In recent years, Georgia has witnessed a significant transformation in the realm of ADR through the promotion and consolidation of arbitration as a pivotal tool. This evolution spans both the domestic and international spheres. Although the integration of arbitration into Georgia’s dispute resolution framework can be traced back to 1997, it has undergone substantial development in the past two decades. The watershed moment occurred in 2009 when Georgia adopted a new arbitration law (the “Law of Georgia on Arbitration”), which ‒ with some notable exceptions ‒is based on the UNCITRAL Model Law on International Commercial Arbitration of 1985 as amended in 2006 (the “UNCITRAL Model Law”).

Arbitration has emerged as the preferred method for resolving disputes in various sectors, including with regard to commercial and corporate contracts, the construction industry, the banking sector, and international trade agreements. Arbitration stands as the predominant mechanism in international trade, primarily due to the confidentiality of the proceedings, the conclusiveness of arbitral awards, and the efficiency of their recognition and enforcement under the 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”).

However, domestic parties tend to prefer litigation before state courts to arbitration for dispute resolution, mostly owing to cost, enforceability, and their familiarity with court proceedings. Meanwhile, arbitration is mostly preferred by non-domestic parties. By way of example, according to one of the prominent arbitration institutes in Georgia, the Georgian International Arbitration Centre (GIAC), the majority of cases still involve at least one foreign party ‒ implying that domestic parties regularly refer to state courts, unless international elements are involved under the dispute.

Arbitration is commonly used for a variety of disputes, including commercial, construction, international trade, employment, IP and consumer disputes. According to reports from arbitral institutions, the bulk of cases involve disputes related to consumer loans, leasing and service agreements, and issues stemming from construction and corporate affairs.

In Georgia, there are more than 35 recognised institutions that facilitate arbitration, but two institutions stand out: the GIAC and the Dispute Resolution Center (DRC). Both institutions enjoy high levels of trust and handle a substantial portion of domestic and international arbitration disputes.

In addition to domestic institutions, parties involved in arbitration proceedings in Georgia often turn to well-established foreign arbitral institutions such as the ICC, the LCIA and the SCC (Stockholm Chamber of Commerce) Arbitration Institute. These institutions are often chosen owing to their global recognition, institutional support, comprehensive arbitration rules, and expertise in handling international disputes.

No new major arbitral institutions have been established in Georgia in 2024‒25.

Although Georgia does not have specialised or separate courts, certain courts within the common court system are designated to hear disputes related to both international and domestic arbitration. Notably, second-instance (appellate) courts handle the majority of arbitration-related matters, including:

• recognition and enforcement of domestic arbitral awards;
• applications to set aside arbitral awards;
• motions for interim measures; and
• challenges to competence of the tribunal.

Meanwhile, the third-instance court (the Supreme Court of Georgia) is authorised to hear cases concerning the recognition and enforcement of international arbitral awards.

The Law of Georgia on Arbitration regulates all arbitral proceedings conducted within Georgia, irrespective of whether they are domestic or international in nature. As mentioned in 1.1 Prevalence of Arbitration, this law was adopted in 2009 and is mostly based on the UNCITRAL Model Law.

No significant amendments have been made to the Law of Georgia on Arbitration in 2024–25. There is no completed or pending legislation expected in the near future that may substantially change the arbitration landscape in Georgian jurisdiction.

In accordance with the Law of Georgia on Arbitration, an arbitration agreement is an agreement through which the parties commit to resolving either all or specific disputes that have arisen or may arise between them based on various contractual or legal relationships.

Under the applicable law, arbitration agreements must contain at least two essential terms:

• the clear intent of the parties to submit disputes to arbitration (“intent shall be clear”); and

• an outline of the types of disputes that are subject to arbitration (“scope of agreement shall be determined”).

Furthermore, the Law of Georgia on Arbitration establishes specific requirements regarding the form of the arbitration agreement, and these must be satisfied for the arbitration agreement to be enforceable. Specifically, the Law of Georgia on Arbitration requires an arbitration agreement to be drawn up in writing. However, the law provides more leniency with regard to the written form requirement in a B2B setting and this requirement can also be satisfied:

• when an agreement is reached through electronic communication;
• when an agreement to arbitrate is reached through the exchange of a statement of claim and a statement of defence, with one party asserting the existence of an arbitration agreement and the other party not disputing this; or
• when a contract references any document containing an arbitration clause, thereby making that clause an integral part of the contract.

