Georgia at the crossroads
A Destructive Venture
The draft "transparency of foreign influence" law, recently passed in its first reading by the Georgian parliament, is a deeply concerning piece of legislation that threatens to severely undermine civil society and democratic freedoms in the country. While ostensibly aimed at promoting transparency around foreign funding of organizations, the law's expansive scope, vague definitions, and punitive enforcement mechanisms suggest an underlying motive to repress dissent and silence critical voices ahead of Georgia’s parliamentary elections, scheduled for October 2024.
The law requires non-profit entities to register as "organisations pursuing the interest of a foreign influence" if they receive more than 20% of funding from foreign sources. This sweeping definition could encompass all non-profit organizations, grassroots initiatives, and media outlets that have international financial ties. The focus is not just on political activity: people with disabilities fear that they will be affected and have appealed to parliament not to pass this law. Even an archbishop has voiced concerns. As all donations need to be published, any foreigner’s contribution will need to be recorded and published.
The definitions employed are alarmingly nebulous, granting immense discretionary powers to authorities. For instance, “any cash and other material benefits” need to be declared, without minimal threshold. An embassy event that invites people from a centre for assisted living for a reception may require meticulous declaration as a “material benefit.” This ambiguity provides ample room for arbitrary enforcement, enabling the government to selectively target organizations based on their viewpoints or activities.
Moreover, the law endows monitoring bodies with sweeping investigative powers, allowing them to conduct intrusive inspections of personal information and operational details of any organization every six months, without apparent justification. A persistent threat of scrutiny creates an environment of perpetual surveillance and self-censorship, stifling free expression and open debate.
Perhaps most egregiously, the law imposes draconian financial penalties for even minor infractions or perceived non-compliance. Fines as high as 25,000 GEL (approximately $9,000 USD) for "evading" registration and 10,000 GEL for "non-fulfillment" in filings are prescribed – sums that could damage or even destroy most Georgian civil society organizations. These fines do not scale with the severity of the infraction – they are immediately applied at the high level. As the legislation stands, not being able to account for 1 GEL could lead to a 10.000 GEL fine. These punitive measures seem deliberately designed to intimidate and suppress independent voices, rather than promote genuine transparency.
Faced with such risks no sensible person can be expected to lead a non-profit entity. NGO leaders could be fined into personal bankruptcy, as there are additional 20.000 GEL fines for non-compliance as determined by the Ministry of Justice. A dog shelter, currently paying its director less in a month than people in most of the EU earn on minimum wage in a week, reported that they expected that they would have to close. Much of their funding is from foreign donations. Few of these donors will be particularly keen to hand over their passport details every time they put a few coins into a jar. It is impossible to do normal non-profit fundraising if every single cash donation needs to be tracked, and a mistake can put you on track to paying more in a fine than you earn in a year.
International experts and human rights groups have long warned that such "foreign agent" laws, when improperly constructed and enforced, can serve as instruments of repression, echoing tactics employed by fully authoritarian regimes to silence dissent and maintain control. As Ted Jonas, an American-trained lawyer with more than 25 years of experience in Georgia has pointed out, the law cannot be compared with similar regulation in Western country, such as the FARA legislation in the United States.
The Georgian law exhibits numerous hallmarks of bad-faith legislation, including excessive scope, ambiguous terminology, arbitrary enforcement opportunities, and disproportionate penalties. As the saying goes, you can only have two out of three: competent judgement; good faith; arguing in favour of this law.
In a healthy democracy, civil society can play a vital role in holding power to account. Civil society can also advocate for marginalized communities and contribute to a robust public discourse. By threatening the existence of all independent organizations and curtailing their ability to operate freely, this law undermines the foundations of Georgian democracy and runs counter to the nation's aspirations for Euro-Atlantic integration, which are anchored in Paragraph 78 of Georgia’s Constitution.
If the government claims to be concerned with how dependent much of Georgian civil society is on foreign funding, it could make more local funding available. Instead, the Georgian Dream government pursues a repressive course, all the while not addressing pressing concerns. Transparency International Georgia has documented more than 150 allegations of high-level corruption that currently remain unaddressed.
On the occasion of Prime Minister Kobakhidze’s mid-April visit to Germany, Chancellor Olaf Scholz was clear in his comment: “we believe that such laws are not necessary.” Rather than promoting transparency, the draft law seems poised to cast a chilling effect over Georgian civil society, stifling critical voices, impeding international cooperation, and ultimately weakening the country's democratic institutions.
Several key figures in the Georgian Dream know precisely what they are doing. The Prime Minister Irakli Kobakhidze, the Speaker of Parliament Shalva Papuashvili, the Minister of Justice Rati Bregadze, and the Chair of the Parliament’s Legal Issues Committee Anri Okhanashvili have all received doctorates in law from German universities.
In response to detailed criticisms of their destructive course, some of these leading politicians have lashed out. This suggests, as journalists have reported, that few of the politicians advocating for the law believe in it. Rather, they appear to follow instructions that make them feel trapped. It appears that the fate of Georgia is entrapped with them also.
Dr. Hans Gutbrod has been working in the Caucasus region since 1999. He has extensive experience on issues of transparency, having led a successful campaign to improve the disclosure of research funding around the world. He has previously written on how accountability legislation is used to stifle civil society, see here. Hans holds a Ph.D. in International Relations from the London School of Economics.