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Issue no: 906/58 • DECEMBER 20 - 22, 2016 • PUBLISHED TWICE WEEKLY PRICE: GEL 2.50

In this week’s issue... Martin Heidegger: Other Way - A New Book by Irakli Batiashvili NEWS PAGE 2 ’s Co-Investment Fund Launches Mtkvari HPP Project

FOCUS ON REDUCING GOV'T INTERVENTION PAGE 5 If the government wants to Hilton Expands European stabilize the Lari’s value, there is no alternative but to build ISET Capital City Presence to trust in Georgia’s economy PAGE 4 PAGE 6 Sarajishvili Brandy Wins Three Wine Tourism Association of Georgia to Medals at Degustation in USA PAGE 7 Host Christmas Market Dechert OnPoint: Why

BY NINO GUGUNISHVILI Brexit is Not Bad News for UK-Based Arbitration and he “Bulbuli” Christmas Market, Litigation organized by the Wine Tourism Association, is to be held on Decem- PAGE 10 ber 24 at the Muse cultural center near Turtle Lake (Kus Tba) in Tbi- Tlisi. Annual Gazprom Popular restaurants, winemakers, farmers, and artists will be participating at the event, which Meeting is promised to be fi lled with traditional Georgian, European and Asian cuisine degustations and Ends without local and European wine-tastings. An exhibition of handcrafts, a concert and lots of activities for Agreement children are also announced as a part of the upcoming Christmas Market next Saturday. PAGE 12

Prepared for Georgia Today Business by Markets Asof16ͲDecͲ2016 STOCKS Price w/w m/m BONDS Price w/w m/m BankofGeorgia(BGEOLN) GBP31.33 Ͳ7,3% +11,9% GEOROG04/21 104.00(YTM5.70%) Ͳ0,2% +0,1% GHG(GHGLN) GBP3.73 Ͳ0,5% +5,1% GEORG04/21 109.10(YTM4.53%) +0,2% +0,6% TBCBankGroup(TBCGLN) GBP15.44 +2,9% +18,1% GRAIL07/22 107.00(YTM6.24%) +0,5% Ͳ0,9% BGEOLN07/23 100.25(YTM5.95%) +0,2% Ͳ0,4% COMMODITIES Price w/w m/m CrudeOil,Brent(US$/bbl) 55,21 +1,6% +18,4% CURRENCIES Price w/w m/m GoldSpot(US$/OZ) 1134,88 Ͳ2,2% Ͳ7,4% GEL/USD 2,7150 +4,6% +9,4% GEL/EUR 2,8234 +2,7% +6,0% INDICES Price w/w m/m GEL/GBP 3,3772 +3,5% +9,4% FTSE100 7011,64 +0,8% +3,9% GEL/CHF 2,6355 +3,3% +6,3% FTSE250 17784,79 +0,3% +1,8% GEL/RUB 0,0439 +5,8% +14,3% DAX 11404,01 +1,8% +6,9% GEL/TRY 0,7789 +4,4% +4,1% DOWJONES 19843,41 +0,4% +5,2% GEL/AZN 1,5274 +5,9% +7,2% NASDAQ 5437,16 Ͳ0,1% +2,7% GEL/AMD 0,0056 +3,7% +7,7% MSCIEMEE 144,00 +2,0% +12,7% GEL/UAH 0,1029 +3,4% +6,6% MSCIEM 856,40 Ͳ2,4% +1,1% EUR/USD 0,9568 +1,0% +2,3% SP500 2258,07 Ͳ0,1% +3,7% GBP/USD 0,8008 +0,7% Ͳ0,4% MICEX 2231,41 +1,0% +10,0% CHF/USD 1,0261 +0,9% +2,4% MSCIFM 2386,92 Ͳ1,1% Ͳ0,3% RUB/USD 62,0650 Ͳ0,6% Ͳ4,1% GTIndex(GEL) 1176,94 +29,5% +29,5% TRY/USD 3,5053 +0,8% +5,5% GTIndex(USD) 871,04 +24,9% +21,0% AZN/USD 1,7853 +0,9% +2,2% GEORGIA TODAY 2 NEWS DECEMBER 20 - 22, 2016 AP Reports Trump Moves to Cancel Deals in Azerbaijan, Georgia Martin Heidegger: Other Way - BY THEA MORRISON