However, if one of the parties involved in an arbitration agreement is a natural person or an administrative body, the arbitration agreement must be in writing in the form of a signed document. In such cases, the written form requirement is narrowly interpreted, and the aforementioned exceptions do not apply.

Although the Law of Georgia on Arbitration does not explicitly categorise arbitrable disputes, it defines the general scope of arbitrable disputes. Specifically, the law states that property disputes of a private nature ‒ characterised by party equality and resolvability through mutual agreement – can be arbitrated.

Furthermore, specialised laws provide that specific disputes are also arbitrable. By way of example, employment disputes are arbitrable under the Labour Code of Georgia and disputes arising from or in connection with PPP agreements are also arbitrable under the Law of Georgia on Public Private Partnership (the “PPP Law”). Therefore, in addition to the Law of Georgia on Arbitration, one must look into specialised laws as well in order to identify whether a dispute can be arbitrable within the jurisdiction of Georgia.

Based on court practice, it is generally understood that disputes involving non-pecuniary claims – for example, child custody matters, divorce-related matters (in certain cases), administrative matters, and tax matters ‒ and disputes involving criminal liability will not be arbitrable.

Regardless of the foregoing, considering the fact that the Law of Georgia on Arbitration was based on the UNCITRAL Model Law (thereby making Georgia a “Model Law country”), the overall policy and the general approach regarding arbitrability in Georgia is pro-arbitration in nature, unless a public interest is involved. By way of example, even though employment disputes are generally arbitrable, courts have found that disputes in which termination of the employment agreement is challenged based on discrimination – which is regulated under a special law (one that favours the person making allegations and shifts the burden of proof onto the defence) – will not be arbitrable.

When determining the law governing the arbitration agreement, courts rely upon party agreement. Provided that parties have explicitly agreed on such governing law, the court will apply it, unless both parties deviate from it either explicitly or in the course of the proceedings (for instance, if both parties base their reasoning on a law other than that already agreed).

In the absence of any explicit agreement on the governing law of the arbitration agreement, Georgian courts may consider various factors ‒ such as the governing law of the main contract or the seat of arbitration, as well as any applicable international conventions or treaties ‒ to identify the implied agreement of the parties. In the absence of any such implied agreement, the courts will apply the law of the seat of arbitration.

However, in practice, courts may also consider Georgian legislation when determining whether the dispute falls under the scope of the arbitration clause. In one case, while deciding whether the dispute fell under the scope of the arbitration agreement, the Supreme Court of Georgia invoked legal principles established under Georgian legislation and established that ‒ as, under Georgian law, a claim for damages is a secondary recourse (ie, can be claimed in the absence or after the termination of the agreement) and as the agreement provided that the claims arising out of the agreement were subject to arbitration – the dispute concerning the claim of damages after termination of the agreement did not fall under the scope of the arbitration agreement in accordance with Georgian law. Therefore, it is advisable for parties to clearly specify the governing law of the arbitration agreement in their contracts, in order to avoid any ambiguity or potential disputes in this regard.

As a general rule, courts in Georgia uphold arbitration agreements, provided that these agreements comply with the requirements outlined in the Law of Georgia on Arbitration in terms of their content and their form. Notably, a 2018 ruling by the Supreme Court of Georgia established that an arbitration agreement can still be enforceable even if it provides that a party “may” apply for arbitration – namely, such choice shall become binding on the parties once one of the parties exercises this option.

Moreover, in court proceedings concerning the request of the counterparty to stay court proceedings in favour of arbitration, various district courts have recently relied upon a prima facie review of the arbitration agreements and stayed proceedings. However, various district courts may still conduct a de novo review of arbitration agreements and court practice in this regard (ie, as to which standard to apply) currently is not aligned.

When it comes to consumer arbitration or arbitration involving a natural person, courts tend to apply stricter standards, both in terms of the agreement’s content (demanding clear and unambiguous consent) and its form. By way of example, in one case, the court of appeal invalidated an arbitration clause entered into online by a natural person. This decision was based on the Law of Georgia on Arbitration’s requirement that, when a natural person is a party to the agreement, the natural person must physically sign the document and on said law’s provision that the electronic execution of an arbitration clause is not permitted in such instances.

