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Protection of the rights of consumers in Energy sectorProtection of the rights of consumers in Energy sector

Malkhaz DzidzikashviliMalkhaz Dzidzikashvili27 June - 3 July,27 June - 3 July, 20082008

Georgian National Energy and Water Supply Regulatory Company

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Decree N 15 of 15 August of 1997 of the National Regulatory Commission approved a Decree N 15 of 15 August of 1997 of the National Regulatory Commission approved a Commission regulation establishing the Board of Consumers as a structural unit of the Commission regulation establishing the Board of Consumers as a structural unit of the Commission;Commission;

Decree of the National Regulatory Commission dated 23 September 2003 approved a new Decree of the National Regulatory Commission dated 23 September 2003 approved a new Commission regulation under which instead of the Board of Consumers a Department for Commission regulation under which instead of the Board of Consumers a Department for Protection of Consumer Rights was founded;Protection of Consumer Rights was founded;

In accordance with the changes and amendments to the law of Georgia on National In accordance with the changes and amendments to the law of Georgia on National Independent Regulatory Bodies, in October 2003, the Commission established within the Independent Regulatory Bodies, in October 2003, the Commission established within the Office of Public Defender of Georgia held a contest at which a public defender of consumer Office of Public Defender of Georgia held a contest at which a public defender of consumer rights was appointed and his deputees were selected. As a result, the existing Office of rights was appointed and his deputees were selected. As a result, the existing Office of Consumer Rights Public Defender was founded independently from the Regulatory Consumer Rights Public Defender was founded independently from the Regulatory Commission;Commission;

After validation by the Parliament of Georgia of the changes and amendments made into the After validation by the Parliament of Georgia of the changes and amendments made into the Law of Georgia on National Independent Regulatory Bodies dated 22 June of 2003, the Law of Georgia on National Independent Regulatory Bodies dated 22 June of 2003, the Commission introduced a change into its regulation and the Department for Protection of the Commission introduced a change into its regulation and the Department for Protection of the Rights of Consumers established within it was abolished.Rights of Consumers established within it was abolished.

Background Information

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Fucntions and powers of the Office of Public Defender Fucntions and powers of the Office of Public Defender

The main functions of the Office of Public Defendant of The main functions of the Office of Public Defendant of Consumer Interests areConsumer Interests are::

To protect the interests of consumers of the electric power and natural gas;To protect the interests of consumers of the electric power and natural gas;

To assess the effect of tariffs and other regulatory changes on consumers, and their To assess the effect of tariffs and other regulatory changes on consumers, and their outcomes;outcomes;

To participate in preparation by the legislative and executive powers of those draft To participate in preparation by the legislative and executive powers of those draft normative acts, which migh have an impact on the interests of consumers.normative acts, which migh have an impact on the interests of consumers.

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The Office of Public Defender, in carrying out its The Office of Public Defender, in carrying out its functions, is entitledfunctions, is entitled::

To stand out as a party on behalf of the consumers in the Regulatory BodyTo stand out as a party on behalf of the consumers in the Regulatory Body;;

To study all those documents and materialsTo study all those documents and materials, romelic kanonmdeblobiT , romelic kanonmdeblobiT nebadarTulia maregulirebeli komisiis mier gasacnobad;nebadarTulia maregulirebeli komisiis mier gasacnobad;

To represent an individual consumer in dispute with a company.To represent an individual consumer in dispute with a company.

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Legal framework of the activities of the Office of Public Defender for Legal framework of the activities of the Office of Public Defender for Protection of Consumer RightsProtection of Consumer Rights

The Office of Public Defender for Protection of Consumer Rights is guided The Office of Public Defender for Protection of Consumer Rights is guided by the following normative acts:by the following normative acts:

Law of Georgia on Independent National Regulatory Bodies, which specifies primary Law of Georgia on Independent National Regulatory Bodies, which specifies primary functions of the Office;functions of the Office;

Law of Georgia on Protection of Consumer Rights, which specifies general rights of Law of Georgia on Protection of Consumer Rights, which specifies general rights of consumers;consumers;

Law of Georgia on Electric Power and Natural Gas, which specifies obligations of suppliers;Law of Georgia on Electric Power and Natural Gas, which specifies obligations of suppliers;

General administrative code of Georgia, which specifies administrative procedure, General administrative code of Georgia, which specifies administrative procedure, administrative bodies and their structures.administrative bodies and their structures.

