Parliament is starting consideration of a legislative package introduced by the Georgian Dream faction, aimed at imposing new restrictions related to party activities and political engagement.

Amendments to the laws “On Grants,” “On Political Associations of Citizens,” and five other laws will be reviewed at first reading by the Legal Affairs Committee on February 2.

The proposed changes are expected to be submitted to the plenary session for first reading on February 3-4. Notably, the draft is not being considered under an expedited procedure.

The package consists of seven draft laws, the first of which concerns amendments to the Law on Grants.

The definition of a “grant” is being expanded to include any funds transferred in cash or in kind by any person to any person, which are used or may be used - based on belief or intent - to influence the Georgian authorities, state institutions, or any segment of society, for activities aimed at shaping, implementing, or changing Georgia’s domestic or foreign policy. It also includes funds used or potentially used for activities stemming from the political or public interests, approaches, or relations of a foreign government or foreign political party.

Receipt of such a grant will be permitted only with the prior approval of the Government of Georgia.

The law introduces the concept of a legal entity of another state whose activities substantially involve issues related to Georgia. Such an entity may receive a grant only after obtaining prior consent from the Georgian government. As explained by the Georgian Dream faction, an organization registered abroad but substantially operating in Georgia will be required to apply to the Georgian government for permission to receive funding; otherwise, it will face criminal liability.

Funds transferred in cash or in kind in exchange for the recipient providing technical assistance - including the transfer of technologies, specialized knowledge, skills, expertise, services, or other forms of assistance - will also be considered a grant. According to Georgian Dream, if a foreign actor hires experts in Georgia in exchange for money, such funds will be classified as a grant and will require prior government approval.

If a representative office, branch, or division of a non-resident legal entity receives a grant - including from the legal entity of which it is a branch - it will likewise require prior government consent. Receiving a grant without such consent will result in administrative liability, specifically a fine equal to double the amount of the illegally received grant.

Amendments are also being made to the Criminal Code. Under the proposed changes, violations of the Law on Grants will incur criminal liability, punishable by a fine, 300 to 500 hours of community service, or imprisonment for up to six years.

An aggravating circumstance is being added to Article 194 of the Criminal Code: money laundering carried out for the purpose of engaging in political activities related to Georgia will be punishable by 9 to 12 years’ imprisonment.

Criminal liability will also apply to a senior official of a political party who violates the Organic Law on Political Associations of Citizens - specifically by accepting foreign funding. This offense will be punishable by a fine, 300 to 500 hours of community service, or imprisonment for up to six years.

External lobbying will also become a criminal offense. The direct or indirect transfer of money, securities, other property, property benefits, or any other advantage to a citizen or legal entity of another state in exchange for engaging in political activities related to Georgia will be punishable by a fine, 300 to 500 hours of community service, or imprisonment for up to six years.

Changes related to restrictions on political party membership are being introduced in the Organic Law on Political Associations of Citizens. The draft establishes grounds for the inadmissibility of party membership: a person employed under a labor contract by an organization whose annual income consists of more than 20% foreign funding will be prohibited from political party membership for eight years.

Monitoring of the financial activities of political party members will be carried out by the State Audit Office.

In addition, the term “entity with a declared electoral purpose” will be replaced by “entity with a declared party-political purpose,” and its scope will be expanded. Restrictions provided by the Law on Political Associations of Citizens for political parties will also apply to entities with a declared party-political purpose.

In cases of receiving foreign funding, criminal liability will be established for both the leadership of political parties and entities with a declared party-political purpose.

Changes are also being introduced regarding the public political activity of business entities. The Administrative Offenses Code will establish a new administrative offense for a business entity engaging in public political activities unrelated to its core business operations. In such cases, the State Audit Office will impose a fine of 20,000 GEL, and 40,000 GEL for repeated or subsequent violations.