Draft

Chapter 1
General Provisions

Article 1. Field of Application

This law defines the general principles of reception, registration, disbursement and control over utilization of the grants and humanitarian assistance.   

Article 2. Interpretation of Terminology

The expressions used in this law bear the following meanings:
1. “Grant” – the grant is an amount of target goods, work and services which are handed to the recipient by the donor gratuitously, for use in implementation of the concrete educational, scientific-research, health, cultural, sports, ecological and sociological projects as well as public or civil projects.

2. “Humanitarian Assistance” – the humanitarian assistance is an amount of vital goods, work and services which gratuitously supplied by the donor to the beneficiary, as well as the goods for services needed for beneficiary for: liquidation of natural disaster, accident, catastrophe, epidemic and epizootic diseases and subsequent rehabilitation, post-war rehabilitation activities, reception, transportation, storing and distribution of the humanitarian Assistance.

3. “State Program” – the plan, approved by the state body and agreed with the Ministry of Finance of Georgia, of reception and utilization of the grant or humanitarian assistance.

4. Grantee – entity, which implements educational, scientific-research, health, cultural, sports, ecological and sociological projects as well as public or civil projects within the determined rules.

5. Recipient of the Humanitarian Assistance – the entity, which hands over the humanitarian Assistance to the beneficiaries or directly serves the beneficiaries according to the determined rules.  

6. Beneficiary – the person or the group of persons, which require and receive assistance and/or service directly or with participation of the third party or the persons for whom the humanitarian activities are being conducted.

7. Distribution project – the distribution project is a plan of distribution of the humanitarian assistance, which includes the target of the humanitarian assistance, the category and number of the beneficiaries, place of distribution (region, district and other), list of the humanitarian goods, amount of the humanitarian goods, price of the humanitarian goods, detailed plan of Assistance distribution, timeframe of distribution of the humanitarian goods.  

8. Goods – goods determined by the 13th clause of the 29th article of the Tax Code of Georgia.

9. Providing services – providing services determined by the 10th clause of the 29th article of the Tax Code of Georgia;

10. Work – work determined by the 11th clause of the 29th article of the Tax Code of Georgia;

11.  Issuer of the grant and humanitarian assistance:
a) International charity, humanitarian and other social organizations (including association, federation and committee);
b) Financial-credit institution;
c) Government of the foreign country or its representation;
d) Foreign non-industrial legal entity or its branch;
e) Georgian non-industrial legal entity (foundation, union) charter of which defines charity, social, cultural, educational, scientific-research or other socially useful activities as the main goals of entity’s activity.

Chapter 2
Grant

Article 3.  Grant

The following shall not be considered as a grant:
1. Tobacco and tobacco products;

2. Food products;

3. Medicaments;

4. Clothes (except of the uniforms);

5. Fuel and lubricants, except of those determined by the state programs;

6. Goods, work and services delivered for achieving the entrepreneurial and political goals.

Article 4. Grant Recipient

The Grant Recipient may be:
a) The Georgian State, in face of the body or organization authorized by the President.
b) Central and Local Governance body of the Georgian State.
c) Non-industrial legal entity residing or non-residing in Georgia, its representation, branch and division;
d) Citizen of Georgia.

Article 5.  Legal basis for issuing the Grant.

1. Legal basis for issuing the grant is any kind of written agreement between the issuer and the recipient or the official written notification from the issuer.

2. The agreement or notification should contain the goal, amount of grant, concrete trends of utilization of goods, work and services and main demands of the issuer to the recipient.

3. The grant should be utilized only for purposes indicated in the agreement or notification; its utilization for other purposes is permitted only with consent of the issuer and if utilization does not contradict with law.   

4. Monetarisation of the goods received by the grant is prohibited, except of the target goods, issued for the governmental bodies.

5. If the goods issued for the governmental bodies as a grant are subject to liquidating, the grant recipient is obliged to agree the rules of liquidating and balance of the recovered funds with the Ministry of Finance of Georgia prior to importing the goods to Georgia. 

