‘The European Business Association (EBA), expresses its profound disappointment regarding the recently adopted law on transparency of foreign influence. As an organization dedicated to fostering economic growth and facilitating the integration of Georgia with the European Union, EBA is deeply concerned about the negative effects this law has on the country’s European aspirations, trading opportunities, investment climate and development financing.

This legislation poses a serious obstacle to Georgia’s ongoing efforts to integrate with the European Union. Its enactment leads to a backsliding on at least three out of the nine steps (disinformation, polarization, fundamental rights and involvement of CSOs) set out in the Commission’s recommendation for candidate status endorsed by EU in December 2023; disregards the Venice Commission’s thorough legal argumentation and recommendation for its repeal, as well as, significantly, the aspirations of the majority of the Georgian people outlined in the country’s constitution. The principles of transparency and accountability are indeed vital. However, the approach taken by this law appears to diverge from the values and standards upheld by the EU. It risks isolating Georgia from its European partners, calling into question the country’s commitment to align with EU norms and practices. This not only hampers our progress toward EU membership but also threatens the broader goal of European integration, which is essential for Georgia’s future prosperity and security.

Furthermore, adoption of this law has raised significant alarm among members and partners of the EBA. It has created an atmosphere of uncertainty and apprehension, which is detrimental to the confidence of both current and prospective investors, international organizations and IFIs. The perception of increased regulatory scrutiny and potential political interference in business operations undermines the attractiveness of Georgia as a stable and welcoming destination for foreign investment and development financing. This is particularly troubling at a time when fostering a positive investment climate is crucial for the sustainable economic development of the country. Additionally, this law could lead to trade restrictions or reduced economic cooperation with Georgia’s major trading partner, potentially resulting in Georgian companies losing preferential and easy access to the European market for their products and services. Moreover, losing access to development financing will pose significant risks, potentially stalling vital infrastructure projects, hindering social development initiatives, and impeding progress towards achieving sustainable development goals.

The EBA remains dedicated to supporting and enhancing the European business community in Georgia, emphasizing the importance of unity and cooperation, particularly during these challenging times in order to minimize potential damage to the business environment and supporting Georgia’s economic development and integration with the European Union’.