Georgia is a great destination for investors and companies from all around the world with stable economic development, liberal and free market oriented economic policy, low tax rates, significantly simplified administrative procedures, low level of corruption and bureaucracy, significantly decreased number of licenses and permissions, competitively priced workforce, lack of language barrier, advantageous geographic location and access to 2.3 billion consumer market through its solid FTA network including both EU and China.

Georgia is a member of the United Nations, the Council of Europe, the World Trade Organization, the Organization of the Black Sea Economic Cooperation, the Organization for Security and Cooperation in Europe, the Community of Democratic Choice, the GUAM Organization for Democracy and Economic Development, and the Asian Development Bank.

Georgia’s impressive progress in improving business environment is well reflected in a number of international indices. Country is considered as a politically stable, corruption-free investment destination with low business costs.

Georgia is maintaining its position among the world’s top 10 economies in the World Bank Group’s annual Doing Business report, which measures ease of doing business. In 2019 Georgia has moved up to 6th place in the global rankings and is currently the highest ranked economy in the Europe and Central Asia region.

Source: World Bank (2020) 

• In Georgia it is easy to start a business Georgia by simplified post-registration procedures (tax registration, social security registration, licensing)
• Georgia has special tax exemptions for virtual zone entities, free industrial enterprises, special trading companies, tourist enterprises, etc.
• Georgia has double tax avoidance treaties with more than 50 countries, including the China, Germany, UK and Spain.
• Georgia has almost no custom duty, with 90 % of goods being exempt from import tariffs, with no quantitative restrictions. The average time for customs clearance is currently about 15 minutes – one of the fastest and most efficient in the CIS.
• In Georgia almost all tax, financial reporting and customs clearances administration procedures are online/web-based
  In Georgia it is easy to pay taxes by significantly revised tax laws, simplifying tax compliance processes and decreasing the number of tax fillings or payments
• In Georgia it is easy to enforce contracts by expanding court automation through introduction of electronic payments and processes, automatic assignment of cases to judges and by publishing judgements

Source: The Heritage Foundation (2019)
Source: World Bank (2020)
Source: Transperency International (2013)

According to the “law of Georgia on Entrepreneurs” the following organizational and legal forms of the enterprises can be formed in Georgia:

There are no restrictions on foreign ownership or corporate governance of legal entities in Georgia with few exceptions. A Company shall have a charter capital, but the Georgian legislation does not contain any specific requirements with regards to the amount of charter capital.Also Georgian legislation does not contain any limitations with regard to the minimum/maximum number of directors/founders of a company. Therefore, it is upon the discretion of founding partners to determine the charter capital amount. The National Agency of Public Registry (NAPR) provides the registration of all types of legal entities. The registration completed on the same day of submission of required documents costs 200 GEL, otherwise ordinary registration takes 1 business day and the relevant fee is 100 GEL. The list of documents required to register a company depends on the organizational-legal form of the company and its founders.

Following documents are required to be submitted for ordinary Limited Liability Company (LLC) registration:

All the documents issued outside Georgia shall be notarized and apostatized or legalized, then translated in Georgian and notarized.
In order to register as an IE, an interested person shall submit an ID card and application for registration.

• No restrictions on foreign ownership or corporate governance of legal entities in Georgia.
• Not any specific requirements with regards to the amount of initial capital.
• Not any limitations on the number of directors/founders of a company.
• Company formation is possible without being in the country .
• Company can be fully managed remotely.
• Registration can be completed on the same day of submission.

The Georgian Lari is the currency of Georgia and sole legal tender for payments on the territory of Georgia, except for the operations related to export-import and free industrial zone.

The central bank is the National Bank of Georgia (NBG). It sets monetary policy, issues licenses, and supervises the activities of banking institutions and currency exchange offices. Commercial banks require a license from the NBG and the minimum statutory capital required to register a bank is 12 million Georgial Lari. Banks are required to be organised as Joint Stock Companies and to report using International Financial Reporting Standards (IFRS).

While there are dozens of banks in Georgia three biggest banks are Bank of Georgia, TBC Bank and Liberty Bank which have correspondent banking relationships with the United States through Citibank.They are included in the London Stock Exchange’s top 250 largest companies list and their shares are traded on the London Stock Exchange.

Opening a bank account in Georgia for foreigners is a remarkably simple process compared to most countries in the world and takes about 30 minutes. Bank accounts for newly registered entities can be opened as soon as the entity registration is completed and a unique identification number is given. All you need to do is visit a bank, show your international passport, fill out a forms and typically your account is open for the next business day. While English is fairly commonly spoken in the country Foreign citizens need to bring a translator with them. You can also make an appointment at the bank of your choice and ask for an English-speaking banker. It is important that opening bank account can be done from distance, remotely by Power of Attorney (POA).

Unlike most international accounts for foreigners, Georgian banks do not require a minimum deposit in order to open the account. Fees for operating the bank account are very low  and the exact amount depends on which particular bank you decide to use and the level of service offered by the account. The only payment that you need to make at the time that you open the account is a small payment (about 70 Gel) in order to obtain a debit card, which can also be used to withdraw funds from ATMs both inside Georgia and around the world. The bank offers a choice of either a Visa or Mastercard. All the three banks offer mobile apps for mobile banking as well as internet banking – so you can track your funds from anywhere in the world.

Bank accounts opened are three currencies in one – one each for GEL, USD and EUR, which means that if you wire funds into your account in either USD or EUR, then the funds will remain in that currency until you want to convert them. All bank accounts in Georgia use the international IBAN format, which makes it simple to transfer funds between the accounts without difficulties of working out the SWIFT/BIC Codes. Funds sent to the account arrive quickly, no later than the next working day.