A New Book by Irakli Batiashvili he Associated Press (AP) reports that the United we need more books like this one. It’ll States' (US) president-elect BY NINO GUGUNISHVILI be our visit-card,” said Rostom Chkhei- Donald Trump has canceled dze, writer, essayist, and literary critic a licensing deal for a hotel at the book launch, while Zaza Shatirish- Tin Azerbaijan and is taking steps to do hilosopher and politician Irakli vili, philosopher, noted that not many the same for a project in neighboring Batiashvili’s new book- Mar- authors abroad would dare to write a Georgia. tin Heidegger: Other Way was book as Irakli Batashvili did, referring Both projects either involved or were presented at Marriott Tbilisi again to the controversy of Heidegger’s associated with people tied to politics, Hotel this Saturday. persona. “Irakli is a true philosopher partnerships that could have raised prob- PDedicated to the 20th century German who can see the world in its entirety- lems once Donald Trump becomes philosopher Martin Heidegger, Batiash- and that is very important," Shatirishvili president. vili’s new book is an attempt to analyse said. The AP says that the moves by Trump's the legacy of the great thinker, inter- “This book is a dialogue. It’s not just company follow a cancellation earlier twined with beletristical sections in the discussion between a very educated this week of a licensing deal for a hotel which the author expresses his own man, an intellectual, and one of the great- in Brazil. The Trump Organization also cash to someone with no ties to the sent a "default notice" earlier this month personal associations and thoughts on est philosopher’s [Martin Heidegger]; recently shut down four companies reg- president-elect to invest in a way unknown to the developer because it had not lived some of the most important challenges it’s a discussion between two thinkers, istered in Delaware that had no business to him, following the practice of most up to terms of the licensing deal. the contemporary world faces today. two philosophers, and that is exactly operations but appeared tied to Saudi recent presidents. Garten described the move as typically At the same time, in his book Batiash- what makes this work so interesting," Arabia, possibly vehicles for future pro- “They say ridding himself (Trump) of a fi rst step to canceling a deal. vili tries to revive Heidegger, who has said Valerian Ramishvili, philosopher, jects in the country. his ownership stake in his business, not Yet “just last week, Trump's develop- been critisized for his antisemitist and one of the reviewers of the book. Trump lawyer Alan Garten said Friday just managerial control, is the only way ment partner told Bloomberg News that fascist views. Batiashvili, as claimed by Praise for the work was continued by that developers in the projects in Azer- to assure he won't put private profi t the long-stalled project would go ahead, the many reviewers of the book, brings Valeri Asatiani, Professor of Classical baijan, Georgia and Brazil had failed to ahead of public interest in shaping tax, and that "talks are on," the AP reports. the reader to the depths of the great Philology, who noted that “Irakli Batiash- meet the terms of licensing deals. He regulatory and foreign policies,” the Donald Trump visited Georgia in April thinker’s realm where questions are vili gifted us with a philosophical essay described the moves as "normal house- article reads. 2012, when was raised as to the essence of an individual’s marked with an undeniable aesthetistm, keeping" and not part of a strategy to Trump has stakes in about 500 compa- Georgia’s President, to launch new pro- existence, and how ways of self-discov- with original thinking vividly visible.” reduce potential confl icts of interest. nies in more than 20 countries around jects of Trump Towers in Tbilisi and ery and the road that a person undegoes Batiashvili himself recalls the period He said the Trump Organization had the globe, though many of the foreign Batumi. in serach of and approaching god, are of working on the book as one of the no moves underway to cancel any other ventures involve him just lending his The construction of towers was sched- regarded as central. most important and interesting in his overseas ventures. name to buildings owned by others. uled to start in 2013. The Batumi Tower “If we want to play an integral part in life, saying that for him personally, Mar- The AP article reads that governmen- The Georgia project is for a tower in project envisaged an investment of $250 the cultural, socio-political or philo- tin Heidegger’s philosophy is the phy- tal ethics experts have been urging Trump the Black Sea resort city of Batumi. Gar- million to build a fi ve-star, 47-storey sophical processes going on in the West, losophy of the future. to sell his vast holdings and hand the ten says the president-elect's company building. GNTA Implements Standards for Marking Hiking Routes in Georgia and routes throughout the country. BY NINO GUGUNISHVILI The marking system is designed based on the experience of Poland, Switzerland and France, countries regarded as lead- n collaboration with the Georgian ers in the hiking tourism sphere in Europe. Hiking and Travel Association, The Upper and Svaneti-Same- National Hiking Federation, Eco- grelo linking hiking routes have already tourism Development Center, been marked, the GNTA says, while a Agency of Protected Areas of further 156 itineraries, covering six regions IGeorgia and GEOLAND, the Georgian of Georgia, are to be marked, and two National Tourism Administration more regions to be added, in 2017. The (GNTA) is implementing a unifi ed stand- marking process of all eight regions is ardized system of markings to be used expected to be concluded by 2020. provides trainings for hiking guides. In creation of a united network for hiking istic infrastructure throughout the coun- for all the mountain-hiking itinararies The project initiated by GNTA also addition, the GNTA is working on the routes that will facilitate access to tour- try. GEORGIA TODAY DECEMBER 20 - 22, 2016 NEWS 3 The New Year in Arakishvili Residence – Discounts & Gifts Galore uy a fl at in the Arakishvili LIVE IN THE BEST PLACE Residence and get it fully The Arakishvili Residence is situated in furnished with full premium the center of Vake: one of the most pop- appliances AND a special ular residential locations in Tbilisi. Aside discount. from its location, the project is architec- BThe residential complex is welcoming turally intriguing. the New Year holidays by offering its The project is fi nanced by the Bank of clients the best household appliances Georgia. Aside from current offer, Arak- and gifts. ishvili Residence customers are able to Those who wish to purchase an apart- benefi t from fl exible payment conditions. ment in the complex will receive a full It is also possible to get an interest-free suite of premium class German house- loan until the end of the project. Cus- hold appliances. tomers are also able to get a mortgage The two New Year's gift packages have at just 6% interest. been specially created for clients who wants to puchase up to 100 sq meters PROJECT SUPPORT: space or for those who want over 100 square meters. The latter package includes • The project is fi nanced by the Bank a Bosch refrigerator, gas set (oven, vent • The exclusive broker for the complex and gas stove), dishwasher, Multi-Robot, is Colliers International Georgia kitchen, washing machine, Breakfast set • The complex is being built by com- (toaster, electric kettle, and coffee pany ‘Anagi’. machine), a vacuum cleaner, Samsung • The construction of the project will LED TV and Hyundai air conditioner. end in 2017. GEORGIA TODAY 4 BUSINESS DECEMBER 20 - 22, 2016 THE ISET ECONOMIST A BLOG ABOUT ECONOMICS AND THE SOUTH CAUCAUS www.iset-pi.ge/blog

The ISET Policy Institute (ISET-PI, www.iset-pi.ge) is an independent think-tank associated with the International School of Economics at TSU (ISET). Our blog carries economic analysis of current events and policies in Georgia and the South Caucasus region ranging from agriculture, to economic growth, energy, labor markets and the nexus of economics, culture and religion. Thought-provoking and fun to read, our blog posts are written by international faculty teaching at ISET and recent graduates representing the new generation of Georgian, Azerbaijani and Armenian economists. What Chile Teaches Georgia

