For a Georgian VASP, local substance begins with express legal requirements for the head office, actual management, supervisory access and monthly presence. The operating model then determines the people, authority and infrastructure needed beyond that minimum.
“Substance” should not be reduced to a registered address or a local name on the corporate extract. Order No. 94/04 requires a head office in Georgia from which the VASP’s administrator or administrators actually manage the business. The office and its equipment must support effective management and control and allow unobstructed NBG inspection; the head office must also be physically separated from premises used by another person.
The statutory substance baseline
| Requirement | What the rule establishes | Operating implication |
|---|---|---|
| Head office | Located in Georgia and used by administrators for actual management. | Decision-making, records and system access should be supportable from the Georgian operation. |
| Physical separation | The head office and operational premises must be physically separated from space used by another person. | A mailing address or casually shared room does not satisfy the operating premise. |
| Supervisory access | The office, equipment and internal system must allow effective control and unobstructed NBG inspection. | Management should know where records, logs and evidence can be retrieved during an inspection. |
| Representative presence | One person authorised to represent the VASP must be in Georgia for at least 14 calendar days in each calendar month. | Presence should be planned around leave, incidents and regulatory interaction; possible breach requires advance notice to the NBG. |
The 14-day rule is a floor, not a staffing model
The presence requirement applies to one person authorised to represent the VASP, with authority evidenced by the Entrepreneurs and Non-Entrepreneurial (Non-Commercial) Legal Entities Registry. If that person may breach the monthly presence period, the NBG must be informed in advance of the reason and given contact details for the period of absence.
Management authority should match the filed organisation
Administrators should understand the services, customer and asset flows, provider dependencies, AML/CFT controls, technology and financial plan presented to the NBG. Delegation can be used, but responsibility, escalation and decision rights should remain clear enough for the Georgian company to operate and explain its own business.
A director who cannot access systems, challenge a provider, approve a control decision or explain the management information presented to the NBG is a weak governance design even if the corporate appointment itself is valid.
There is no universal VASP headcount
Order No. 94/04 requires the application to include an organisational structure showing head-office units, their functions and employee numbers, together with a development plan for the first six months after operations begin. It also requires a business plan with at least a three-year budget forecast and evidence of resources and procedures appropriate to the activity.
That makes staffing an operating-model question. Customer types, volumes, operating hours, cash exposure, custody, technology, languages, sanctions/KYT workload, complaints, accounting and outsourcing determine the required capacity. A small B2B transfer model and a retail exchange should not be forced into the same staffing template.
Outsourcing cannot hollow out local management
Critical technology, custody, KYC, blockchain analytics, cloud, liquidity and other functions may involve third parties. The Georgian VASP should nevertheless have contracts, access rights, management information, incident notification, continuity arrangements and people capable of understanding and challenging those providers.
The practical test is whether the Georgian company can identify a failure, make a decision, evidence that decision and continue or safely suspend the affected service without waiting for an external provider to tell it what happened.
The office is a supervisory control point
The head office is not only evidence of address. The NBG can require access to the internal system at the head office for a full on-site inspection. Operations must be recorded, systematised and retained so that actions on recorded information can be logged and information can be retrieved promptly from the head office.
Where in-person cash exchange is provided, additional video-surveillance requirements apply to the relevant head office or branch. That should be built into premises selection before signing a lease.
Evidence actual management after registration
Maintain evidence that the filed operating structure exists in practice: role descriptions, employment or service arrangements, administrator and staff access rights, training, presence records, meeting and decision records, management information, provider oversight, incidents, escalations and remediation.
Periodic comparison of the filed structure with actual headcount, system users, outsourced activities and budget helps identify when a change-control or NBG notification assessment is required.
Local substance should connect people, authority and supervisable operations
The aim is not a photographic office file; it is an operating Georgian company that can evidence how it is managed.