07TBILISI1956, GEORGIA WARNS OUTSIDE INVESTORS ON BUYING PROPERTY

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Reference ID Created Released Classification Origin
07TBILISI1956 2007-08-07 10:59 2011-08-30 01:44 UNCLASSIFIED Embassy Tbilisi

VZCZCXRO3363
PP RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHPOD RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHSI #1956/01 2191059
ZNR UUUUU ZZH
P 071059Z AUG 07
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC PRIORITY 7219
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY
RUCNDT/USMISSION USUN NEW YORK PRIORITY 4575

UNCLAS SECTION 01 OF 02 TBILISI 001956 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PREL PGOV GG
SUBJECT: GEORGIA WARNS OUTSIDE INVESTORS ON BUYING PROPERTY 
IN CONFLICT ZONES 
 
REF: TBILISI 602 
 
1.  On August 3, Post received a diplomatic note from the 
Georgian Ministry of Foreign Affairs regarding its concern 
about possible sales of property belonging to IDP's by the de 
facto governments in Abkhazia and South Ossetia.  As part of 
the 1994 Quadripartite Agreement, signed by Georgia, Abkhazia 
and Russia, the sides agreed to work to ensure the safe, 
voluntary and dignified return of IDPs to Abkhazia.  Georgia 
fears, with reason, that the sale of IDP's homes and 
apartments, which they were forced to abandon in the early 
1990's, will make their eventual return impossible. 
 
Begin text: 
 
Circular Note 
 
No. 6/3277-12 
 
The Ministry of Foreign Affairs of Georgia presents its 
compliments to the Diplomatic Missions accredited in Georgia 
and has the honor to deliver the Non-Paper, regarding the 
official position of the Georgian side about the illegal 
alienation of private and state property by the separatist 
regimes of Abkhazia and Tskhinvali region/South Ossetia, 
Georgia. 
 
The Ministry of Foreign Affairs of Georgia avails itself of 
this opportunity to renew to the Diplomatic Missions in 
Georgia the assurances of its highest consideration. 
 
Tbilisi, 2 August, 2007 
 
Non-Paper 
 
On Issues Related to Illegal Acquisition of Property in 
Conflict Regions of Georgia 
 
-- In the mission to solve peacefully the territorial 
conflicts, protection of human rights and interests of 
internally displaced persons (IDPs) is a topmost priority to 
the Georgian Government.  First, this concerns the 
inalienable right of IDPs/refugees to voluntarily return to 
the entire territory of Abkhazia, Georgia in safety and 
dignity.  The same is true of the Tskhinvali region/South 
Ossetia. 
 
-- Both Abkhazia and Tskhinvali region/South Ossetia are 
indivisible parts of the Georgian state in its 
internationally recognized borders and is within Georgian 
jurisdiction.  For the time being, de facto the territories 
of the regions are temporarily and illegally under control of 
separatist regimes. 
 
-- Among other consequences of this state of affairs, the 
process of an illegal acquisition of private and governmental 
property (hotels, sanitariums, tourist centers, factories, 
coal layers) has been long ago launched by the leaders of the 
separatist regimes. 
 
-- Immovable property of the Georgian state and IDPs is being 
illegally seized by new "proprietors", who try to change 
locations of buildings, names and numbering of the streets, 
exteriors of houses so that the owners and their legitimate 
heirs could hardly claim their rights on their real estate, 
due to inability to identify it. 
 
-- With the aim of implementation of the existing Georgian 
legislation, in order to ensure the protection of the right 
in question and protect legitimate interests of Georgian 
citizens and the State itself, the Presidential program 
entitled "My House" has been developed. 
 
-- According to the Georgian legislation, any investment made 
on the territory of Abkhazia, Georgia is deprived of any 
legitimate basis and is a priori declared null and void.  It 
means that any current investor puts himself at risk of 
losing the invested money. 
 
-- There will be no justification for the outside investors, 
since the international community is properly informed of the 
illegal nature of any transactions carried out in Abkhazia 
without preliminary concent of the Georgian side.  Thus, in 
case of further investments, an investor, who, has been 
preliminary and adequately notified of impermissibility of 
transactions in questions, may face a possibility of civil 
liability or even criminal responsibility. 
 
-- Implementation of the Georgian legislation enables the 
IDPs and other natural or legal persons to claim their 
immovable property on the uncontrolled territories according 
 
TBILISI 00001956  002 OF 002 
 
 
to the rules and forms approved by the Minister of Refugees 
and Accommodation of Georgia. 
 
-- Abkhazia is a conflict zone, where there is a very high 
crime rate including kidnapping, abduction for the purpose of 
ransom, etc.  Human rights of the local population are being 
grossly violated on a daily basis. 
 
-- A potential investor, who wishes to make his/her money 
work in Abkhazia, should be fully aware that mentioned 
property is "Trophy" and he or she will have to make deals 
with separatist regime involved in ethnic cleansing, which is 
condemned by documents of the OSCE Lisbon, Istanbul, Budapest 
summits, and that a considerable amount of property that is 
the subject of illegal deals, belong to Georgian citizens 
forcibly expelled from Abkhazia. 
 
-- The Georgian side will continue providing the 
International Community with updated information regarding 
this issue. 
 
End text. 
 
2.  Comment:  The dip note from the Ministry of Foreign 
Affairs is the latest step in Georgia's campaign to draw 
attention to the problem of illegal property transactions in 
A
bkhazia and South Ossetia.  It may be an attempt to build a 
case to present at the European Court of Human Rights in 
Strasbourg, as Shota Malashkhia, Chairman of the 
Parliamentary Commission on Territorial Integrity, indicated 
in March (reftel).  It also presents Georgia's official 
response to recent media reports of Russian companies 
purchasing property in Abkhazia near the border with Sochi in 
anticipation of the 2014 Olympic Games.  Considering that the 
Abkhaz de-facto authorities have already passed a 
"parliamentary" decree effectively nullifying all IDP claims 
to property, the rhetoric between the Georgian and Abkhaz 
sides will likely continue to escalate.  A Georgian claim at 
the EU Human Rights Court would also likely identify Russia 
as the primary illegal investor in Abkhaz territory, placing 
further strains on an already tense relationship. 
 
3.  Comment continued:  The note was received about the same 
time as unconfirmed reports appeared in the Georgian press 
that the city of Sokhumi has begun to register apartments in 
one district previously populated by Georgians for sale at 
auction.  Statements by a Sokhumi official suggested that the 
extreme state of dilapidation of the apartments, thirteen 
years after they were abandoned, justifies putting them back 
in to use, possibly as housing for construction crews 
involved in preparation for the Winter Olympics in 2014.  The 
GOG has expressed concern about investments by Russia itself 
in Abkhazia in enterprises to supply the Olympics.  The 
Russian Ambassador in Tbilisi, Vyacheslav Kovalenko, has said 
that Russia "will not invest in Abkhazia without Tbilisi's 
agreement."   While the Ambassador's promise may apply to the 
Russian government, it is not clear how it will deter private 
Abkhaz, Russian and other foreign citizens who are likely to 
be eyeing abandoned apartments in the subtropical vacation 
area with envy.  End Comment. 
PERRY

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