until today: in the 2015 Index of Economic Freedom, BY FLORIAN BIERMANN published by the Fraser Institute, Chile's economy AND KÁLMÁN MIZSEI is ranked 7th (Georgia is 22nd). With almost USD 25,000 per capita income (PPP), Chile is the richest country of South America (Georgia: USD 9,500). n 1991, the former fi nance minister of Chile, Finally, in 2010, the international community acknowl- Alejandro Foxley, said in an interview, “We edged Chile’s economic success story when it became may not like the government that came before the only South American country so far to be admit- us. But they did many things right. We have ted to the OECD, the “rich man’s club of developed inherited an economy that is an asset.” countries” (Karen Kornbluh). IAbout twenty years before, General Augusto When Pinochet died in 2006, an editorial in the Pinochet had toppled the democratically elected Washington Post summarized his legacy as follows: President of Chile, Salvador Allende. Pinochet’s “Mr. Pinochet was brutal: More than 3,000 people rule from 1973 to 1990 was characterized by severe were killed by his government and tens of thou- violations of human rights, yet fi nally he agreed to sands tortured, mostly in his fi rst three years. hold a referendum on his political future, and when Thousands of others spent years in exile. It's hard the Chilean people voted against him, he stepped not to notice, however, that the evil dictator leaves down without bloodshed or violence. behind the most successful country in Latin Amer- ica. In the past 15 years, Chile's economy has grown SEEDING REFORMS at twice the regional average, and its poverty rate Of what kind were Chile’s acclaimed economic has been halved. It's leaving behind the developing policies? Pinochet relied on a group of Chicago- world, where all of its neighbors remain mired.” trained economists (nicknamed “Chicago Boys”) who, as Karen L. Remmer writes in the Journal of DON’T CHANGE A WINNING CONCEPT Developing Areas, “removed free market restric- Returning to Georgia, there is no doubt that the tions” and “dismantled the state sector of the government of can claim a great economy in favor of private ownership”. Between achievement, namely ending the notorious practices of extortions and political blackmail which had 1973 and 1976, the spending of the Chilean govern- become the unjustifi able epitome of the late Saakash- ment fell by 40%, and 449 state-owned fi rms (out vili era. In 2012, an increasingly authoritarian gov- of 494) were privatized, while the government ernment was replaced by a more civilized one (like share in the labor force went down from 18% to in Chile, without violence, a fact for which one can- 13%. In the agricultural sector, the Chicago Boys not praise Pinochet and Saakashvili too much). abolished existing restrictions on landholding size However, there is an important difference between and land ownership. Previously one of the most Chile and Georgia: the subsequent governments of protected economies in the world, Chile almost Chile were careful not to reverse the successful entirely erased protective tariffs, to “promote the economic policies that were enacted under the pre- modernization of Chilean industry, subject monop- vious government. As Robert Packenham and Wil- olies to foreign competition, and encourage a more liam Ratliff write for the Hoover Institution: “All effi cient and rational allocation of economic four civilian governments [of Chile] since 1990 have resources” (Remmer). With regard to foreign invest- maintained the new, more market-oriented economic ments, the government got rid of bureaucracy and and social models inherited from the military regime. lifted various restrictions for foreign investors. The Although there were changes at the margins after goal was to make Chile, as it was offi cially announced, 1990, the point of sharpest and deepest positive “the best place in Latin America to invest”. Gov- change was unquestionably 1973 and immediately ernment agencies, like the fi nancial markets super- thereafter, not 1970 or 1990.” visory authority, were dissolved. Labor laws, restrict- The Georgian government, on the other hand, ing the layoffs of workers, were weakened, and puts at stake those libertarian economic principles social welfare expenditures and minimum wages for which Georgia had gained international repu- were reduced. Remmer writes: “The theory of eco- tation between 2004 and 2012. By adopting policies nomic development guiding these policies was of excessive government interventions, be it through that… future economic progress would depend on the reinstatement of a competition authority, the the expansion of industries able to compete on the announced antidumping law, or the anti-dollariza- international market”. tion measures recently promulgated as a response The immediate consequences of this shock ther- to the Lari devaluation, Georgia may quickly forfeit apy were double-edged. The infl ation rate fell from its economic advantages. As one can learn in an 505% in 1974 to 30% in 1978, and the balance of advanced microeconomics class, a government payment improved: in 1976, Chile achieved a trade must only tinker with the free market if there is surplus of USD 500 million. Not unexpectedly, market failure. Without market failure, government however, inequality rose as well: it is estimated interventions can only make a bad situation worse. that the top 5% of income recipients increased their Economic theory is very elaborate on this, and share of the national product from 23% to 50%. there is no place for reasonable doubt on this mat- And the reforms were pushed against the fi erce ter. Dollarization, however, is no market failure but resistance of large parts of the population. As Pablo the optimal adjustment of economic agents to a Baraona, the governor of the Chilean Central Bank, situation of economic uncertainties. The govern- said at the time: “The fact that more than 90% of ment should abstain from interfering. the people are against our policies is proof that the Clearly, there are many economists endorsing the model is working, that is has affected everybody government’s interventionist plans, but one should and that it has privileged nobody”. realize that many of the countries sending and pay- Does the Chilean economic agenda seem familiar ing these experts have in the last 13 years not been to you? economically as successful as Georgia. Many Euro- pean nations, for example, did not experience sat- HARVESTING SUCCESS isfactory growth for decades, suffering from the As it is usually the case with economic reforms, very structural problems caused by the interven- their fruits can only be harvested much later, often tionist recipes they want to prescribe to Georgia. by the successors of those who implemented them. If the government wants to stabilize the Lari’s While in Chile of the 1970s, there was a lot of tur- value in the long run, there is no alternative but to moil and social hardship, the situation stabilized in build trust in Georgia’s economy. This trust will the 1980’s. The greatest dividends, however, were be primarily established by reducing the govern- incurred in the 1990s and later. Between 1990 and ment’s involvement in economic matters, as dem- 1993, Chile experienced an average growth rate of onstrated between 2004 and 2008, when the price 7.7%, and from 1994 to 1999, this number was still as of the dollar fell from 2.20 GEL to 1.40 GEL. This high as 5.6%. Between 1973 and 1999, exports grew long-term appreciation of the Lari was interrupted by a staggering 9% per year. And the impact lasted Continued on page 5 GEORGIA TODAY DECEMBER 20 - 22, 2016 BUSINESS 5 What Chile Teaches Georgia’s Co-Investment Georgia Continued from page 4 by temporary devaluations, and it is important to understand that these are Fund Launches Mtkvari totally inevitable for a very small econ- omy exposed to the forces of interna- tional foreign exchange markets. Instead of economically detrimental responses to something that cannot be controlled, the government must concentrate on the long run – building trust, letting the HPP Project market work, and interfering only in clear-cut cases of market failure. Cush- BY THEA MORRIOSN Mtkvari HPP presentation ioning social hardship in a limited way may be part of the program. Most impor- tant, however, is that there will be no tinkering with the Liberty Act. eorgia is to have a new The current government is making Hydro Power Plant (HPP) very promising efforts to move Georgia in Akhaltsikhe Municipal- towards true judicial independence. That ity, South Georgia, on the would be a lasting contribution to the river Mtkvari. building of a sustainable Georgian state, GThe project was launched by Georgia’s particularly in view of the growing dan- Co-Investment Fund (CIF). Initially, the gers stemming from the geopolitical project was started in 2009 but the con- dynamics here. Indeed, like in Chile, struction works were then suspended. there are many points where the Geor- In 2014, the CIF purchased 100 percent gian Dream government can (and did) share of the project and renewed the improve on its predecessor. The eco- works this year. nomic principles that guided Saakash- The USD 131 million project was intro- vili’s reign, however, are not one of those. duced by the CIF on Friday at a presenta- For the sake of successful state build- tion attended by the Energy Minister and ing, this needs urgent remedy. It will Deputy-Premier, Kakha Kaladze, and strengthen Georgian Dream’s legacy, Infrastructure Minister, Zurab Alavidze. without any doubt! “Implementation and fi nancing of such projects promotes the rapid develop- Florian Biermann is assistant professor of eco- ment and progress of all regions of the nomics at ISET, where he teaches, among country,” Kaladze stated. others, a course in market failure. Georgia’s Co-Investment Fund under- Kálmán Mizsei is former visiting professor at lined that the Mtkvari HPP is being built the Central European University in Budapest, with the most advanced technologies Hungary. He served as regional director of and the construction process monitored UNDP for Europe and the CIS, Special Rep- by Europe’s leading companies. resentative of the EU in Moldova, and head "The Fund has already invested more of the EU advisory mission to . Cur- than USD 53 million in the project; more multi-million permanent income is being Georgia’s Energy Ministry reports that 255 million MW/ h power annually. rently, he is writing a study on transformation than 500 people are employed in con- created for the country’s budget,” CIF the total installed capacity of the HPP will The Mtkvari Hydro Power Plant will processes in Eastern Europe. struction of the plant; and a source of representatives stated. be 53 Megawatts. It is expected to produce become operational in 2019. GEORGIA TODAY 6 BUSINESS DECEMBER 20 - 22, 2016 Techpark Hosts Business Forum Hilton Expands European Capital City Presence to Tbilisi "Made in Georgia" ilton is to introduce its business and events visitors, the hotel fl agship Hilton Hotels & will offer more than 1,000 square meters Resorts brand to the cap- of function and meeting space, in addi- ital of Georgia with the tion to an Executive Lounge and business signing of a management center. Hagreement with Granat LLC. The 206- “Hilton is the world’s leading hospital- guest room Hilton Tbilisi is set to open ity brand and throughout its nearly 100- in early 2019. The building’s historic year history it has continually pioneered façade will be preserved as part of the into new destinations,” said Andreas design, while a striking glass roof will Lackner, Regional Head, Full Service be constructed on top of the building Brand Management, Hilton. “This mag- and will house the hotel’s rooftop bar nifi cent addition in Tbilisi will invite our and spa. guests to visit the charming capital city, “Hilton Tbilisi joins a robust portfolio while sharing in our love of hospitality.” of Hilton Hotels & Resorts either trad- Hilton Hotels & Resorts has 18 proper- ing or in development across 30 Euro- ties currently under development across pean capitals, underscoring our regional Europe, with two hotels in Georgia: Hil- strategy to expand into more Eastern ton Batumi on the Black Sea coast, which European cities,” said Patrick Fitzgibbon, opened in the summer of 2015, and Hil- Senior Vice President of Development, ton Garden Inn Tbilisi Chavchavadze, EMEA, Hilton. “Tbilisi’s diverse econ- which is currently under construction omy, with substantial international infra- and set to open in 2018 in the heart of structure investment, a burgeoning events Tbilisi's fi nancial district. calendar and leisure growth, makes the Hilton Tbilisi will be located at 59 city a promising market to be introduc- Merab Kostava Street, Tbilisi, 0179. ing our fl agship brand to.” Located on Kostrova Street, Hilton ABOUT HILTON Tbilisi will be equidistant between two Hilton is a leading global hospitality of the city’s most vibrant and colourful company, comprising more than 4,800 ast week Techpark Tbilisi, study for better understanding. Partici- ness - quality and international standards, districts. Tbilisi’s main thoroughfare, managed, franchised, owned and leased Business Georgia, with the pants had an opportunity to learn about the role of distribution channels and Rustavelli Avenue, three kilometers away hotels and timeshare properties with partnership of Business Con- the achievements in development of chain stores, trade relations as an addi- and spotted with picturesque architec- nearly 789,000 rooms in 104 countries tact and Maestro TV, organ- local business and share their experience tional opportunity, its impact on export ture, is home to the city’s main cultural, and territories. For 97 years, Hilton has ized Business Forum “Made in producing goods and services in the and import, and success stories of Geor- religious and government buildings. been dedicated to continuing its tradi- inL Georgia”. country. Business Georgia contributed gian brands. They also discussed Geor- Vake, the city’s busy commercial district tion of providing exceptional guest expe- Within the topic were discussed the to stimulating the advancement of Geor- gia’s potential in producing goods and and the heart of Tbilisi’s developing riences. The company's portfolio of 13 challenges and potential of local prod- gian entrepreneurship by organizing this services, the main concerns of producers, fi nancial center, can be found the same world-class global brands includes Hil- ucts produced in Georgia. Business Forum," she said. government incentives, international distance in the opposite direction. Hilton ton Hotels & Resorts, Waldorf Astoria The main objective of the event was At the forum, speakers discussed the facilitators, the role of innovation for Tbilisi will also be two kilometers from Hotels & Resorts, Conrad Hotels & to provide the audience with in-depth current situation of Georgian Products production, fi nancial resources, the role the city’s main train station and 15 kilo- Resorts, Canopy by Hilton, Curio - A information in order to simplify the cor- on Local and Global Markets, the pro- of the banking sector, foreign direct meters from Tbilisi International Airport. Collection by Hilton, DoubleTree by rect perception and estimated role of duction spectrum, product competitive- investments and the role of media in Dimitry Kumsishvili, former Minister Hilton, Embassy Suites by Hilton, Hilton local businesses in strengthening the promoting an entrepreneurial mindset. of Economy and Sustainable Develop- Garden Inn, Hampton by Hilton, Tru by country's economy and creating a favora- The Business Forum speakers were: ment of Georgia said, “The long term Hilton, Homewood Suites by Hilton, ble business environment. The chosen CEO of Partnership Fund Davit Saga- goal of Georgia’s Tourism Strategy 2025 Home2 Suites by Hilton and Hilton Grand topics answered the challenges that local nelidze, Deputy Minister of Economy is to develop the country as a sought- Vacations. The company also manages manufacturers face in a wide variety of and Sustainable Development Ketevan after tourist destination and increase the an award-winning customer loyalty pro- contexts and are equally important for Bochorishvili, Chairman of the National international profi le of Georgia. Projects gram, Hilton HHonors®. various types of businesses. Wine Agency Giorgi Samanishvili, Head such as Hilton Tbilisi are key to broad- The forum was attended by high level The event aimed of the Georgian National Tourism Admin- ening the appeal of Tbilisi and Georgia ABOUT HILTON HOTELS government offi cials, commercial and istration Giorgi Chogovadze, Entrepre- to more international visitors and will & RESORTS international sectors, entrepreneurs and to promote local neurship Development Agency Ana help boost tourism to the city.” For nearly a century, Hilton Hotels & start-ups, chain store representatives, Kvaratskhelia, President of the Georgian Elguja Tsintsadze, Chief Executive Offi cer, Resorts has been proudly welcoming distributors, importer and exporter com- production, to Small & Medium Enterprises Associa- Granat LLC, said, “This is our fi rst hotel the world's travelers. With more than pany representatives, investors, fi nancial tion Mikheil Chelidze, Secretary General development and we are proud to be work- 570 hotels across six continents, Hilton institutions, media, chambers of com- answer existing of the EU-Georgia Business Council ing with Hilton on our maiden hospitality Hotels & Resorts provides the founda- merce and industry, individuals who Zviad Tchumburidze, Director of the project. The exterior of the Soviet era tion for memorable travel experiences represent decision-making organizations, questions through Start-up Georgia Vazha Menabde, Direc- building will be fully restored, while a and values every guest who walks through and those playing a key role in creating tor of Sakpatenti Nikoloz Gogilidze, Chief stunning glass roof will be constructed on its doors. As the fl agship brand of Hilton, an effective business environment. discussion, and to of Party of the USAID G4G Natalia Beru- top of the hotel in a USD 50 million invest- Hilton Hotels & Resorts continues to Business Georgia’s General Director ashvili and Deputy Head of the GCCI ment. The result will be one of the city’s set the standard for hospitality, provid- Ana Gogishvili talked about the positive provide deep Nato Chikovani. fi nest and most unique hotels.” ing new product innovations and services aspects of the Business Forum. "This The speakers reviewed and outlined In addition to the rooftop bar, the hotel to meet guests' evolving needs. Hilton event was intended to promote local study for better plans for the expansion of the market will include an all-day dining restaurant, Hotels & Resorts is a part of the award- production, to answer existing questions for Georgian products and increasing lobby bar and a street facing café. For winning Hilton HHonors program. through discussion, and to provide deep understanding the scale of production in Georgia.

