The returned bill about the proposed amendments to the Civil Code of Georgia with Presidential remarks was one of the main issues of discussion at the plenary session held on 30 May 2013 related to the transformation of a private legal entity into a legal entity of public law. Current legislation prohibited a change of legal form of a not-for-profit legal entity. Amendments to Article 38 of the Code – the bill adopted by the Parliament and vetoed by the President – prohibited a change of the legal form of a not-for-profit legal entity unless it transformed into a legal entity of public law.

Discussion between the Parliamentary Majority and Minority was accompanied with debates and accusations towards each other. Sergo Ratiani, MP from the United National Movement, expressed his own opinion regarding the bill.

According to his statement, “If the universities are not private legal entities and are transformed into public legal entities, the state has the right to confiscate their properties and we have an example of this today. The observatory was taken away from the University without informing the researchers and councils about it. It is closed and inaccessible and this was done during the period of your new government.”

FactCheck 

wondered about the accuracy of the facts mentioned in the statement by this MP.

Dali Tskitishvili, Head of the Legal Service Office at Ilia State University, confirms with FactCheck

that the University received a copy of a letter from the National Agency for State Property on 26 February 2013. This agency was asking the Adigeni Registration Office of the National Agency of the Public Registry to cancel the note to the registration of usufruct right of Ilia State University over the Abastumani Observatory. Ilia State University was entitled to use the Abastumani Observatory for the term of its existence based on the usufruct agreement dating back to 16 May 2008; however, notification sent by the National Agency of State Property to Ilia State University on 16 May 2013 highlights that the National Agency of State Property is not opposing non-profit legal entity Ilia State University from looking after and paying the utility taxes of the real estate located in Abastumani, Mountain Kanobili, in accordance with the current legislation until the resolution of the issue regarding the disposal of the property by the state.

In addition, Tskitishvili tells that the state did not have any communication with the University prior to this decision.

Tskitishvili indicated that by the time of the abolishing of the right to use the property, Ilia State University – similar to most universities – was pursuing a status of not-for-profit legal entity. According to her, by this time, the Abastumani Observatory belongs to the state; however, the researchers currently working there are employees of Ilia State University.

As a response to our letter sent to the National Agency of State Property, the Agency informed us that the usufruct agreement of Ilia State University, dating back to 16 May 2008, was abolished in accordance with Article 47 ^a 

under the Georgian Law on State Property and Ordinance (N1-1/1633) issued by the Minister for Economy and Sustainable Development on 10 August 2012. According to the same Ordinance, 53 usufruct agreements were terminated in total with regard to different universities. The Ordinance equally terminated agreements formed at different points in time with schools, museums, legal entities of public law – departments, agencies, bureaus, institutes and other establishments.

The registration note to the usufruct right of Ilia State University over the Abastumani Observatory is abolished in accordance with the letters dating to 26 February 2013 (N5/4055) and 14 March 2013 (N5/5675).

The Ministry of Economy and Sustainable Development also noted that the University was informed prior to the decision regarding the confiscation of the property. This was proven to us through the provision of the register of the Ordinance issued by the Minister of Economy and Sustainable Development on 10 August 2012 (N1-1/1633). The register of the Ordinance was sent to the University by the Ministry of Economy and Sustainable Development.

We established that Ilia State University had indeed received the abovementioned Ordinance of the Minister of Economy and Sustainable Development as we received the requested copy of this exact Ordinance and its enclosure from the University. However, the enclosure does not mention the property of Ilia State University and, instead, discusses the agreements formed with the National Forensics Bureau, the Civil Service Bureau and the National Bureau of Enforcement which probably represents a technical mistake on the part of the Ministry of Economy and Sustainable Development and also a certain degree of negligence on the part of Ilia State University.

Conclusion

The Ministry of Economy and Sustainable Development also noted that the usufruct agreement with Ilia State University, signed on 16 May 2008 and which provided the University with the right to use the property for the period of its existence, was abolished on 10 August 2012. The Public Registry of the National Agency of State Property and the letters sent to Ilia State University on 26 February and 14 March 2013 regarding the cancellation of the registration note to usufruct right represent the enforcement of this Ordinance.

