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Posted by Earsbern on the 25th Jan :-

Frontera got another mention, then :-
“the result of this trend is that foreign direct investment in Georgia is on the decline because U.S. and European business interests have been subjected to harassment, contact cancellation and expropriation attack.” A member of Congress said “a notable example of this is the oil and gas company from Houston, Texas, Frontera Resources.”

The business community in Georgia must be worried by now. They have had a series of American congressional letters pointing out that trade and finance will suffer if their country yields itself to the oligarchs, and effectively saying that Georgia's treatment of FRR is an indication of that weakness. I wonder if the US is planning to encourage the protests threatened by the government's opponents from 04/02/20. Wouldn't be at all surprised. A change of direction (or a change of government) is looking increasingly likely IMHO, as is a better outcome for FRR. The story of this company's struggle is nothing short of astonishing.

Posted by Aurora1 on the 25th Jan :-

https://babin.house.gov/

Posted by Ivyspivey on the 25th Jan :-

Again many thanks to Looed for posting lately.
This has been referred to but nit sure if has been published here.

https://i0.wp.com/civil.ge/wp-content/uploads/2020/01/letter-to.png?resize=780%2C405&ssl=1

Posted by Blownitalready on the 25th Jan :-

Congress letters....more reactions
https://www.interpressnews.ge/en/

Posted by Ivyspivey on the 25th Jan :-

Presume you mean this one as I think it is new

https://www.interpressnews.ge/en/article/105513-congressman-pete-olson-the-georgian-people-deserve-better

Posted by Looed on the 25th Jan :-

RE: Newsletter from Congressman Brian Babin
I found another article similar to the first one which it seems I can cut & paste - This is Pt.1
Congressman Brian Babin, a Republican member of the House of Representatives, posts a letter to his Georgian counterpart, George Gakharia, on his Twitter page.
The letter is dated January 23, 2020.
“Dear Prime Minister,
As a member of Congress, I am writing to you today to address my growing concern about Georgia's continued deterioration in democratic values ??and the deteriorating economic prosperity associated with it.
In this regard, I join my colleagues in Congress representing the Georgia group, Chairman Adam Kinsinger and Chairman Gary Connolly, in their recent letter of December 13, 2019, which raised concerns about the decision to reject promised democratic reforms, as well as the related peace issue. Protest a In the aftermath of the violence of information. In addition, I would also like to join my colleague, Congressman McQueen Malin, and the message he conveyed in his January 13, 2020 letter.
As you know, since the independence of Georgia since 1991, the country has been strongly supported by the United States for many years. Last year, the US House of Representatives passed the "Georgia Support Act," currently under consideration in the US Senate. It is worth noting that the most important principle, which was first put forward in the text of this Act, is as follows:

US policy is that to support the continued development of democratic values ??in Georgia, including free and fair elections, public sector transparency and accountability, the rule of law and anti-corruption efforts;
In the spirit of this policy, I am writing to you because of the noticeable negative training in the indicators of a democratic and free market economy in Georgia that has become a matter of concern among members of the United States Congress.
The result of this trend is that foreign direct investment in Georgia is declining as US and European business interests are under attack, harassment, contract expropriation and expropriation. A well-known example of this is Frontera Resources, an oil and gas company from Houston, Texas. It was also disturbing that the US social media company Facebook had just announced that it had discovered and shut down a wide network of accounts affiliated with the ruling Georgian Dream party and found that they were engaged in "coordinated non-verbal activities". In order to have an opposition in Georgia Anti-Western sentiments have been suppressed and promoted, especially against the United States.

