Europaudvalget 2021-22
EUU Alm.del Bilag 579
Offentligt
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Council of the
European Union
Brussels, 17 June 2022
(OR. en)
10323/22
ELARG 48
COEST 467
COVER NOTE
From:
date of receipt:
To:
No. Cion doc.:
Subject:
Secretary-General of the European Commission, signed by Ms Martine
DEPREZ, Director
17 June 2022
General Secretariat of the Council
COM(2022) 405 final
COMMUNICATION FROM THE COMMISSION
Commission Opinion on Georgia's application for membership of the
European Union
Delegations will find attached document COM(2022) 405 final.
Encl.: COM(2022) 405 final
10323/22
RELEX.4
GL/sb
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EUROPEAN
COMMISSION
Brussels, 17.6.2022
COM(2022) 405 final
COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN
PARLIAMENT, THE EUROPEAN COUNCIL AND THE COUNCIL
Commission Opinion on Georgia's application for membership of the European Union
EN
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A. INTRODUCTION
Since its independence, Georgia has clearly expressed its European aspirations. This European
ambition is included in the Georgian Constitution, and is supported by the people of Georgia
(83% of Georgians approve joining the EU
1
) and across the political spectrum. This has been a
driver for a number of key reforms founded on European values
and standards. Georgia’s
commitment to progress on its European path was underlined by the Government’s initial
intention to submit an application in 2024.
a) Application for membership
On 3 March 2022, Georgia presented its application for membership of the European Union.
The application was tabled in the context of Russia’s war of aggression against Ukraine.
On 7
March 2022, the Council of the European Union requested the Commission to submit its
opinion on this application. EU Heads of State and Government endorsed this decision at the
informal leaders meeting in Versailles
2
. Georgia received questionnaires on 11 April 2022 on
the political and economic criteria and on 19 April on the EU
acquis
chapters and provided its
replies on 2 May and on 10 May.
Article 49 of the Treaty of the European Union states that ‘Any
European State which respects
the values referred to in Article 2 and is committed to promoting them may apply to become a
member of the Union. The European Parliament and national parliaments shall be notified of
this application. The applicant state shall address its application to the Council, which shall
act unanimously after consulting the Commission and after receiving the consent of the
European Parliament, which shall act by a majority of its component members. The conditions
of eligibility agreed upon by the European Council shall be taken into account.’
Article 2
states that ‘the
Union is founded on the values of respect for human dignity, freedom,
democracy, equality, the rule of law and respect for human rights, including the rights of
persons belonging to minorities. These values are common to the Member States in a society in
which pluralism, non-discrimination, tolerance, justice, solidarity and equality between women
and men prevail.’
This is the legal framework within which the Commission submits the present Opinion.
In June 1993, in Copenhagen the European Council concluded that:
‘Accession will take place as
soon as a country is able to assume the obligations of membership
by satisfying the economic and political conditions required.
Membership requires:
- that the candidate country has achieved stability of institutions guaranteeing
democracy, the rule of law, human rights and respect for and protection of minorities;
- the existence of a functioning market economy, as well as the capacity to cope with
competitive pressure and market forces within the Union;
- the ability to take on the obligations of membership including adherence to the aims of
political, economic and monetary union’.
In December 1995, the Madrid European Council referred to the need
"to create the conditions
1
2
According to the January 2022 National Democratic Institute (NDI) survey.
20220311-versailles-declaration-en.pdf (europa.eu)
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for the gradual, harmonious integration of [the applicant] countries, particularly through the
development of the market economy, the adjustment of their administrative structures and the
creation of a stable economic and monetary environment."
In December 2006, the European Council agreed that
‘the enlargement strategy based on
consolidation, conditionality and communication, combined with the EU's capacity to integrate
new members, forms the basis for a renewed consensus on enlargement’.
In this Opinion, the Commission assesses Georgia's application on the basis of its capacity to
meet the criteria set by the European Council in Copenhagen in 1993, as well as in Madrid in
1995, notably regarding the country’s administrative capacity. The Opinion also takes into
account Georgia’s efforts in implementing its obligations under the Association
Agreement
(AA) and Deep and Comprehensive Free Trade Area (DCFTA). The Commission will assess
the impact of Georgia’s accession on the EU policy areas at a later stage.
b) Relations between the EU and Georgia
The beginning of the EU-Georgia relations dates back to the times following the independence
of Georgia in 1991. The European Community established relations with Georgia in 1992. In
1996, a Partnership and Cooperation Agreement was signed (PCA), which entered into force in
1999.
An Association Agreement (AA), including a Deep and Comprehensive Free Trade Area
(DCFTA) was signed in June 2014, and fully entered into force on 1 July 2016. The
AA/DCFTA is the key bilateral legal instrument serving as the basis for deepening political
ties, stronger economic linkages, the promotion of common values and enhanced cooperation in
areas of mutual interest. The agreement contains binding provisions and provides for enhanced
cooperation. In its preamble, the EU acknowledged the European aspirations and the European
choice of Georgia, including its commitment to building a deep and sustainable democracy and
a market economy. Based on the AA/DCFTA, Georgia has carried out a number of challenging
reforms and successfully approximated its legislation with the EU
acquis
in many areas. The
EU-Georgia Civil Society Platform (CSP) is one of the bodies set up under the Association
Agreement between the European Union and Georgia. It enables civil society organisations on
both sides to monitor the implementation process and prepare recommendations to the relevant
authorities.
The subsequent Association Agendas agreed between the EU and Georgia establishes clear
priorities in order to implement the Association Agreement and its DCFTA. The adoption of
the new Association Agenda (2021-2027), which focuses on democracy, human rights and
good governance; freedom, security and justice; and economic, trade and sectoral cooperation,
is imminent.
The Georgian government does not exercise effective control over its regions of Abkhazia and
South Ossetia. The EU supports Georgia’s sovereignty and territorial integrity within its
internationally recognised borders and has been engaged since 2008 in peaceful conflict
resolution efforts, including through the EU Monitoring Mission and the EU Special
Representative for the South Caucasus and the crisis in Georgia.