ROUTING FLIGHT NUMBER WEEK DAYS DEPARTURE ARRIVAL TK 387 05.50 07.25 TBILISI - TK 385 11.45 13.25 ISTANBUL ATATURK AIRPORT TK 383 18.10 20.00 EVERYDAY TK 386 01.40 04.55 ISTANBUL ATATURK AIRPORT - TK 384 07.30 10.50 TBILISI TK 382 13.55 17.15 TBILISI - TK 381 07.40 09.00 ISTANBUL SABIHA GOKCEN AIRPORT EVERYDAY ISTANBUL SABIHA GOKCEN AIRPORT - TK 380 20.45 00.10+1 TBILISI BATUMI - ISTANBUL TK 393 17.50 19.10 EVERYDAY ISTANBUL - BATUMI TK 392 13.55 16.55 Tel: (995 32) 2 45 08 08 10 Galaktion Street E-mail: [email protected]

TIFLIS KIS TARIFESI 7.5x6cm ING.indd 1 02/11/16 15:23 GEORGIA TODAY DECEMBER 20 - 22, 2016 BUSINESS 7 Asia Development Bank to Finance Water and Sanitation System Improvements in Georgia

Giorgi Koberidze, Director of Water Supply Company and Yesim Elhan, Kayalar ADB country Director Georgia

with the participation of the United Water Supply BY NINO GUGUNISHVILI Company and the Ministry of Infrastructure and Regional Development of Georgia under the frame- work of the Urban Services Improvement Invest- hiatura, Marneuli and Bolnisi will have ment Program, signed by ADB and Georgia in 2011 their sanitation and water supply sys- which aims to improve infrastructure through the tems renewed in 2017 within the USD reconstruction of water supply and sanitation sys- 99 million project fi nanced by the Asia tems throughout the country. Development Bank under the recent ADB has already mobilized more than USD 2.1 loanC agreement between the ADB and the Govern- billion in public and private sector fi nancing in ment of Georgia. The project will be implemented Georgia since 2007. Sarajishvili Brandy Wins Three Medals at Degustation in USA