Chapter 3
Humanitarian Assistance

Article 6.  Humanitarian Assistance

1. The following shall constitute the humanitarian Assistance:
a) Vitally needed goods gratuitously supplied, directly or through a humanitarian Assistance transmitter, by the donor to the beneficiaries; in particular: food products, medications, tents and other temporary shelter, beds, clothing, shoes and other goods of first priority, as well as first-Assistance items;

b) Goods gratuitously supplied by the donor to a humanitarian Assistance transmitter that are designated for rendering the essential services to the beneficiaries; in particular: medical equipment, equipment for studies, equipment for child-care institutions and the institutions providing care to elderly and handicapped people, special equipment for studies, social development and employment of physically handicapped people;

c) Goods gratuitously supplied, directly or through a humanitarian Assistance transmitter, by the donor to the beneficiaries, required for providing necessary supplies for emergency-rescue operations and subsequent rehabilitation measures after natural disasters, accidents, catastrophes, epidemic and epizootic diseases, post-war rehabilitation.

d) Goods required for receiving, transporting, storing and distributing humanitarian Assistance and allocated for that purpose.

e) Goods, work and services designated by the state programs.

2. For the purposes of this Law, assistance provided for achievement of political or entrepreneurial goals, as well as the goods designated by the decree of the President of Georgia, shall not be deemed to constitute the humanitarian Assistance.

Article 7.  Recipient of the Humanitarian Assistance

1. Recipient of the Humanitarian Assistance:
a) Receives and distributes the assistance among the beneficiaries;

b) Hands over the Assistance to another transmitter for subsequent distribution;

c) Conducts activities designated in the sub-clause (c) of the 1st clause of the 6th article of the this Law;

d) Serves beneficiaries directly.

2. Recipient of the Humanitarian Assistance shall be:
a) Body of State or Local Governance

b) Legal entity, residing or non-residing in Georgia, its representation, branch and division;

c) Issuer of the Humanitarian Assistance. If the issuer of the humanitarian Assistance distributes the Assistance or conducts the humanitarian activities directly, the issuer is obliged to fulfill the conditions of the present law for receiving the humanitarian assistance.

Article 8.  Beneficiary
Beneficiary is a person or a group of persons in need of assistance who is provided with the assistance and/or services directly or through the third persons and for whom the works of humanitarian nature are performed, including: handicapped persons, elderly people, orphans, persons who lost their maintenance providers, refugees and forcibly displaced persons, diseased persons, large families and their members, persons who suffered from war, armed conflict, accident, natural disaster, catastrophe, epidemic and epizootic diseases.
 

Article 9.  Basis for allotment of the Humanitarian Assistance
1. Legislative base for allotment of the humanitarian assistance is a written agreement between the issuer and recipient, or a written decision on allotment.

2. The agreement or a written decision shall contain the purpose of allotment and amount of the assistance.

3. The humanitarian assistance should be used only for the goals designated in the agreement or decision, their utilization for the other purposes is permitted only with consent of the issuer, if not in contradiction with this law.

4. Liquidating of the humanitarian goods is prohibited.

5. The recipient is obliged to introduce the distribution project to the Ministry of Finance of Georgia.

6. The recipient is responsible for implementation of the distribution project. 

Chapter 4
General Principles for Registration and Utilization of Grants and Humanitarian Assistance

 Article 10.  Registration and control of the grants and humanitarian assistance
1. Registration and recording of the grant and humanitarian assistance is conducted in accordance with the Georgian legislation.

2. According to the provisions of this law the status of the humanitarian assistance is imposed over the goods, work and services by the Ministry of Finance of Georgia based on the President’s order.

3. The Ministry of Finance of Georgia imposes status of the grant over the goods, work and services allocated as grants for the ministries of State Security, Defense, Internal Affairs as well as for the State Departments of Border Guard and Intelligence the based on the written recommendation of the National Security Council of Georgia.  

4. Control of the grants and humanitarian assistance is conducted in accordance with the Georgian legislation.

Chapter 5
Imposing taxes on the Grant and Humanitarian Assistance

Article 11.  Taxation of Grants and Humanitarian Assistance
1. The rules of taxation of grants and humanitarian assistance are determined by the effective Georgian legislation.

2. Violation of the provisions of this law and those normative acts, which had been on the basis of this law, results in removal of the status of grant or humanitarian assistance from the goods, works and services, received as the grant or humanitarian assistance.  

Chapter 6
Conclusive and Transient Provisions

Article 12.  The normative acts, which shall be adopted for enactment of this law
Within the 30 days the Ministry of Finance of Georgia should elaborate draft of the President’s order on “Imposing Status of Grant or Humanitarian Assistance Over the Imported Goods, Monitoring of the Humanitarian Assistance and Registration of the Grants Received by the Bodies of the State Power”.

Article 13.  Conclusive Provisions

1. This law should be enacted within the 30 days after its publication, except its 12th article.

2. The 12th article of this law should be enacted at the moment of publication of the law.

a) The Georgian Law “On Grants”, of June 28, 1996 shall be considered as ineffective.

Eduard Shevardnadze
President of Georgia

Tbilisi, 2002.  # —