamentary Agriculture Committee Gigla Agulashvili stated that no negative consequences of the ban had been observed, and that officials of the previous government had been colluding corruptly with foreign investors in farmland, justifying the ban.

There was certainly no contrition or acceptance of responsibility for negative consequences from any government representative in attendance.

It is to be hoped that parliament recognises the unconstitutionality of its ban on foreign-invested enterprises likewise acquiring farmland, rather than insisting on another time-consuming taxpayer-funded challenge in court, and promptly introduces a reasonable and transparent process for Georgian and foreign-invested enterprises to acquire farmland on an equal basis.



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