Under the Law of Georgia on Arbitration, the separability of arbitration clauses is explicitly recognised. The Law of Georgia on Arbitration provides that an arbitration agreement may be concluded either as a clause within a contract or as a separate agreement.

Furthermore, the law also stipulates that invalidity, termination or unenforceability of the main contract does not affect the validity of the arbitration clause contained therein. This ensures that the arbitration agreement remains effective and enforceable, even if the underlying contract is no longer valid.

Arbitrators are selected in accordance with the parties’ agreement and as per the rules of the particular arbitration institute chosen by the parties. However, this autonomy is subject to certain limitations. Specifically, under Georgian law, a person may not be appointed as an arbitrator if they:

• have limited legal capacity or are beneficiaries of support, unless otherwise provided by a court judgment;
• are state employees, state political officials, political officials, or public servants;
• have an unexpunged or unvacated criminal conviction; or
• have previously served as a mediator in the same dispute or in another case substantively related to the dispute in question.

In the event that the procedure selected by the parties cannot succeed, an arbitrator is not selected, or various circumstances prevent the appointment, parties are authorised to apply to the courts with a request for appointment of an arbitrator. In such cases, parties are usually expected to present the candidates and their consents to the court for review and approval by the court.

As for multiparty arbitration, the Law of Georgia on Arbitration does not prescribe any specific provisions that would govern the constitution of the arbitral tribunal in such cases.

The Law of Georgia in Arbitration prescribes that the court can only intervene in the selection of arbitrators when:

• a party fails to appoint an arbitrator within 30 days after receiving a request to do so from the other party;
• the two party-appointed arbitrators fail to agree on the appointment of the third arbitrator within 30 days of their appointment; or
• the arbitration is to be conducted by a sole arbitrator and the parties fail to agree on the appointment of the arbitrator within 30 days following a request by one party to do so.

In any of the above-mentioned scenarios, the court is authorised to appoint the arbitrators only upon the request of a party.

The Law of Georgia on Arbitration establishes particular provisions governing the challenge and removal of arbitrators. Specifically, a party to the arbitration has the right to challenge the arbitrator if:

• an arbitrator does not qualify under the qualifications agreed to by the parties; or
• there are circumstances that may cause reasonable doubt about the arbitrator’s impartiality or independence.

Furthermore, a party may challenge an arbitrator appointed by themselves only for reasons that become known to the party after the appointment of the arbitrator.

The parties are authorised to agree on the procedure for challenging, arbitrators taking into account the provisions of the Law of Georgia on Arbitration. In the absence of such agreement, a party who intends to challenge an arbitrator must submit the statement of challenge to the arbitration within 15 days from the date on which the party became aware of the appointment of the relevant arbitrator or of any circumstance specified by the Law of Georgia on Arbitration that may serve as a ground for challenge. If the arbitration does not satisfy the party’s application to challenge the arbitrator, the party challenging the arbitrator may apply to the court for the challenge of the arbitrator.

The Law of Georgia on Arbitration also prescribes for the termination of the authority of an arbitrator and provides that a party is not entitled to unilaterally replace the arbitrator it has appointed. Under the procedure, if the arbitrator becomes unable to perform their obligations or becomes inactive for any other reason, their authority terminates based on their request to withdraw from the position or based on the parties’ agreement on termination of authority. In cases where the parties cannot reach an agreement within 30 days after submission of a request to terminate the authority of an arbitrator, one party may file a claim in court seeking termination of the authority of the arbitrator.

The Law of Georgia on Arbitration upholds the fundamental principle of impartiality and independence of arbitration. The law provides that, in the case of appointment of an arbitrator by a court or any other authority, the qualifications of the arbitrator – as well as the arbitrator’s independence and impartiality – are to be considered. As mentioned in 4.4 Challenge and Removal of Arbitrators, the law also provides any party with the right to challenge an arbitrator if there are circumstances that may create reasonable doubts about the independence or impartiality of the arbitrator. In addition, arbitrators are under a continuing obligation to disclose at the time of their appointment or during the arbitral proceedings any circumstance that may raise questions about their own impartiality or independence.

