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The News in Brief

Monday, July 13
Customs officer arrested for accepting a bribe

Officers of the Anti-Corruption Agency of the Ministry of Internal Affairs have arrested a customs officer on bribery charges.

"Customs officer Shota Bitsadze was detained for accepting a large bribe. Investigation has established that Bitsadze accepted 10,000 USD in exchange for providing commercial information to an entrepreneurial entity," - said the Ministry in its official statement.

The detainee faces from 7 to 11 years of imprisonment if convicted.

Trial of the case on Zurab Zhvania’s death temporarily suspended

The trial of Koba Kharshiladze and Mikheil Dzadzamia, who stand accused in the case of Zurab Zhvania’s death, was temporarily suspended after a motion was discussed.

The defence filed a motion demanding the FBI’s conclusive report obtained by Rustavi 2 TV on the case and provided to them, be admitted into evidence.

According to the judge’s decision, the FBI’s report is not admissible in the proceedings of this case.

The parties’ representatives have not made any official comments yet.

Kharshiladze and Dzadzamia are guilty and must be punished – Prosecutor

The word of a man, who has changed his evidence five times is totally worthless, - Prosecutor of the Zurab Zhvania case Rezo Nadoi declared at Tbilisi City Court.

According to the Prosecutor, Kharshiladze and Dzadzamia are guilty and they must be punished, otherwise, no justice will be met.

He expressed his hope that the Jury will deliver an objective verdict.

“We have heard that the accused are going to break their silence and tell truth in court. They have changed their evidence five times. The word of a man, who has changed his evidence five times, is totally worthless. They are guilty and must be punished,”- Rezo Nadoi said.

According to the Prosecutor, former PM Zurab Zhvania was taken to a suspicious place and Kharshiladze and Dzadzamia were obligated to provide Zhvania with security but did not; in fact, they abandoned him.

“All this resulted in a terrible incident. The PM died in under vague circumstances; this means Kharshiladze and Dzadzamia did not fulfill their obligations properly and must be held accountable for what this caused… They violated special service of state security protocol, according to which they were committed to provide security to a high-ranking official,”- declared Rezo Nadoi in the courtroom.

The session has been underway since morning at Tbilisi City Court.

Georgia-US deepen ties to avoid tax evasion

Georgia and the United States (US) are deepening their bilateral relationship to improve international tax compliance and ensure all citizens pay their appropriate taxes when living abroad.

Today Georgia signed an Inter-Governmental Agreement (IGA) with the US on tax compliance and mutual understanding, which encompasses implementation of the Foreign Account Tax Compliance Act, commonly known as FATCA.

Following the signature Georgia must report information regarding US account holders in Georgia to the US Internal Revenue Service (IRS) in order to eliminate cases of tax evasion.

The agreement will establish a framework to assist Georgian financial institutions in reporting certain financial account information required by the US’ FATCA.

"Georgia joined those 80 countries who have already signed this agreement with US. Georgian banks were waiting for the day when Georgia would sign the document. This document enables Georgian banks to operate on US market through the US bank’s effort," said Georgia's Finance Minister Nodar Khaduri.

The agreement was signed by Georgia’s Finance Minister Nodar Khaduri and US Ambassador to Georgia Richard Norland.

Parliament Speaker Comments on Controversial Bill on Banking Supervision

Parliament will not finalize adoption of the bill that would remove banking supervisory functions from the National Bank of Georgia (NBG) and transfer them to a separate agency, until “mutual understanding” is reached with international financial institutions, Parliament Speaker Davit Usupashvili said on July 10.

The controversial bill, which has drawn criticism from the President, business associations, opposition parties and a group of civil society organizations, was passed by the Parliament with its first reading in late June; the bill has yet to be confirmed with two separate readings before it is sent to the President for signing it into law; but President Giorgi Margvelashvili has suggested previously that he would veto it. President’s office has also notes that the way how the bill was developed violates Georgia’s commitments under the Association Agenda with the EU as the legislation related to the central bank is being amended without prior consultations with experts from the European Central Bank.

The International Monetary Fund (IMF); European Bank for Reconstruction and Development (EBRD); Asian Development Bank (ADB), and the World Bank have called for keeping banking supervision inside NBG.

These international financial institutions laid out their concerns in details in a joint letter to PM Irakli Garibashvili and Parliament Speaker Davit Usupashvili on June 24, saying that “in Georgia’s case, moving banking supervision out of the NBG does not seem prudent.”

But the letter also says that if the authorities were “determined” to move forward with the bill, it would be crucial to address concerns outlined in the letter.

“We have stated it repeatedly and let me make this clear for everyone once again: the Parliament of Georgia does not intend to finalize work on this legislation until all issues are addressed and until we reach mutual understanding on all principle topics with our foreign counterparts, the international financial institutions… as well as with EU representatives, I want to reassure businesses, political circles, Georgian public, the National Bank employees, those who are following this process and might be worried, nothing that would damage our country and our banking system will come to pass,” Usupashvili said at a session of parliamentary bureau on July 10.

“On the contrary, whatever happens will be aimed at improving the existing legal framework in this sector. Therefore, the work will continue up until the moment when mutual understanding is achieved with the international financial institutions. This is a very important issue. We all understand that Georgia needs the support of international organizations; and indeed, the process has been moving forward in close cooperation with international organizations,” Usupashvili said.

He also said that the Parliament may be ready to consider the bill with its second reading at a session next week.

Although the bill is being amended as a result of discussions within the parliamentary committee for finance and budgetary issues, its key part involving removing banking supervisory functions from NBG will remain unchanged as the bill has already been confirmed with the first reading.

Co-sponsor of the bill GD MP Tamaz Mechiauri, who chairs parliamentary committee for finance and budgetary issues, said during the bureau session on July 10 that a delay to consider the bill with its second reading does not in any way mean that the proposal will be withdrawn.