The policy makers of post-Soviet states as well as prominent thinktanks and independent researchers constantly refer to the exceptional case of Georgia. This country, located in the heart of the Caucuses, has much in common with Ukraine, but has definitely moved ahead with its reform ambitions and transformations.
Alexander Bolkvadze, founding partner of BLC Law Office, answered questions which are very sensitive for Georgian lawyers, and shared insights of the IBA ECA Forum to be hosted by his firm in Tbilisi in November.
Olga Usenko: How has the Georgian legal market evolved over the last few years?
Alexander Bolkvadze: The Georgian legal market is on a constant evolution path: we are witnessing the appearance and some disappearance of law firms: Dentons has replaced DLA Piper, Dechert has left the market and was replaced by the Georgian firm MG Law. Few new Georgian law firms have appeared with the ambition of having their own slice of the market. Law practices of auditing firms are growing bigger. As for us, we are happy to have our position for many years now in the first tier according to international legal guides – Chambers Global, Legal 500.
O. U.: What lags behind current developments?
A. B.:It is worth mentioning that for years the government conducted tenders for legal services unfairly and unjustly. Namely, all government contracts for legal work were given to one or two economic agents – internationallaw firms. Georgian law firms were left in the cold with nothing. Please note that these international law firms were paid from the state budget, from Georgian taxpayers money. Our law firm came with the initiative of rebuffing such (in our view) unlawful practices. We are united in this fight with other Georgian law firms through the Georgian Law Firms Association.
O. U.: Yes, but international law firms are usually hired for legal work of a cross-border nature that local law firms cannot offer without hiring firms in other jurisdictions. How do you envisage changing this?
A. B.: All legal matters that are connected with Georgia contain local legal elements, whether this is transactional or dispute resolution work. Accordingly, Georgian law firms have to be considered for a chunk of work. In addition, leading Georgian law firms have developed solid partnership networks with international law firms. Accordingly, if Georgian law firms are involved, they will be able to find a proper international law firm as a partner for specific work. It would be more cost effective and fair as far as distribution of work is concerned. Furthermore, please note that in the past the Government would give a lucrative contract to an international law firm through the so-called “direct and simplified procedure”. This administering of Government money is unlawful and raises a lot of corruption related questions.
O. U.: Which legislative changes in your country do you consider to be the most important?
A. B.: Georgia has very modern laws. The process of legal reform took place at the beginning of this century. Nevertheless, currently, in order to adhere to the requirements of the Deep and Comprehensive Free Trade Agreement with the EU, we are bound to undertake approximation measures. That is, to bring Georgian law to EU standards. Bearing this in mind we have undertaken Pension Reform, amended the Labor Code, drafted amendments to the Competition Law, State Procurement Law, Bankruptcy Law, etc.
O. U.: What are the main sources of client work for your firm?
A. B.: Our firm has been developing along with the Georgian economy by following the demands of the market. Up till now, several areas of practice have been dominant: real estate and construction, banking and finance plus capital markets transactions, energy (especially hydropower development) and litigation. Therefore, in this line, these practices are the most developed in our firm. Nevertheless, our firm is a general practice law firm, and we provide services in all areas of law. We currently have 23 lawyers, which makes us one of the biggest firms on the market.
O. U.: What is the geographical breakdown of inbound investment?
A. B.: If we take countries of the former Soviet Union as a region, where people can communicate in Russian, we have Kazakhstan and Russia as the leading investors. They have invested heavily in the energy and infrastructure sectors. Apart from this region, Turkey is a standalone leader. Turkish companies have invested massively in the hospitality business, real estate and construction. They were initially very active in hydropower development sector, though to a lesser extent now. There are also a fair number of European investors in the retail/distribution sectors, etc.
O. U.: Do you have requests from Ukraine?
A. B.: Unfortunately, not many. We work in the main with Arzinger, where Lana Sinichkina is the main contact. We would appreciate more communication and work with Ukrainian law firms.
O. U.: It’s a good point to get to know the Ukrainian legal community. By the way, this autumn your firm will once again host the IBA ECA Forum in Tbilisi. What is its main purpose?
A. B.: Yes, indeed. We are happy to say that the Georgian legal community is hosting IBA Europe – Caucasus – Asia Forum this year. This event will take place on October 31 — November 2 in Tbilisi. Our firm is part of the Host Committee, where there are also other Georgian Law firms: BLB, BGI Legal, Nodia, Urumashvili & Partners, and Gvinadze&Partners. The agenda of the conference is very, very interesting. I call on all law firms in the region (especiallythe former Soviet Union) to participate in this event. We will discuss important aspects of cooperation, rule of law, interrelationships. The aim of all this is to improve communication and develop business. Please note that the President of IBA – Mr. Horacio Bernardes Neto will be present at the Forum.
All participants need to register through the IBA for this particular event. We are keen for this event to be a success.