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Tuesday, 25 August 2015

Tbilisi court restricts operation of Georgia's largest TV company

Published in Field Reports
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By Eka Janashia (19/08/2015 issue of the CACI Analyst)

On August 7, Tbilisi City court froze the assets of Georgia’s leading media company – Rustavi 2 TV – based on a the lawsuit of businessman Kibar Khalvashi claiming that the formerly ruling United National Movement (UNM) party forced him to give up his share in the company in 2006.

The court’s interim verdict prevents the company’s current owners from selling their shares as well as vending or renting out the organization’s property, including equipment and vehicles. The broadcaster’s general director and chief financial officer are also restrained from changing existing regulations or reorganizing the company.

Rustavi 2 TV, Georgia’s largest and most successful broadcaster, was established in the 1990s in the provincial town Rustavi. It became an influential media player, introducing high professional standards of journalism, and an important player in shaping political attitudes and public perceptions. Rustavi 2 TV made a crucial contribution to the 2003 Rose Revolution and the UNM’s ascent to power, cementing the relationship between the two. Former president Mikheil Saakashvili’s UNM allegedly attained full control of Rustavi 2 from 2004. According to Transparency International (TI) Georgia, from 2004 to 2012 the company changed owners roughly 20 times through vague and controversial deals with a sharp political flavor. The new owners were chosen in light of the given political context and in line with their allegiance to the government.

In 2004, Khalvashi, with close links to then interior minister and Saakashvili’s confidant Irakli Okruashvili, purchased a controlling stake of the company from three of its founders – Davit Dvali, Jarji Akimidze and Erosi Kitsmarishvili, each holding 30 percent of the shares. As soon as Okruashvili left the government in 2006, Khalvashi sold his share to Georgian Industry Group, a company connected to Davit Bezhuashvili, the brother of former foreign minister Gela Bezhuashvili.

Rustavi 2 TV kept changing owners until UNM was voted out of government in 2012. Currently, 91 percent of Rustavi 2 TV’s stocks are owned by the brothers Giorgi and Levan Karamanishvili who reportedly are also confidants of the former president.

After the Georgian Dream (GD) coalition came to power, Rustavi 2 TV became a mouthpiece for opposition parties, especially the UNM, and aired the most pointed criticism against the government’s policy. Although the company is closely associated with Saakashvili and his team, it has accrued genuine public devotion and respect. TI reported that out of every 100 minutes Georgians spend in front of their TV set, 32 are spent watching Rustavi 2 TV. In the first half of 2015, the company earned GEL 21.5 million in advertising revenue – more than twice as much as its main competitor Imedi TV earned in the same period.

Given Rustavi 2 TV’s tremendous political clout, opposition political parties, NGOs and international organizations questioned the motives behind Khalvashi’s lawsuit as well as the decision by Tbilisi City Court. “[The court’s] decision is disproportionate and excessive and may constitute a threat to media pluralism in Georgia,” OSCE Representative on Freedom of the Media Dunja Mijatović said. A group of seven civil society organizations asserted in a separate statement that the decision triggers suspicions of political meddling and is “fraught with a high risk of control and restriction of the media outlet’s operations.”

These allegations are further enhanced by speculations over the long-time friendship between former PM Bidzina Ivanishvili and Khalvashi, whose sister Pati Khalvashi is a GD majority MP in the parliament.

Whereas Khalvashi could in 2006 well have been pressured by the ruling party to concede his share, his earlier obscure deal to obtain the company’s assets has also raised multiple questions, especially in light of Kitsmarishvili’s death.

The latter insisted that the UNM had illicitly deprived him of his share in favor of Khalvashi. Last summer, Kitsmarishvili was found dead in his car with a single gunshot wound to the head. According to the official version, Kitsmarishvili committed suicide but his relatives continue to gather evidence disclosing signs of an assassination.

The attacks against Rustavi 2 TV started simultaneously with the government shift in 2012. Shortly after the elections, the general director of the company, Nika Gvaramia, was arrested on accusations of corruption and released on a GEL 30,000 bail.

The court’s controversial decision, ahead of the next parliamentary elections in 2016, thus goes well beyond a dispute of private entities and ramps up the confrontation between the company and the government. Any attempt to rein in Rustavi 2 TV will damage Georgia’s pluralistic media environment as well as the free dissemination of critical opinions. It will also harm Georgia’s democratic performance and may considerably deepen social discontent.

Image attribution: Wikimedia Commons

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