BY THEA MORRISON

eorgian wine brandy Producer Sarajishvili won two gold and one silver medal at the degustation of tastings.com powered by the Beverage Testing Institute, which aims at producing fair, impartial wine reviews for consumers. The degustation was held in Chicago, United States, where Sarajishvili XO brandy got 92 points out of 100, while Sarajishvili VS Brandy was awarded 91 points. GBesides the gold medals, Sarajishvili Extra Special Reserve got 87 points and was awarded a silver. Tastings.com reports that Sarajishvili XO brandy has an "exceptional taste." “Spicy, woody aromas and fl avors of leather, dried fruits, chestnut, honey and pepper, with a satiny, crisp, dry-yet-fruity medium body and a tingling, engaging, medium-length conditioned leather, spiced raisins, cola, and mossy earth fi nish. A nice woody brandy that will play nicely in whisky cocktails,” the review reads. As for Sarajishvili VS Brandy, tastings.com says it has a brilliant amber color. “Savory, umami aromas and fl avors of salty nuts and olives, conditioned leather, raisins in balsamic, and brown butter with a supple, bright, dryish medium-to-full body and a tingling, intrigu- ing, medium-length oak, brown spices, cola fl oat with mocha gelato, and mossy earth fi n- ish. A woody, spicy brandy for cigars or cock- tails,” the review reads. Sarajishvili is the oldest leading wine brandy manufacturing Georgian company. It was established in 1884 as a pioneer in Georgia for using classical French cognac technologies for wine brandy production. The brand offers a generous range- from three to 100 year-old brandies, pro- duced to satisfy the needs of many, from low to high-income consumer categories. Sarajish- vili products are successfully sold in more than 15 countries. GEORGIA TODAY 8 BUSINESS DECEMBER 20 - 22, 2016 HSC Group: Drive to Excellence

INTERVIEW BY NATIA LIPARTELAINI

SC Group is one of the leading con- sulting groups on today’s Georgian market. The consulting group was founded this year by three enthusi- astic and energetic young profes- Hsionals: Giorgi Dolidze (CEO, co-founder), David Zarnadze (co-founder and lawyer, and Davit Markhulia (co-founder and FCO). HSC Group aims to offer high quality service and service packs for small and medium businesses in the fi eld of hospitality. Among the wide range of services that the company offers are: sales/market- ing, revenue management, general management, accounting, working standards formation and enforcement, service management, operating in on-line reservation systems (OTA), and legal and fi nancial analyses. The three founders already have a fresh perspec- tive and concrete plans in terms of achieving those ambitious objectives in order to bring positive changes to the Georgian hospitality sector. GEOR- GIA TODAY talked to Giorgi Dolidze and David Zarnadze to fi nd out more about their activities and the current situation in the sector.

HOW WAS HSC GROUP FOUNDED? Giorgi: Our work meant we often had to travel and visit various hotels at which we interacted with representatives of the hospitality sector. We sensed that there was a problem among Small and Medium Sized Enterprises (SME) to successfully operate in the market and maintain standards, especially in terms of service quality and adequately equipped rooms with the aim of attaining customer satisfac- tion. We decided to have SME as our target seg- cies and to run their business according to modern vices. When we were thinking about what services TELL US ABOUT THE TRAININGS ment, as big businesses such as 5-star hotels do not standards. We provide such services as research to offer, we listed every possible service a hotel YOU OFFER HOTEL STAFF really face such problems, supported as they are of the current position of the hotel, measurement might need based on market research. We found David: We’ve had training programs in six by large international companies. We founded the of effi ciency level, “mystery shopper” studies, out what the market requirements were and came hotels already. Our training programs tend to Group in February after a period of market research assessment of the competitive environment, and up with 26 types of services that are a perfect fi t last one month and implies training reception- to confi rm our choice. We aim to help the SMEs in SWOT analysis of the business which enable us to for them. We have partners and often do outsourc- ists, house-keepers and managers to smile, be the hospitality sector to improve their effi ciency suggest effective ways to overcome problems and ing. We also often have invited trainers. approachable and do so in a natural way. We of doing business and to meet existing market barriers. We also assist the SME in estimating and train them in every required service that is requirements. developing relationships with partners, refi nement WHAT ARE THE IMPORTANT needed during the customer’s entire journey; of legal and fi nancial activities and other important CHALLENGES THAT THE GEORGIAN basically in every operational, legal and finan- WHAT ARE YOUR KEY COMPETENCIES? issues which are essential for the effective opera- HOSPITALITY SECTOR IS FACING TODAY? cial activity, such as what packages to offer or David: Our goal is to offer a professional service tion of the business. Giorgi: Even though the hospitality industry is how to deal with problematic customers. You’d mainly to hotels, which allows them to strengthen Giorgi: Our core competencies are: operational developing quite dynamically, there are lots of be surprised the problems that exist in some their position in the market, to remove ineffi cien- management, fi nancial management and legal ser- problems, especially for SMEs, 4 and 3-star hotels. hotels- there is no e-mail culture whatsoever; David: The way the hotel star rating system is in some cases the staff does not even know regulated is a challenge in itself. how to answer phone inquiries. Giorgi: Yes, we actually aim to work with the Geor- gian government in order to develop a better system HOW DO YOU CARRY OUT for accrediting stars to hotels, as nowadays you can “MYSTERY SHOPPER” RESEARCH? fi nd lots of hotels in Georgia that claim to be 4-star David: This method is stereotypically used in and are simple not. The problem is more discernible banks, for some reason. It’s a great way to expose in the regions, outside of Tbilisi. What would not problems that exist for the customer in order to even be considered a 2-star hotel in Europe claims improve the system. The method involves a to be a 4-star in Georgia, and this is not good. Our researcher visiting the establishment as a guest company does not have only commercial objectives; and deliberately creating problems or special cir- we want to cooperate with the government in order cumstances that the hotel staff needs to deal with. to improve the existing standards in the hospitality Based on these observations, and photo and audio sector. We’ve already had 15 orders from different reporting of the whole customer journey, concrete companies so far, mainly from Tbilisi, but we aim to suggestions can be made to the visited hotel. move beyond and start operating in the regions. YOU ALSO HELP COMPANIES TO IS THE GEORGIAN TAX SYSTEM MANAGE SOCIAL MEDIA NETWORKS KIND TO THE HOTEL BUSINESS? Giorgi: Yes. Very often, companies do not know David: The Georgian tax system is a fi eld that how to effectively promote their company and end requires monitoring as our laws change regularly. up targeting the wrong audience. This is due to the One of those changes will occur from 2017; there fact that they do not know who are their main audi- will be some changes to the Georgian tax system ence or customers are. It is possible to effectively which means it will be essential for companies that manage social media and with a very low budget operate in the hospitality sector to have consulta- communicate relevant information and ensure tions in order to keep up with the changes. maximum exposure. David: The main platform in that sense is, of course, Facebook, but people from Russia, Kazakh- stan and Ukraine for example, use social network VK (vkontakte) and this should be taken into con- sideration if the target audience is from those countries.