Moreover, the Georgian Code of Ethics for Arbitrators establishes a set of regulations regarding the impartiality and independence of arbitrators. Particularly, the Georgian Code of Ethics for Arbitrators imposes on the arbitrator an obligation to uphold high standards of conduct to ensure that the arbitral proceedings are held fairly and in good faith. However, the Georgian Code of Ethics for Arbitrators was formulated by the Georgian Association of Arbitrators, a non-governmental professional organisation established by arbitrators. As such, the Georgian Code of Ethics for Arbitrators does not constitute a legally binding instrument under national law and its application is limited to arbitral institutions that have formally adopted the code. Accordingly, arbitrators operating under the rules of such institutions are bound by the Georgian Code of Ethics for Arbitrators, which serves as a professional guideline governing their conduct throughout the arbitral proceedings.

Furthermore, institutional rules also regulate the above-mentioned issues. By way of example, under the GIAC Arbitration Rules, all arbitrators must remain impartial and independent throughout the process. Prior to appointment, a prospective arbitrator must sign a confirmation of impartiality and independence. They must also disclose any facts or circumstances that would lead to reasonable doubts in this regard.

The competence-competence principle, as outlined in Article 16 of the UNCITRAL Model Law, is mirrored in the Law of Georgia on Arbitration. As such, an arbitral tribunal may rule on a party’s challenge to the tribunal’s own jurisdiction.

Under the Law of Georgia on Arbitration, the court may only intervene if specifically provided for by the law, which only authorises court intervention within certain limits. Such intervention is permitted only in circumstances where:

• a party applies to the court and the opposing party challenges the jurisdiction of the court, requesting staying proceedings in favour of arbitration;
• a party challenges the competence of the tribunal after said party has determined that the tribunal has competence to hear an arbitration claim; or
• either annulment proceedings or recognition and enforcement of the award are being heard by the relevant court.

In all of the above-mentioned circumstances, the limits and scope of court intervention vary. By way of example, recent court decisions suggest that some courts may undertake a prima facie review of an arbitration agreement when deciding whether to stay proceedings in favour of arbitration, whereas in court proceedings concerning the review of the competence of the tribunal ‒ as well as annulment and/or recognition and enforcement of arbitration awards – courts tend to undertake a de novo review.

Furthermore, courts have also found that compliance with pre-arbitration procedures (eg, adherence to the Dispute Adjudication Board (DAB) procedure) is a matter for the tribunal to resolve. As such, this limits the court’s power to review the jurisdiction of the tribunal on the ground of non-complying with such pre-arbitration procedures.

Lastly, courts in Georgia do not review negative rulings on jurisdiction by arbitral tribunals.

A party may declare that the arbitral tribunal lacks jurisdiction before submitting its response to the claim. The appointment of an arbitrator by a party or participation in the arbitrator’s appointment does not deprive that party of the right to make such a declaration.

According to the Law of Georgia on Arbitration, a declaration that the arbitral tribunal has exceeded its jurisdiction must be made within seven days of the party becoming aware of the relevant circumstances. Such declarations concerning the tribunal’s jurisdiction may also be made after the expiry of the aforementioned time limits if the arbitral tribunal considers the delay justified.

The arbitral tribunal may rule on the declaration of lack or excess of jurisdiction either by issuing a separate decision before the final award or by incorporating it into the final award. If the tribunal decides – prior to rendering the final award ‒ that it has jurisdiction, any party may challenge that decision before the court within 30 days of receiving notice of the decision. The court must issue a reasoned ruling on the tribunal’s jurisdiction within 14 days of receiving the application. This ruling is final and not subject to appeal.

Pending the court’s decision, arbitral proceedings may be initiated or continued, and an award may be rendered. Where the parties have agreed, the arbitral tribunal will decide on its jurisdiction in accordance with such agreement, either prior to or together with the final arbitral award.

Georgian courts, when reviewing questions of jurisdiction, mostly apply the de novo standard. Notably, when reviewing the arbitral tribunal’s decision on its own competence, the court examines the arguments and evidence of the parties, as well as the arbitral tribunal’s decision. The court is not bound by the tribunal’s findings and may consider additional arguments or evidence that were not raised during the arbitral proceedings.

As for admissibility, several courts have recently found that it was up to the tribunal to review whether parties have complied with pre-arbitration procedures such as DAB. Therefore, as mentioned in 5.2 Circumstances for Court Intervention, this matter is ultimately reserved for the competence of the tribunal.

As per the Law of Georgia on Arbitration, a court before which an action is brought in a matter that is the subject of an arbitration agreement – based on a request by a party made before the expiration of the time period within which a statement of defence must be submitted ‒ is obliged to terminate the proceedings and refer the parties to arbitration, unless it finds that the agreement is void, invalid or incapable of being performed.