The EU’s commitment to supporting Georgia is long-standing
and has delivered results. The
EU is the biggest provider of financial assistance to Georgia. Over the years 2014-2021, EU
support amounted to EUR 819.2 million in grants under the European Neighbourhood
Instrument, EUR 166 million under the Macro-Financial Assistance programme in the form of
loans and grants to support socio-economic development, and EUR 159.6 million from foreign
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policy instruments. The EU provides its support to Georgia through policy development and
comprehensive reforms, with the strong involvement from EU Member States in a Team
Europe spirit. Among the key programmes are the support to agriculture and rural development
(ENPARD), support to public finance management, as well as the support to economic and
business development.
The Economic and Investment Plan for the Eastern Partnership
3
seeks to unlock EUR 3.9
billion in public and private investments for economic development of the country, including
tailored flagship investments.
The EU and other financial institutions have worked hand in hand to support Georgia’s reform
efforts. Since 2014, the European Bank for Reconstruction and Development and the European
Investment Bank have respectively allocated EUR 2.3 billion and EUR 1.6 billion in loans. The
EU is also working in close cooperation with the World Bank and the International Monetary
Fund, which have been key partners providing assistance to the country since 2014. EUR 12,5
million have been allocated in 2021
to strengthen the capacities of the Georgian defence forces’
medical, engineering and logistic units.
Citizens of Georgia enjoy visa-free travel to the Schengen area since March 2017. An
agreement on readmission between the European Union and Georgia is in force since 2011.
Georgia is a contracting Party to the Energy Community Treaty and the Agreement on the
Common Aviation Area, which assist in approximating Georgian legislation to the EU
acquis.
The country is also a full member of the United Nations, the Council of Europe and a
participating state of the Organisation for Security and Cooperation in Europe (OSCE).
Since 2014 Georgia has progressively extended its participation in EU programmes. It currently
takes part in Horizon Europe, Creative Europe, EU4Youth, and the Black Sea Interreg
programme and has recently joined the Customs programme. Organisations and individuals
from Georgia can also benefit from certain actions of the Erasmus+ and European Solidarity
Corps Programme. In November 2018 a high-level meeting between the European Commission
and the Georgian government took place in Brussels.
The country has also concluded working arrangements or memoranda of understandings with a
number of EU agencies such as the European Border and Coast Guard Agency (Frontex); the
European Union Aviation Safety Agency (EASA); the European Union Agency for Criminal
Justice Cooperation (EUROJUST); the European Fisheries Control Agency (EFCA), the
European Agency for Safety and Health at Work (EU-OSHA), the European Environment
Agency (EEA), the European Food Safety Authority (EFSA), the European Centre for Disease
Prevention and Control (ECDC), the European Union Agency for Law Enforcement Training
(CEPOL), the European Training Foundation (ETF), the European Monitoring Centre for
Drugs and Drug Addiction (EMCDDA), the European Union Intellectual Property Office
(EUIPO), the European Police Office (Europol), and the European Maritime Safety Agency
(EMSA).
Georgia is a participant
in
the Eastern Partnership (EaP). The EaP is based on the principle of
inclusivity and differentiation. Russia’s war in Ukraine has shown that multilateral cooperation
and cohesion is now more important than ever, as is strengthening the resilience of the region.
A focus on bilateral relations will also be important going forward, to allow Georgia to
implement key reforms including in the field of governance, justice and rule of law.
3
SWD(2021) 186 final
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B.
1.
CRITERIA FOR MEMBERSHIP
POLITICAL CRITERIA
This assessment is based on the Copenhagen criteria, related to the stability of institutions
guaranteeing democracy, the rule of law, human rights and respect for and protection of
minorities.
1.1. Democracy
As established by its
Constitution,
Georgia is a parliamentary democracy in which the
legislative powers are exercised by the Parliament, and the executive powers by the
Government. The Constitution guarantees the fundamental principles of a democratic state,
including the rule of law, free elections and the protection of human rights. The primacy of
international law is explicitly stipulated by the Constitution, which states that an international
treaty takes precedence over domestic law unless it comes into conflict with the Constitution or
a Constitutional Agreement.
The Supreme Court is the highest court of general jurisdiction, whereas the Constitutional
Court exercises constitutional jurisdiction.
The
President
of Georgia is the head of State, elected for a five-year term of office. He/she is
formally head of the armed forces and has otherwise mostly representative functions, including
representing the country in foreign relations, with the consent of the Government. The
executive power is exercised by the
Government,
consisting of a Prime Minister and 12
Ministers.
The
Parliament
is the legislator in Georgia, adopting legislation, including amendments, to the
Constitution. It exercises democratic control and oversight over the executive branch. Not all
parliamentary procedures function properly in the spirit of control and accountability, mostly
due to strong tensions between two main political parties as political dialogue is polarised. The
EU-mediated 19 April 2021 agreement provided an opportunity to tackle this polarisation and
to forge a cross-party consensus on crucial reforms notably in the electoral and judicial fields.
This opportunity has not been seized by Georgia’s political elites.
More needs to be done to
reduce this polarisation, and improve oversight and control of the Parliament over the
government and effective scrutiny of legislative developments by Parliament.
The
electoral framework
is overall in line with relevant international standards. Through 2020
Constitutional amendments, the parliamentary elections of 2020 were held under a mixed
system of 120 proportional and 30 majoritarian seats in Parliament, with a 1% threshold. Also
in line with these amendments, the parliamentary elections scheduled in 2024 will be fully
proportionate. Further constitutional amendments envisaged by the 19 April agreement, setting
inter alia the threshold to enter Parliament from 2024 onwards, are pending in Parliament.
According to the Office for Democratic Institutions and Human Rights (ODIHR), the 2020
parliamentary elections were competitive and, overall, fundamental freedoms were respected
.
ODIHR also highlighted allegations of voter pressures, vote buying and the blurring of the line
between the ruling party and the state. More needs to be done regarding the transparency of
campaign and political party financing and countering the misuse of state resources, electoral
dispute resolution, criteria for granting and conducting recounts, as well as balanced and
impartial media coverage. The recommendations made by ODIHR in 2020 and 2021 should be
fully addressed
.
