President vetoes controversial National Bank of Georgia bill

  • President of Georgia Giorgi Margvelashvili had 10 days ten days to draft a corresponding bill. Photo by the President’s Press Service., 31 Jul 2015 - 13:55, Tbilisi,Georgia

The President of Georgia has vetoed a bill initiated by majority members of Parliament (MPs) that envisages stripping the National Bank of Georgia (NBG) of its right to supervise financial institutions. 

President Giorgi Margvelashvili stressed that the hasty process of discussing the draft bill and its contents encouraged him to use his constitutional right to veto the bill. 

"The NBG is a very significant, constitutional institution and I heard no genuine evidence why we should amend its structure especially when NBG activities are highly scored by international institutions,” said Margvelashvili while stating why he used his veto. 

The President emphasised the importance of democratic institutions and stressed that making hasty decisions might affect the county’s macroeconomic field and effective implementation of monetary policy. 

Margvelashvili said through consultations with international organisations and the European Union (EU) his Administration had developed motivated remarks and a corresponding bill. 

"The bill offered by us empowers NBG and its supervisory functions. The majority has stated that it intended to amend the law again in September based on consultations with relevant, foreign organisations. The President’s Administration has already held consultations and created a new bill.” 

 "The bill is an optimal outcome.”

The President underscored that his veto should not be described as a lever of any political confrontation. 

"The veto should be viewed as a lever for getting better outcomes; a lever that benefits democratic values and laws through collaboration among different state institutions,” he said. 

The bill offered by the Georgian Dream coalition members stated that a separate Financial Supervisory Agency would be established and governed by a seven member Board. The NBG president and one more member of the central bank’s Board will take two seats; five other seats will be occupied by candidates nominated by the Government and confirmed by Parliament. The head of the Agency will be nominated by Board members and confirmed by Parliament. 

The majority will need at least 76 votes in 150-seat Parliament to override the President’s veto. Georgian Dream holds 86 seats in the legislative body.