---
title: "Disposal of State Shares and Stocks"
url: "https://legal.ge/en/service/civil-law-en/state-shares-disposal-en"
field: "Civil Law"
description: "Disposal of Georgian state shares and stocks: auction forms, pledges, 45-day and 3-month contract deadlines and breach rules. Legal.ge."
updated: "2026-10-14"
publisher: "legal.ge"
---

# Disposal of State Shares and Stocks

> Source: legal.ge, https://legal.ge/en/service/civil-law-en/state-shares-disposal-en

## Disposal of Shares and Stocks — Forms and Actors

The disposal of shares and stocks registered in the name of the state is one of the most institutionally loaded directions of state property management. The law distinguishes three forms of disposal of shares and stocks: privatization, transfer of management rights, and exchange. Each has its own procedural regime, but the common feature is one — the centralization of the decision on the state's side.

Privatization of shares or stocks may be carried out through auction, direct sale and direct sale on the basis of competitive selection. In addition, shares, stocks or stocks represented by certificates may be privatized directly or through an intermediary, by public or private offer, on a recognized foreign stock exchange, or by another form of offer consistent with the practice existing at the relevant time on international capital markets. These special forms allow the state to offer an asset to investors through channels customary for the market.

The full text is available on legal.ge after signing in: https://legal.ge/en/service/civil-law-en/state-shares-disposal-en

### In what forms are state shares and stocks disposed of?

The forms are privatization, transfer of management rights and exchange. Privatization proceeds by auction, direct sale, competitive selection, as well as directly or through an intermediary, by public or private offer and on a recognized foreign stock exchange.

### When does a privatization obligation pass to a new owner?

If, before the pledge encumbrance, the registry entry reflected information on the obligation, then upon transfer into the pledgee's ownership or upon realization the obligation passes fully to every new owner.

### What happens on breach of the privatization conditions?

Upon unilateral termination of the contract the property returns to state ownership, the registered pledge of a third party is voided, and the acquirer is not reimbursed for amounts paid and expenses. These rules do not apply to public-private partnership projects.

### Within what periods is the contract concluded?

For a management-rights transfer — within 45 days of the auction or 3 months of the Government decision. For privatization — within 45 calendar days of the auction, and for direct sale within 3 months of the disposition. Missing the periods voids the results or the decision.

### Who determines the conditions of an exchange-based sale?

The property manager presents a justified proposal to the Government, and the Government's disposition determines the quantity or percentage indicator, the fee, the deadlines and other essential conditions.