WHAT ARE YOUR FUTURE PLANS? Giorgi: First of all we haven't really invested much in PR and marketing; so far we’ve only developed You’d be surprised the partnerships based on our personal contacts. The strategy we've been using is mainly word-of-mouth problems that exist in but we do plan to increase our marketing activities. As I said, we plan to work with the Georgian National some hotels- there is no Tourism Administration to develop interesting projects. We also plan to offer business strategy e-mail culture plans to companies and establish relationships with companies who have the same profi les abroad in whatsoever; in some order to share even more international experience with local hotels. We also want to start working cases the staff doesn't with restaurants in future. We've worked with standards that need to be maintained in hotel res- even know how to taurants but we want to expand our work even answer phone inquiries more in that regard. GEORGIA TODAY DECEMBER 20 - 22, 2016 BUSINESS 9 Kheledula HPP to Be Built in Georgia

Georgia’s Vice Prime Minister and the Minister BY THEA MORRISON of Energy Kakha Kaladze and Anadolu Tasıt Ticaret A.S. Energy Group Coordinator Tugban Izzet Aksi- yom signed a deal on the Kheledula-3 HPP con- urkish company Anadolu Tasıt Ticaret struction on Thursday. A.S. is investing USD 90 million to According to the memorandum, the company is build the 50.77 Megawatt Kheledula obliged to realease a part of the processed energy Hydro Power Plant (HPP) in Georgia’s onto the local market. Kvemo Svaneti region, Lentekhi The project will be especially profi table for Geor- Tmunicipality, over the River Kheledula next year. gia in the winter season when there is a power The construction will be carried out on the basis defi cit in the country. of a memorandum of understanding signed between Kaladze stated the energy sector is vital for Georgia’s the Georgian government and Anadolu Group in economic and energy development and such projects May, 2015. will help Georgia to gain energy independence. Badagoni Wine Company Celebrates 10th Anniversary in London

Badagoni Celebration in London

organize such events in future to help promote BY NINO GUGUNISHVILI Georgian wine in the UK even further.” The celebration, held in a historic building, designed by 19th century architect John Nash who fter a celebration dedicated to the also designed the Brighton Pavillion and Marble 10th anniversary of the Badagoni Wine Arch, was followed by a gala-dinner and a concert Company held in the region of Kakheti, with Georgian musicians Liza Bagrationi, Nikoloz Georgia, this November, the Institute Rachveli and Giorgi Zagareli performing music by of Directors in London hosted a fol- Giya Kancheli and other Georgian composers. Alow-up event organized by the Georgian Wine Club. Qamarauli and Muriu talked about the history of The Georgian Wine Club is a UK-based wine Georgian wine and introduced a range to the guests. importing company, founded by Berdia Qamarauli Serge Pradier, Food and Beverage Manager at the and his business partner Dennis Muriu, with an Institute of Directors was in charge of food and online presence selling exclusive, Georgian fi ne wine pairing- offering guests a detailed description wines. and giving tasting notes for each of the wines. “The event was one of the most important for us. Tamar Beruchashvili, Ambassador of Georgia to Badagoni Wine Company is our biggest supplier the UK, greeted the guests attending the event and a trusted partner,” said Qamarauli. “This year while Giorgi Salakaia, Founder of Badagoni Winery, was especially important for them as it is their 10th expressed his gratitude and willingness to be more year anniversary. The celebratory event was also exposed to the UK market. a very important evening for Georgian wine in Mako Abashidze, Founder Director of the British general. No such event has been held in the UK Georgian Chamber of Commerce, then congratu- before and we are very proud that we managed to lated Badagoni on 10 successful years and announced do it together with Badagoni and in association the signing of the Memorandum of Cooperation with British Georgian Chamber of Commerce and between BGCC and the Solidarity Fund in Georgia, Georgian Embassy to the UK. The event was which took place during her last visit to Tbilisi attended by representatives of the British govern- “We plan to hold a series of fundraising events in ment, business persons, UK media, and Georgian London next year to raise awareness of the Geor- diaspora. The Georgian Wine Club intends to gian Solidarity Fund in the UK,” she said. GEORGIA TODAY 10 BUSINESS DECEMBER 20 - 22, 2016 Dechert OnPoint: Why Brexit is Not Bad News for UK-Based Arbitration and Litigation echert is partnering with While the UK’s post-Brexit legal frame- Georgia Today on a regular work is thus diffi cult to predict, it is almost section of the paper which certain that Brexit will terminate the pri- will provide updated infor- macy of EU law over domestic UK law mation regarding signifi cant and will free the UK courts from the legalD changes and developments in Geor- controlling jurisdiction of the Court of gia. In particular, we highlight signifi cant Justice of the EU (CJEU). Currently, many issues which may impact businesses EU companies opt for Swiss-seated arbi- operating in Georgia. Contributing this trations, precisely because EU law is not week are London-based Dechert Partners part of Swiss domestic law and Swiss Arif Ali and Miriam Gonzalez, London- courts are not subject to the controlling based Senior Directors Roger Matthews jurisdiction of the CJEU or the European and Andrew Hood, London-based Senior Commission. Switzerland is thus widely Associate Daniel Dozsa, and Brussels- considered neutral ground, where claims based Special Counsel Erica Stein. based on EU law (including the competi- Together, they make up Dechert's Brexit tion and state aid defenses often invoked and International Arbitration team, which by respondent states and companies alike) has market-leading experience in advis- are dealt with expeditiously and without ing clients in all aspects of Brexit, includ- the pro-EU slant often exhibited by EU ing international arbitration and litigation member states’ courts, which are under issues associated with it. an obligation of “sincere cooperation” in the enforcement of EU law (Art. 4(3) WHY BREXIT IS NOT BAD Treaty on European Union). NEWS FOR UK-BASED Thus, by simplifying English law and ARBITRATION AND LITIGATION the English legal system, Brexit could in A lot has been said about the uncertain- fact make the UK a more attractive and ties surrounding Brexit and its likely neutral jurisdiction to resolve interna- impact on doing business with and within tional disputes. Furthermore, the UK the UK. Will London remain Europe’s judges’ and legal practitioners’ decades fi nancial center? Will the UK reinstate workers? Just to name a few examples. tion (Recast) (No 1215/2012) and the applying such laws. Brexit will not change of experience in applying EU law could customs duties on imports and will the Answering these questions is, at the predecessor Brussels Regulation (No that. Brexit, therefore, is unlikely to serve them well in effi ciently resolving EU reciprocate? Will the UK impose moment, diffi cult. However, when it comes 44/2001) as the Brussels Regulation. impact London’s standing as a leading disputes with an EU element. restrictions on the free movement of to Brexit’s likely impact on UK-based Arbitral awards within and outside the international arbitration center. As to court proceedings, it is highly arbitration and litigation, the picture is EU are recognized and enforced under In fact, there may be an opportunity unlikely that Brexit will terminate the clearer and the outlook more positive. the 1958 New York Convention, which for London to become the go-to neutral free movement of judgments between currently counts 156 members, and is forum to resolve intra-EU disputes. the UK and the EU. LONDON’S POSITION AS ONE widely considered as the single most EU law is currently incorporated into The free movement of domestic court OF THE WORLD’S LEADING important international legal instrument UK law by virtue of the 1972 European judgments in the EU is older than the ARBITRATION CENTERS IS governing the international resolution Communities Act. To implement Brexit, UK’s EU membership. The members of UNLIKELY TO CHANGE of commercial disputes. Brexit will not the UK will have to repeal or substan- the EEC (later, EC, then EU) ratifi ed the London may EU law by and large does not apply to change that. tially amend the European Communities Brussels Convention in 1968, ensuring arbitration. The Brussels Regulation, Thus, arbitral awards rendered in Lon- Act (hence the on-going debate whether that domestic court judgments made in become the go-to which governs the recognition and don will continue to be enforced post- Parliament, as the legislator, is required one Member State would be recognized enforcement of judgments within the Brexit internationally, including within to approve the Government’s “Article and enforced throughout the other Mem- neutral forum to EU, does not apply to arbitration (Art. the EU, in accordance with the New York 50” notice to the EU – a cardinal ques- ber States of the EEC. The UK acceded 1(2)(d) of Regulation No 1215/2012 Convention. tion that will ultimately be decided by to the Brussels Convention in 1978, ten resolve intra-EU (Recast) – for the sake of simplicity, we The UK is renowned for its arbitration- the UK Supreme Court at the beginning years after its inception and fi ve years disputes will refer to both the Brussels Regula- friendly laws and experienced legal bar of 2017). Continued on page 11

