The Ministry of Justice is increasing the budget by GEL 1 million to GEL 66 million for hiring lawyers in international courts, - according to the National Agency for State Procurement.
As of the document, GEL 65 million was allocated for hiring lawyers in 2024, which was not enough, so an additional GEL 1 million was added late this year.
It is unknown whether this is related to the decision of the International Chamber of Commerce Arbitration Tribunal in favor of company ENKA. As a result of, the Georgian government will be required to pay USD 383 million to ENKA in compensation for force majeure and breach of contract in the Namakhvani project.
The government's interests in this dispute were defended by the international company White & Case, whose fees paid to its lawyers in this dispute have so far amounted to GEL 25 million. According to the government, the discussions on the case are ongoing.
"Amendments were made to the appropriations bills approved by the 2024 annual budget and GEL 1,000,000 was added to the existing GEL 65,000,000 for the procurement of legal services. GEL 60,674,198.83 has been spent since January 2024. Taking into account the above, the remaining resources for the reimbursement of services to be provided by the end of the year (according to the submitted invoices) and arbitration expenses within the framework of the current agreements are insufficient and an additional GEL 1,000,000 is required," the Ministry of Justice stated.
The Georgian government is involved in about a dozen investment disputes, with a total compensation claim of USD 1.7 billion. The Ministry of Finance writes about the risks arising from losing these disputes in the Fiscal Risk Analysis document for the 2025 budget.
The Georgian government is spending millions of GEL on hiring lawyers in these arbitration disputes. Since 2020, the amount paid to lawyers has been GEL 230 million, including the most expensive contracts signed with the international law firm White & Case, for which the Ministry of Justice has paid GEL 171 million since 2020. GEL 31 million was paid for the services of the law firm AARPI, and GEL 25 million was paid for the hiring of Dechert.
As of now, Georgia’s arbitration disputes fall into two categories: one is investment disputes between international companies and the Georgian government, and the other - disputes between the Georgian government and defaulting infrastructure contractors (mainly on road projects) who have failed to fulfill their obligations.
Compensation required in several arbitration disputes:
- “Zaza Okuashvili vs. Georgia” - compensation sought in the lawsuit is USD 328.2 million;
- Magti holder companies – “TELCELL WIRELESS LLC” and “INTERNATIONAL TELCELL CELLULAR LLC” – compensation sought in the lawsuit is USD 154 million;
- ENKA Renewables vs. Georgia, compensation sought in the lawsuit is USD 383.2 million.
