Turkey is Georgia's number one trading partner, driven by geographic proximity and the existing Free Trade Agreement (FTA). However, dealings with Turkish companies are characterized by specific legal and cultural nuances that must be considered when drafting agreements. High-intensity trade volume increases the likelihood of legal risks, particularly regarding quality control, transportation timelines, and payment security. Properly drafting Georgia-Turkey contracts is essential to avoid misunderstandings that often arise due to different legal systems and business practices.
Particularly important is the principle of "diagonal cumulation" (Pan-Euro-Mediterranean Convention), which allows manufacturers to use Turkish raw materials and export the final product to the EU with Georgian origin (under preferential regime). Utilizing this mechanism requires meticulous adherence to rules of origin in the contract and accompanying documentation. Specialists registered on Legal.ge will assist you in establishing solid legal relationships with Turkish partners, covering trade, investment, and construction contracts.
What does the Georgia-Turkey Contracts service cover?
- Georgia-Turkey FTA Analysis: Checking customs tariffs and quotas for specific products (as the agreement does not cover all products, especially in agriculture).
- Diagonal Cumulation Schemes: Including conditions in the contract ensuring documentary proof of raw material origin for subsequent export to Europe.
- Logistics and Incoterms: Considering the specifics of land (Sarpi, Vale) and sea freight in delivery terms.
- Quality Control: Detailed mechanisms for inspecting goods before and after crossing the border.
- Dispute Resolution: Selecting neutral arbitration or courts. Arbitration is often recommended for ease of enforcement.
- Construction Contracts (FIDIC): Adapting FIDIC forms to Georgian legislation when Turkish construction companies operate in Georgia.
- Bilingual Contracts: Preparing Turkish-Georgian or English-Georgian texts with legal precision.
Common scenarios requiring this service
A typical scenario involves importing textiles or construction materials from Turkey. Often, goods arrive late or with incomplete documentation, delaying customs clearance. Penalties and a document checklist specified in the contract reduce this risk. Another scenario is creating a Joint Venture with Turkish investors to build a factory in Georgia, where outlining corporate governance and profit distribution rules is critical. A third scenario involves importing Turkish raw materials (e.g., fabric), manufacturing clothing in Georgia, and exporting to Europe (diagonal cumulation).
Georgian Legal Framework
The legal basis is the Free Trade Agreement between Georgia and the Republic of Turkey. This agreement regulates tariff preferences. The Customs Code of Georgia and the Civil Code are significant. Regarding investments, the Agreement on Reciprocal Promotion and Protection of Investments applies. Transport issues are covered by the Convention on the Contract for the International Carriage of Goods by Road (CMR), to which both countries are parties.
Step-by-step service process
The process begins with analyzing the trade operation scheme (import, export, or transit). The lawyer checks if the product falls under the free trade regime. Then, a contract is drafted detailing payment terms (letter of credit, bank guarantee) and transportation routes. Special attention is paid to force majeure (e.g., border delays). After signing, legal support is provided during customs procedures.
Why choose a specialist on Legal.ge?
Trade with Turkey is massive but full of specific risks. On Legal.ge, you will find lawyers with years of experience working with Turkish businesses who understand the nuances of regional trade. They will help you turn geographic proximity into real economic benefit without legal risks.
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