Strategic notes on freezing orders and interim relief in Georgia under the Law on Rehabilitation and the Collective Satisfaction of Creditors' Claims

Under the Law on Rehabilitation and the Collective Satisfaction of Creditors' Claims, Georgian courts have authority to impose interim protective measures — including asset freezes — at a creditor's application, but the procedural window for securing that relief is narrower than foreign practitioners commonly assume. For foreign creditors with Georgian counterparties, understanding exactly when and how those measures become available — and when they are displaced by the collective insolvency regime — is the operational priority.

The Law on Rehabilitation and the Collective Satisfaction of Creditors' Claims establishes a dual-track framework. Before a rehabilitation or insolvency case is formally opened, a creditor may seek interim measures through ordinary civil procedure — including an application to freeze the debtor's bank accounts, real property, or movable assets registered in Georgia. Once proceedings are opened, however, the administration of the debtor's estate passes to the court-appointed administrator, and individual enforcement actions — including any pre-existing interim orders — are subject to an automatic moratorium.

The practical consequence is significant: a freezing order obtained through civil procedure before insolvency commencement remains in force only until the moratorium takes effect. At that point, the frozen assets become part of the general insolvency estate and are administered collectively, not exclusively for the benefit of the creditor who obtained the freeze.

Note: If a creditor applies for a freezing order simultaneously with — or shortly before — a debtor's own application to open rehabilitation proceedings, the court may treat the moratorium as effective from the date of the debtor's filing, potentially extinguishing interim relief secured only days earlier. Creditors who rely on a civil freeze as a substitute for timely creditor registration in the insolvency proceedings risk losing both their interim protection and their priority position in the distribution schedule.

For foreign creditors — particularly those holding Russian or CIS-domiciled debt obligations against Georgian counterparties — the cross-border dimension introduces two additional complications.

First, the recognition of foreign judgments and arbitral awards in Georgia operates under a distinct procedural track from domestic insolvency. A foreign creditor seeking to enforce an award against a Georgian debtor who subsequently enters rehabilitation cannot rely on the recognition judgment as automatic grounds for lifting the moratorium. The creditor must file separately as a creditor in the Georgian proceedings, presenting the recognised award as the basis for its proof of debt. Failure to file within the statutory creditor registration period — which is short and runs from the public announcement of insolvency commencement — results in the claim being treated as a subordinated late claim.

Second, Georgian courts have discretion to impose interim measures in support of foreign proceedings, but this requires a specific application demonstrating that the Georgian assets are at risk of dissipation and that the foreign proceedings are of a type the Georgian court regards as analogous to domestic insolvency or enforcement. That assessment is fact-specific and court-specific; the outcome is not predictable from the face of the statute alone.

For creditors whose recovery strategy involves Georgian assets as part of a multi-jurisdictional enforcement — whether the primary debt obligation is governed by Russian, English, or any other law — early coordination with Georgian counsel is not a precaution but a structural necessity. The moratorium clock and the creditor registration deadline run independently of whatever timetable the creditor may be managing in other jurisdictions.

[CTA: If you are a foreign creditor with assets or counterparties in Georgia and are assessing interim protective measures or creditor registration under the Rehabilitation Law, make an enquiry: info@vetrovpartners.com | WhatsApp/Telegram: +7 (983) 510-38-76]

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Vetrov & Partners is a Russian-qualified boutique law firm established in 2009, recognised by Pravo-300 for eight consecutive years. For matters governed by Georgian law, the firm collaborates with trusted local counsel in Tbilisi.

The firm advises foreign creditors — including those with Russian and CIS-domiciled debt obligations — on cross-border asset recovery strategies spanning multiple jurisdictions. Enquiries involving Georgian counterparties or assets are coordinated through the firm's cross-border recovery practice.

Enquiries: info@vetrovpartners.com | WhatsApp / Telegram: +7 (983) 510-38-76 | t.me/vitvetcom

This publication is provided for informational purposes only and does not constitute legal advice under Russian or any other applicable law. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Vetrov & Partners is a Russian-qualified law firm. For matters governed by foreign law or requiring local admission in another jurisdiction, we collaborate with trusted counsel in the relevant jurisdiction. For advice regarding your particular situation, please contact info@vetrovpartners.com.

— Giorgi Kavtaradze Contributing Regional Analyst — Georgia, Commercial Disputes and Enforcement vetrovpartners.com/contributions/