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Competition Law Advisory

Does Competition Law apply to NGOs and social enterprises in Georgia?

Yes, under Georgian law, any entity engaged in economic activity—regardless of its legal status (NGO or Ltd)—is considered an "economic agent." If your NGO sells goods or services, you must comply with competition regulations, including bans on unfair competition, abuse of dominance, and anti-competitive agreements. Ignorance of this status does not exempt you from potential fines.

What constitutes unfair competition in advertising?

Unfair competition includes misleading advertising, discrediting a competitor without factual basis, or unauthorized use of another's intellectual property to create confusion. For example, claiming your product is "the only eco-friendly option" without proof could be a violation. We review your marketing strategies to ensure they comply with both Competition Law and Consumer Protection regulations.

What are the risks of "bid rigging" in public procurement?

Bid rigging involves coordinating bids with other tender participants to determine the winner in advance. This is strictly prohibited and heavily penalized by the Competition Agency. Even informal discussions with competitors about pricing or participation can be interpreted as collusion. We advise on compliance protocols to ensure your participation in state tenders is independent and lawful.

Do we need approval for merging two social enterprises?

If the merging entities meet certain annual turnover thresholds defined by the law, the merger (concentration) requires prior notification and approval from the Georgian National Competition Agency. Failure to notify can result in significant fines and the invalidation of the merger. We assess your financial data to determine if filing is mandatory and handle the notification process.

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Competition Law Advisory is a critical legal service for both the business sector and Non-Governmental Organizations (NGOs) engaged in economic activities (social enterprises). In Georgia, competition protection mechanisms are strengthening annually, and the powers of the Georgian National Competition Agency are expanding. NGOs often mistakenly believe that the "Law on Competition" does not apply to them; however, if an organization conducts entrepreneurial activities (e.g., selling services or products), it becomes an economic agent and is obliged to adhere to fair competition rules. This includes prohibitions on abuse of dominant position, unfair competition, and avoiding concerted practices (cartel agreements) when participating in public procurement.

This service covers all aspects of competition law and includes:

  • Auditing the organization's activities for compliance with the "Law on Competition" of Georgia;
  • Consulting on adhering to competition principles when receiving state aid (subsidies, grants);
  • Responding to facts of unfair competition (e.g., misleading advertising, unauthorized use of intellectual property);
  • Representation during dispute resolution at the Competition Agency;
  • Preparing notifications for mergers and concentrations (if social enterprises merge);
  • Preventing risks of "bid rigging" (collusive tendering) when participating in public procurement.
Assistance from specialists ensures that your economic activity is lawful and protected from high fines.

Competition law advisory is needed in various practical situations. For example, several large NGOs working on the employment of persons with disabilities decide to merge their social enterprises. Such a merger might be considered a concentration and require prior approval from the Agency. Another scenario is when an organization receives exclusive rights from the state to provide a specific service — here, the legality of state aid might be questioned. Disputes regarding unfair advertising are also common, where one organization groundlessly disparages a competitor's activities in its marketing campaign. In such cases, the involvement of a qualified lawyer is essential to protect reputation and market share.

The legal framework relies on the "Law of Georgia on Competition," which regulates relationships between economic agents. The "Law on Consumer Rights Protection" is also important, as violations of competition and consumer rights often overlap. Regarding public procurement, the "Law on State Procurement" and normative acts of the Competition Agency are relevant. A lawyer helps you correctly interpret these regulations to prevent your actions from being classified as anti-competitive.

The work process begins with an analysis of the client's activities: Which market does it operate in? Who are the competitors? What types of agreements does it sign with partners? The lawyer reviews contracts to exclude clauses that restrict competition (e.g., price fixing). In case of a dispute, a complaint or response is prepared for the Competition Agency. With the help of a specialist on Legal.ge, you will be able to protect your business interests and operate according to fair play rules.

Legal.ge is a platform giving you access to lawyers with narrow specialization in competition law. This field requires not only legal but also economic knowledge. Protect your organization from sanctions and ensure healthy competition with experts from Legal.ge.

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