GILS Dispute Resolution: Georgia (2025)

GEORGIA

Irakli Kordzakhia, Sofia Roinishvili

CASE №1:

Client: American Express

Represented American Express in a competition dispute that may set a precedent by the National Bank of Georgia (a local regulatory) regarding the regulation of vertical agreements in the financial sector.  As a result on July 25, 2025, American Express announced its readiness to open its payment network to all banks in Georgia. The company intends to partner with any banks interested in issuing and acquiring its Global Network cards.

The National Bank of Georgia (NBG) welcomed the decision, calling it a significant step toward promoting effective competition in the country's payment industry. The NBG noted this move aligns with its mandate to ensure non-discriminatory access to payment systems, in line with EU-harmonized legislation.

According to NBG statistics, American Express is the third-largest player in the Georgian market with a 14.6% share (1.5 million cards), behind Mastercard (52% share, 11.3 million cards) and Visa (28% share, 2.9 million cards).

CASE №2:

Client: JSC Silknet

We represent the client in a tax dispute in the first instance court concerning the client's request for a preliminary ruling by the tax authorities regarding the tax implications of a software license agreement. We are defending the client's position that payments made to residents of Turkey and China under this agreement do not constitute royalties and should instead be treated as business profits for the purposes of the applicable double tax treaties.   A key issue for the court to decide is whether the software license agreement involves the transfer of a copyright itself or merely the use of a copyrighted product. As there is no existing court practice on this matter, the case is expected to set an important precedent.