Information provided by the Ministry of Economy and Sustainable Development confirms that Ilia State University was informed about the Ordinance issued on 10 August 2012; however, the Head of the Legal Service Office at the University states that the Ministry did not have any communication with the University prior to the letter on 26 February regarding the enforcement of the decision.

After having checked the fact anew, we ascertained that the property of Ilia State University is not mentioned in the enclosure of the Ordinance which Ilia State University received from the Ministry of Economy and Sustainable Development despite the fact that the enclosure presented to us by the Ministry certainly mentioned such property. FactCheck

requested the Ordinance issued by the Minister of Economy and Sustainable Development on 10 August 2012 (N1-1/1633) and its entire enclosure once again in which the usufruct agreements, abolished by the Ministry’s Ordinance, were grouped as follows:  ‘schools,’ ‘museums,’ ‘higher educational institutions,’ ‘theatres,’ ‘departments,’ ‘agencies,’ ‘bureaus,’ ‘institutions’ and ‘others.’ The information listed in the initial version of the enclosure, which was presented to us by the Ministry of Economy and Sustainable Development the first time, is included in the category ‘higher educational institutions’ on the full version of the enclosure while the property discussed in the enclosure, which was presented to us by Ilia State University, was included in the category ‘bureaus.’

It should be noted that it is unknown to us whether or not any kind of consultation between the governing bodies of the University and the Ministry of Economy and Sustainable Development took place before issuing the Ordinance on 10 August 2012.

Dali Tskitishvili confirmed that researchers of the University are currently working at the Observatory. Also, as mentioned in the letter sent to the University by the Ministry of Economy and Sustainable Development, the Ministry is not opposing the University from looking after and paying the utility taxes of the Observatory until the resolution of the issue regarding the disposal of the Observatory by the state.

Correspondingly, we rate the statement by MP Sergo Ratiani that the Observatory was taken away from the University without notifying the professors and councils, that this happened during the current government and that the Observatory is closed and inaccessible as MOSTLY FALSE.   Editor’s note: After the publication of the initial version of the article we spoke to Sergo Ratiani who disagreed with our research. According to his assertion, the two-page enclosure of the Ordinance dating to 10 August 2012, which was received by Ilia State University on 14 September 2012, did not mention the property of Ilia State University. Therefore, according to Sergo Ratiani, the University could not have been informed about the termination of its right to use the property. Having checked the information on various occasions, FactCheck confirmed the fact that the property of Ilia State University was certainly included in the enclosure of the Ordinance of the Minister of Economy and Sustainable Development. However, the information requested by us from Ilia State University revealed that the enclosure received by the University did not mention the property of Ilia State University. Furthermore, as outlined in the article, the Minister’s Ordinance abolished the usufruct agreement and not the right to use the property. The Deputy indicated that as the information in the Public Registry was being checked periodically, it could be ascertained that the Observatory and the property related to it stayed in Ilia State University’s possession until 6 March 2013. Our article states that the Observatory remained at Ilia State University’s disposal up to the point of the changes being made into the Public Registry based upon the letter of the Ministry dating to 26 February. We also examined the response of the Ministry to the University’s letter which notes that the Ministry does not mind the University taking care, protecting and paying the bills of the Observatory until the state makes the final decision regarding this matter. Sergo Ratiani states that even in the case if this kind of Ordinance existed, the enforcement of it by the current government serves as proof of the government’s consent to the Ordinance. The enforcement of the Ordinance by the current government, and thus its consent to it, was one of the reasons for Sergo Ratiani’s statement being rated as “mostly false” instead of “false.” The MP remarked with regard to the example of the sport facility Karishkhala, brought by us in the initial version of the article, and noted that it was taken away from the University prior to the University’s receiving of a status of a non-entrepreneurial (non-commercial) legal entity. We checked the abovementioned assertion and it was confirmed; therefore, this example has been omitted from the revised edition of the article. This matter, however, did not affect the final ruling of FactCheck, either in the initial version of the article or in the revised edition.