The Georgian Stock Exchange (GSE) is the only organized securities market in Georgia, which was established with the financial support of USAID and Barents Group in 2000. The GSE’s automated trading system can accommodate thousands of securities that can be traded by brokers from workstations on the GSE floor or remotely from their offices: www.gse.ge

In Georgia, every company is entitled to choose a field of activity at its own discretion and run a business without limitation, unless such an activity is directly prohibited by the “law or a permit or license” is required to perform the activity. Special permits and licenses for doing business in Georgia are required only for companies whose activities will be related to medicine, construction, communications, gambling, energy, security and etc.

According to the Georgian legislation, there are two types of applicable licenses: the license to exercise an activity and the license to use.

The License to Exercise an Activity is a license which grants a person the right to exercise a certain activity specified by the law (e.g. to set up a private security service). To obtain a license for an
activity, one has to meet particular requirements. This type of license may be used only by the person (a natural person or legal entity) who has been granted the license. Therefore, a transfer of a license for an activity to another person is not allowed.

The License to Use applies to the use of national resources specified by the law. Such a license grants its holder the right to use certain resources (e.g. natural resources). Licenses of this type can only be awarded in an open outcry tender, except the cases stipulated by the law and the holder of the license may transfer it to others.

In addition to special licenses and permits, there are various types of business activities in Georgia that are provided with special status such as Virtual Zone Entity, Free Industrial Zone Enterprise, Special Trading Company, Tourist Enterprise, etc. and benefit from special tax or other favorable regimes. In order to get these benefits, it is required to apply and obtain the appropriate status and certificates from the relevant agencies. 

If your main business activity is to provide business activity in IT and / or software & app development service to the clients outside of Georgia, then you can apply for the Virtual Zone Entity status to the Ministry of Finance of Georgia. Virtual Zone Entities are exempt from VAT and corporate income tax and pay only 5% of personal income tax in case of dividend distribution. 

Free Industrial Zone (FIZ) is the type of a free zone envisaged by the “Tax Code of Georgia” where the business-friendly regulations, favorable tax, and customs regulations apply. FIZ is open for production & processing of any goods or provision of services, except for: Using of buildings for residence, Production of Arms and munitions, trade of arms and munitions, Production of nuclear and radioactive substances, trade in nuclear and radioactive substances, Import, storage, production or/and sale of Narcotic and psychotropic substances, Excise goods (except for the cases for personal use).

Free Industrial Zone entities are exempt from all taxes except personal income tax (20%) which is paid a the employee. You need to apply for this status to the organizer of Free Industrial Zone and pay annual fee. There are five industrial zones operating in Georgia in the following cities: Poti (sea port), Kutaisi (third largest city) and Tbilisi (capital city): Poti Free Industrial Zone; Hualing Kutaisi Free Industrial Zone; Kutaisi Free Industrial Zone; Tbilisi Free Zone;Tbilisi Industrial Park Free Industrial Zone.

#	Indicator Name	2014	2015	2016	2017	2018
1	Population, total (million)	3.72	3.73	3.73	3.73	3.73
2	Time required to start a business (days)	2	2	2	2	2
3	Time required to register property (days)	1	1	1	1	1
4	Strength of legal rights index (0=weak to 12=strong)	9	9	9	9	9
5	Time to resolve insolvency (years)	2	2	2	2	2
6	GDP (US$ billion-Current)	16.5	14	14.4	15.1	16.2
7	GDP growth (annual %)	4.6	2.9	2.8	4.8	4.7
8	GDP per capital (US$ )	4.4	3.8	3.9	4	4.3
9	Inflation (average)	3.1	4	2.1	6	2.6
10	US$/GEL exchange rate (average)	1.77	2.27	2.37	2.51	2.68
11	EUR/GEL exchange rate (average)	2.35	2.52	2.62	2.83	3.01
12	Foreign direct investments (US$ billion)	1.8	1.7	1.7	1.9	1.3
13	Total Reserves (US$ billion)	2.7	2.5	2.8	3	3.3
14	Real interest rate (%)	7.8	6.2	8.1	5.1	7.2
15	Lending interest rate (%)	11.9	12.5	12.6	11.5	11.1
16	Deposit interest rate (%)	8.4	8.9	9.9	9.7	8.8
17	Unemployment Rate	17.4	16.5	16.6	13.9	12.7
18	Total Export (US$ billion)	7.1	6.3	6.3	7.6	8.9
19	Total Import (US$ billion)	10	8.7	8.5	9.4	10.8
20	Number of tourists (million)	5	5.3	5.4	6.5	4.8

Source: National Statistics Office of Georgia
Source: National Bank of Georgia
Source: The World Development Indicators – The World Bank

There are only six taxes in Georgia, of which five (personal income tax, corporate income tax, Value added tax, excise tax and import tax) are nationwide, and one (property tax) is a local tax. There are no inheritance, wealth, property transfer, social, branch remittance or other taxes imposed in Georgia.

From 1 January 2017 a new model of Corporate Income Tax was enacted in Georgia, which means that for Georgian entities and foreign entities doing business in Georgia by a permanent establishment the retained profit will no longer be taxable until they are distributed.The main purpose of the new model is to encourage domestic and foreign investments by taxing the businesses when they will extract the profits. Commercial banks, credit unions, insurance companies, microfinance organisations, and pawn shops will be switched to the new tax regime after 1 January 2023.

According to the Tax Code of Georgia, “A person/entity, which carries out an economic activity and the total amount of VAT taxable transactions carried out in any continuous period up to 12 calendar months exceeds GEL 100 000”, shall apply for a VAT registration to Revenue Service under Ministry of Finance of Georgia. A person/entity can also perform voluntary registration.

Georgia – Business Friendly Country!