Presentation by the National Agency of Public Register on the process and reforms taken to start (register) a business in Georgia.

1. Georgian Case –
Starting a Business
Mari Khardziani
Head of International Relations Unit
National Agency of Public Registry
Skopje, North Macedonia
April 8, 2019

2. 02
Ease of Doing Business in Georgia
Region Europe & Central Asia
GDP per capita 4067.7 USD
Income Category Lower middle Income
Population 3,729,600
Capital Tbilisi

3. 02
Ease of Doing Business in Georgia
112
37
21
16
13
17 16
9 8
15
24
16
9
6
73.75
76.2
78.89
81.78
80.69
77.52 78.19
80.68
82.8 83.28
50
55
60
65
70
75
80
85
90
95
100
0
20
40
60
80
100
120
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Ranking Score (DTF)

4. 02
Before Reforms
Heavy regulations, cumbersome procedures and inefficient public services
Weak institutions and widespread corruption: GCI – 127th out of 133 countries
High taxes, though Budget revenues less than 7% of GDP
Limited prospects of economic growth: low level of FDIs, unemployment rate -
17%
Low level of economic development: GDP per capita – under 1000 USD

5. 02
Before Reforms
Business Registration
(DB 2004 Report)
State and Tax registration separately
Getting official stamp
Obtain a clean criminal record for the director and owners of the company from the
Ministry of the Interior
Business registration by Courts
Procedure (number): 9
Time (days): 25
Minimum capital (% of income per capita): 62.6
Cost (% of income per capita): 22.7

6. 02
Impact of the Reforms
GDP per capita quadrupled
Smart regulations and simple procedures & efficient public services
Low and uniform taxes & increased Budget revenues: over 24% of GDP
Customer-oriented, corruption-free public institutions. GCI: 44th place
Higher economic growth, FDI-s increased on average 3 times;
Unemployment level reduced to 12,7%
₾
₾
₾

7. 02
Business Registration System Reform in Georgia
7
Customer-oriented, transparent, corruption-free and efficient
registration system established
One-stop-shop service
State & tax registration united
Simple registration procedure & Centralized registration process
Streamlined, reduced & fixed registration terms and fees
Fully open extracts & foundation documents
Legal framework improved
Web-based software & IT infrastructure developed
Online services introduced

8. text
Voluntary Registration as VAT payer
Consultation cards,
templates of documents:
http://www.napr.gov.ge
Once-Only Principle and Customer-Oriented Service
Extract from Business Registry in English
Opening of a bank account
SMS notification (information on registration)

9. My.Gov.Ge – E-Services

10. Extract from Business Registry
Transparent
Accessible
Secure

11. Business Registration Service
Registration Terms and
Fees
1 working day
GEL / USD
At same day
GEL / USD
Business 100 / 37.2 200 / 74.4
Individual enterprise 20 / 7.4 50 /18.6
Extract from
Business
Registry
In person 15 / 5.6 50 / 18.6
Online 10 / 3.7 40 / 14.9

12. 2019
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
36
10
8
7
6
5
4
2017 2018
3
2
2019
Starting a Business in Georgia

13. 02
Starting a Business in Georgia
Source: DB 2019 Report - http://www.doingbusiness.org/en/data/exploreeconomies/georgia#DB_sb
Indicator Georgia Europe &
Central Asia
OECD high
income
Best Regulatory
Performance
Procedure – Men/Women (number) 1 5.2 4.9 1 (New Zealand)
Time – Men/Women (days) 2 12.9 9.3 0.5 (New Zealand)
Cost – Men/Women (% of income per
capita)
2.2 4.6 3.1 0.0 (Slovenia)
Paid-in min. capital (% of income per
capita)
0.0 2.3 8.6 0.0 (117 Economies)
2nd place according to Doing Business 2019 Report

14. 02
Starting Business in Georgia
0
5000
10000
15000
20000
25000
30000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
New Limited Liability Companies

15. 02
SMEs - Business Statistics
42048.0
44327.90
50064.70
56984.80
64081.80
71740.10
9971.0
10362.80
11477.80
13294.60
14039.10
16568.30
13499.20
15368.90
17308.60
19018.70
21786.40
22970.70
,0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
,0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
2012 2013 2014 2015 2016 2017
Total turnover (mln GEL) Medium-sized Small
23096.0 23553.60
26068.60
29993.90
34156.90
38206.80
6098.60
5998.70
6571.30
7873.490
8573.90
9719.20
6432.50
7187.50
8309.10
9600.359
11381.40
12892.90
.0
5000.0
10000.0
15000.0
20000.0
25000.0
30000.0
35000.0
40000.0
2012 2013 2014 2015 2016 2017
Total output (mln GEL) Medium-sized Small
Turnover Output

16. 02
SMEs - Business Statistics
Employment
534397.0
550885.0
592147.0
626739.0
666790.0
708165.0
118021.625
125925.059
126431.582
137170.630
142447.0
145463.0
246931.346
246537.905
279205.174
290982.279
306543.0
329112.0
.0
100000.0
200000.0
300000.0
400000.0
500000.0
600000.0
700000.0
800000.0
2012 2013 2014 2015 2016 2017
Total employment (person) Medium-sized Small
24025.258
23777.634
24474.106
26784.159
27933.196
33539.80
13636.179
15413.046
15268.70
16852.573
18971.237
20792.922
16995.888
18241.008 18137.903
20034.431
21814.517
24699.995
-
5000.0
10000.0
15000.0
20000.0
25000.0
30000.0
35000.0
40000.0
2012 2013 2014 2015 2016 2017
Medium-sized Small SME Performance (GEL)
Performance

17. 02
Ease of Doing Business – Reforms in Georgia -
WB Doing Business
Topics
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Starting a business √ √ √ √ √ √
Dealing with construction permits √ √ √ √ √
Getting electricity √ √ √
Registering property √ √ √
Getting credit √ √ √ √ √ √ √ √
Protecting minority investors √ √ √ √ √ √
Paying Taxes √ √ √ √ √
Trading across borders √ √ √ √
Enforcing contracts √ √ √ √ √
Resolving insolvency √ √ √ √
50

18. Thank you for your attention!