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Pt.4 (and final part)

(KK) - If we follow how and what statements they made and how they tried to sell this information, I have the impression that they are either very incompetent and do not understand what they are talking about, or do not know English well and can not read the document or deliberately make these statements to the detriment of countries for their personal political reasons.

(J2) - In fact, under the bill, our country will receive at least $ 132,025,000 from a strategic partner, and the fate of 15% of that aid will be decided by the State Department. The State Department should report on whether Georgia is working to strengthen democratic institutions in the fight against corruption, the rule of law in the private sector, and the protection of foreign investment in the country.

(GV) - This congress will be based on the report of the State Department and not only on the topic of Georgia. The rule and number is as follows. Can you help everyone? But, the record of that is in the report card and this part of the report card is actually done by people who are interested in our interests.

(J2) - Why is the National Movement and its split party trying to undermine the strategic partnership? The ruling team has one answer - narrow party interest. And, in some cases, possibly individual American politicians as well.

(GV) - Isn't this a connection of interest, say, between Frontera lobbyists and our opposition? Isn't this the interest of the people who come out today as if they were defenders of democratic institutions and its guardians? Exactly, they are with their lobbying groups.

(J2) - The case of Frontera is a classic example. It is a documented fact that the congressmen who talk about the deterioration of the business environment in Georgia because of "Frontera" are in fact open lobbyists of this company. The document shows even more. For example, the author of critical letters and statements to Georgia, Texas Congressmen Marquin Malin, Brian Babin and Pete Olson, have been receiving donations from Frontera in recent years. However, in all cases, the Georgian side still has to contact all interested parties and explain the real situation. Precisely because Georgia is a strategic partner of the United States and it is important to have accurate information about our country.

https://www.youtube.com/watch?v=HI4IgmD29rw&list=PLMys-CD6bNrJmlrUh8D8n0PDNVYFvOqs6

Pt.3

(KK) - If we follow how and what statements they made and how they tried to sell this information, I have the impression that they are either very incompetent and do not understand what they are talking about, or do not know English well and can not read the document or deliberately make these statements to the detriment of countries for their personal political reasons.
In fact, under the bill, our country will receive at least $ 132,025,000 from a strategic partner, and the fate of 15% of that aid will be decided by the State Department. The State Department should report on whether Georgia is working to strengthen democratic institutions in the fight against corruption, the rule of law in the private sector, and the protection of foreign investment in the country.

Giorgi Volsky, First vice speaker of Parliament, (GV) - This congress will be based on the report of the State Department and not only on the topic of Georgia. The rule and number is as follows. Can you help everyone? But, the record of that is in the report card and this part of the report card is actually done by people who are interested in our interests.

(J2) - Why is the National Movement and its split party trying to undermine the strategic partnership? The ruling team has one answer - narrow party interest. And, in some cases, possibly individual American politicians as well.

(GV) - Isn't this a connection of interest, say, between Frontera lobbyists and our opposition? Isn't this the interest of the people who come out today as if they were defenders of democratic institutions and its guardians? Exactly, they are with their lobbying groups.

(J2) - The case of Frontera is a classic example. It is a documented fact that the congressmen who talk about the deterioration of the business environment in Georgia because of "Frontera" are in fact open lobbyists of this company. The document shows even more. For example, the author of critical letters and statements to Georgia, Texas Congressmen Marquin Malin, Brian Babin and Pete Olson, have been receiving donations from Frontera in recent years. However, in all cases, the Georgian side still has to contact all interested parties and explain the real situation. Precisely because Georgia is a strategic partner of the United States and it is important to have accurate information about our country.

Pt.2

(J2) - Staffers are those whose information is relied upon in various reports and letters by congressmen and senators. As it turned out, the National Movement pays a lot of money for informing them. This is also an official document. It states that the National Movement pays the PR company $ 250,000 for lobbying in America. The contract is for 1 year and expires in October 2020. Under the agreement, lobbyists are not only required to send letters. They have to plan meetings for the guests from Georgia. For example, this group, which held meetings in the United States last December, was commissioned by the National Movement and organized by American lobbyists.

