Georgia must align its laws with EU rules under the EU-Georgia Association Agreement. To meet this goal, Georgia adopted a consumer protection law. The Law on the Protection of Consumers’ Rights sets rules for contracts between consumers and traders. It also introduces new safeguards for handling personal data in consumer relations.
Traders must inform consumers about how they collect and use personal data. They must also ensure data is processed lawfully and transparently. The law reflects EU standards, including principles from the General Data Protection Regulation (GDPR). These changes aim to strengthen consumer trust and privacy protection in Georgia.
The Law also introduces important safeguards for handling personal data in consumer relations. Traders must inform consumers about how they collect and use personal data and ensure that this data is processed lawfully and transparently. These provisions align with EU standards, particularly the General Data Protection Regulation (GDPR), strengthening consumer trust and privacy protection in Georgia. Read more about Personal Data Protection in Georgia.
Trader
The Law imposes general obligations on the traders to protect consumers’ rights. Under the Law, a trader means any natural person or any legal person acting within the scope of commercial activity.
It also includes any other person acting in the trader’s name or on the trader’s behalf.
Further, the Law states that commercial activity includes any act, omission, conduct, or explanation by the trader.
It also covers commercial communication, including advertising and marketing, directly related to selling or supplying goods or services. Consequently, the Law applies to every trader in the territory of Georgia who supplies goods or services to consumers.
Prohibition of Discrimination
The Law prohibits discrimination against consumers in the availability or delivery of publicly offered goods or services. According to the Law, a trader offering goods or services on the Georgian market must not discriminate between consumers.
This applies while the trader conducts any commercial activity.
Burden of Proof
According to the Law, if a customer finds a defect within six months, certain rules apply.
Until proven otherwise, the defect is presumed to have existed before the goods were delivered. In this case, the burden of proof rests with the trader. If the consumer discovers the defect more than six months after taking possession, different rules apply. The consumer must then prove the defect existed when the goods were delivered.
Main obligations of the traders
The law imposes the following main obligation on the traders:
- Obligation to provide the goods: The trader must deliver the goods to the consumer without delay. Delivery must occur no later than 30 calendar days after the contract, unless the contract states otherwise
- Obligation to provide information to the consumers: The Law states that traders must provide correct and complete information to consumers. This includes the names of goods and services and the seller’s identity. Traders must also disclose terms for changes, repairs, and technical services, if any. They must inform consumers about the price, main costs, and any additional costs. The Law requires disclosure of payment and delivery terms, if applicable. Traders must explain the terms of the legal guarantee. They must also provide details of any commercial guarantee, if available.
- Obligation to change or repair the goods: The Law gives the consumer the right to repair or change the goods. If repair or change is impossible, or the trader fails to act promptly, the consumer may terminate the contract.
Distance Contracts and Off-Premises Contracts
The Law sets out requirements for the distance contracts and off-premises contracts as well. For the Law, a distance contract means a contract between the trader and consumer.
It is concluded using one or more means of remote communication. The trader and consumer are not physically present at the same time. Moreover, an off-premises contract means the contract between the trader and the consumer is concluded outside of the trader’s premises and requires the physical presence of the trader and the consumer.
The Law states that consumers may refuse a distance or off-premises contract within 14 calendar days without giving a reason. Such refusal automatically terminates the contract.
The trader must return any amount paid by the consumer within 14 calendar days. The consumer must return the goods to the trader within 7 calendar days
Standard Terms of the Contract
In addition to the above, the Law regulates the standard terms of the contract as well. Under the Law, standard terms are those set in advance by the trader and intended for multiple uses.
The Law stipulates that the standard terms are invalid if they contradict the principles of trust and good faith and cause an unjustified imbalance of the rights and obligations of the contract.
Regulatory Oversight
The Georgian National Competition Agency (the “Agency”) enforces the Law on consumer protection. Consumers have the right to file complaints with the Agency if they believe traders violate the Law.
This enforcement framework also covers issues related to personal data protection within consumer transactions. The Agency oversees compliance to ensure that consumer rights and personal data receive proper protection.
Within 10 days of application to the Agency by the consumer, the Agency informs the applicant whether it has started the investigation into the case.
When the Agency starts an investigation, it usually lasts one month.
The Agency may extend the investigation based on its importance and complexity. However, it shall not last more than 3 months.
In case the Agency concludes that the trader violated the requirements of the Law, it shall, by its decision, set a deadline for the trader and require the fulfilment of one or both of the following terms:
- Restoration of the violated right;
- Termination of the prohibited action.
The Agency must publish the decision on its website within 3 business days. If the trader does not comply with the Agency’s decision within the set period, the Agency will impose a fine. The amount of such a fine shall not exceed 2% of the trader’s annual turnover during the previous financial year. In case the trader repeats its violation within 12 months, it will be fined twice the amount of the imposed fine.
Consequently, the Law imposes new obligations on the traders and defines the consequences of violation of its provisions. Therefore, all traders operating in Georgia must take this into account