Posted by Looed on the 25th Jan :-

RE: Employee protests continue
I can't open that link but this is a longer article from Georgia that covers the same protest. It could be Google Translate but the comments from the workforce etc do feel a bit scripted IMO, though there does appear to be a quote from an FWGL manager?-

Employees of oil company Frontera Western Georgia demand payroll debt. For this reason, about 100 people gathered in Dedoplistskaro. Protesters gathered live chains at the gates. It is said that until the debt is settled, the company will not be allowed to extract oil and continue working in Dedoplistskaro.
Locals also responded to a letter from American congressman Marqueeen Malen, calling it political. The assemblies say they have good reason to suspect that Frontera's CEO, who is currently in America, may have misled Congressman Malin.
"Our Director General is in America and is reporting to Congressman Malin the wrong information about Frontera. It is as if the Georgian government is preventing American companies from operating in Georgia, which is a lie and a lie. On the contrary, the government helps us as much as possible. Starting from here, they are doing so in a political context that is completely unacceptable to us. Someone wants to take advantage of this situation completely. They came here and figured out the situation on the ground, ”say the protesters.
According to Giorgi Janiashvili, the manager of the company, the management of Frontera will fully recover the debts and debts.
Dedoplistskaro Mayor met with the participants of the action. According to Nikoloz Janiashvili, the state has started a dispute with Frontera in international arbitration and hopes that the process will end in favor of employees.
Frontera, a company of 84 employees, has an 11-month debt totaling up to GEL million. Employees sued the company in front of the company a month ago.
Republican Congressman Marcouine Malin, in a letter sent to George Gakharia on January 19, is concerned "with Georgia's shifting democratic values ??and deteriorating economy." According to him, American and European business interests in Georgia were subject to harassment and assault - for example, the oil and gas company Frontera Resources, Texas.

Source - https://imedinews.ge/ge/saqartvelo/126181/pronteras-tanamshromlebi-sakhelpaso-davalianebis-daparvasitkhoven

Posted by Oopsi on the 23rd Jan :-

Transfer
Without knowing the structure of the “transfer/farm out” it is impossible to determine whether it is a breach of the contractual documentation. It is entirely conceivable that the manner in which the “transfer” has been structured (with the assistance of legal advice) is designed to deliberately circumvent the prohibition on a transfer of the asset. The reality is we don’t know. There are some things we do know.

1. It is difficult to act legally once the horse has bolted. Hope would have been in a better position had he had a whiff of the “transfer” before it completed. He could have sought injunctive relief.
2. If the contractual documentation is clear cut in its prohibition on a transfer of the asset then it is strange that it has been over 12 months and the liquidator has not taken any formal legal action to declare the transfer void. Strange. Instead what we have is the liquidator scrambling around in the US. I suspect what they are looking for is for some additional evidence to demonstrate that the intention behind the transfer was to deliberately circumvent Outriders rights rather than a commercial transfer/farm out.
3. Even if the liquidator is successful, its difficult to see how it could be anything more than a pyrrhic victory. If the court in Cayman were to declare the transfer void, so what? I can’t see how the declaration could be enforced without involvement from the courts in Georgia to reverse the transfer. That is a long drawn out process and I can’t imagine it will fill the liquidator with joy to go down this route. An adverse finding from the Cayman court may cause reputational damage to FRR and potentially act as a negative in any third party due diligence.
4. FRR raised no objections in the US to recognition of the Cayman liquidation proceedings.

It seems perverse to say it but the liquidation proceedings are not the biggest challenge facing us presently. The arbitration is. I’ve already said I don’t hold out much hope of success here – just a gut reaction. The arbitrators will provide there award on or around the middle of this year. I hope for our sake that we can do a deal before then.