Kakhaber Kuchava, Deputy Chairman of Parliament, (KK) - You can not play with the strategic partner of the country on such sensitive issues because of your personal goals. Here we are talking about the unprecedented high level of relations between the American and Georgian peoples, the unprecedented high level of cooperation and partnership between our countries, which has the status of a strategic partnership, and thus speculating to achieve your personal party goal is really detrimental to the country.

(J2) - Kakha Kuchava, who often communicates with his American counterparts, is well acquainted with their attitude towards Georgia. In the interview, he explains how the efforts of individual political forces could affect, not the Georgian Dream government, but the whole country.

Giorgi Gakharia, Prime Minister of Georgia, (GG) - Due to some of our so-called politicians, there are attempts to involve our foreign partners in these internal political controversies. This is bad because in the end, it does not hurt any political force, in the end it hurts the country.

(J2) - Examples, unfortunately, have accumulated a lot. The United National Movement and European Georgia present the criticism of Georgia, which, as it turned out, is often written in various documents through their efforts, as their personal victory.

Irakli Beraia, (IB) - This on their part, of course, is not surprising because these are ordinary pests and they are ready to harm and destroy the whole country for their own narrow personal interests.

(J2) - Often their attempts actually hurt the country. However, more often than not they just show that the relationship between the government and the strategic partner can no longer go the old-fashioned way. A recent example is the draft law, which, among many other topics, discussed the terms of financial assistance to Georgia. The project is still at the committee level and has a long way to go, but the destructive opposition is trying to present as if the United States has reduced its aid to Georgia by 15% and this is an already resolved issue.

(A very pro-Govt point of view, on and on about lobbyists)

Pt.1

Journalist 1 (J1) - The former government team is celebrating and spreading false information, as if the states have reduced financial assistance to Georgia by 15%. However, the reality is quite different. There is a record in the draft state budget of the United States for 2020-2021, according to which more than 132 million dollars will be allocated for Georgia. However, there is also a condition that 15% of aid should be suspended until the State Department finds that the independence of institutions, the democratic environment and anti-corruption regulations in Georgia have improved. We are now talking about a project that has a long way to go before it can be approved and eventually signed by President Trump. Probably everyone is wondering how and why this condition appeared in the budget bill. Let us recall the processes that preceded this, but with specific documents, and openly state who is trying to discredit Georgia in the United States. We have reviewed the document published on the website of the Department of Justice of the United States, where the terms of the agreement between the National Movement and the lobbyists and the activity report are published. After getting acquainted with this document, it is easy to understand who provides US congressmen, senators, and international research organizations with incorrect information about Georgia. Lobbyists have a direct indication from customers that these people and organizations should talk about anti-democratic processes in Georgia and pay hundreds of thousands of dollars for it. See the harmful games of anti-democrats for the country.

David Zalkaniani, Minister of Foreign Affairs of Georgia, (DZ) - Here it is. Randy Scheunemann send e-mail to Sebastian DeLuca who is the staffer of Kinzinge, and it is indicated right in the subject: anti-democratic developments in Georgia. More emails from Randy Scheunemann, in this case to the staffer of Senator Risch. Scheunemann once more… Scheunemann… Scheunemann…

Journalist 2 - (J2) - Together with the Minister of Foreign Affairs, I am reading a report on the activities of American lobbyists commissioned by the United National Movement. A document released by the US Department of Justice details who the lobbyists met and what they talked about. According to the report, their main goal is to convince US congressmen and senators, as well as large organizations, which Georgia is developing in an anti-democratic way. The task is being done by Randy Scheunemann and Michael Mitchell, longtime UNM partners who have been meeting for months and sending emails with information that is damaging to Georgia.

DZ - This is the order of a particular political party. This is their lobbyist, and he gets paid for it, and, naturally, whatever this political party orders, he tries to bring this narrative to the relevant staffs of Congress and the Senate.

Pt.5

7. What was going in the first and second instance?

From June 2016 to April 2019, the Tbilisi City Courts never rendered a decision against us, but also refused to consider our arguments defending the company. Therefore, through some sort of mechanism, our opponents were able to terminate our business activities in Georgia with no evidence that we broke the law.