Therefore, the court is not authorised by the Law of Georgia on Arbitration to stay proceedings of its own initiative, and the opposing party must challenge the jurisdiction of the court by referring to the arbitration agreement. Recently, several courts decisions have been issued, establishing that the court shall undertake prima facie of the arbitration agreement in such cases. However, in practice, the standard of review varies between different courts and depending on the subject matter.

The Law of Georgia on Arbitration does not allow an arbitral tribunal to assume jurisdiction over individuals or entities that are neither parties to the arbitration agreement nor signatories to the contract containing the arbitration clause (thereby either implicitly or explicitly consenting to becoming parties to the arbitration agreement). The Kutaisi Court of Appeal annulled a decision by an arbitral tribunal, as the decision affected a non-signatory to the arbitration agreement who was not involved in the arbitration proceedings.

Subject to the consent of the parties and on their request to the tribunal, interim measures can be invoked before or during proceedings in arbitration in Georgia.

The arbitral tribunal can order parties to:

• maintain or restore the status quo before the final award is made;
• take measures to prevent harm to the other party or to the arbitration process;
• form a vehicle for safeguarding assets from which a future award can be satisfied; and
• preserve and keep evidence that is material to the dispute and its resolution.

An interim measure issued by an arbitral tribunal is binding but subject to an enforcement by the court ‒ specifically, a party must submit an order and request its enforcement by the court. During such proceedings, the opposing party is notified and given the opportunity to challenge the enforcement by referring to the grounds of non-enforcement.

However, in Georgia, most parties prefer to apply directly to the court for interim relief. For further details, see 6.2 Role of Courts.

In Georgia, unless otherwise stipulated in the arbitration agreement, any party can request the arbitral tribunal to grant interim measures before the commencement of arbitration proceedings or at any point during the proceedings prior to the issuance of the arbitral award. Additionally, Georgian legislation permits parties, as per their will, to apply directly to the relevant appellate court (instead of applying to the tribunal) and request the use of provisional measures even after the composition of the tribunal.

Furthermore, in line with existing practice and the Civil Procedural Code of Georgia, a party may seek interim relief even before filing an arbitration claim under applicable arbitration rules. However, if a court grants such interim relief, the claimant has to file an arbitration claim within ten days and demonstrate to the court within said ten days that such claim has been filed; otherwise, the court will annul the decision on interim relief.

As mentioned in 6.1 Types of Relief, in practice, parties mostly prefer to apply directly to the court for interim relief – taking into account the simplified and less time-consuming nature of obtaining such relief from courts. Under Georgian legislation, courts are obliged to issue an ex parte decision within 24 hours, which then is communicated to the opposing party, who can later challenge it.

Moreover, Georgian courts may aid foreign-seated arbitrations as well. Even if the seat is abroad, provided that it has a relevant connection to the jurisdiction of Georgia, a party may directly apply to the court and request use of interim relief.

As for types of interim relief, Georgian courts may grant various types of preliminary or interim relief, including:

• freezing orders;
• prohibition of disposal or transfer of assets;
• measures aimed at maintaining or restoring the status quo;
• orders securing evidence; and
• orders requiring the provision of security of guarantees.

As for emergency arbitrators, Georgian legislation does not provide any specific regulation in that regard. However, the law allows parties to regulate the use of interim relief via party agreement, thus leaving it up to the parties to ‒ via express or implied agreement (which may be provided under applicable arbitration rules) ‒ allow the use of emergency arbitrators. Furthermore, certain arbitration institutes in Georgia (such as the DRC and the GIAC) have adopted provisions regarding the emergency arbitrator in their arbitration rules.

The Law of Georgia on Arbitration provides wide discretionary powers to arbitrators. Moreover, party autonomy is widely recognised. Therefore, security for costs may be granted, provided that arbitration rules agreed by the parties grant such authority to the tribunal.

The arbitration procedure in Georgia is governed by the Law of Georgia on Arbitration, which is mostly based on the UNCITRAL Model Law. It recognises party autonomy, allowing parties to choose ad hoc arbitration or to conduct arbitration under the chosen institutional arbitration rules, as well as opt for the application of any soft law desired by the parties.

