Best Equity Capital Markets Lawyers in Tbilisi

About Equity Capital Markets Law in Tbilisi, Georgia

Equity Capital Markets (ECM) in Tbilisi, Georgia, are an essential part of the country's financial system. The ECM refers to the portion of the capital market that deals with the issuance, buying, and selling of shares and other equity instruments. It serves as a platform where companies can raise capital from investors, both locally and internationally, by offering shares to the public or through private placements. Tbilisi, as the financial hub of Georgia, hosts the Georgian Stock Exchange (GSE) which is the main venue for equity trading and capital formation. The legal framework guiding ECM activities is designed to ensure transparency, protect investors, and foster public confidence in the market.

Why You May Need a Lawyer

Legal expertise is crucial when navigating equity capital markets due to the complexity and regulatory oversight involved. You may need a lawyer in the following situations:

• If you are a company planning to go public or issue new shares to raise capital through the Georgian Stock Exchange.
• If you need assistance with preparing prospectuses or disclosure documents required under Georgian securities law.
• If you are a foreign investor wanting to acquire shares or invest in a Georgian entity.
• If you require advice on compliance with local laws, insider trading regulations, or corporate governance norms.
• If you are involved in mergers, acquisitions, or restructuring deals that include share swaps or other equity arrangements.
• If you need help resolving disputes related to equity transactions or shareholder rights.

Local Laws Overview

Some key local laws and regulations impact equity capital markets in Tbilisi:

• The Law of Georgia on Securities Market governs the issuance and trading of securities. It outlines requirements for public offerings, ongoing reporting, and insider trading prevention.
• The National Bank of Georgia (NBG) is the key regulatory authority overseeing capital markets, including the licensing and monitoring of market participants.
• The Law of Georgia on Entrepreneurs sets rules for the formation and operation of companies, including rules related to the increase and decrease of share capital and shareholder rights.
• The Georgian Stock Exchange sets its own requirements for listing and ongoing transparency, complementing national legal provisions.
• The Civil Code of Georgia covers underlying contractual and property rights issues relevant to equity securities.
• Foreign investors are generally allowed to participate in the Georgian equity capital markets, but certain sectors may have special restrictions or disclosure requirements.
• Anti-money laundering laws apply to all capital markets transactions, requiring disclosure of beneficial ownership and monitoring of suspicious activity.

Frequently Asked Questions

What are equity capital markets?

Equity capital markets are platforms where companies raise funds by issuing shares or other equity instruments to investors. In Georgia, these activities are mainly facilitated through the Georgian Stock Exchange.

Can foreign nationals invest in Georgian companies through equity markets?

Yes, foreign nationals can invest in Georgian companies, subject to certain regulatory and disclosure requirements. Some sectors may have special restrictions on foreign ownership.

What is the process for a company to list on the Georgian Stock Exchange?

A company must meet the listing requirements of the Georgian Stock Exchange, prepare a prospectus, comply with transparency obligations, and undergo regulatory review by the National Bank of Georgia.

What is a prospectus, and when is it required?

A prospectus is a legal document that provides details about a share offering to potential investors. It is required for public offerings and must be approved by the National Bank of Georgia.

How are shareholder rights protected under Georgian law?

Shareholder rights, such as voting, dividend entitlements, and access to information, are protected under the Law on Entrepreneurs and the Civil Code of Georgia.

What regulations are in place to prevent insider trading?

The Law on Securities Market explicitly prohibits insider trading and market manipulation, and sets out penalties for violations. The National Bank of Georgia is tasked with enforcement.

Are there ongoing reporting obligations for listed companies?

Yes, listed companies must make regular financial and operational disclosures to the Georgian Stock Exchange and regulatory authorities, ensuring transparency for investors.

What is private placement, and is it allowed in Georgia?

A private placement is the sale of securities to a select group of investors rather than on the open market. It is permitted in Georgia, but still subject to specific regulations and disclosure requirements.

What legal risks should investors be aware of?

Investors should consider risks such as regulatory compliance, potential for fraud, market volatility, and legal disputes related to shareholder rights or contract interpretation.

How do I find a qualified ECM lawyer in Tbilisi?

You can consult the Georgian Bar Association, seek referrals from commercial law firms with capital markets expertise, or research firms with a proven track record in ECM transactions.

Additional Resources

• National Bank of Georgia - the regulator for the Georgian capital market
• Georgian Stock Exchange - the main equity market platform
• Georgian Bar Association - for finding qualified lawyers
• Service for Accounting, Reporting and Auditing Supervision (SARAS) - for corporate reporting standards
• Ministry of Economy and Sustainable Development - for information on foreign investment regulations

Next Steps

If you need legal assistance in Tbilisi's equity capital markets, start by identifying your specific needs - whether it is share issuance, investment, regulatory compliance, or a dispute. Gather copies of relevant documents, such as share registers, company charters, or past correspondence. Reach out to a qualified lawyer or law firm experienced in ECM matters for an initial consultation. Be prepared to discuss your goals and challenges openly, so your legal advisor can provide tailored guidance. If you are an investor, consider conducting due diligence on potential investments, and always ensure that your transactions comply with Georgia's regulations.