After coming public with our story in March 2019 on the Rustavi Ori channel, and after starting international arbitration proceedings against the government of Georgia in November 2018, the Tbilisi City Courts rendered a decision in our favor in April of 2019. However, our victory was short lived, as our opponents appealed the decision twice: to the second instance (the Appeals Court), and now to the Supreme Court of Georgia. Our opponents lost the appeal in the second instance court and we are currently waiting for a major decision from the Supreme Court in or around June 14th of this year.

8. As we know, have your foreign lawyers appealed to the UN International Arbitration Court?

In 1994, the U.S. and Georgia signed a bi-lateral investment treaty. A primary aspect of this treaty includes certain guarantees for American investors operating in Georgia, as well as reciprocal protections for Georgians investing in the U.S. Such guarantees, which we believe that the government has violated, includes protections against expropriation of businesses and their assets, security guarantees, protection against discrimination, and also guarantees of fair treatment by the local justice system.

Due to the ongoing attacks against our company (and even against myself personally), and with little to no results appealing to the local authorities and courts, we were forced to take this drastic action in 2018 in order to protect ourselves and our American investors back home.

We have retained an American law firm out of Switzerland who specializes in international arbitration cases and investment treaty violations. Our U.S. lawyers filed a Notice of Arbitration against the government of Georgia in November 2018, and in early 2019, they retained a U.K. based law firm to respond to our complaint. This arbitration claim was to begin legal proceedings in an international arbitration court (to be chosen at a later date) under “UNCITRAL” rules (United Nations Commission on International Trade Law).

Out of professional courtesy to our colleagues in the Georgian government, we have temporarily halted these legal proceedings while waiting for the final court decision from the Supreme Court of Georgia. The decision to accept or reject our opponents’ false and frivolous appeal is on or around June 14th, 2020, and we expect such a decision to be made with transparency, fairness, and under the standards of Georgian and international law.

Pt.4

5. When and i under what circumstances you had been asked to give money as a cash, in exchange of no longer having a problem building a building?

During the previously mentioned summer 2015 meeting at the City Hall, which was arranged by former Mayor David Narmania, several of our opponents attending the meeting demanded that we surrender our territory to them and cancel our business plans. One of the English speakers present, Leri Shaftal, stated that he and his colleagues would abandon their attacks on our company if we would agree to purchase all of the flats that they owned in the neighboring building. The approximate cost of making such a purchase was over 1,000,000 GEL.

Naturally, this was unacceptable to us, so we refused this gesture in totality, then the attacks from the neighbors continued to intensify.

6. In 2016, by the mediation of the Ministry of Foreign Affairs and the US Embassy, the City Hall still gave you construction permit , but the dispute continued in court. Who appealed the court for the first time?

The Ministry of Economy, U.S. Embassy, and City Hall reviewed our situation and worked together to issue us our construction permit, over the objections and complaints from our opponents. However, as we started our construction process, the neighbors sued us for the first time in June 2016. The Tbilisi City Courts immediately issued an order to freeze our business indefinitely, while we were given no opportunity to fight the freeze in court or defend ourselves.

We have been fighting the court ordered construction freeze, and the attempt to cancel our construction permit, for the past four years until now. Throughout the court process, every instance of court agreed to continue the construction freeze indefinitely, though they refused to inform us of what we did wrong: or if we broke any laws or regulations. We spent countless time and funds to provide hard evidence, reports, and documentation to defend our business and to refute the false claims made against us by our opponents in court. In fact, a large amount of our documentation were conclusions from the semi-governmental Levan Samkharauli Forensics Bureau. However, the courts refused to review or comment on our evidence and continued the construction freeze again and again.

In February 2018, Judge Levan Murusidze of the Tbilisi Appeals Court also upheld the construction freeze against us, while also noting that he felt our business should continue to be stopped due to his “personal feelings.” Other than stating his personal feelings, Murusidze wrote no other reasons or precedents rooted in Georgian law. Additionally, Murusidze violated our investor’s rights by blocking our request to counter-sue our opponents and ask for financial damages.
Since originally suing us in June 2016, our opponents have kept attacking us in court, and in the meantime, our business has continued to be stopped due to the original 2016 freeze order from the Tbilisi C

Pt.3

We additionally offered to build major infrastructure in the area, which by special agreement with our company, would be available and free for them and the entire community to use. This infrastructure included converting large parts of the territory from barren, dirt areas to green zones containing fruit trees and pine trees.