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Financial provision of the Office of Public Defender of Financial provision of the Office of Public Defender of Consumer RightsConsumer Rights

Activities of the Office of Activities of the Office of Public Defender of Public Defender of Consumer RightsConsumer Rights, as part of regulation,is financed , as part of regulation,is financed through regulation fees paid to the Regulatory through regulation fees paid to the Regulatory Commission;Commission;

Financing of the Office of Public Defender of Financing of the Office of Public Defender of Consumer Rights is reflected as a separate article in Consumer Rights is reflected as a separate article in the budget of the Commissionthe budget of the Commission..

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Legal basis and requirements to the appointment of a Legal basis and requirements to the appointment of a Public Defender of Consumer RightsPublic Defender of Consumer Rights

Basis for appointment of a Public Defender of Consumer Basis for appointment of a Public Defender of Consumer Rights is the Law of Georgia on National Independent Rights is the Law of Georgia on National Independent Regulatory Bodies;Regulatory Bodies;

A Public Defender of Consumer Rights may be a person: A Public Defender of Consumer Rights may be a person: – Who has higher legal educationWho has higher legal education– Who is competent in natural monopolies Who is competent in natural monopolies – Who is competent in consumer rights Who is competent in consumer rights – Who has a license of legal practiceWho has a license of legal practice

A Public Defender of Consumer Rights may not be a member A Public Defender of Consumer Rights may not be a member of any political party.of any political party.

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To appoint a Public Defender of Consumer Rights, To appoint a Public Defender of Consumer Rights, within the Office of Public Defender of Georgia a within the Office of Public Defender of Georgia a special Competition Commission is formed which special Competition Commission is formed which takes a decision by majority of votes;takes a decision by majority of votes;

A decision of a Competition Commission is effected A decision of a Competition Commission is effected within 10 days by order of the Chairman of the within 10 days by order of the Chairman of the Commission;Commission;

A Public Defender of Consumer Rights is appointed A Public Defender of Consumer Rights is appointed for a two-year term.for a two-year term.

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Consumer Rights Protection Consumer Rights Protection

Representation of the interests of consumers to the Regulatory Representation of the interests of consumers to the Regulatory CommissionCommission

• A Public Defender of Consumer Rights participates in A Public Defender of Consumer Rights participates in discussions of tariffs at the Commission sessions;discussions of tariffs at the Commission sessions;

• A Public Defender of Consumer Rights participates in A Public Defender of Consumer Rights participates in working out of normative acts by the Commission and their working out of normative acts by the Commission and their discussion at the Commission sessions.discussion at the Commission sessions.

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Defending public interests against companyDefending public interests against company

A Public Defender of Consumer Rights will study consumer A Public Defender of Consumer Rights will study consumer applications and offer relevant proposals on eradication of applications and offer relevant proposals on eradication of violations to companies;violations to companies;

If proposals offered by a Public Defender of Consumer Rights If proposals offered by a Public Defender of Consumer Rights are ignored by a distribution company, under agreement with the are ignored by a distribution company, under agreement with the consumers, it will appeal to the Regulatory Commission to settle consumers, it will appeal to the Regulatory Commission to settle the dispute, or prepare relevant petitions to the court.the dispute, or prepare relevant petitions to the court.

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General information General information

on on

violations of the rights of consumersviolations of the rights of consumers

By data of the Office of Public Defender of Consumer Rights, the statistics By data of the Office of Public Defender of Consumer Rights, the statistics of consumer appeals to the Office by years is as follows:of consumer appeals to the Office by years is as follows:

In 2004 - 160 applications;In 2004 - 160 applications; In 2005 - 260 applications;In 2005 - 260 applications; In 2006 - 586 applications;In 2006 - 586 applications; In 2007 - 447 applications.In 2007 - 447 applications.

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Thank you for attention