'To Support Ukraine is to Comply with International Sanctions Regimes', US Ambassador Says

Bank of Georgia Group (BGEO LN) shares closed at GBP 49.50/share (- 3.32% w/w and -4.44% m/m). More than 262k shares traded in the range of GBP 48.80 - 51.50/share. Average daily traded volume was 62k in the last 4 weeks. The volume of BGEO shares traded was at 0.58% of its capitalization.TBC Bank Group (TBCG LN) closed the week at GBP 30.75/share (- 3.61% w/w and -4.35% m/m). More than 145k shares changed hands in the range of GBP 30.25 - 32.00/share. Average daily traded volume was 54k in the last 4 weeks. The volume of TBCG shares traded was at 0.26% of its capitalization.Georgia Capital (CGEO LN) shares closed at GBP 13.06/share (-0.31% w/w and +1.08% m/m). More than 181k shares traded in the range of GBP 12.90 - 13.50/share. Average daily traded volume was 62k in the last 4 weeks. The volume of CGEO shares traded was at 0.42% of its capitalization.

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Consideration of the draft law "On transparency of foreign influence" has begun. The legal issues committee of the Parliament is considering the initiative against the background of protests.The rally is taking place at the back entrance of the Parliament of Georgia. Representatives of civil organizations and media are gathered at the site, who have unfurled banners with the inscription "No to the Russian law!" Those present at the rally are protesting the draft law "On the transparency of foreign influence", which is being considered by the legal committee.

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The police are mobilized on the spot.In addition, it should be noted that in addition to the rally scheduled for the morning, the rally against the bill will be held in front of the Parliament in the evening at 19:00."The fight for the European future of Georgia continues. Don't stay at home, go out. "Russian law" applies to all citizens of Georgia! "Russian law" is a big wall between Georgia and Europe! Yes Europe! Not to the Russian law!" - is written in the information spread by the organizers on the social network.The Parliament starts considering the draft law "On the transparency of foreign influence". The draft submitted by the faction "Georgian Dream" is being discussed today by the Legal Affairs Committee in the first reading.

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The fact that international companies are very interested in this status is evidenced by today's situation - more than 1,200 companies have been granted the status of Virtual Zone Person in Georgia. This sector forms an important part of the high-income middle class in Georgia, which is the best tool for improving the socio-economic background. The high salaries paid by companies with VZP status circulate in the real economy of the country. In addition to this, the most sought-after, highly qualified IT specialists are in demand on the world market today. These professionals are no longer forced to leave the country in search of better pay.Briefly about tax benefits and regulatory lawsCompanies with the status of a "Virtual Zone Person" are exempt from profit tax on the profits they receive from the creation of software products (for example, a website, mobile application, or software) for foreign customers. That is, in this case, we are talking about the profit obtained from the exported digital product.The activity of a Virtual Zone Person in Georgia is mainly regulated by 4 legal acts. These are: the Tax Code of Georgia; the Law of Georgia "On Information Technology Zones"; Resolution N49 of the Government of Georgia dated January 26, 2011 "On the rules and conditions for granting the status of the Virtual Zone Person and determining the person granting the status of the Virtual Zone Person" and the instruction "On administration of payments" approved by the order of the Minister of Finance of Georgia dated December 31, 2010, N996.However, laws and instructions, like in all other areas, need constant attention, refinement, and adaptation to modernity. It is practically impossible to work in this direction for companies with VZP status individually. It was to protect their interests, to communicate constructively with the governmental structures, and, as a result, to create a favourable working environment for these companies, that the decision was made regarding the creation of the Association of Georgian Virtual Zone Persons. The Association was headed by highly qualified lawyer and lobbyist Shorena Kopaleishvili. Ms. Shorena's active cooperation with the Ministry of Finance and the Business Ombudsman has also yielded results, and fine sanctions previously charged to the VZP status companies were either nullified or reduced to a minimum.In addition to the above-mentioned activities, the Association actively provides consultations to those companies that are interested in receiving the status of a Virtual Zone Person.The path from a company subject to standard taxation to a VZPFirst of all, let's determine which law entitles the company to enjoy tax benefits in Georgia - according to the 35th - 36th parts of Article 8 of the Tax Code of Georgia, a Virtual Zone Person is a legal entity that carries out information technology activities and has been assigned the appropriate status.A company interested in the status of a Virtual Zone Person in Georgia must first apply to the Financial-Analytical Service. For this, the candidate electronically fills out the application form posted on the official website of the Financial-Analytical Service (www.fas.ge).The representative of the company must attach to the application a list of information technology projects implemented by the company during the last three years.After that, the company is granted the status of a Virtual Zone Person no later than 10 working days after making the application. The electronic certificate confirming the status of the Virtual Zone Person is issued by the agency no later than 2 working days after the decision is made. The status of the Virtual Zone Person is issued for an indefinite period.A few more legal nuancesThe legislation of Georgia does not define the concept of a software product and the regulations related to its creation. At the same time, the law of Georgia "On copyright and related rights" recognizes the concept of computer programs. Specifically, according to Sub-paragraph “j” of Article 4 of this law, a "computer program" is a set of instructions expressed in words, codes, chips or in any other machine-readable form, which enables a computer to achieve certain results. The term also includes preparatory material for a computer program design.As in "computer program," software generally refers to a program or set of programs that contains instructions necessary for the computer itself to operate or instructions to perform other tasks. Software is independent of hardware (computer devices), and it is through it that computers can be programmed.Which product of the VZP company is not subject to the tax exemption?To comply with the activities within the status of the Virtual Zone Persons, the company's activities must involve the implementation of such activities in the field of computer information systems, which are used in the creation and(or) development of software. Accordingly, if this activity is limited to the electronic provision of services defined by the company using various hardware and software, the purpose of which is not to create a software product, the profit received from such activity will not be considered a profit received from the provision of information technologies, and therefore, the tax relief established by sub-paragraph “P” of Article 99 of the first part of the Tax Code cannot be applied to the distribution thereof.Easier way to get VZP statusAs already mentioned above, the best way to simplify the process of obtaining the status of the Virtual Zone Person and to understand all the necessary details in advance is to go through consultations with the Association of Georgian Virtual Zone Persons. Here you will get full information not only on the procedures for obtaining the status but also on the nuances related to further operation in the Georgian market under the existing regulations, the knowledge of which will make it significantly easier to manage your business under the status of a VZP.