Lastly, we tried to convince them that our construction process would be swift, and we would take special care not to interrupt their daily lives. We also explained that we would be building special roads and access ways to the territory that they could use to easily and conveniently access their homes and parking areas.

Unfortunately, upon starting the meeting, it was clear that our opponents had no interest in hearing anything we had to say. They also verbally insulted and threatened us. Among the group of neighbors were in attendance businessman Leri Shaftal and Supreme Court Judge Giorgi Shavliashvili. During this meeting, and in front of my entire staff, Shavliashvili verbally threatened the Deputy Chief Architect of the City Hall, and also myself. He identified himself as a judge, and informed the City Hall that “there would be a price to pay” if they would allow “the Americans” to continue our business plans. He also threatened me personally and promised that he would never “allow” us to build on our own territory.

Needless to say, the meeting was non-productive and overall was a failure. After the meeting, our opponents decided to escalate their attacks, which ended up in two lawsuits against us in the years to come.

4. The agreement did not take place even though you not only agreed to build the square, but also to repair and paint the facade of their building and make the swimming pool?

During the 2015 meeting, our opponents stated that they wanted our land to be used as a green square and a swimming area for their private use. We agreed to provide this infrastructure, and in fact, such amenities were already promised within our construction documents and business plan.

In addition to the green area and swimming pool, we promised to build a hypermarket, kindergarten, and fitness gym within our project. In the spirit of compromise, we also offered to provide lifetime access to these amenities to our neighbors, for free.
We also offered to pay for the repainting of their unfinished building and to repair their elevators, which at the time were in dire need of repair and were dangerous for them and their children to use. The approximate costs of such services were more than 100,000 GEL.

Our opponents refused all such offers and continued to insist that we abandon our business in Georgia and leave immediately. Some of them also asked us to surrender our territory to them as a gift, without financial compensation.

During the previously mentioned summe

Pt.2
The first benefit that we presented to our opponents at the City Hall was the securing and cleaning of the entire territory: which for years acted as an open air garbage landfill, attracted wild animals and vermin, and was a dangerous site at night being frequented by drug users and prostitutes.

We secondly offered to help renovate their own building and homes, which is currently still under the legal status of “arashenda” with the City Hall. We also offered to repair their elevator systems, which at the time was in dire need of repairs.

We additionally offered to build major infrastructure in the area, which by special agreement with our company, would be available and free for them and the entire community to use. This infrastructure included converting large parts of the territory from barren, dirt areas to green zones containing fruit trees and pine trees.

Lastly, we tried to convince them that our construction process would be swift, and we would take special care not to interrupt their daily lives. We also explained that we would be building special roads and access ways to the territory that they could use to easily and conveniently access their homes and parking areas.

Unfortunately, upon starting the meeting, it was clear that our opponents had no interest in hearing anything we had to say. They also verbally insulted and threatened us. Among the group of neighbors were in attendance businessman Leri Shaftal and Supreme Court Judge Giorgi Shavliashvili. During this meeting, and in front of my entire staff, Shavliashvili verbally threatened the Deputy Chief Architect of the City Hall, and also myself. He identified himself as a judge, and informed the City Hall that “there would be a price to pay” if they would allow “the Americans” to continue our business plans. He also threatened me personally and promised that he would never “allow” us to build on our own territory.

Needless to say, the meeting was non-productive and overall was a failure. After the meeting, our opponents decided to escalate their attacks, which ended up in two lawsuits against us in the years to come.

4. The agreement did not take place even though you not only agreed to build the square, but also to repair and paint the facade of their building and make the swimming pool?

During the 2015 meeting, our opponents stated that they wanted our land to be used as a green square and a swimming area for their private use. We agreed to provide this infrastructure, and in fact, such amenities were already promised within our construction documents and business plan.

