Changing the director of an LLC: what to do under Georgian law

What to do

1. Who decides: the general meeting of partners appoints and removes the director, unless there is a supervisory board (Law of Georgia on Entrepreneurs, Art. 44). A majority means more than half of the votes of participating partners (votes counted by share), unless the articles of association require otherwise (Law on Entrepreneurs, Art. 126). A sole partner decides alone, in writing (Law on Entrepreneurs, Art. 20). A decision without a meeting is possible only if the articles of association allow it (Law on Entrepreneurs, Art. 129). Read the articles of association first.
2. Removal: the director may be removed at any time without giving a reason (Law on Entrepreneurs, Art. 44). If the post becomes vacant (resignation, death), a new director must be elected within 1 month (Law on Entrepreneurs, Art. 124).
3. Form: a decision submitted to the registry must be certified (Law on Entrepreneurs, Art. 12). A notary is not required if the signature is certified at the Public Registry (Public Service Hall) or made with an electronic signature (Law on Entrepreneurs, Art. 4).
4. Registry (NAPR): a change of director (data in the founding agreement) is subject to registration (Law on Entrepreneurs, Art. 12) and is filed by the director. If the director does not cooperate, any partner may file the director's details (Law on Entrepreneurs, Art. 12).
5. When the new director can sign at a bank: the data are considered changed from the date the registration decision takes effect (Law of Georgia on Public Registry, Art. 20¹). Towards banks and counterparties, the change applies only after publication (Law on Entrepreneurs, Art. 14). During the first 15 days, a third party may prove that it did not know of the change (Law on Entrepreneurs, Art. 14).
6. Check: the director may be a natural or legal person; citizenship is not restricted by law (Law on Entrepreneurs, Art. 124). The term is no more than 3 years. If no new term or director is registered, the powers of the former director are extended indefinitely (Law on Entrepreneurs, Art. 44). If several directors are appointed and the articles of association do not provide otherwise, they sign only jointly (Law on Entrepreneurs, Art. 42).
7. Disputes: a claim to contest a decision must be filed within 1 month of learning of it, but no later than 6 months from the decision (Law on Entrepreneurs, Art. 93). A refusal or suspension of registration may be appealed within 30 calendar days (Law of Georgia on Public Registry, Art. 29).
8. Where to apply: NAPR (Public Service Hall or online); notary; court, for disputes.
9. Evidence: articles of association, extract from the registry, minutes or decision, the director's ID; foreign documents with apostille and translation.
10. Pitfalls: the new director signs before registration, and the bank sees the former director in the registry; an uncertified signature on the decision means registration will be suspended; removal from office does not by itself terminate the director's service contract.

Be sure to check

• who makes the decision and by what majority (general meeting or sole partner; articles of association)
• certification of the signature: notary, Public Service Hall or electronic signature
• registration of the change in the Registry of Entrepreneurs (NAPR); any partner may file it
• the moment from which the new director acts for banks and third parties
• the director may be removed at any time without giving reasons