On September 19, 2023, Natia Turnava, the acting Director of the National Bank of Georgia (NBG), on the basis of her sole decision, granted Otar Partskhaladze[1] (former Prosecutor General of Georgia and a person close to Bidzina Ivanishvili), who was sanctioned by the US Department of the Treasury, access to his bank accounts.

With the above decision, the National Bank of Georgia deviated from the previously established practice[2] and legal regulations,[3] according to which the financial institutions of Georgia fully operated in accordance with the financial sanctions imposed by the USA, the European Union and Great Britain against the Russian Federation. Natia Turnava's decision was preceded by the remarks made by Georgian Dream Chairman Irakli Kobakhidze, who assessed the actions of the National Bank and commercial banks as unconstitutional and a violation of the presumption of innocence. Natia Turnava confirmed that Irakli Kobakhidze's opinion was "worth considering".

According to the Democracy Research Institute, the argumentation of the Georgian Dream team lacks legal logic for the simple reason that there is no legal connection between the conviction of a person and the seizure of his financial assets/property.

Article 31 of the Constitution of Georgia explains the essence of the presumption of innocence: "A person shall be presumed innocent until proved guilty, in accordance with the procedures established by law and the court’s judgment of conviction that has entered into legal force." According to the legislation of Georgia, the seizure of a person's property and financial assets is possible even at the earliest stages of litigation, and in no case is it related to finding a person guilty or not guilty. Thus, for example, during criminal proceedings, the seizure of a person's property and financial assets, including his bank accounts, is allowed by law even at the earliest stages of litigation, on the basis of a court ruling, before a person is found guilty. A similar principle applies to civil proceedings as well, during which property/bank accounts can be seized as soon as a lawsuit is filed. Accordingly, the argument that the change made by the National Bank is related to the protection of the Constitution and that banks and states should not take measures against Partskhaladze due to presumption of innocence, lacks legal logic.

The main purpose of sanctions is to immediately restrict a person's access to financial resources, in the absence of criminal prosecution, if he is involved in actions against human life. The order of September 19, 2023 made the economic and financial sanctions of international financial institutions and partner countries ineffective in Georgia. According to the exceptional order of the National Bank President of September 19, if there is no criminal prosecution initiated against a person in Georgia and if he is not found guilty by the court (which is a lengthy process), he may have unrestricted access to financial resources, which may result in the failure to  prevent the financing of illegal actions or their facilitation for years.

Irakli Kobakhidze's statement was a gross interference with the activities of a constitutional body, which has already resulted in the resignation of three Vice-Presidents of the National Bank of Georgia.

According to the Law of Georgia on the National Bank of Georgia, the National Bank shall be guided in its activities by the Constitution of Georgia, legislation of Georgia, and shall rely on the rules and custom[4] applied in international banking practice. Accordingly, it is an independent body and should not be influenced by representatives of other institutions. By creating an exceptional rule, Natia Turnava endangered the independence of the National Bank and the country's European future.

In a given situation, the Democracy Research Institute considers that:

 

[1] On September 14, 2023, the Office of Foreign Assets Control (OFAC) of the US Department of the Treasury imposed sanctions on Otar Partskhaladze, the former Prosecutor General of Georgia and a person close to Bidzina Ivanishvili, and restricted his financial and economic operations.

[2] According to the instructions of the National Bank of Georgia, from February 26, 2022, Georgian financial institutions have been fully operating in accordance with the financial sanctions imposed by the USA, the European Union and Great Britain against the Russian Federation.

[3] Regulation approved by the National Bank of Georgia on August 4, 2023.

[4] Law of Georgia on the National Bank of Georgia, Article 1, paragraph 1.