Posted by Looed on the 24th Jan :-

Part 3
Aside from criticism over economic freedom, the five US congressmen also addressed Facebook’s recent move to shut down a vast network of fake accounts linked to the ruling party, and reports claiming that prosecutors appointed by Georgian Dream had reopened old cases against potential political opponents, as a decline in the country’s democratic values.
Georgia’s domestic politics became turbulent last summer amidst mass protests against the government over its allegedly soft stance on Russia, as well as its backtracking on electoral reforms that would have seen the 2020 general election run under proportional representation. The government was also criticised for appointing Supreme Court judges who have close ties to the ruling party.
As pointed out by Mr Gigitashvili, the latest poll of the US-based National Democratic Institute shows that 59 per cent of the Georgian public does not regard their country as a democracy, with 64 per cent of them assessing the government’s performance negatively. “These figures are much higher compared to previous years and it shows that trust to country’s political institutions is eroding,” he says, underlining that “the key problem is the state capture caused by an increasing informal control of Georgian Dream leader Bidzina Ivanishvili over key state institutions, which undermines the balance between government branches.”
“Most of the key decisions in state institutions are made in favour of certain groups and no longer based on public interest. The government’s recent refusal to switch to a fully proportional system for the 2020 parliamentary elections was an explicit example of this trend,” he stresses.
Responding to the US criticism, the Georgian prime minister said that his government was always ready to discuss such issues with Georgia’s strategic partners.
“Georgia is developing the fastest growing and most stable economy in the region. We will explain this to our friends and colleagues in details, in figures, certain examples and results, which we are achieving together every day,” Mr Gakharia told reporters on January 23.

Source - https://emerging-europe.com/news/is-economic-freedom-in-georgia-under-threat/

Posted by Looed on the 24th Jan :-

Part 2
Likely to be a key topic during parliamentary elections, Anaklia Deep Sea port is the largest infrastructure project in Georgian history and has been repeatedly described as of strategic importance by both the country’s government and the opposition. However, earlier this month, the Georgian government cancelled its contract with the ADC, claiming that it was unable to fulfil its financial obligations.
Last October, Conti Group International, a US-based construction and development company left the consortium, allegedly over a lack of support from the Georgian government.
“The Georgian government’s decision to suspend the construction contract with the Anaklia Development Consortium, in which Conti Group was a member, is definitely an alarming signal in terms of economic freedom in Georgia,” Givi Gigitashvili, a Research Assistant for the Caucasus and the Digital Forensic Research Lab of the Atlantic Council, tells Emerging Europe, adding that the available evidence seems to suggest that cancelling the contract with the ADC was a politically motivated decision about a project, with such decisions “indeed damaging the foreign investment climate in Georgia.”
At the same time, the latest edition of the World Bank’s Doing Business Report says that Georgia is by far the best performer in emerging Europe when it comes to the ease of doing business, with the country ranked seventh of 190 countries.
Mr Gigitashvili says that some Georgian Dream MPs have acknowledged that the project was shut down due to potential threats coming from Russia should construction be completed.
“For the first time in the history of an independent Georgia, our government sabotaged the accomplishment of a large-scale strategic project, which was openly backed by the US government. Regrettably, the fact that the Russian factor played an important role sends a negative signal not only to investors, but to Georgia’s friends in the US and the EU about the country’s reliability as a strategic partner,” he stresses.
Discussing potential sanctions put forward by Congressman Mullin, he believes that the bill, which was introduced over Frontera’s legal dispute with the Georgian authorities, would not gain enough support in the US Congress as it lacks the sufficient number of sponsors. However, the very existence of this bill “is already damaging the country’s image” and gaining more support will likely depend on the final decision taken by the arbitration court in the Hague.
“The fact that arbitration proceedings are pending at an international court gives hope that the decision will be objective,” he says, noting that “it is hard to discuss what impact it can have on bilateral relations between Georgia and the US before the court’s verdict is announced.”