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For more information contact: + 995 595279997 GEORGIA TODAY DECEMBER 20 - 22, 2016 BUSINESS 11 Dechert OnPoint: POLITICS Why Brexit is Not Bad All the Electorate's Men News for UK-Based Arbitration and Litigation Continued from page 10 BITs is routinely raised by losing states after the UK’s accession to the EEC. in proceedings to enforce or set aside Although the Brussels Convention was arbitral awards before Member State generally superseded by the Brussels courts. The CJEU (the only court that Regulation in 2001, it continues to apply can give an authoritative opinion on this to certain overseas territories of EU issue) is yet to deliver its preliminary member states (Art. 68(1) Brussels Reg- ruling on the legality of one such intra- ulation). EU BIT, and even if it does determine The “Brussels Regime” has thus become such arbitral awards rendered under part of EU law. However, the EU has also intra EU-BITs to be illegal, it is uncertain extended the Brussels Regime to neigh- whether the CJEU will constrain its boring, non-EU states. In 1988, the EC opinion to the legality of the specifi c BIT and the Member States of EFTA with at issue (between the Netherlands and the exception of Lichtenstein (today, Slovakia), or whether it will opine on Iceland, Switzerland and Norway) rati- the broader issue of the compatibility of fi ed the Lugano Convention, the terms intra-EU BITs with the EU legal order. of which mirrored the Brussels Conven- The UK has intra-EU BITs with twelve tion. When the EU internalized the Brus- member states (Bulgaria, Croatia, the sels Convention through the Brussels Czech Republic, Estonia, Hungary, Lat- Regulation, the EFTA states followed via, Lithuania, Malta, Poland, Romania, suit by entering into new Lugano Con- Slovakia and Slovenia). These BITs will stamp the whole thing. The popular vote distilling all communal bonds down to OP-ED BY ROBERT ISAF vention (recast, 2007), which mirrored cease to be intra-EU BITs, post-Brexit. is properly sideshow. the essentially economic ones formed the terms of the Brussels Regulation. Therefore, investors relying on these Now, why on earth should we care, you by land ownership and tenancy is – with- Thus, membership in the EU has never intra-EU BITs to bring claims against ask, half a world and a daylight away? out further commentary – possible. Is been a pre-condition to being part of the EU Member States post-Brexit will be s we go to press, the United The Electoral College remains signifi cant the same possible, or even desirable, European area of free movement of judg- able to do so with the reduced risk of States of America will elect for all of us, wherever we are, precisely here? ments. the respondent state successfully raising their 45th president. because of how sharply its perceived The closer we come to simplicity in In summary, although there is uncer- the EU defense in the arbitration, or in Of course, especially from fl aws throw into relief the terms of that electoral practice, the closer we come tainty as to how the free movement of the subsequent annulment or enforce- this far away, we’d be for- national compromise required of any to autocracy. This can seem benign and judgments will be ensured between the ment proceedings. And even if the UK Agiven for thinking that particular mile- state. even positive seen in passing, or perhaps UK and the EU, post-Brexit, it is highly were to terminate these intra-EU BITs stone already past. If the international What the crowds and coneheads clam- purely superfi cial; but who wants to live unlikely that either the UK or the EU in the course of Brexit (which is yet to spotlight has ever rested on the peculiar oring for the primacy of the popular vote under an autocracy of someone else’s would seek the UK’s exit from the Brus- be determined), it is very unlikely that institution of the Electoral College, are really doing is declaring the interest sheer majority? If states aren’t made sels Regime, because the ensuing judicial such termination would affect invest- though, it does so now. I’ll leave it to of the individual person, as a policy con- complex, they either homogenize and vacuum would seriously undermine the ments that have already been made at readers to review the details of the sys- sideration, to be sacrosanct, and taken bleach out, or break apart. If small lan- UK’s commercial stability and its role the time of the BITs’ termination. tem for themselves; there’s a litany of over all other considerations. In order guage communities aren’t given policy as a fi nance hub and it would also hurt Therefore, companies intending to articles, essays, thinkpieces, and general to seriously and consistently argue like protection, aren’t allowed to legally voice the EU’s commercial interests. make signifi cant investments in coun- entreaties circulating now on the topic, that, “One Man, One Vote” has to be their own interests as an individual group Finally, Brexit could reinforce the UK’s tries with which the UK has intra-EU many of which contain the germ at least treated as a sort of Single-and-Alone, at the forum of state policy-making, they intra-EU Bilateral Investment Treaties, BITs are well-advised to consider struc- of some genuinely marvelous specula- with an almost fundamentalist fervor. will disappear under the chatter of major- reducing investors’ enforcement risk. turing their investment so as to benefi t tive fi ction. But no society is simply a clustering ity. If territorial communities feel frus- Another consequence of Brexit will be from the protections that the UK’s BITs I’d like to call instead for all of us to of citizens. Nor, when voting, is any but trated in their attempts to infl uence state that the UK’s Bilateral Investment Trea- could have to offer. step back for a moment, and refl ect on the most tragically hermetic citizen vot- policy, they’ll leave – as happened, vio- ties (BITs) with other EU member states the true meaning of the Electoral Col- ing purely based on his or her own ‘indi- lently, in the US in 19th century, in Yugo- will no longer be “intra-EU” BITs. In * * * lege. December 19th was much more vidual’ interests. The communities to slavia in the ‘90s, and, of course, here. general, BITs promote foreign direct Note: This article does not constitute legal than merely a moment for American which we belong – especially those com- Needless to say, I make no commentary investment by protecting investors from advice. You are responsible for consulting families to gather and give thanks for munities in which membership is most here on the morality of this – only on illegal expropriation, discrimination, or with your own professional legal advisors the gift of Representative Democracy normally inherited, into which we are the fact of it. the breach of their legitimate expecta- concerning specifi c circumstances for your over their traditional meal of Chicken naturally born, to which we are native, Protests continue now across America. tions and by giving them the powerful business. Tetrazzini, blissfully oblivious to what- those communities defi ned by a national To the extent that these protesters sim- recourse to have their potential griev- ever’s actually cogging on in the back- quality like language, or ethnicity, or ply feel that Hillary Clinton has won the ances against the host state adjudicated Dechert Georgia is the Tbilisi branch of Dechert ground. religion, or tribe – these communities right to be President, or that her lead in before a neutral, international arbitration LLP, a global specialist law fi rm that focuses No; this year, let’s all of us, in every have individual interests of their own, the popular vote proves the need to abol- forum, as opposed to the host state’s on core transactional and litigation practices, nation, let America’s Electoral College as a body. ish the Electoral College, they are deeply domestic courts. As such, ensuring proper providing world-class services to major cor- be a reminder of what true national sov- In the US, the communities that mat- misguided. Her much-discussed 2.8 mil- BIT coverage, where available, is essen- porations, fi nancial institutions and private ereignty is, and must be: a compromise, ter, that are allowed to vie equally with lion margin of victory is attributable tial in structuring any large scale cross- funds worldwide. With more than 900 Law- between the interests of a state’s citizens each other as communities over shaping almost entirely to the combined six border investment. yers in our global practice groups working in as individual persons, and the interests state policy, are defi ned by territory, and counties of New York and LA alone – The European Commission has taken 27 offi ces across Europe, the CIS, Asia, the of the state’s communities as individual called states. America’s system is laugh- completely entirely if we ignore Staten the position that intra-EU BITs have Middle East and the United States, Dechert groups. ably far from perfect, and even so has Island (and who doesn’t?). That isn’t to been superseded by EU law and should has the resources to deliver seamless, high This is deep, serious stuff! And too been shamelessly declawed over the say that she won 2.8 million votes in therefore be considered void or, at the quality legal services to clients worldwide. often forgotten or full-out ignored, even decades; but the spectacle of an Electoral those two cities – she won 2.8 million very least, terminated by the Member For more information, please visit www. by the high priests who ought to know College every four years, consisting of more votes there than did her opponent. States concerned, and the illegality of dechert.com or contact Nicola Mariani at better. Among all the punditry we hear individuals representing by constitution Ignoring, for now, the (grotesquely unfi t) arbitral awards rendered under intra-EU [email protected]. things like “the Electoral College has and with their conscientious vote their character of that opponent, we ought at failed” (by which of course is meant that state, rather than simply some faceless least to appreciate a system that protects it’s failed to conform to the popular vote), plurality of yesses, is a visceral reminder Alabama, and even New Hampshire, or that it’s an “anachronism” that needs of a basic truth. Individuals matter, but from the autocracy of the Brooklynite. to be abolished or “reformed” (by bring- not at the expense of the communities The challenges here are different. Guria ing it more fully into line with the pop- to which they belong, and which in turn probably doesn’t need protection from ular vote), or, in its defense, that it’s an constitute the State at large. the whim of the Tbiliseli. But here, as in “emergency brake on the process of Without passing any judgement or sug- any country, there are assuredly groups selecting a president” (Lawrence Lessig, gesting any change, then, let us consider and communities that DO need extra a Harvard law professor). our own state. Is the Republic of Georgia care – and if they can’t be immediately, Of course that’s all rubbish. The Col- in fact quite as monolithic as its electoral instinctively identifi ed, then it’s probably lege isn’t a failsafe to the process; it is practice suggests? Does the district sys- a matter of even more necessity. the process. There are some stops and tem adequately refl ect the full diversity So, as the United States of America whistles attached, to be sure, but they’re of communities and communal interests deconstruct themselves, the innards of attached TO the core organ, rather than that make up the state? Are, in fact, the what’s been a fair machine should provide visa versa. If there’s an emergency brake, most essential communities within Geor- some engaged study for a newer and it exists in Congress, which has a last gia even recognized as such under the smaller democracy now working to make opportunity to object to electors’ legal- law? In America, a country of transplants the best of itself, for all its citizens and all ity as electors, and does, in fact, rubber- and colonists, the political simplicity of its communities, in the century that comes.