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The urgency procedure to pass legislation, including in areas relevant to EU commitments, has
been used often and, at times, for institutionally sensitive issues that would have merited a
broader consensus. There is a legal framework providing for comprehensive impact
assessments of proposed legislation, but it is only partially implemented.
Independent accountability and democratic oversight functions, including through the Public
Defender’s office should be strengthened, as well as effective oversight on law enforcement
agencies and the control of personal data processing.
Civil society
in Georgia is well developed, diverse, vibrant and enjoys freedom to operate. The
country’s legal framework provides an enabling environment for an active civil society.
Freedom of association is protected, and specific rules for the non-profit sector, including a
differentiated tax regime, are in place. Mechanisms for consultation with the public in policy-
making and law-making exist and are used. Recently, some CSOs have been excluded from
policy consultation; this needs to be corrected.
1.2. Public administration reform
The public administration legal framework and the civil service system are mostly in line with
European public administration principles and European standards and practices. The
government needs to continue to implement the legislation and ensure a stable, accountable and
transparent civil service system.
Successive governments followed a
strategic framework for public administration reform,
based on the 2015-2020 public administration reform (PAR) strategy. A new PAR strategy is
being elaborated. The Government Programme 2021-2024,
‘Toward Building
a European
State’, outlines a vision for building a professional, honest and streamlined system of state
governance.
Regarding
multi-level governance,
the Government Programme 2021-2024 focuses on de-
concentrating and decentralising the system of state governance in order to establish successful
European-standard local self-government by 2024, and transform sectoral-centralised
governance into effective local-territorial governance.
The reform of
public financial management
(PFM) is based on the 2019-2022 PFM strategy.
A new PFM strategy is currently being developed. The Government’s medium-term
budget
framework for 2022-2025 is in place and the 2022 budget as well as the annual budget process
are reasonably well developed. Budget transparency remains strong and reforms are being
addressed in the area of external audit, parliamentary oversight and public procurement.
The
public service and human resources management
is based on a coherent legal
framework, which guarantees the implementation of the civil service system and continuity in
the modernisation and capacity building of public administration. More work is needed to
ensure a merit-based, professional civil service at all levels of the administration, as well as
transparent recruitment, promotion and dismissal procedures.
The institutions and the regulatory framework for central government
policy development and
coordination
are in place and functioning. This is a regulatory and procedural foundation for
evidence-based policy making. This framework needs to be enforced, and there is room for
further strengthening the capacity and implementation of policy-monitoring.
The central government is rationally organised, and the legal framework is being improved to
ensure efficient and coherent
accountability
lines between supervisory and subordinated
bodies. Access to public information is ensured by a legal framework, but the administrative
capacity for its effective implementation needs to be further enhanced following a review of the
overall framework.
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A key government priority is to ensure a more user-oriented
service delivery.
Georgia has
expanded the ‘one-stop-shop’ network of
public services at central and local level and the
government offers
many e-public services.
The Basic Data and Directions 2018-2021 strategy
focused on the need to modernise and expand public services to serve citizens more effectively.
Furthermore, the Public Administration Reform Roadmap 2020 identified some gaps in public
service design and delivery to be addressed.
1.3. Rule of law
In recent years, the country has undertaken numerous legislative and institutional reforms
aimed at strengthening the rule of law, including in the areas of the fight against corruption and
organised crime. Overall the constitutional and legal instruments are in place to guarantee the
respect of the rule of law at all levels. However, practical implementation and enforcement
need to be consolidated. Moreover recent developments have not been in line with the
recommendations of the Venice Commission and weakened the independence of key judicial
institutions.
a) Judiciary
Four successive waves of reform have improved the legal framework regarding the functioning
of the judiciary and the capacity and organisation of the Georgian justice system. However,
progress on justice reforms and their implementation has now stalled and some backward steps
have been taken. Public perception of the independence of the judiciary has deteriorated.
Georgia has not yet adopted a strategic framework for justice reform post-2020.
The
constitutional and legislative frameworks,
in principle, guarantee the independence of
the judiciary and its impartiality, including specific guarantees for judges. Codes of ethics for
judges and prosecutors are in place, as is a complaint mechanism. A system of verification of
asset declarations of judges and prosecutors exists, but its practical implementation needs fine-
tuning.
The appointment of judges and prosecutors is largely based on merit and objective criteria, as
assessed through public competitions. Presidents of individual courts are appointed by the High
Council of Justice. However, as a matter of priority, a substantive reform of the High Council
of Justice is required to increase its transparency, integrity and accountability, including in
appointments, appraisals, promotions, transfers, disciplinary measures and appeals, in line with
the Venice Commission and the Organisation for Security and Co-operation in Europe
(OSCE)’s Office for Democratic Institutions and Human Rights recommendations (ODIHR).
The five non-judge members of the High Council of Justice have not been appointed despite
long-overdue vacancies. Concerns were expressed over the process of recent appointment of
two judge members of the High Council of Justice. The published decisions of the High
Council of Justice should add explanations of their reasoning.
While a system for the nominal random allocation of cases to judges is in place, more needs to
be done to reduce numerous exceptions to this rule, so that the allocation of high-profile cases
is not influenced.
Appointments of all the Supreme Court judges for a life-long term were made despite repeated
calls by the EU to pause and revise the appointment process to bring it in line with the Venice
Commission recommendations. Georgia needs to bring the Law on common courts in line with
the advice of the Venice Commission in its opinions on the applicable legislation and the
ODIHR recommendations issued on the procedures.
Open access to reasoned court decisions in compliance with data protection rules has yet to be
fully ensured.
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As regards the prosecution, the appointment process for the Prosecutor-General needs to be
improved to ensure the autonomy of the office/position of the Prosecutor
.
Georgia has
committed, in the Association Agenda, to introduce a qualified majority vote in Parliament,
which is the main recommendation of the Venice Commission in this respect.
