Branch, Subsidiary or Representative Office: How a Foreign Company Enters Georgia
An existing company that wants a presence in Georgia has three routes, and they are not interchangeable. A branch is the parent under another roof, a subsidiary is a new Georgian company the parent owns, and a representative office cannot trade at all. What each one is in law, how it is taxed, what the registry needs, and how to pick.
A founder starting fresh registers an LLC and moves on. A company that already exists abroad faces a prior question: should the Georgian presence be the same legal person, a new one, or no trading entity at all. The three answers are a branch, a subsidiary and a representative office, and the choice sets the liability of the parent, the tax base in Georgia, the documents the registry will ask for and how much the structure can be changed later.
| Branch | Subsidiary (Georgian LLC) | Representative office | |
|---|---|---|---|
| Legal personality | None: part of the foreign parent | Separate Georgian legal person | None: part of the parent |
| Can it trade and invoice? | Yes | Yes | No: liaison, marketing and research only |
| Who is liable? | The parent, without limit | The subsidiary; the parent's exposure is its capital | The parent |
| Georgian tax base | Profit attributable to the branch, on distribution to the head office | The subsidiary's own profit, on distribution | None from trading; payroll taxes only |
| Management | A representative in Georgia appointed by the parent | A director; foreigners and non-residents allowed | A head of office |
| Registry filing | Parent's documents plus the decision to open a branch | Founder's documents plus a charter | Parent's documents plus the decision |
What a branch is, legally
A branch of a foreign enterprise is registered in the Georgian entrepreneurial registry, receives an identification number and can open bank accounts, hire staff and contract in its own name, but every obligation it takes on is an obligation of the parent. There is no capital to ring-fence, no separate charter, and no shareholder: the parent decides, through the representative it appoints. For tax, the branch is treated as a permanent establishment; profit attributed to it is subject to Georgian profit tax under the same distribution-based model that applies to Georgian companies, with remittance to the head office treated as the distribution.
A foreign enterprise may carry out activity in Georgia through a branch registered in the Registry of Entrepreneurs and Non-Entrepreneurial (Non-Commercial) Legal Entities. A branch is not a legal person; the foreign enterprise is liable for the obligations arising from the branch's activity.
What a subsidiary gives you
A subsidiary is an ordinary Georgian LLC whose shareholder happens to be a foreign company. It has its own charter, director, bank account and liability; the parent's risk is limited to what it has put in. It qualifies for the same tax statuses as any Georgian company, from the profit-tax model to the Virtual Zone and International Company regimes where the activity fits, and it can later take in local partners, be sold, or be restructured without touching the parent. The price is a second set of accounts and corporate formalities, and dividends to the parent that pass through Georgian withholding, reduced where a treaty applies.
The documents either route needs
- 1
The parent's registry extract or certificate of good standing, issued recently, apostilled or consular-legalised, with a certified Georgian translation.
- 2
The parent's constitutional documents, legalised and translated, so the registry can see who is authorised to decide.
- 3
The parent's decision: to open a branch and appoint its representative, or to found a subsidiary and appoint its director; signed by the body the constitutional documents empower.
- 4
Identification for the representative or director and, for a subsidiary, the beneficial-ownership declaration down to the natural persons behind the parent.
- 5
A registered address in Georgia with the owner's consent, and for a subsidiary a charter; the registry decides the filing in one business day on the standard track once the file is complete.
The parent's documents are where the time goes. A registry extract older than the registry accepts, a translation not certified by a Georgian notary, or a decision signed by someone the articles do not empower each cost a round of correspondence with the home country. Order the legalised set first and build the filing around it.
Next step
If the answer is a subsidiary
A Georgian subsidiary is an ordinary LLC, and the parent company's documents are what make the filing different. Trustlex handles the corporate founder route: apostilled parent documents, the resolution, and the filing itself.
See the registration routeHow to choose
- Choose a subsidiary when the Georgian activity carries commercial risk, when local partners or a future sale are conceivable, or when a Georgian tax status such as the Virtual Zone is part of the plan; it is the default for most operating businesses.
- Choose a branch when the parent must be the contracting party, for example a regulated business whose licence or client contracts cannot be assigned, or when the Georgian activity is a small, temporary extension of the parent's own.
- Choose a representative office when nothing will be sold in Georgia: a liaison presence for a parent that sells from abroad and needs staff, an address and a name on the door.
- Do not choose a branch to save on formation: the parent's unlimited liability and the tax attribution questions usually cost more than a subsidiary's charter.
The European software company that almost opened a branch
An EU software company wants a Tbilisi engineering team and considers a branch because it looks simpler: no charter, no capital, one registration.
- 1Its client contracts are with the parent and will stay there; the Georgian presence will employ engineers and bill the parent for their work.
- 2As a branch, the parent's whole balance sheet stands behind Georgian employment and tax obligations, and the profit attributable to the branch becomes a permanent-establishment question with the home tax authority.
- 3As a subsidiary, a Georgian LLC employs the team, invoices the parent under an intercompany agreement, and its profit is taxed only when distributed; the parent's exposure is the subsidiary's capital.
- 4The team's work is software development for export, so the subsidiary also qualifies to apply for Virtual Zone status, which a branch of a foreign company would not.
The subsidiary cost a charter and a second set of accounts and gave the parent limited liability, a cleaner tax position at home and access to a Georgian incentive. The branch would have saved a document and cost all three.
Whether a branch creates a permanent establishment for the parent's home tax authority is a question of the parent's own jurisdiction and treaty; take advice on both sides.
Next step
Bringing an existing company to Georgia
We form Georgian subsidiaries and register branches for foreign parents, prepare the legalisation list for the parent's documents in advance, and advise on which route fits the activity before anything is filed.
Start the applicationGeneral information, not legal advice. Branch and subsidiary registration is governed by the Law of Georgia on Entrepreneurs and the registry's rules; the tax treatment of branches and the availability of tax statuses are set by the Tax Code and change.