Lease terms and conditions for state-owned tea plantation

A state-owned tea plantation may be leased without an auction with the approval of the Government of Georgia.

• Lease term – 25 years.
• Annual lease cost – 50 GEL per hectare.
• Lease cost review – The lease cost may be reviewed in the 15th year from the contract signing and then every 5 years.
• Transfer of lease – The lease may be transferred to a third party with the prior consent of the agency, provided that the new lessee assumes all obligations of the previous lessee towards both the agency and the lessor.
• For agricultural cooperatives, the leased area of state-owned tea plantations must not exceed the cooperative's already owned plantation area.

To lease a state-owned plantation, an interested party must apply to the LEPL "National Agency of State Property" with a relevant application, a conditional co-financing agreement signed with the agency, and an irrevocable and unconditional bank guarantee issued by a commercial bank, covering 10% of the co-financing amount specified in the program conditions.

The bank guarantee submitted to the LEPL "National Agency of State Property" must be valid for at least 68 months from the date of application submission and must meet the following requirements:

• During the first 4 months of its validity, the bank guarantee ensures that the lease agreement will be signed if the Government of Georgia issues the relevant legal act.
• If the Government of Georgia issues the relevant legal act, the bank guarantee ensures the fulfillment of the participant's obligations under the program and covers penalties in case of non-compliance.

If the Government of Georgia does not issue the relevant legal act within 1 month of the entrepreneur's application submission, the bank guarantee will be returned to the entrepreneur.

If the Government of Georgia issues the legal act, the lease agreement must be signed within 3 months of its issuance.

If the entrepreneur does not sign the lease agreement within three months of the Government of Georgia issuing the legal act, their guarantee amount will be fully transferred to the state budget.

If multiple participants submit documents for the same real estate property, priority will be given to the one who submitted their documents to the LEPL "National Agency of State Property" first.

After signing the lease agreement within the legally specified timeframe set by the Government of Georgia, the relationships related to the bank guarantee will be regulated by the lease agreement and Georgian legislation.

If the lessee fails to fulfill the obligations outlined in the lease agreement, they will not be reimbursed for any payments made or expenses incurred in case of lease termination.

*Note – Definition of Terms