In addition to the green area and swimming pool, we promised to build a hypermarket, kindergarten, and fitness gym within our project. In the spirit of compromise, we also offered to provide lifetime access to these amenities to our neighbors, for free.
We also offered to pay for the repainting of their unfinished building and to repair their elevators, which at the time were in di

Pt.1

This is a recent and quite long interview with Seth Char but it shows the extraordinary challenges they continue to face. It starts with a discussion on the origins of the project and then goes on -

2. This should have been the first construction project of the skyscraper in Georgia, which failed due to completely absurd reasons. Did the Tbilisi City Hall give you permission to build almost without any problems, until several neighbors from the next building complained and demanded to build a garden on your land ?

The factual reasons that stopped our construction for five years, terminated the jobs of several of our Georgian employees, and caused our initial business plan to fail were indeed absurd: perhaps the word “absurd” is an understatement. The reasons for attacking our company, as presented by our opponents (and later accepted by the courts) included frivolous claims, such as: our American inspired building design was too ugly for the tastes of our neighbors, and that our construction activities would be blocking their parking areas. In actuality, our opponents have expropriated our construction site for their own use and have been using it for illegal parking and private business since 2015. As for their first claim, their design opinions about having an American style premium skyscraper nearby is not a legal argument to stop an American investor for five years; at least, it’s not a valid argument under international and Western standards.

The Tbilisi City Hall, under David Narmania, gave us construction permission not once, but twice, to construct our project. On top of that, today’s City Hall under the leadership of Mayor Kakha Kaladze reviewed our construction permit and reaffirmed its legality and validity in the Tbilisi City Courts.

Since 2015, through the process of receiving our first construction permit, our neighbors and opponents attempted to cancel the construction permit by applying political pressure on the City Hall. Throughout this process, they also demanded that I abandon my business in Georgia and allow them to build a private garden and swimming pool instead (on my privately owned land). Naturally, such a proposition was unacceptable, so my staff and I attempted to negotiate an amicable compromise with them, to no avail.

3. Why there was no reconciliation between you and your neighbors when Tbilisi Mayor was the initiator of resolving the conflict in 2015 and both sides invited you to join?

In the summer of 2015, Mayor David Narmania called our team and our opponents to the City Hall for a negotiation, in an attempt to resolve our differences. My lawyers, architectural team, and myself came totally prepared to this meeting with technical and legal documents. Our intention was to introduce ourselves to our opponents face to face and present our exact community plans, and the benefits that would be offered from our plans.

Pt.3

What the West fails to appreciate -

Western officials, with the reverence for the rule of law, tend to have trouble recognizing power plays disguised as legal actions, say experts in post-Soviet legal culture. Yet the practice of “legal” corporate raiding — called Reiderstvo — has been fairly common for at least a decade, they say. As Thomas Firestone wrote in a 2008 article for The International Lawyer, “Russian ‘reideri’ rely on court orders, resolutions of shareholders and boards of directors, lawsuits, bankruptcy proceedings, and other ostensibly ‘legal’ means as a cover for their ... activity.” The Georgian provision for a special administrator — validated by the local Supreme Court — is one such example.

As court cases rumble on, a new issue pops up -

Several of fifteen miners of the Georgian Manganese in Georgia's western town of Chiatura have sewn their mouths in protest as the company refuses to fulfil their demands regarding increased salaries. The miners went on strike on May 15, demanding a 50 per cent increase in salaries, improved healthcare, working conditions and nutrition and banning the movement of the company’s heavy vehicles in the town, polluting the environment.

This didn't stop the Georgian Govt pimping out GAA as a success story earlier this year -

US involvement can be seen across the whole economy, from extraction and export, oil and gas, transport and logistics, energy, tourism, and retail. To run through a few examples, manganese has been Georgia’ the biggest export category for 5 of the last 10 years, responsible for $2.1 billion in exports from 2006-2015. Most of that has been done by Georgian American Alloys, a Florida based company.

