Retails Keep Silent about Arbitration and Feel Comfortable under Existing Court System

The Competition Agency of Georgia has finished the retail market monitoring and published corresponding recommendations.

In this interview for Business Partner, Iva Chkonia, president of the Georgian Distributors Business Association, discussed the market trends and analyzed the existing challenges before distribution companies.

“The Georgian Distributors Business Association was established to determine certain regulations and settle relations between two parties. The regulations that we are discussing now were introduced tens of years ago in the USA. These standards are also practiced in Great Britain, Ireland and Central Asia.

Objective of these regulations is to administer relations between two private bodies, because the power and money are accumulated by either of parties and anybody is able to misuse them, even more so, the court system is inefficient and companies are frequently closed before trials”, Iva Chkonia noted.

The top margin for payment must exist. There are cases, when money is not transferred within agreed timeframes. Companies cannot clarify how correctly the money is remitted. The so-called Entrance Fee is also unclear. As noted by Chkonia, regulations should be prepared with the participation of international experts, while the retail sector keeps silent about the arbitration and therefore, the existing court system is very comfortable for them, he said.

“The current crisis has exposed the needs of our sector. It is important that small and medium business companies could introduce their products to the retail sector and to prevent the market monopolization. Even if one company of 16 ones face problems and fails to pay money, tens of companies will be damaged and Georgian economy will suffer serious losses”, Iva Chkonia pointed out.