The Law of Georgia on Arbitration prescribes various stages of arbitral proceedings, such as filing an arbitration claim, composition of the tribunal, communication between the parties, and conduct of arbitral proceedings, as well as the issuance of the award and its interpretation. However, in most cases, the law provides broad party autonomy ‒ authorising parties to regulate the conduct of arbitral proceedings.

Under the Law of Georgia on Arbitration, the arbitrators are obliged to be impartial and independent and to make relevant disclosures upon gaining knowledge of the facts, which shall be disclosed to the parties. Furthermore, arbitrators ‒ under the applicable law ‒ have a duty to keep the acquired information confidential.

There are no particular legal qualifications or other requirements specified by the Law of Georgia on Arbitration for legal representatives who appear in arbitration proceedings in Georgia. Therefore, such representatives may also have qualifications other than domestic ones.

However, foreign representatives are deprived of a right to represent clients at appellate courts (in annulment of enforcement proceedings), unless they are members of the Georgian Bar or employees of the involved parties.

The Law of Georgia on Arbitration does not explicitly regulate the the collection and submission of evidence at the pleading stage and at the hearing (eg, discovery, disclosure, privilege, use of witness statements, and cross-examination). The procedure for the submission of evidence and the presentation of witness statements (and related procedures) can be agreed by the parties, either directly in the arbitration agreement or by reference to the applicable arbitration rules.

The use of direct examinations or cross-examinations, and whether the process is more inquisitorial than adversarial, depends on the parties’ agreement and the applicable arbitration rules. Generally, under the Law of Georgia on Arbitration, arbitrators have the power to summon – and, if necessary, require the examination of ‒ the witness of any party or to use the testimony in the arbitration proceedings, unless otherwise regulated by the party’s agreement.

The Law of Georgia on Arbitration does not provide for specific rules of evidence. The tribunal, however, is given wide discretionary powers to decide on the admissibility, significance, substance and weight of the evidence. This enables the parties and the tribunal to choose whichever evidentiary rules they consider most appropriate for the nature of the case, including the internationally used International Bar Association Rules on the Taking of Evidence in International Arbitration (if that is what the parties have agreed upon).

Under the Law of Georgia on Arbitration, at any stage of the arbitration proceedings, the arbitral tribunal ‒ or a party, with the consent of the arbitral tribunal ‒ may request assistance from a court in taking evidence. This evidence can be presented to the party or arbitral tribunal at any stage of arbitration proceedings.

Furthermore, the arbitral tribunal is authorised to ask the court to ensure the attendance of witnesses. The rights and duties of witnesses summoned by the court are determined in accordance with the Civil Procedure Code of Georgia.

As per the Law of Georgia on Arbitration, unless there are specific provisions to the contrary in the law or the parties’ agreement, all arbitration proceedings are required to be confidential. Accordingly, no documents, evidence, or written or oral statements from the proceedings can be published or be transferred for use in any other judicial or administrative proceedings. The duty of confidentiality applies both to arbitrators and to any individuals involved in the arbitration process.

The Law of Georgia on Arbitration provides that the arbitral award must be in writing and signed by the arbitrator(s). The award must provide information identifying the decision-making arbitrators and the parties, as well as the date and place of rendering of the award. The award must also contain the reasoning, unless otherwise agreed by the parties or it is rendered via settlement. There are no common restrictions with regard to the permissible types of relief ‒ although any relief must not be contrary to Georgian public policy.

As for time limits, the Law of Georgia on Arbitration provides that ‒ unless otherwise agreed by the parties ‒ the arbitration award must be rendered within 180 days after the commencement of the arbitration proceedings. If necessary, the arbitral tribunal may extend this period for no longer than 180 days. However, the same law authorises parties to regulate time limits under their agreement directly, as well as implicitly via agreed arbitration rules, which may provide shorter or longer time periods.

On several occasions, appellate courts have partially enforced arbitral awards that entitled a party to an excessive penalty against a natural person under a loan agreement. Specifically, courts have found that excessive penalties (eg, exceeding around 130% of the principal amount of the loan) violate Georgian public policy; therefore, enforcement will only be granted partially and for a reduced amount.

Considering the foregoing, it is highly likely that Georgian courts will not enforce awards granting punitive or exemplary damages. As for the simple interest and compound interest, if a court finds that the principle of proportionality is violated or the enforcement of the award would violate public policy, it may refuse recognition and enforcement.

