Starting a company in Georgia: what to check before registration

Consider who will own the business, whether outside investment is expected, how risks will be allocated and who can make binding decisions. A limited liability company may be suitable for many projects, but it is not automatically the right solution for every business.

Review representation authority, management powers, transfer of ownership interests, shareholder voting and deadlock procedures. A template charter may not address a venture with several investors or an unusual management structure.

Verify the names and identifying details of founders and authorized representatives; identify when consent, translation, authentication or a power of attorney may be required. Requirements depend on the participants and the particular filing.

Assess tax registration and reporting, accounting, employment arrangements, licenses where relevant and compliance with data protection obligations. Registration does not by itself confirm that a regulated business activity may begin.

Registration creates the formal vehicle; it does not settle how the owners will govern it. Record voting thresholds, transfers of shares, the director’s authority, conflicts of interest and how deadlock would be resolved. Where foreign founders are involved, examine authentication of documents, powers of attorney and any required beneficial-ownership information.

Historical Supreme Court practice distinguishes a company’s liabilities from the separate duties of directors and shareholders. Limited liability is not complete immunity, while a director’s role is more than a signature. Set up controls for cash movements, tax decisions, related-party transactions and records. Any personal exposure must be assessed under the currently applicable Entrepreneurs Law and proven facts.

Registration proves that a legal entity has been formed; it does not resolve how shareholder disputes, conflicts of interest or signature authority will work in practice. A founder should examine the registered representation rules alongside internal approval thresholds for borrowing, guarantees, asset sales and related-party transactions. The shareholders’ agreement can deal with deadlock, future investment, confidentiality, voting and exit rights, but must be checked against mandatory company law and the registered charter. Before opening bank accounts, establish beneficial ownership, sources of funds, tax-registration needs and the documents a bank may request. International groups should also analyse whether agreements are concluded with the Georgian subsidiary or the foreign parent: separate legal entities should not be conflated merely because the same group controls them.

Two founders hold equal shares but their articles say nothing about a deadlock on major decisions. Before registration they should agree who appoints the director, which matters need unanimity and how an owner can exit. Access to company accounts, related-party transactions and conflict-of-interest procedures deserve separate treatment. Georgian court practice distinguishes the duties of directors and shareholders, making governance controls more useful than a generic template.