EU Urges Georgia to Withdraw 'Foreign Agent' Bill as Protests Continue

BRUSSELS/TBILISI (Reuters) - On Wednesday 15 May 2024, the European Union urged Georgia to withdraw its highly contested "foreign agents" bill, saying the measure would set back the nation's ambitions to join the bloc, as protests against the legislation continued in a rolling political crisis.

Georgia's parliament on Tuesday 14 May 2024 passed the third and final reading of the bill, which would require organisations receiving more than 20% of their funding from abroad to register as agents of foreign influence, imposing onerous disclosure requirements and punitive fines for violations.

"The adoption of this law negatively impacts Georgia's progress on the EU path," said a statement from EU foreign policy chief Josep Borrell and the European Commission, the bloc's executive body. "The choice on the way forward is in Georgia's hands. We urge the Georgian authorities to withdraw the law."

The Georgian government has said the law is necessary to ensure the transparency of foreign funding for NGOs. It did not immediately say if it would back away from passing the bill following the EU's comments.

Thousands of protesters against the bill on Wednesday blocked key intersections throughout Tbilisi for the second day running, bringing traffic to a halt in much of the city.

Georgia's interior ministry said one man had been arrested for attacking police during a protest on Monday 13 May 2024.

London-listed shares in Georgia's two biggest banks were down sharply on Wednesday, a day after the US suggested it might sanction some Georgian officials if the law went ahead.

Shares in TBC Bank Group were down just over 15% on the day at their lowest since August and set for their largest one-day drop since March 2020, while Bank of Georgia shares fell almost 12% to their lowest since February, heading for their biggest daily drop since May 2020.

Presidential veto

A NATO spokesperson warned on Wednesday that the draft law was a step in the wrong direction for Georgia and would draw it further away from European and Euro-Atlantic integration.

Georgian President Salome Zourabichvili has vowed to veto the bill, telling a joint press conference on Wednesday with foreign ministers from Latvia, Lithuania, Estonia and Iceland that voting for the legislation would "betray the spirit" of Georgia, according to comments cited by Georgian media.

However, Georgia's parliament can overcome any presidential veto.

EU leaders agreed in December to grant Georgia the status of a membership candidate on the understanding that it completes nine steps, including reducing political polarisation. Diplomats said the bill clearly did not fit with that aim.

The European Commission said the bill would "undermine the work of civil society and independent media while freedom of association and freedom of expression are fundamental rights at the core of Georgia's commitments" to the EU.

The statement followed days of wrangling between EU member governments and officials.

Officials initially tried to agree a statement among the bloc's 27 member governments but that foundered on resistance from Hungary and Slovakia, diplomats said.

It then took more time to agree a Commission statement that had Hungary's support.