The 2020 budget for the judicial system was EUR 32.4 million (0.23 % of GDP). The number
of judges (329) and the number of prosecutors (414) is low compared to the European averages
of 21 judges/12 prosecutors per 100,000 inhabitants (9 judges and 12 prosecutors per 100,000
inhabitants for Georgia
4
). Judges are trained at the High School of Justice, which is assessed as
adequate. Prosecutors are trained by the General Prosecutor's Office.
The Supreme Court publishes annual statistical data for each year of cases at the common
courts of Georgia. The High Council of Justice publishes activity reports covering several
years. An integrated case management system is in place, but needs to introduce a statistical
element. In terms of
efficiency,
the disposition time in civil and commercial litigious cases
increased to 433 days in 2020, compared to 274 days in 2018. The clearance rate decreased to
87 % (91 % in 2018). The disposition time remains a major concern. The backlog for pending
court cases amounts to 4 322 and 746 cases for the first and second instances, respectively.
b) Fight against corruption
Georgia has introduced substantial legal reforms regarding anti-corruption, approximating to
EU
acquis
and international norms. It
is a participating state of the Council of Europe’s Group
of States against Corruption (GRECO) and the Anti-Corruption Network of the Organisation
for Economic Cooperation and Development (OECD/ACN). Georgia is a party to all key
international anti-corruption conventions, including the United Nations Convention against
Corruption (UNCAC). Corruption remains an issue that requires continued attention.
An important number of cases of corruption involving low and-medium level officials have
been successfully prosecuted, primarily in the public procurement field.
The system of asset declarations of public officials is in place, and the laws regulate conflict of
interests and protection of whistle-blowers. The scope of the law related to asset declaration, its
implementation and monitoring should be improved (as family members are not covered), and
whistle-blower protection needs to be strengthened. There is no single independent anti-
corruption agency that deals independently with conflicts of interest, verification of declared
assets, auditing the spending of political parties and whistle-blowers protection. The
administrative capacity to obtain effective control of party financing and electoral campaign
financing needs to be strengthened.
There are no specialised law enforcement, prosecution services or specialised courts dealing
with the fight against high-level corruption. More needs to be done to strengthen investigations
in this area. The anti-corruption entity is part of the State Security Services. Current
implementation of the policy is on-going, but the
anti-corruption policy in
Georgia is
negatively affected by the fact that the National Anti-corruption Council has not met since
2019. As of the beginning of 2021, the secretariat of the Council was moved from the Ministry
of Justice to the Government Administration and remains understaffed. No new national Anti-
Corruption Strategy and Action Plan for 2021-2022 has been developed yet.
As regards the
track record
of high-level corruption cases, a total of 28 verdicts have been
issued since 2020, out of which 21 were convicted for corruption, including a deputy minister,
deputy district prosecutor, governors and members of local councils. More needs to be done to
4
According to the Council of Europe European Commission for the Efficiency of Justice (CEPEJ)
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tackle high-level corruption and in particular, to address the role of large scale vested interests
and their influence in both the economic and political sphere.
c) Organised crime
Georgia has ratified the United Nations Convention against Transnational Organized Crime, as
well as its protocols on Trafficking in Persons and on Smuggling of Migrants. In these areas the
criminal code is partially in line with the EU
acquis,
and anti-money laundering legislation
partially reflects the provision of FATF recommendations and relevant international legislation,
but there are still outstanding recommendations from MONEYVAL. Putting in place a
comprehensive framework for the fight against financial crime and money laundering, and
ensuring its effective implementation, are crucial to address the significant risks they pose.
Georgia’s criminal procedure code gives prosecutors up to ten years to trace and identify assets
after conviction. The law on the confiscation of criminal assets is partially aligned with EU
acquis.
The National Strategy on Combating Organised Crime 2021–2024 and Action Plan
2021-2022 were approved in September 2021.
Investigations of organised crime are conducted by several agencies and institutions, depending
on the nature of the crime. Coordination is ensured by Georgia's Inter-agency Coordination
Council for Combating Organised Crime. Crime statistics are collected by the Ministry of
Internal affairs in a case management data base.
Georgia concluded cooperation agreement with the European Union Agency for Law
Enforcement Training (CEPOL), an operational and strategic agreement with the European
Union's law enforcement Agency (Europol) and a Memorandum of Understanding with the
European Monitoring Centre for Drugs and Drug Addiction (EMCDDA). Georgia participates
in the European Multidisciplinary Platform Against Criminal Threats (EMPACT). The country
is a member of Interpol.
The number of organised crime convictions remains relatively low compared to the estimated
value of the criminal market. In 2020, Georgia prosecuted 5 high-level cases and a further 49
individuals were detained and charged for membership of criminal organisations. 152
cybercriminals were detained by the police and brought to justice.
The number of finalised criminal proceedings on alleged crimes committed by organised crime
groups has slowly increased in recent years but remains still relatively low (2021
–499
cases;
2020
377 cases; 2019
293 cases). There are very few finalised investigations of Trafficking
in Human Beings (2021
45 cases; 2020
57 cases; 2019
10 cases). There were 20 final
convictions for organised crime in 2020.
Georgia is located at a crossroads for the smuggling of illegal goods (in particular drugs and
arms) to the EU. Trafficking in human beings remains a concern: Georgia is primarily a
country of origin and, to a lesser extent, destination and transit, of victims of trafficking in
human beings. In 2020, 13 cases were prosecuted.
Georgia has made significant efforts to fight organised crime within the framework of its
national strategy and corresponding action plans, and has stepped up cooperation with Europol
and EU Member States. Continued and sustained efforts are needed, to further strengthen the
capacity of law enforcement services to effectively tackle organised crime. .
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1.4. Fundamental rights
a)
International framework
Georgia has ratified the main international human rights instruments, including the European
Convention on Human Rights, the UN Convention on the Rights of the Child and its Optional
Protocols, the Convention on the Elimination of all Forms of Violence against Women and the
Council of Europe Convention on preventing and combating violence against women and
domestic violence (the Istanbul Convention) with reservations.
b)
Legal and institutional setup
The legal and institutional framework regulating fundamental rights is largely in place, and
laws follow European and international standards.
