Foreigners Might Be Prohibited to Purchase More Than 2.5 Hectares of Land in Georgia

Information Center of Kakheti

Specialists drafted special legislative initiative for alienation of lands in Georgia. According to the draft-law, foreign citizen will be able to purchase maximum 2.5 hectares of agricultural land in Georgia. In total, only 5% of agricultural land fund might be under ownership of foreign citizens.

Newspaper Rezonansi reported that authors have already sent the bill on the amendments and additions to the Law About Possession of Agricultural Lands to Davit Usupashvili, chairman of the parliament. The draft-law was worked out by doctor of economic science Paata Koguashvili, Doctor of Law Ana Pirtskhalaishvili and Doctor of Legal Science Zaur Jinkolava.

The draft-law states that below-listed paragraphs and sub-paragraphs shall be added to the Article 4 Paragraph I subparagraph 11 of the Law of Georgia on the Possession of Agricultural Land:

a)foreign citizen (per family/person) can purchase maximum 2.5 hectares of agricultural land in Georgia. No more than 5% of existing agricultural land fund shall be owned by foreign citizens.

b) agricultural land can be used only for agricultural purpose in accordance to social and economic interests of Georgia. 

c) only Georgia registered legal entity, where Georgian citizen owns at least 51% of assets, can purchase agricultural land in Georgia;

d)Georgia registered legal entity, with mixed capital, shall purchase no more than 10% of agricultural land foundation of Georgia in total. If the legal entity is liquidated or divided, the foreign partner, as a physical person, can take no more than 2,5 hectares of land under his/her personal possession; but, both legal and physical persons shall keep agricultural land in possession if they become partner of Georgia registered legal entity, where foreigners will have no more than 49% of asset.

e) foreigner, who has desire to purchase agricultural land in Georgia shall: 1) have legally lived in Georgia for the last 10 years; 2) have agricultural education, 5-year-experience of living in the village and conducting agricultural activities; 3) have capacity relevant to agricultural activities; 4) to set up special commission at the Ministry of Agriculture, which will study each case of foreign citizens purchasing agricultural lands and pass relevant decision. 

“Before June 26, 2012 Law of Georgia on Possession of Agricultural Lands in Georgia (Article 4 Paragraphs 1 and 11) prohibited foreign citizens to purchase agricultural lands in Georgia; moreover, if he/she had inherited it, he/she was entitled to assign it to the citizen of Georgia within 6 months,” newspaper Rezonansi wrote.

Based on the resolution of June 26, 2012 plenum of the Constitutional Court of Georgia, the prohibition (including relevant articles, paragraphs and words) was removed from the law,” the annex paper of the draft-law states.

The authors of the draft law state that after the plenum of the Constitutional Court of Georgia abolished the prohibition, both Georgian and foreign citizens enjoyed equal rights when purchasing agricultural land in the country. Since Georgian citizens are massively in loser’s position in comparison to financial capital of foreign investors, the purpose of the new bill is to create specific regulations for foreigners when purchasing agricultural land in Georgia.

Reportedly, after the aforementioned resolution was passed by the Constitutional Court of Georgia, foreign citizens, particularly Indian and Arab people, massively purchased plots in Georgia. A video from YouTube shows Indian citizen Saini Darjmit, who offers his compatriots to purchase land in Kakheti. He speaks about cheap workers and fertile land in Georgia. He said 1 hectare of land costs 1 000 USD in Kakheti. Darjmit calls upon his compatriots to purchase plots in Georgia. Ten thousands of people visited the video on YouTube.