The Law of Georgia on Arbitration does not contain specific provisions on the allocation of costs. Therefore, it is up to the parties to regulate cost allocation either directly in the agreement or by reference to the applicable arbitration rules.

Generally, the arbitral tribunal has jurisdiction to decide on its own costs. Usually, however, the relevant body under the applicable arbitration rules makes a decision on the amount of the advance costs before the tribunal is formed and before the parties are required to pay such advance costs. As for the approach taken by tribunals seated in Georgia, they usually follow a “costs follow the event” approach.

The Law of Georgia on Arbitration entitles parties to request the annulment of the award. In such cases, applications are heard by appellate courts. The grounds for appealing an arbitral award in Georgia are similar to the grounds provided under the UNCITRAL Model Law ‒ namely, a party may request an annulment if:

• a party was legally incompetent when they entered into the arbitration agreement or did not receive the support they were supposed to receive from a legal guardian in relation to the issues in dispute;
• the arbitration agreement is void according to the law chosen by the parties, and in absence of a choice of law provision, in accordance with the laws of Georgia;
• a party was not given proper notice of the appointment of an arbitrator or proper notice of the arbitration proceedings (or was otherwise unable to present their case or protect their interests);
• the award settles a matter that was not in dispute or the award contains a decision on matters beyond the scope of the arbitration request ‒ if the ultra vires decision(s) can be separated from the legitimate decision(s), the award will only be partially set aside;
• the constitution of the arbitral tribunal or the arbitral procedure did not comply with the arbitration agreement or the Law of Georgia on Arbitration;
• the dispute is non-arbitrable; or
• the award violates Georgian public policy.

The Law of Georgia on Arbitration requires that such challenge must be submitted within 90 days after receipt of the arbitral award by the party and the duration of such challenge proceedings must not exceed 30 days from the admissibility of the relevant motion/challenge. The court is obliged under the Law of Georgia on Arbitration to render a decision within such 30 days. However, in practice, annulment proceedings usually last up to several months. Challenging an award does not automatically suspend the process of recognition and enforcement and the judge shall make a relevant decision upon the request of a party.

Up until now, Georgian courts have not reviewed a case concerning the exclusion of expansion of the scope of appeal. However, amendment of the scope of review is unlikely to be permissible under the Georgian legislation.

The standard of review varies depending on the subject matter and the parties involved. Provided that the case concerns B2B transactions, the court is likely to apply a more differential review. However, the standard applied by courts is stricter where a consumer or a natural person is a party to arbitration proceedings. Mostly in such cases, the court ‒ when reviewing compliance with Georgian public policy – will examine the merits of the case.

Nonetheless, as mentioned previously, courts are more reluctant to undertake such a review in B2B cases. Various courts have stressed that “when reviewing a claim to annul an arbitral award, the court does not examine the merits of the case, determine the factual circumstances, or assess the evidence”.

Georgia is party to the New York Convention. However, Georgia has not made any declaration and/or reservations upon its ratification.

In Georgia, second-instance (appellate) courts have jurisdiction over the recognition and enforcement of domestic arbitral awards. The Supreme Court of Georgia, as the third-instance court, is authorised to hear cases concerning the recognition and enforcement of international arbitral awards.

A party seeking the recognition and enforcement of an arbitral award must submit either the duly certified original of the arbitral award (for awards rendered outside the territory of Georgia) or its duly certified copy, as well as the original or a duly certified copy of the arbitration agreement (if such exists). If the arbitral award or the arbitration agreement is not in the Georgian language, the party must also submit a duly certified Georgian translation of these documents.

In recent years, courts have adopted an arbitration-friendly approach in various instances. By way of example, the Supreme Court of Georgia has found that an arbitration agreement providing that parties “may” refer a dispute to arbitration was enforceable. However, there have been instances where courts have evaluated arbitration agreements governed by foreign law through the lens of Georgian legal principles, potentially leading to inconsistent interpretation and application.

The award that has been set aside by the courts in the seat of arbitration may be refused recognition and enforcement in Georgia. As per the Law of Georgia on Arbitration, a court may refuse enforcement of a foreign arbitral award if it has been set aside or suspended by a court of the country in which ‒ or under the law of which ‒ the award was made. However, courts have not developed a decisive practice in this regard, mainly owing to the rarity of such motions.