The Ombudsperson institution is called the Public Defender's Office (PDO). It is designated as
National Preventive Mechanism
and accredited with an “A” status by the Global Alliance of
National Human Rights Institutions as largely complying with the Paris Principles. The
Ombudsperson is an independent and well-functioning institution. Overall, the capacity of the
institutions in charge of the protection and enforcement of human rights, including the judiciary
and police, needs to be further improved.
The Human Rights Strategy drafted in 2020 is yet to be adopted, preventing the approval and
the implementation of related action plans. The State Inspection Service responsible for
investigating alleged human rights violations committed by law enforcement and overseeing
personal data protection has been recently dissolved. The newly created agencies
the Special
Investigation Service and Personal Data Protection Services
still need to prove their
efficiency and independence.
c)
Key fundamental rights issues
Georgia has 27 judgements of the European Court of Human Rights under enhanced
supervision procedure pending their enforcement. These include cases related to the right to life
and protection against ill treatments, excessive use of force, abuse of pre-trial detention, failure
to protect from homophobic attacks and police inaction related to domestic violence.
Cases of excessive use of force and
ill-treatment
by law enforcement officials still exist but are
being addressed. The physical conditions in places of deprivation of liberty are relatively good
including in pre-trial detention, but infrastructure needs to benefit from further investment.
Georgian citizens are guaranteed
freedom of expression.
The
media
environment is largely
pluralistic, but intimidation and physical and verbal attacks on media professionals have
increasingly taken place, especially in the context of demonstrations and election rallies, and
investigations are lacklustre. Court proceedings and investigations against opposition media
owners have become frequent. Recent verdicts have a chilling effect on critical media
reporting. Further alignment of the legislation on the media regulator (the Georgian National
Communication Commission) with European standards is needed.
The Georgian Constitution guarantees
protection against discrimination,
and the criminal
code defines aggravating circumstances for crimes that include (without using the term) hate
crimes. Overall, the country’s legal framework
on non-discrimination and gender equality is
largely in line with the EU
acquis,
but not sufficiently enforced. There are continued efforts to
raise awareness on
gender equality,
to address persisting inequalities preventing women from
fully exercising their equal rights. 19.3% of parliamentarians elected in 2021 are women. The
scale of gender-based violence, including domestic violence and femicides remains a major
concern. Women continue to face
inequality
in the labour market; a gender pay-gap persists
with women overall earning 36.2% less than men on average in 2019.
After Georgia’s
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ratification in May 2017 of the Istanbul Convention, work has been carried out to improve
access to justice and to improve the quality of social protection services. Further engagement,
including on increasing public awareness, is needed. More needs to be done to protect the rights
of lesbian, gay, bisexual, transgender, intersex or queer (LGBTIQ) persons in Georgia,
particularly in light of the July 2021 events.
A Code on the Rights of the Child has been adopted, setting a legal framework for the
protection of the rights of the child.
There is no national strategy to address violence against
children. The reform on deinstitutionalisation of children needs to be completed.
A Law on the Rights of
Persons with Disabilities
was adopted in 2020 and the Optional
Protocol to the UN Convention on the Rights of Persons with Disabilities has been ratified.
Persons with disabilities remain one of the most marginalised groups.
A State Strategy for Civic Equality and Integration 2021-2030 and its Action Plan are in place,
but the social, economic and cultural rights of persons belonging to
minorities
and their
political participation remain insufficiently enforced.
Respect for privacy of communications has been put into question by eavesdropping and illicit
surveillance of politicians, journalists, civil society activists and the diplomatic community,
including tapes of private life and correspondence. The pledged investigations usually do not
lead to credible conclusions. The repeated calls, including by the Public Defender, to improve
accountability and effective institutional oversight are yet to be addressed.
2. ECONOMIC CRITERIA
This assessment is made on the basis of the Copenhagen criteria related to the existence of a
functioning market economy, as well as the capacity to cope with competitive pressure and
market forces within the Union.
2.1. Functioning market economy
Georgia has a Gross Domestic Product (GDP) per capita corresponding to 33% of the EU
average in terms of purchasing power parity (PPP). The country demonstrated solid economic
growth of around 5% in the years before the COVID-19 pandemic. Following a year of
pandemic-related contraction by almost 7% in 2020, GDP strongly expanded by over 10% in
2021.
Georgia has a good track record of applying sound fiscal and monetary policy, as commended
by the International Monetary Fund in successive programme reviews. The country has strict
fiscal rules imposing ceilings on the fiscal deficit (3% of GDP), government debt (60% of
GDP) and revenues. Georgia generally complied with these rules before the pandemic. Fiscal
deficit and public debt levels were low: below 2% of GDP and around 40% of GDP
respectively. The fiscal rules were suspended for three years due to the pandemic. The vast
majority of Georgia’s public debt is external, coming almost solely from multilateral and
bilateral partners on concessional terms.
Monetary policy is conducted in a transparent way through an inflation targeting regime, under
which the National Bank of Georgia (NBG) determines the medium-term inflation target
(currently 3%) and makes corresponding decisions on interest rates and other monetary policy
instruments. Actual inflation fluctuated around the target in the last years before increasing
sharply since mid-2021 due to external shocks, as in other economies. Georgia has a floating
exchange rate regime with the rate formed on the foreign exchange market, with sporadic
interventions of the NBG. Despite the gradual depreciation of the lari (by 31% against the euro
between 2016 and 2021), Georgia’s current account balance was consistently strongly negative
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before 2020 and further deteriorated during the pandemic, leading to the accumulation of
significant levels of external debt (both private and public) and some external vulnerability
concerns. Georgia’s international reserves gradually increased over the last
years and covered
4.6 months of imports in 2021.
Over the past two decades, Georgia has pursued ambitious reforms aimed at improving its
economic governance and business climate. The government-related economic institutions can
be overall considered as effective, with the country scoring high on government effectiveness
(75
th
percentile of all countries of the world) and on regulatory quality (83
rd
percentile) in the
latest (2021) World Bank Governance indicators. Substantial progress has been made notably
in the field of public financial management, public procurement, tax and customs
administration, supported by EU and IMF programmes and their conditionality.
