Party property and state funding
The property of a party is formed by membership fees, donations and, in the cases established by law, funds allocated by the state. Only that sum of money which has been paid in the form of a membership fee in accordance with the law, and whose exact amount is fixed in the party's charter, is considered a membership fee. As for state support, a sum is allocated annually from the state budget of Georgia for the financial support of the activities of parties and for the development of the party system.
Donations and membership fees: prohibitions and limits
The law defines precisely from whom donations may not be received. It is impermissible to receive a donation:
- from a physical person who is not a citizen of Georgia;
- from a person in respect of whom a decision envisaged by the Organic Law on the Constitutional Court of Georgia has been adopted;
- from a legal entity registered in Georgia or outside Georgia, and/or from another form of association of persons;
- from a public institution;
- from a constituent subject of the system of state power of another state;
- anonymously.
Monetary limits are also defined. The total amount of donations received by a party from each individual citizen of Georgia during a year must not exceed 60 000 lari, while the annual amount of membership fees paid by each individual member of the party must not exceed 1 200 lari. The total amount of expenditure incurred by a party during a year must not exceed 0.04% of Georgia's gross domestic product of the previous year; included in that amount are also expenses incurred by another person for the party and for its benefit, which have been established by the State Audit Office and about which the respective party is notified. The restrictions established by this chapter also extend to a person who has a declared party-political goal of their own and uses appropriate financial and other material resources to achieve it.
A party is prohibited from transferring, directly or indirectly through a candidate, a representative or another person, money, gifts or other material or non-material values to a citizen of Georgia (except for low-value campaign accessories of the party — T-shirts, caps, hats, flags and other similar items), from selling or supplying goods or services at a discount or on preferential terms, from purchasing goods or services above the market price, from supplying or distributing goods or services free of charge (save for the exceptions envisaged by this law), and from inducing a citizen's interest through the provision or promise of money, securities, material or non-material values or services — including through the creation of fictitious employment or other relations.
Reporting: monthly information and the annual financial declaration
Every month, information on donations received and on membership fees paid must be submitted to the State Audit Office no later than the 15th day of the month following the reporting month. By 1 February of each year, the party sends the State Audit Office the financial declaration for the past year, together with the conclusion of an auditor (audit firm); copies of the declaration and the conclusion are sent to the local tax authority at the party's legal address.
The declaration reflects the party's annual income — the amounts of membership fees and donations, the identities of the persons who paid the membership fees, data on the subjects who made the donations, and the funds allocated by the state — and its expenditure: expenses on elections, on the financing of various events, on remuneration and official travel, and other expenses. A report on the party's property is also presented: the number and types of owned buildings and vehicles, their total value, and the amounts of money held on accounts in banking institutions. The rules for ensuring the transparency of data on a party's financial condition and on the making of donations are established by the State Audit Office; it is also entitled to develop the form of the party's annual financial declaration and of the electoral-campaign-fund report, and to set the standards for auditing party funding.
Monitoring and audit by the State Audit Office
The monitoring of the legality and transparency of a party's financial activity is carried out by the State Audit Office. It is entitled to verify the completeness, accuracy and legality of the financial declaration and of the electoral-campaign-fund report, to request information on the finances of a party, a party member or a person with a declared party-political goal, and to conduct an audit of a party's financial activity no more than once a year. Where a well-founded suspicion of unlawful financial activity exists, the Office applies to a court with a demand to conduct an extraordinary financial audit. For monitoring purposes the Office may question a physical person according to the procedure established by this law, examine a person before a magistrate judge in accordance with the Administrative Procedure Code of Georgia, and request necessary information — including special-category personal data, other personal data and secrets (except for state secrets under Georgian legislation) — from a public institution, a physical or legal person (including a payment-service provider) and any other subject. Data that is not public information is requested on the basis of a court decision, and the court adopts a decision within 48 hours of the submission of the application. Administrative proceedings in the exercise of this competence must not last longer than 3 months; the Auditor General may, where necessary, extend that period by not more than 3 months. Every subject from whom the Office requests information is obliged to submit the information at its disposal.
Liability and sanctions
If a party fails to submit the financial declaration to the State Audit Office in due time, the Office will warn it in writing and demand that the defect be eliminated within 5 days. If, after the expiry of 5 days, the party still does not submit the financial declaration, it loses the right to receive state funding for the next 1 year. If a party does not submit the financial declaration to the State Audit Office for 2 consecutive calendar years, or if in every such declaration submitted for 2 consecutive calendar years every income and expenditure equals zero, the National Agency of Public Registry, on the basis of an application by the Auditor General, cancels the registration of that party, and after the cancellation of its registration the party's remaining property is transferred to the state treasury in compliance with the requirements of Georgian legislation.
The receipt and/or concealment of a donation or membership fee prohibited by Georgian legislation entails the transfer of that donation or membership fee to the state budget and a fine on the party, electoral subject or person with a declared party-political goal in double the amount of that donation or membership fee. If the requirements established by law are violated through the receipt of a donation or the payment of a membership fee, the party is obliged to return the sum to the donor or to the person who paid the membership fee within 5 working days of its deposit into the bank account; if this obligation is not fulfilled, the sum is transferred to the state budget of Georgia. If the party did not know and could not have known about the unlawfulness of the donation, the obligation to return it arises from the moment of the demand by the State Audit Office.
Voluntary questioning and the rights of the person questioned
A physical person who may possess information necessary for the monitoring of the financial activity of a party, a party member, an electoral subject or a person with a declared party-political goal may be questioned by the State Audit Office on a voluntary basis only. Coercing the person questioned to present evidence or to give information is impermissible.
The person questioned has the right to use the services of an advocate at their own expense and not to give information against themselves and/or their close relative. A close relative is deemed to be the person's parent, adoptive parent, child, foster carer, grandfather, grandmother, grandchild, sister, brother or spouse. The State Audit Office must explain these rights to the person questioned before the questioning begins. Before the start of the questioning the person's identity and other necessary information are established and recorded in the protocol; the Office is obliged to explain that the questioning is voluntary, that the person is obliged to provide correct information, to warn the person in writing of the liability envisaged for providing false information, and to explain that the person may be summoned for questioning before a magistrate judge — all of these explanations are recorded in the protocol. During questioning the use of sound- and/or image-recording equipment is allowed, of which the person must be notified in advance; the questioning may also be conducted remotely, by electronic means.
Registration data and changes
The National Agency of Public Registry checks the accuracy of the documents submitted and resolves the question of a party's registration within one month of their submission: the party is either registered or refused registration. In the case of registration, the registration certificate is issued within 7 days of the adoption of the decision. Registration may be refused if the party's charter or other documents submitted for registration contradict the Constitution of Georgia or this law. The party is also obliged, where changes are made to the charter and/or to the data subject to entry in the register of political associations of citizens — the legal address, the telephone, the signature specimens or the symbolism — to notify the Agency thereof within 10 days and to submit the corresponding document to it.