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According to Scholz, it is now very important to organize this process so well that all the necessary criteria for membership are developed.“Judicial and economic reforms are important here, but, above all, also the rule of law and democracy. We know that joining the European Union is not only the government’s aspiration but also the great desire of the citizens of Georgia, the people who support Georgia’s accession to the European Union and the acceleration of this process. That is why supporting European values is crucial, and the European Union and Europe should be very important,” said Olaf Scholz.The German Chancellor believes it is also crucial to discuss problems.“We, like the entire EU, are very critical of the so-called Agents Law, and since this bill has been suspended, we had high hopes that it would no longer be on the agenda. The new bill has remained virtually unchanged. This is almost the same as last year, and we really hope that Georgia and the Georgian Parliament will not adopt this law while taking into account our critical position and the position of the population of Georgia. Therefore, in our conversation, I once again emphasized the importance of civil society organizations and cooperation between the opposition and the government, which is very important for social development,” said Olaf Scholz.At the press conference, the German Chancellor was asked the question: “You commented on the law on Transparency of Foreign Influence and expressed hope that Georgia will not adopt the law in its current form. The Prime Minister of Georgia said that the European Commission also came up with a similar initiative. We observe that the regulations in this area are relevant in Europe, many countries have adopted the same or similar laws. We wonder why European partners are concerned, if the same regulations or similar rules apply in Europe and the USA,” to which Olaf Scholz remarked:“There is no such legislation in the European Union. There is a discussion about establishing transparency in various areas, but this is a completely different concept. This has not yet been decided and most likely will not be decided,” said Olaf Scholz.

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According to the Union of Georgian Airports, Kutaisi Airport served 127,569 passengers in March (91,802 passengers in March 2023).In addition to the passenger flow, there was an increase in the number of flights at the Kutaisi International Airport at the beginning of the year. Flights at the airport increased by 23% in March compared to the same period last year and served 374 flights (March 2023 - 304 flights).In the first quarter of 2024, the passenger flow at Kutaisi International Airport increased by 57%, and the number of flights - by 42%.According to the information of the Union of Georgian Airports, 5 airlines operate from Kutaisi International Airport at this stage. Flights are fulfilled to 39 destinations in 20 countries.

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The general director of the bank, Vakhtang Butskhrikidze, stated the priority of lending to the sector at the presentation of the TBC capital research, which was held by the investment bank for the private sector (5:00 p.m., April 11, Stamba, Tbilisi)The strategic sector does not lose its investment attractiveness. According to his prediction, the trend will continue in the future.The energy takes the second largest share in the bank's corporate portfolio. According to Vakhtang Butskhrikidze, industry is one of the most important for the economy, and TBC Bank was the first to start financing this sector.Today, TBC is the largest financier of this field. It includes 41 hydroelectric power stations, of which 30 HPPs are in operation, and 11 will be launched soon.According to him, 65% of the electricity generated in the country accounts for the partners of "TBC Bank". The total output of TBC-funded HPPs is 500 MW. 

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According to the document, production of barley decreased by 26.9 percent year-on-year set 43.0 thousand tons. Production of maize equaled 189.8 thousand tons, which is 24.1 percent more than in the same period of the previous year.According to the preliminary data, in 2023 sown areas of annual crops amounted to 205.2 thousand hectares, which is 4.9 percent less than the same period of the previous year. However sown area of winter crops decreased by 3.7% and amounted to 64.6 thousand hectares and sownareas of spring crops decreased by 5.5% and consisted of 140.5 thousand hectares.Sown area of maize took the biggest share in the sown areas of annual crops and equaled 75.4 thousand hectares. Sown area of wheat was 56.7 thousand hectares, sown area of barley – 22.4 thousand hectares, sown area of potato – 16.2 thousand hectares, sown areas of fodder crops –13.2 thousand hectares, sown area of vegetables – 10.2 thousand hectares and sown areas of the remaining crops 11.1 thousand hectares.

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