Day: March 4, 2026
The Georgian Dream-led disputed parliament has adopted in the final hearing a restrictive package that imposes additional curbs on receiving foreign funding, criminalizes “external lobbying,” restricts political activities, imposes limits on businesses, and penalizes “systematic” refusal to recognize the government’s legitimacy.
The changes, announced in January, include amendments to the Law on Grants, Law on Political Associations, Criminal Code, and Administrative Offences Code, and have drawn widespread criticism over what observers see as repressive and vague clauses allowing arbitrary application and restricting many forms of political participation.
The amendments:
- Significantly broaden the scope of what is considered a “grant” that needs government approval, to include technical and free-of-charge assistance, as well as grants transferred from a foreign organization to its local branches, while also expanding the list of entities considered as grant recipients, including foreign-based organizations working on Georgia-related issues. Criminal penalties are introduced for grants-related violations.
- Introduce 8-year bans on political party membership for those who have worked in foreign-funded organizations; expand the notion of “declared electoral goal” into “declared party-political goal,” potentially subjecting broader groups to strict financial controls; and introduce criminal sentences for heads of parties/subjects with “declared party-political goal” that receive foreign funding.
- Introduce jail terms (up to 6 years) for those engaged in what lawmakers call “external lobbying.”
- Introduces penalties for businesses “publicly carrying out such political activity that is not related to its principal entrepreneurial activity.”
- Introduce “extremism” clause, with up to 3 years’ jail terms for those who “systematically” refuse to recognize government legitimacy.
The package follows an earlier series of laws restricting foreign funding, including previous amendments to the Law on Grants, which introduced fines for those who failed to obtain government approval before receiving foreign funds, as well as Georgian Dream’s version of the U.S. Foreign Agents Registration Act (FARA), which introduced jail sentences for foreign-funded entities and individuals who did not register as foreign agents.
Below are the new legislative changes in detail:
New Restrictions on Foreign Grants
Broadening the definition of grants:
- The package broadens the definition of what amounts to “grant” that are subject to government approval, to include “funds transferred in monetary or in-kind form” from a foreign organization or a foreign citizen to a Georgian organization, citizen, or resident “that are used or may be used for activities carried out or to be carried out to exert any influence on the Government of Georgia, state institutions, or any part of society, that are directed toward the formulation, implementation, or alteration of Georgia’s domestic or foreign policy, as well as used or may be used for activities arising from the political or public interests, approaches, or relations of a foreign government or a foreign political party.”
- Funds, in monetary or in-kind form, transferred between the same subjects for the above purposes, where the recipient “provides technical assistance in the form of sharing technologies, specialized knowledge, skills, expertise, through services and/or other types of assistance” will also be considered as such a grant. Exempt are employees working in foreign governments, their branches, or international organizations.
- Providing technical assistance “in the form of sharing technologies, specialized knowledge, skills, expertise, through services and/or other types of assistance,” including those provided free of charge, will also be considered as grants needing government approval.
- The funds – in monetary or in-kind form – transferred by the legal entity of a foreign country to its local branch in Georgia, except for the purposes of entrepreneurial activities, will also count as grants requiring government consent;
- The law also considers “legal entities of another country” whose activities “substantially” involve working on “Georgia-related” issues, as “grant recipients.” Transfer of such grants will also require government approval.
- The funds transferred “for the purposes of achieving entrepreneurial objectives” – except for those transferred to an entity with the status of an agricultural cooperative – won’t be considered as grants.
Breaching the rules of the above-listed clauses will result in criminal responsibility for the grant recipient in the form of a fine, community service, or imprisonment for up to 6 years; This does not apply to grants transferred from a foreign organization to its local branch in Georgia; in such cases, the grant recipient will be subject to a fine equal to twice the amount of the grant.
The same criminal penalties apply in cases where funds that “in their nature constitute a grant” are transferred through a “sham agreement.”
At the same time, the amendments to the Criminal Code introduce the notion of money laundering “committed for the purpose of carrying out activity on a political issue related to Georgia,” punishable by imprisonment for a term of nine to twelve years. The Criminal Code adopts the definition of such activity from the new definition of what qualifies as a grant.
Georgia’s Audit Office, which has recently absorbed the Anti-Corruption Bureau, will be supervising the law’s implementation.