Georgia’s business environment has been profoundly liberalised since the mid-2000s.
According to the OECD, Georgia has managed to build up a high-standard regulatory and
business environment that has received international recognition. The country scores better than
other countries in the region in all dimensions of the recent (2020) OECD small and medium
sized enterprises (SME) policy index. Registering a company requires just a single procedure
and can be completed in a day. Licences and other barriers to market entry were systematically
reduced. The new insolvency law, adopted in 2020, facilitated insolvency proceedings, made
them more transparent and reduced their duration and costs. The Law on Entrepreneurs,
adopted in 2021, modernised the regulations on the legal forms of companies, the procedures
for their establishment and functioning. To ensure a resilient business environment, more needs
to be done to strengthen the legal framework and enforcement procedures in competition law,
and step up the enforcement of contracts and judicial independence.
The state footprint in the economy is very modest. There are 236 state-owned enterprises
(SOEs), which account for less than 5% of the total value added of the corporate sector. As
many SOEs reported financial losses in the last years, a reform of SOE governance is ongoing.
The government adopted in 2021 SOE corporate governance standards in line with OECD
guidelines and is developing a comprehensive SOE strategy. Work is also ongoing with the
IMF on disclosing and preventing fiscal risks coming from SOEs.
Georgia’s financial sector is generally sound.
It is dominated by banks and strongly
concentrated; the two largest domestic banks, out of 16 in total, hold around three quarters of
the total assets. Georgia’s banking sector has a low-risk
profile: the share of nonperforming
loans in total gross loans has been low (between 5% and 8%) over the last five years, and the
capital adequacy ratio has been high and rising (to 19.6% at the end of 2021).
The IMF’s recent
Financial Sector Stability Assessment confirms that Georgia’s banking system remains resilient
after the pandemic, in spite of some losses incurred in this period. Bank lending to the private
sector was the highest in the region at 80% of GDP, and has more than doubled over the last
decade. The share of companies without access to credit is lower in Georgia than in the other
countries of the region, although access to finance remains an obstacle for many SMEs.
The unemployment rate in Georgia stood at 19% at the end of 2021 and was high in
comparison to other countries in the region. The employment rate has persistently been low
(41.5% at the end of 2021). This is partially caused by a mismatch between workforce skills
and fast evolving needs of employers, a high number of subsistence farmers (classified in the
statistics as being outside the labour force or unemployed), as well as high informal
employment, estimated at 32% of non-agricultural employment. Public employment services
played a very limited role until recently, but they have been gradually strengthened following
the establishment of the State Employment Support Agency in 2019.
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2.2. Ability to cope with the competitive pressure and market forces of the EU
Despite high educational attainment with an average of 12.8 years of schooling, the quality of
the education system and curricula is poor, which partially reflects lower spending on education
(3.8% of GDP in 2020) than recorded by regional peers. Skills of graduates in Georgia are
ranked only 125
th
out of 141 countries in the Global Competitiveness Index, and the learning
outcomes measured by the PISA assessment are behind countries in the region. The authorities
make efforts to improve curricula and teaching methods and to strengthen vocational education.
In the latter field, the National Agency for Vocation Skills was established in 2019. Spending
on R&D was low at some 0.3% of GDP in the last years. Georgia ranks 91
st
in the Global
Competitiveness Index as regards innovation capability, behind most countries of the region.
Georgia’s investment levels have been high,
around 25% of GDP in the last years, but only 3-
4% of GDP was spent on infrastructure. According to a recent joint EIB and EBRD assessment,
the main energy infrastructure, including generation units, transmission lines and gas pipelines,
has improved substantially over the last two decades. In spite of its huge potential for
producing renewable energy, Georgia remains excessively dependent on fossil fuels, especially
on subsidised gas, and has become a net electricity importer. In the area of transport, the quality
and density of road and rail network remains weak despite gradual improvement, leading to
long travel times and poor road safety records. Water supply and sanitation outside of big cities,
as well as in waste management facilities, need substantial infrastructure investment. Despite
the noticeable growth of the ICT sector in the last years, access to digital infrastructure remains
insufficient in some parts of the country.
The Georgian economy has a diversified economic structure, with a focus on low value-added
sectors. Services play a major role in the economy, especially trade and repairs (17% of GDP in
2021), real estate, construction, transport and tourism. Manufacturing accounts for 12% of
GDP, agriculture for 7% and mining for 4%. Exports of goods were systematically increasing
from 14% of GDP in 2016 to 23% of GDP in 2021. The structure of exports is dominated by
metals (copper ores and ferroalloys), food products (wine, spirits, mineral waters, hazelnuts)
and re-exported cars. The participation of Georgian firms in global value chains is very limited.
The country has in recent years consistently displayed a substantial trade deficit, partially
compensated by the inflow of remittances and a surplus in tourism and other services.
The Association Agreement including the Deep and Comprehensive Free Trade Area between
the EU and Georgia, signed in 2014, contributes to the development of Georgia’s economy
through trade liberalisation and alignment with EU legislation and standards. Between 2016,
when the AA entered into force, and 2021, Georgia’s exports to the EU increased by 30% and
imports from the EU by 11%. The EU has been the top trade partner of Georgia over the last
years, accounting for 21%
of the country’s exports and 23% of imports in
2020. Georgia is a
WTO member since 2000, with a tradition of an open trade policy.
3. ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP
The ability of Georgia to assume the obligations of membership has been evaluated based on
the following indicators:
-
-
The commitments in the Association Agreement and the Deep and Comprehensive Free
Trade Area and their implementation;
The level of adoption, implementation and enforcement of the
acquis
outside the
AA/DCFTA
The EU-Georgia Association Agreement, including the Deep and Comprehensive Free Trade
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Area (AA/DFCTA) belongs to a new generation of most ambitious association agreements the
EU has concluded with its partner countries. The Agreement captures a substantial part of the
EU
acquis
with detailed timetable of implementation varying from 2 to 10 years and brings the
country closer to the European Union in terms of regulatory alignment.