PUBLISHER & GM Journalists: Photographer: ADDRESS Reproducing material, photos George Sharashidze Tony Hanmer, Irakli Dolidze 1 Melikishvili Str. and advertisements without Zaza Jgarkava, Tbilisi, 0179, Georgia prior editorial permission is COMMERCIAL Maka Bibilashvili, Layout: strictly forbidden. DEPARTMENT Karen Tovmasyan, Misha Mchedlishvili Tel.: +995 32 229 59 19 The author is responsible for Commercial Director: Dimitri Dolaberidze, E: [email protected] all material. Rights of authors Iva Merabishvili Maka Lomadze, Webmaster: F: GeorgiaToday are preserved. The newspaper Marketing Manager: Tim Ogden, Joseph Larsen, Sergey Gevenov is registered in Mtatsminda Mako Burduli Vazha Tavberidze, ADVERTISING & district court. Nugzar B. Ruhadze, Circulation Managers: SUBSCRIPTION EDITORIAL DEPARTMENT: Nino Gugunishvili, David Kerdikashvili, +995 595 279997 GEORGIA TODAY Editor-In-Chief: Thea Morrison, David Djandjgava E-mail: marketing@ Reg. # 06/4-309 Katie Ruth Davies Natia Liparteliani georgiatoday.ge GEORGIA TODAY 12 POLITICS DECEMBER 20 - 22, 2016 EU, UNDP Summarize Parliamentary Election Media Monitoring Annual Gazprom he need for more in-depth positive dynamic contributes to further online media. The monitoring was car- analysis of political pro- strengthening of democracy in Georgia," ried out from May through November grams, growing polarization said Janos Herman, Ambassador of the 2016 by the three Georgian civil society in some media segments European Union to Georgia. organizations: the Georgian Charter of Meeting Ends and cases of hate speech The EU-UNDP media monitoring Journalistic Ethics, Internews Georgia, Tare the focus of recommendations to the examined media performance during and the Civic Development Institute Georgian media that have resulted from the 2016 Parliamentary elections in Geor- (CDI). Throughout the entire monitor- the 2016 Parliamentary Election media gia covering forty-seven ing process, media monitors were receiv- without Agreement monitoring supported by the national and local ing professional support from the Slovak European Union (EU) and media outlets: tel- media monitoring organization Memo’98. United Nations Develop- evisions, radio, “Findings of the election media moni- their new proposal is unacceptable for ment Programme print and toring have been informed by the tre- BY NATIA LIPARTELIANI us,” Kaladze said. (UNDP). mendous job of collecting and analysing Gazprom is the largest Russian gas- The fi nal reports of of up to 300 thousand media monitoring producing company, supplying numer- media monitoring, cases, undertaken by our partner civil recent meeting with ous countries, including 25 EU members, released at a press society organizations. The EU-UNDP Gazprom representatives with natural gas worldwide. conference on 16 media monitoring has become an essen- ended without results. As Georgia's energy minister, former A.C. December, tial part of election cycles in Georgia Vice PM of Georgia, Min- Milan football star Kakha Kaladze has acknowledged the equally useful and benefi cial for the ister of Energy, Kakha held several meetings with Gazprom progress made by media and public,” said Niels Scott, Head AKaladze told reporters, the views of representatives, stating that Georgia is the Georgian media of the United Nations in Georgia. Gazprom did not coincide with the views seeking energy diversifi cation. Kaladze in recent years, and of the Government of Georgia. had previously justifi ed the negotiations highlighted challenges with Gazprom by saying Azerbaijan was on the way to quality Kaladze said that the Georgian Gov- without the technical ability to supply reporting and professional ernment does not want to change the more gas. and ethical media culture. existing conditions of the agreement. Some believe an agreement with "Media freedom and pluralism “The agreement on transit is signed Gazprom will threaten the region's energy are fundamental values in our coop- annually. They said we should receive status quo and Georgia might become eration with Georgia. I am pleased that fi nancial reimbursement but we have dependent on Russian energy, which, in positive trends were observed, pointing been receiving 10% of the transited nat- turn, critics say, could jeopardize Geor- to more balanced and diverse reporting ural gas as the cost of transit and as such gia’s Western-oriented integration plans. in media during the election period. This