Retroactive application: The changes will also apply to unused grants received prior to the law’s entry into force. In such cases, the grant recipient will be required to seek government approval and will be prohibited from using the funds if the application is rejected.
Ban on ‘External Lobbying’
A similar criminal sentence – a fine, community service of 300-500 hours, or imprisonment for up to 6 years – applies for “direct or indirect transfer of money, securities, other property, property benefit, or any other advantage to a citizen of another state or to a legal entity in exchange for carrying out activity on political issues related to Georgia,” a clause Georgian Dream lawmakers defined as “external lobbying.” The organizations committing the same act will face a fine or a combination of fine and liquidation. The definition of a “activity on political issues related to Georgia” is again copied from the new definition of what amounts to a grant.
The clause does not apply to the employees of foreign governments, their branches, or international organizations providing technical assistance to their employers, or to branches of foreign organizations, but applies to local branches of the above-defined “legal entities of another country” whose activities “substantially” involve working on “Georgia-related” issues.
Restrictions on Parties and Political Activities
The package introduces a number of restrictions regarding political parties and political activities, including:
- “Declared Party-Political Goal”
The earlier notion of “declared electoral goal” in the Law on Political Associations is replaced by a broader person with “declared party-political goal,” defined as an entity “which is not registered as a party, but essentially resembles a party through the nature of its activities and public actions, including participation in the formation and exercise of citizens’ political will.”
Such entities will be subject to rules, regulations, and financial control from the Audit Office applicable to political parties, while physical individuals with such a goal will be subject to rules applicable to an independent election candidate.
The amendments also introduce criminal liability for the failure of subjects with “party-political goals” to submit a financial declaration, as well as “intentional inclusion of incomplete or incorrect information in the declaration, or the failure to correct deficiencies in the declaration,” with the act punishable by fine, community service, or up to 3-years ban on holding an office or pursue activities.
- Criminal Liability for Receiving Foreign Funding
The heads of parties or entities with “declared party political goals” that receive foreign funding, whether from non-Georgian citizens or from foreign organizations, will face criminal punishment of a fine, community service, or imprisonment of up to 6 years
- Bans on Party Membership
Individuals who were employed and received a salary from an “organization pursuing the interests of a foreign force” will be banned from party membership for eight years, starting from the year when they last received income from such an organization. The “organization pursuing the interests of a foreign force” is defined as organizations, media outlets, and broadcasters that have received more than 20% of their income from a “foreign force.”
‘Extremism’/Non-Recognition Clause
The amendments to the Criminal Code introduce an Article (316-prima) of “extremism against Georgia’s constitutional order.”
The new law foresees the penalty of a fine, community service of 400-600 hours, or imprisonment for up to 3 years for individuals making “systematic public call for mass violation of the legislation of Georgia, for mass disobedience to the Georgian government bodies, or for the creation of alternative bodies to the government bodies of Georgia.”
The same punishment applies for “the arbitrary, public and systematic presentation of another person or of themselves as a representative of the authorities of Georgia” as well as “any other systematic act” directed “at establishing the perception of the illegitimacy of Georgia’s constitutional order or constitutional bodies and harms the interests of Georgia or creates a real threat of harm to the interests of Georgia.”
Legal entities committing the same acts will be subject to a fine or a combination of “liquidation and fine.”
Aggravating clause: Committing a crime “motivated by the non-recognition of Georgia’s constitutional order or constitutional bodies” becomes an aggravating circumstance per the Criminal Code, resulting in a punishment that will extend the minimum sentence for that specific crime by “at least 1 year.”
Restrictions for Business Entities
The new package also imposes new restrictions for businesses (entrepreneurial legal entities) “publicly carrying out such political activity that is not related to its principal entrepreneurial activity,” with the definition of “political activity” again copied from the new definition of what amounts to a grant. Such an act will be subject to a fine of GEL 20,000 (about USD 7,500), while repeated acts are punished by a fine, community service up to 200 hours, or imprisonment of up to 3 years.
More to follow…
Other state-owned companies participating in non-oil export activities include SOCAR Polymer, AzerGold, Azəralüminium, SOCAR’s Gas Export Department, Azərpambıq Aqrar Sənaye Kompleksi, SOCAR-DALĞIC, Azərbaycan Dəmir Yolları, the State Energy Service of the Nakhchivan Autonomous Republic, and İstisu Mineral Water Plant.