Since the provisional entry into force of the AA/DCFTA in 2014, EU Member States are
closely involved in the implementation of the AA/DCFTA through the Association Council and
the Association Committee. Common Positions are adopted for the Association Council and a
detailed Annotated Agenda is agreed for the Association Committee. The strategic guidance is
provided by the Association Council meetings at the highest political level. Furthermore, the
EU-Georgia Parliamentary Association Committee involves the European Parliament and the
Georgian Parliament into the implementation of the agreement. The discussions are also
informed by the input provided by the civil society through the EU
Georgia Civil Society
Platform and duly taken into account.
The institutional set-up includes also the Association Committee and the Association
Committee in Trade Configuration, dedicated Sub-Committees as well as Cluster Sub-
committees covering almost all chapters of the EU
acquis
allow for on-going and thorough
analysis of the progress in the relationship. The EU and Georgia have worked closely together
to identify key policy areas, set targets for reform and legislative progress, and benchmark
achievements in those areas. The regularly updated Association Agendas set out the short- and
medium-term policy objectives of EU-Georgia cooperation.
Georgia’s implementation of the EU
acquis
is documented in the EU’s ‘Association
Implementation Reports’ issued annually since 2016
5
. Pending a fully-fledged analysis of all
chapters to be carried out at a later stage in the process, the analysis provides examples of
chapters in the clusters in which Georgia has achieved particularly good results and highlights
areas where there has been a limited approximation to the
acquis.
Following the adoption of the revised methodology
6
and for the purpose of the EU’s
Enlargement policy, the EU
acquis
is structured in six thematic clusters. The EU
acquis
in
these clusters is substantially covered by the Association Agreement and the Deep and
Comprehensive Free Trade Area and Georgia has gradually approximated with it. Overall
Georgia has a satisfactory track record of implementation, though progress is uneven and there
have been some delays in meeting the ambitious times lines in the AA/DCFTA.
The
Fundamentals cluster
includes the chapters of the
acquis
on
Judiciary & fundamental
rights, Justice, freedom and security, Public procurement, Statistics, and Financial control.
This cluster has been mainly assessed under the Political and Economic criteria sections.
There are areas in the cluster where approximation to the EU
acquis
is still limited, for example
in
Judiciary and fundamental rights
and
Justice, freedom and security.
The
Internal market
cluster includes the chapters of the
acquis
on
Free movement of goods,
Free movement for workers, Right of establishment and freedom to provide services, Free
movement of capital, Company law, Intellectual property law, Competition policy, Financial
services, Consumer and health protection.
Georgia has for example made substantial progress
in approximating the
acquis
in the area of
company law
by adopting new legislation, creating a
uniform and transparent legal framework for corporations, their shareholders, directors,
creditors, and other stakeholders.
There are other areas where the approximation to the EU
acquis
is still limited, for example, the
5
6
SWD(2021) 18 final
COM (2020) 57 final
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area of
consumer protection policy,
where more efforts are needed including as regards the
implementation and enforcement of recently adopted legislation.
The
Competitiveness and inclusive growth
cluster includes the chapters of the
acquis
on
Information society and media, Taxation, Economic and monetary policy, Social policy and
employment, Enterprise and industrial policy, Science and research, Education and culture,
Customs union.
Particularly good results were reached. For example Georgia has already made
substantial progress in the area of
economic and monetary policy,
with legislation defining
numerical fiscal rules for budget deficit and public debt.
On
education and culture,
Georgia is well advanced in fulfilling all recommendations and
Council Decisions on the enhanced quality of all levels of education. Progress towards
recognition of qualifications and competences, and ensuring transparency in the area of
recognition of qualifications, is good.
Georgia’s association to Horizon Europe is a successful
instrument for integration with the EU’s practices in the field of
research and innovation.
There are other areas where the approximation to the EU
acquis
is still very limited; for
example,
electronic communication
and
social policy and employment.
Further efforts are
needed to ensure effective implementation of the anti-discrimination legislation. In the field of
antitrust and merger control, Georgia has partially aligned its legislation with the EU
acquis.
Georgian State aid legislation is not aligned.
The cluster on the
Green agenda and sustainable connectivity
includes the chapters of the
acquis
on
Transport policy, Energy, Trans-European networks, and Environment and climate
change.
Georgia has made substantial progress in the area of
energy
by approximating the
adapted EU
acquis
under the Energy Community Treaty. However, important steps still need to
be undertaken to unbundle and certify the electricity and gas transmission system operators in
order to accelerate the development of renewables and reduce the energy dependence on
Russian fossil fuels in line with REPowerEU Plan. This is especially relevant as Georgia does
not have yet physical energy interconnections with the EU. Georgia has adopted key pieces of
legislation related inter alia to renewables and energy efficiency
In other areas, such as
environment and climate change,
Georgia will have to invest
considerable efforts in further legislative alignment with the acquis and the European Green
Deal policies as well as strengthening its administration to enable the green transition.
Alignment with the transport acquis, in particular in the maritime and aviation sectors, is
supported by the Common Aviation Area Agreement signed in 2010 and a multi-sectorial
Transport Dialogue launched in 2019.
The cluster
Resources, agriculture and cohesion
includes the chapters of the
acquis
on
Agriculture and rural development, Food safety, veterinary and phytosanitary policy,
Fisheries, Regional policy and coordination of structural instruments, and Financial and
budgetary provisions.
Georgia has already made substantial progress in
food safety, veterinary
and phytosanitary policy
allowing trade between the EU and Georgia to be increased and
diversified. Georgia is working in close cooperation with regional
fisheries
management
organisations to align its relevant legislation to the EU
acquis
and international standards. The
country has started to implement some key mechanism for
regional policy.
Georgia has been very effective in implementing the ambitious legal approximation plan of the
AA/DCFTA, and is on track to achieve full approximation as scheduled. More efforts will be
needed in order to effectively implementing the Directives.
The approximation to the
acquis
in the area of
Agriculture and rural development
is limited.
The cluster on
External Relations
contains the chapters on
External relations
and
Foreign,
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security and defence policy.
Georgia’s alignment rate with relevant High Representative
statements on behalf of the EU and Council Decisions was 53% in 2021, (2020: 61%; 2019:
55%; 2018: 54%, 2017: 56%).
