The issue took on additional weight once the opposition television station Imedi broke the story of the Tbilisi city mayor’s office seizing apartments that the previous government had given to famous Georgians. Soon after, the city also started to seize and destroy small businesses and kiosks around the city.

According to Tbilisi Mayor Gigi Ugulava, the property was illegally privatized during the Shevardnadze government, and the city had the right to reclaim it. However, according to Georgian law, the government can only revisit issues of privatization up to three years following the purchase. The property in question had already passed that deadline. In addition, according to Georgian law, if the government wants to reclaim a piece of property, it must issue the order in writing in a timely manner so the owner of the property can take the matter to court; in the most recent cases the property holders were informed orally as little as two or three days before the city destroyed their buildings and reclaimed their property.

Although representatives from the National Movement and the president’s office never officially addressed the issue, at the height of the scandal in early February president Mikheil Saakashvili met with members of the opposition and promised to send a draft law to the parliament to further protect property rights. No details of the draft law were released and no date for its presentation was announced.

On February 12, Georgian Parliament Speaker Nino Burjanadze announced that the parliament would draft the law, as well as create a joint committee with members of the opposition to look into the cases. While she noted that “most” cases were likely instances of illegal privatization, the government would offer compensation if there was evidence that the seizure was illegal.

According to the public defender’s office, while there have been several cases of property abuse already in 2007, the problem is not a new one. The difference is that prior to 2006, most cases involving property seizure were part of the plea bargaining system that the Saakashvili government initiated as part of its ongoing anti-corruption campaign. A company or wealthy individual with suspicious wealth agreed to “give” the government private businesses or sums of money in exchange for his freedom. While this campaign enjoyed wide public support in 2004, in 2006-07 the government is no longer just targeting big business and has moved quickly into the realm of small stores and kiosks.

Surprisingly, the cases have not had a great resonance within the Georgian population or the investor market. Foreign direct investment was up in 2006 to reportedly $1 billion and the government announced in December that even higher investments are anticipated in 2007. For instance, on February 19 Georgian media announced that a Persian Gulf Emirate agreed to invest $817 million in real estate in Georgia.

Despite the fact that the Georgian constitution clearly protects property owners – and the owners affected had all the proper paperwork – the government’s actions against them did not result in a huge public outcry or protest.

Once again, the Saakashvili government has survived a potentially painful scandal with little more than an extra press conference and a few vague promises. Like the Sandro Girgvliani murder case and the 2006 prison riots, the recent wave of illegal property seizures could have caused the government – at the least – a great deal of embarrassment. However, due to the weakness of the opposition and general public apathy, the ruling party was able to bypass any potential harm without making any significant sacrifice or gesture.

While no one denies that privatization was often carried out illegally during the Shevardnadze regime, once the statute of limitation has expired, the owners enjoy all the rights of any other property owner. The Saakashvili government has not suffered noticeably from the allegations of property right violations but the praise it has received throughout the past year over progress in reform of the business climate could be jeopardized unless it can prove that property owners – and their investments – are protected in Georgia.