There is more murkiness, such as a GAA lawyer arrested on corruption, ex-Govt ministers appointed to the BOD, but the company does seem to be active and still doing business

All this has been cherrypicked from these articles -

https://gaacc.ge/blog/georgian-market-potential/
https://agenda.ge/en/news/2019/1362
https://www.neweurope.eu/article/georgia-just-expropriate-us-manganese-mine-operation/
https://www.miamiherald.com/news/business/biz-monday/article172421852.html

Pt.2

The company makes it political -

Representatives of the company claim that thousands of jobs in Georgia are jeopardized as well as the rule of law is. Moreover, owners of the company state that their urge towards cooperation with the government has been undermined. “Our company is the largest employer in the country and, until recently, we had positive relations with the government of Georgia. Since the day of its foundation, Georgian Manganese has invested hundreds of millions of dollars and created thousands of jobs in Georgia.
Regrettably, taking into consideration the latest developments, this urge towards cooperation with the government has been undermined and we have become victims of decisions, which are incompliant with the principles of the legislation of Georgia, international law and international business society. Thousands of jobs in Georgia are at risk, as is the rule of law, international reputation of Georgia and row material supply of USA for still production, which is extremely important for the national security of USA.

The media picks it up -

the sticky combination of far-flung geography, diplomatic interests, behind-the-scenes politics and the inscrutable influence of wealth has resulted in an imbroglio worthy of an espionage novel, complete with government stonewalling, powerful oligarchs, toxic waste and a holiday-weekend corporate grab.

Court cases and possible Arbitration -

In hindsight, company officials say they should have seen this coming. The first shot over the bow was suddenly getting slapped in 2015 with an $89.7 million tax assessment based on a range of claims that the company considers arbitrary and groundless. Almost half the bill, say company executives, was based on counting mining waste as inventory because it contains some unsellable ore residue. After GAA complained about the tax assessment, four separate criminal investigations were opened against the company and its executives in Georgia. Inquiries also were launched in Switzerland and Luxembourg — probes the company insists were a “fishing expedition” and a “transparent attempt to intimidate ” the company, according to a company submission to the U.S. Treasury made by global law firm Baker McKenzie, which also claims those inquiries came at the behest of the Georgian government. The investigation includes allegations that GGA committed tax fraud and money laundering.

To company officials, the timing of the May 2017 order is also suspicious. It came just days after GAA informed both Georgian officials and the U.S. Treasury that it was considering seeking international arbitration on the 2015 tax matter under a bilateral investment treaty. “Given the timing of this egregious and alarming development, there can be little doubt about its retaliatory nature,” said an updated company submission to Treasury. “This action in itself constitutes an expropriation of GAA’s investment.”

Pt.1

The recent statement by Iconia Capital references two other companies - FRR and Georgian American Alloys (GAA). This is a quick recap of their story.

About GAA - Georgian American Alloys, Inc. (“GAA”), headquartered in Miami, FL, manufactures and supplies high quality ferroalloys used in the manufacturing of iron and steel through wholly-owned US-based subsidiaries Felman Production, LLC, Felman Trading, Inc., and CC Metals and Alloys, LLC and its Georgian-based subsidiaries Georgian Manganese, LLC and Vartsikhe 2005, LLC. Georgian Manganese’s Zestafoni ferroalloy plant is a major producer of high-grade and regular-grade silicomanganese. Its Chiatura manganese mining operation includes seven mines and eight quarries. GAA employs approximately 6,000 persons in Georgia."

Then this happens -

"The Georgian have summarily expropriated operations of Georgian American Alloys, after the Ministry of Environment and Natural Resources of Georgia intervened to appoint the head of the private company. The move came after a Tbilisi city court verdict found that the company had created “grave ecological conditions” in a town in Georgia"

The Company responds -

The Company asserts that the environmental claims are based on unlawful, arbitrary and discriminatory application of Georgian environmental and other laws. The law does have a provision for a government mandated environmental administrator in extreme cases. However, in this case the court granted the environmental administrator control over all aspects of the company, including production,financial and Human Resources. The right to act in the place of the Management Supervisory Board and the Shareholders.

Alarm bells are raised -

The question raised is not just one of rule-of-law, and the potential abuse of power, but whether there can be at any point enough justification for seizing, via an ex parte order issued in one day, a multi-hundred million dollar investment based on alleged environmental harms that, according to Georgia’s own court submission in support of the Takeover Order, had been occurring for “several decades. But as Georgia edges closer to the European Union, with the EU-Georgia association agreement coming into force less than one year ago, the government intervention in a private company has raised alarm bells in Brussels.

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