Georgia has been an active contributor to EU CSDP missions and operations: it currently
contributes to the European Union Training Mission (EUTM) in Central African Republic with
32 personnel ensuring protection, and with 1 military officer in EUTM Mali. A High-Level
Political and Security Dialogue with Georgia was launched in 2017, to complement the regular
exchanges under the Association Council and further promote the gradual convergence on
foreign and security policy matters. There is scope to further enhance cooperation in the area of
Common Security and Defence Policy. Efforts should be made to increase Georgia’s
convergence with the Common Foreign and Security Policy, including on EU positions.
4. CONCLUSIONS AND RECOMMENDATIONS
Georgia is a parliamentary democracy. Recent national and local elections have been
recognised as competitive and conducted with overall respect of fundamental freedoms.
Crucial challenges nevertheless remain in particular due to the overly divided political scene.
There is an urgent need to address this political polarisation and enhance democratic oversight.
Eradication of vested interests needs to be a high priority. Georgia has a well-developed and
dynamic civil society whose opinion and input needs to be taken into account in a more
systematic manner. A strategic framework for reforms in public administration is in place and
includes provisions to strengthen local governance. Regarding the judiciary Georgia had
undertaken important judicial reforms, but later changes have stalled this positive trend. The
independence of the judiciary needs to be consolidated and accountability and impartiality of
the entire judicial institutional chain ensured. Georgia has taken important steps to fight
corruption yet more needs to be done to strengthen the anti-corruption processes and their
effectiveness. In particular, fighting high-level corruption and eliminating vested interests,
including that of oligarchs, require further decisive actions. Similarly, important measures
undertaken to tackle organised crime need to be strengthened further. A vocal pluralistic media
environment exists and needs to be protected including in legal proceedings. Fundamental
rights laws broadly follow European and international standards. The enforcement of these
rights needs to be strengthened. Overall, as regards the
political criteria,
Georgia has a
foundation in place to reach the stability of institutions guaranteeing democracy, the rule of
law, human rights and respect for and protection of minorities, even if recent developments
have undermined the country’s progress.
As regards the
economic criteria,
Georgia has achieved a good degree of macroeconomic
stability with a track record of sound economic policy and a favourable business environment.
In order to improve the functioning of its market economy, further reforms and investment are
needed to ensure long-term inclusive growth and external competitiveness. In order to reinforce
the capacity of the country to cope with competitive pressure in the EU, Georgia needs to
strengthen in particular its human capital (particularly through education reform) to ensure
skills for the labour market and innovativeness, strengthen physical infrastructure including
renewable energy generation and transport infrastructure, as well as access to global value
chains.
As regards the
capacity to fulfil the obligations of membership,
Georgia has worked since
2016 on the implementation of the EU-Georgia Association Agreement, including a Deep and
Comprehensive Free Trade Area (AA/DFCTA). These agreements already capture an
unprecedented amount of the EU
acquis.
Georgia has gradually approximated to substantial
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elements of the EU acquis across many chapters. It has an overall positive track record of
implementation, while in some sectors the country is more advanced than in others. Overall
Georgia has established a solid basis for further alignment.
Georgia is a European State committed to respecting and promoting the values on which the
European Union is founded. The Commission therefore recommends to the Council that
Georgia should be given
the perspective to become a member
of the European Union.
The Commission recommends that Georgia be granted
candidate status,
once the following
priorities will have been addressed:
-
-
address the issue of political polarisation, through ensuring cooperation across political
parties in the spirit of the April 19 agreement;
guarantee the full functioning of all state institutions, strengthening their independent and
effective accountability as well as their democratic oversight functions; further improve the
electoral framework, addressing all shortcomings identified by OSCE/ODIHR and the
Council of Europe/Venice Commission in these processes.
adopt and implement a transparent and effective judicial reform strategy and action plan
post-2021 based on a broad, inclusive and cross-party consultation process; ensure a
judiciary that is fully and truly independent, accountable and impartial along the entire
judicial institutional chain, also to safeguard the separation of powers; notably ensure the
proper functioning and integrity of all judicial and prosecutorial institutions, in particular
the Supreme Court and address any shortcomings identified including the nomination of
judges at all levels and of the Prosecutor-General; undertake a thorough reform of the High
Council of Justice and appoint the High Council’s remaining members.
All these measures
need to be fully in line with European standards and the recommendations of the Venice
Commission.
strengthen the independence of its Anti-Corruption Agency bringing together all key anti-
corruption functions, in particular to rigorously address high-level corruption cases; equip
the new Special Investigative Service and Personal Data Protection Service with resources
commensurate to their mandates and ensure their institutional independence;
implement the commitment to “de-oligarchisation” by eliminating the excessive influence
of vested interests in economic, political, and public life;
strengthen the fight against organised crime based on detailed threat assessments, notably
by ensuring rigorous investigations, prosecutions and a credible track record of
prosecutions and convictions; guarantee accountability and oversight of law enforcement
agencies.
undertake stronger efforts to guarantee a free, professional, pluralistic and independent
media environment, notably by ensuring that criminal procedures brought against media
owners fulfil the highest legal standards, and by launching impartial, effective and timely
investigations in cases of threats against safety of journalists and other media professionals;
move swiftly to strengthen the protection of human rights of vulnerable groups, including
by bringing perpetrators and instigators of violence to justice more effectively;
notably consolidate efforts to enhance gender equality and fight violence against women;
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-
-
ensure the involvement of civil society in decision-making processes at all levels;
adopt legislation so that Georgian courts proactively take into account European Court of
Human Rights judgments in their deliberations;
ensure that an independent person is given preference in the process of nominating a new
Public Defender (Ombudsperson) and that this process is conducted in a transparent
manner;
ensure the Office’s effective institutional independence.
The Commission will monitor Georgia’s progress to address these priorities and report on them
by the end of 2022.
The accession process remains based on
established criteria and conditions.
This allows any
country in the process to progress based on own merits but also means that steps towards the
EU can be reversed if the underlying conditions are not met anymore.
18