When an arbitral award is subject to ongoing set-aside proceedings at the seat, this does not automatically result in the suspension of enforcement proceedings in Georgia. However, the court may ‒ upon a party’s motion ‒ consider whether to suspend the enforcement proceedings pending the outcome of the annulment proceedings. The decision to suspend is discretionary and assessed on a case-by-case basis by the court.

As for the defence of sovereign immunity, Georgian courts have so far not addressed this issue.

Georgian courts have a pro-enforcement approach towards both foreign and domestic arbitral awards, in line with Georgia being a signatory of the New York Convention. Moreover, as mentioned in 11.3 Standard of Judicial Review, Georgian courts frequently emphasise that “when reviewing a claim to annul an arbitral award, the court does not examine the merits of the case, determine the factual circumstances, or assess the evidence” ‒ thereby reinforcing the principle of minimal judicial interference in arbitral proceedings. However, when it comes to consumer arbitration or arbitration involving a natural person, courts tend to derogate from the above-mentioned principle and apply stricter standards, both in terms of the arbitration agreement’s content (demanding clear and unambiguous consent) and its form.

A foreign or domestic arbitral award will be enforced and recognised unless a ground of refusal is proven by the party opposing enforcement. These grounds include the absence of a valid arbitration agreement, violation of due process, non-arbitrability of the subject matter, or that enforcement would be contrary to public policy.

Georgian courts are able to refuse recognition or enforcement of an arbitral award when, in the view of a court, recognition or enforcement would be against the public policy of Georgia. Thus the analysis is conducted through the lens of domestic legal principles and not with reference to international public policy. When determining whether an award contravenes Georgian public policy, courts limit their interpretation of public policy to situations involving fundamental principles of law ‒ for example, violations of due process, corruption, fraud, or awards that seriously conflict with the core values of the Georgian legal system or international legal standards such as the principle of proportionality.

The provisions of the Georgian arbitration law do not specifically regulate class action or group arbitration. The Law of Georgia on Arbitration, which follows the UNCITRAL Model Law, primarily deals with individual disputes arising between parties who have concluded an arbitration agreement.

In terms of ethical standards applicable to counsel and arbitrators conducting arbitral proceedings in Georgia, there are no statutory provisions in this regard, except for a set of general obligations upon arbitrators to remain independent and impartial. However, as mentioned in 4.5 Arbitrator Requirements, the Georgian Association of Arbitrators (a non-statutory organisation) has established a Code of Ethics for Arbitrators, which has been adopted by various arbitral institutions. Arbitrators who operate in accordance with the arbitration rules of such institutions are bound by the Georgian Association of Arbitrators’ Code of Ethics for Arbitrators, which serves as a guideline for their conduct during arbitration proceedings.

The Law of Georgia on Arbitration does not provide any specific regulations regarding third-party funding in arbitration. As of the time of writing (July 2025), there have been no such court decisions regarding this matter.

The Law of Georgia on Arbitration does not specifically regulate the consolidation of separate arbitral proceedings. Nevertheless, consolidation can take place if the relevant institutional arbitration rules (eg, the GIAC Rules) allow such a consolidation.

Notably, as per the GIAC Rules, upon the request of a party, the GIAC Arbitration Council – following referral from the GIAC Secretariat ‒ may decide to consolidate a new case with a pending arbitral proceeding if:

• the parties have agreed on the consolidation of the proceedings; or
• all claims sought are made under the same arbitration agreement.

To date, Georgian courts have not established a clear legal precedent demonstrating that individuals or entities who did not sign the arbitration agreement can be held to its terms. Given the general stipulation that natural persons and administrative bodies must explicitly sign an arbitration agreement, it is improbable that non-signatory administrative bodies or individuals will be legally bound by arbitration agreements that lack their signatures.

However, in a case rendered by the Kutaisi Appellate Court in 2012, the court set aside an arbitral award concerning a third party who did not participate in the arbitral proceedings. Referring to Article 42, Part One, subparagraph a(g) of the Law of Georgia on Arbitration, the court stated that it is authorised to set aside an arbitral award rendered in Georgia only if the party against whom the award was issued files a claim with the court and proves that they were not duly informed of the arbitral proceedings or of the appointment of the arbitrator (or were otherwise unable to participate in the hearing for a valid reason). Moreover, in situations involving legal succession or assignment, the individuals or entities receiving rights or obligations through such processes are indeed bound by the arbitration agreement ‒ thereby becoming parties to it.