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Cartu Group about New Oppression Facts

October 31, 2011

Nino Tarkhnishvili, Radio “Liberty”

On October 28, Georgian news agency published two statements souvent. The first statement was released by the administration of Cartu Bank and the second by Bidzina Ivanishvili’s press-center.

Bidzina Ivanishvili’s press-center stated that Tbilisi City Hall’s Supervision Department does not allow the Cartu Group to continue rehabilitation activities in King Rostom’s Palace in King Eerekle Square. The lawyer of the Cartu Group clarified that the company New Capital within the Cartu Group purchased the building in 2009 and finished the reconstruction activities for multifunctional business-center late in August of 2011. On September 1, 2011 the Company requested the City Hall to inspect the implemented reconstruction activities in order to launch the exploitation of the building. According to the law, the representatives of the Supervision Department were to inspect the King Rostom’s Palace before October 13 but they arrived there only on October 26 and requested the workers to stop working. On their side, the Tbilisi City Hall is surprised with the accusations of the Cartu Group and thinks that it is ungrounded, unfair and politicized accusation.

The press-center of the Cartu Group noted in their statement that the Supervision Department suspended the construction activities in the multifunctional business-center because of incorrectly implemented construction works. The Radio Liberty also visited the King Erekle’s Square and met Giorgi Kvezereli, manager of the Burji Ltd; the latter conducted reconstruction activities in the King Rostom’s Palace.

Kvezereli said the representatives of the Supervision Department arrived at the area on October 26. “They came here in the morning and started measuring of the building without informing anybody about it. They called me at 9:30 pm and ordered to stop activities. They alleged we had breached the initial project. On October 27, they hang an act on the building which states that there were violations in the reconstruction activities. Afterwards, strangers arrived in the area and banned us to enter or leave the building; we could not take in or out any materials either; the same happened on October 28. They said nobody can enter the territory.”

The lawyer of the Cartu group Archil Kbilashvili clarified in his interview with the Radio Liberty that the resolution which was handed to the Cartu Group by the Supervision Department clarified all technical shortcomings which were detected by the Dept when inspecting the building. The number of stair steps and the door replaced in the vitrage became reasons for canceling the reconstruction activities. Archil Kbilashvili added that the detected shortcomings were not so dangerous that could compel the Supervision Department to request them to stop construction. However, as the resolution states if the shortcomings cannot be eradicated without canceling the construction, the Supervision Department is entitled to order to cencel the construction activities.

Archil Kbilashvili clarified that the decision put the Cartu Group in an awkward situation. “When they decided to suspend the reconstruction, they deprived the possibility from the Company to eradicate the shortcomings. There is another way – to correct the project and to submit the new version to the Architect Department in order to obtain a new permit. However, it is arguable whether the Architect Department issues a new permit or not. In fact, the resolution cut all the ways out for the Company.”

According to the statement, another property of the Cartu Group also faced problem – the land of 3 000 sq. meters in King Erekle’s Square. In 2010 the Company New Capital within the Cartu Group purchased the space from the state for 59 year-term and intended to construct an underground parking-lounge there. The preliminary permission for the construction was issued by the Tbilisi City Hall. The construction of the tunnel finished on May 26, 2010 and only incrustation activities were to be carried out there. Archil Kbilashvili clarified with the Radio Liberty that on October 26, the New Capital received an email which stated that the resolution, determining agreement between the Tbilisi City Hall and the New Capital, was annulled. Consequently, the Tbilisi City Hall requested the company to leave the entity.

“In order to annul the agreement, the City Hall shall appeal to the Court, to verify its decision on annulling the agreement and if the Court accepts its verification, the suit will be satisfied. In our particular case, only City Hall expressed its desire to annul the agreement but it does not mean that the agreement was cancelled. Their request in the email to annul the agreement was overstatement and of course it did not have any legal grounds,” Archil Kbilashvili told the Radio Liberty.

The Tbilisi City Hall was surprised with the Cartu Group’s Statement and on October 28 spread official reply and stated that the Cartu Group’s accusations were ungrounded and politically motivated. “Since big companies join the business-center and their operation is urgently important for the city, the Tbilisi City Hall expresses readiness to allow the Company to continue the activities in the business-center as soon as the corrected project is submitted,” the statement of the Tbilisi City Hall reads.

As for the parking-lounge, the Tbilisi City Hall noted that it is a property of the self-governmental agency and it was assigned to the New Capital under building rights which allowed the company to construct the parking lounge for general public and not for concrete company. The accusation regarding this issue is groundless.

On October 28, Cartu Bank released a new statement which responded to the initiative of Giorgi Kadagidze, president of the Georgian National Bank. The latter expressed its readiness to allocate financial resource for the Cartu Bank equal to the distrained amount of money before the situation is stabilized. However, the President of the Cartu Group Nodar Javakhishvili told the Radio Liberty that the Cartu Bank is not going to accept the Georgian National Bank’s proposal and does not exclude the possibility that it is a new provocative step taken by the GNB.

“If we accept their proposal, it might have negative impact on us; they might soon declare that the Bank has problems of liquidity and then they would suggest introduction of temporary administration into the bank. The National Bank is fully aware that we do not have any financial problems; we have problems due to oppression from the government and the National Bank itself. We declare that the bank has become target of the assault due to political motives. The National Bank is entitled to protect our bank from similar political factors rather than offering money to us. The seized three million Euro will not bankrupt the Cartu Bank. We do not need their financial aid; we need their assistance in condemning completely ungrounded oppression on the Bank,” Nodar Javakhishvili told the Radio Liberty.

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