Posted by Looed on the 24th Jan :-

Another article - this time from a UK based operation Pt.1
Is economic freedom in Georgia under threat?
January 24, 2020Dominik Istrate
With Georgia currently preparing for a parliamentary election, the political and economic practices of the country’s government – led by the ruling Georgian Dream party – have again come under scrutiny, this time from US lawmakers.
On January 21, four representatives of the US Congress sent a letter to Georgia’s prime minister Giorgi Gakharia to express their “grave concerns over political targeting and a declining economic trend that spells trouble for Georgia’s path towards democratic reform and Western integration.”
In the letter, co-signed by US House Representatives Adam Kinzinger, Gerald Connolly, Eliot Engel and Michael McCaul, the US lawmakers argue that “Georgian Dream’s perceived political targeting” of the Anaklia Development Consortium (ADC), an international group of companies that were responsible for managing the construction of Anaklia Deep Sea port on the Black Sea has now deterred or prevented investment from American companies.
“These developments seem to reflect an increasingly unfavourable business environment and could deter future US investment in Georgia,” the four US congressmen wrote.
Mr Kinzinger and Mr Connolly are the co-chairs of the influential US House Georgia Caucus, a congressional advocacy group of US lawmakers tasked with fostering relations with Georgia.
The letter of the four US congressmen was published shortly after Markwayne Mullin, a US lawmaker and member of the House Committee on Energy and Commerce, spoke about “a deteriorating economic climate” in Georgia, especially for US companies.
“Recent years have revealed a continued negative trend in democratic and free market economic indicators that has not gone unnoticed in the United States,” Mr Mullin wrote to the Georgian PM, pointing to the case of Frontera Resources, a US-based oil and gas company. In 2018, the company was sued by BIA, Georgia’s national energy company, for allegedly breaching its financial obligations towards the Georgian government.
Mr Mullin states that the voices of concern in the US Congress over Georgia are on the rise, which is the reason why he himself had joined fellow US lawmakers in introducing the Georgia Fair Business Practices Sanctions Act in early 2019.
Besides the US lawmakers, Georgian opposition figures including Mamuka Khazaradze, the former head of the ADC’s supervisory board, as well as the management of the consortium also came out against the Georgian government, saying that they are sabotaging the project.

Posted by Symore_Bottoms on ii on the 24th Jan :-

Isn’t this the continuation of the legal due process in NY? Once the application was made late last year, this was always coming, so shouldn’t have been a surprise. But now we have reached this point, we do need to assess the implications. The court has approved what was requested (uncontested by FRR). So what does this mean? Well, it is giving more powers/access to the Liquidators to follow up all avenues to ‘trace & recover’ assets of FRCC. This also allows them to question Zaza, SN and Levan as part of their investigation. I say good luck with all that FTI/Hope. Plus, reaching Levan and Zaza could be tricky as they are not US citizens. Let the ‘goose chase’ begin, and during all this time, costs are being incurred by FTI; either Hope continues to fund that, or they will have to throw in the towel because money has ran out.

The bigger issue/risk remains on the Arbitration and this was evidently obvious with the Open letter to the Georgian PM from the US-House of Congress. And has it kicked up a right fuss. The PM has now officially responded from Davos, so let’s see where we go from here. But it’s clear that Ivanshivili is pro-Russian while the whole country is pro-West.

interpressnews.ge 1

Giorgi Gakharia on the Congressmen’s letter: We can objectively discuss all...

We are always ready to sit down with our strategic partners and speak about all issues calmly; letters may not be the best form of communication between the strategic partners and friends,
I have to also admit I am at a loss as to why everyone is fighting so hard to get the Block(12) back if it is empty (according to the Georgians themselves). So, if FRR is financially weak and at risk of losing the PSA, why would Hope not try to reach a settlement before it’s too late? Why is he still fighting so hard via FTI? Then you have the Georgian Govt who have hired some of the best lawyers to represent them at the Arbitration. Again, if FRR is weak, would it not be best for them to let them die slowly, rather than risk a political fallout with FRR?

On the PSA, I believe it was legitimately ‘farmed out’ - not transferred (big but subtle difference). If that is the case, then this required Georgian Govt approval. But if FTI are going to contest the farmout, then that could also be a long and costly process - roll out the industry experts.

On the Arbitration, my confidence is ebbing, mainly because of the ‘hard nosed’ approach taken by the Georgians but also by the exquisite timing of Senator Mullin’s letter (to put some pressure on the Georgians).

JMO

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