VZCZCXRO6846
PP RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHPOD RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHSI #0826/01 1061333
ZNR UUUUU ZZH
P 161333Z APR 07
FM AMEMBASSY TBILISI
TO RUEHC/SECSTATE WASHDC PRIORITY 6069
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY

UNCLAS SECTION 01 OF 02 TBILISI 000826 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR EUR/CARC, DRL, PRM ETTA TOURE 
 
E.O. 12958: N/A 
TAGS: PREL PGOV PHUM PREF GG
SUBJECT: SOUTH OSSETIA: LAW ON RESTITUTION 
 
REF: TBILISI 602 
 
¶1.  Summary:  On January 1, 2007, a new Georgian restitution 
law entered into force, authorizing the GoG to provide 
compensation for the approximately 60,000 Ossetian refugees 
(90% of whom fled to North Ossetia) and Internally Displaced 
Persons (IDPs) who lost their homes during the 1990-92 war. 
The law calls for the establishment of a nine-member 
Restitution Commission, to be formed by May 31, which will 
review all refugee property claims over a period of nine 
years.  According to the law, three international experts 
will be appointed to the Commission, and these experts will 
then choose three representatives each from the Georgian and 
Ossetian sides.  Valerie Marchand, OSCE Rule of Law Advisor, 
told Poloff on April 11 that Zinaida Beststaeva, State 
Minister for Civil Integration is in charge of forming the 
Commission.  Beststaeva just recently sent out letters to the 
international community asking for assistance in finding 
international experts for the Commission.  MP Shota 
Malashkhia, Chairman of the Temporary Commission for the 
Restoration of Territorial Integrity, told Poloff on April 4 
that the de-facto authorities in South Ossetia have refused 
an invitation to participate in the Commission.  He said the 
GoG will propose that the Commission consider representatives 
from Dimitry Sanakoyev's alternate government to represent 
the South Ossetian side.  He also said that the GoG has not 
yet allocated any money in the budget for claims, but were 
looking at a number of ways to compensate refugees, including 
property swaps and assistance from international donors. 
USAID is providing USD 270,000 over two years to the NGO 
"Association for Protection of Landowners Rights" (APLR) to 
establish a property database, implement an information 
sharing campaign for refugees in North Ossetia, and collect 
property claims for submission to the Commission.  End 
Summary. 
 
Restitution claims on hold until Commission forms 
--------------------------------------------- ---- 
 
¶2.  One of the key provisions of the restitution law calls 
for the establishment of a tri-partite Restitution Commission 
that will oversee the restitution process and adjudicate all 
property claims.  Malashkhia told Poloff on March 28 that the 
law "isn't working" primarily because representatives from 
the de-facto South Ossetian government have refused to 
participate on the Commission.  According to the OSCE's 
Marchand, however, the Commission cannot even be formed until 
three international experts have been appointed, and these 
experts in turn choose the Georgian and South Ossetian 
members.  Marchand said that the GoG recently sent out 
official letters asking for support from the international 
community in finding these experts, adding that the GoG's 
late start makes it unlikely that the Commission will be 
formed in time for the May 31 deadline (Note:  The law can, 
and likely will, be amended to extend this deadline.  End 
note).  Marchand said that members of the international 
community are reluctant to participate because the law is not 
clear about who will pay for these experts, what their role 
will be, and who will provide support staff. 
 
GoG to recommend Sanakoyev's representatives for Commission 
--------------------------------------------- -------------- 
 
¶3.  Since the South Ossetian de-facto officials refuse to 
participate, Malashkhia said that the GoG would support the 
inclusion of any party willing to take responsibility for the 
Ossetian refugees, including representatives from Sanakoyev's 
alternate government.  He added that he hoped representatives 
from Sanakoyev's government would join the commission "soon," 
but acknowledged that that nothing would move forward prior 
to the appointment of the international experts to the 
Commission.  Malashkhia also said that the restitution law 
was passed too late to include it in the GoG budget for FY07. 
 Funds for restitution claims would likely be included in the 
FY08 budget, he said, but the GoG was also looking at other 
approaches, such as property swaps, that would not require 
much funding.  The GoG also hoped to organize a donors 
conference, he said, to help generate funds to cover 
restitution claims. 
 
Majority of refugees prefer to remain in North Ossetia 
--------------------------------------------- --------- 
 
¶4.  The law is intended to benefit all refugees and IDPs, 
regardless of where they fled, whether it was North Ossetia, 
Georgia, or anywhere else. Marchand said, however, that many 
of the refugees who fled to North Ossetia were skeptical that 
they would receive any compensation from the Georgian 
government.  She said the majority of these refugees prefer 
to remain in North Ossetia, where they have lived for over 13 
years, and receive cash compensation for their lost property 
 
TBILISI 00000826  002 OF 002 
 
 
(Note:  the law guarantees the return of the refugee's 
original property or suitable 'immovable substitute', 
allowing for cash compensation only in the event it is 
impossible to provide an adequate substitute residence.  End 
note).  She said they did not want to return to their 
original residences, nor did they want a comparable 
'immovable substitute.'  She said all the refugees now have 
Russian citizenship, many have children who speak only 
Russian, and either have no desire to return to Georgia or 
are afraid of what will happen when they return. 
 
APLR begins property database inventory 
--------------------------------------- 
 
¶5.  APLR, in conjunction with the Ministry of Refugees and 
financed with a USD 270,000 USAID grant, has started to 
inventory houses and land parcels abandoned by Ossetians who 
fled Georgia during the war.  According to David Giorgadze, 
director of APLR, approximately 6,000 homes and an equal 
number of land parcels in 260 villages were abandoned by 
Ossetians fleeing Georgia.  Once its inventory and database 
of the properties are complete, and the Restitution 
Commission is formed, APLR will conduct outreach activities 
to refugees in North Ossetia, informing them of the program 
and beginning to collect individual claim information. 
 
 
Comment 
------- 
 
¶6.  While the passage of the restitution law marks an 
important first step toward providing compensation for 
Ossetians who lost their property during the war, the GoG 
still needs to address some key issues as it moves forward. 
Ambiguities in the law concerning the finance and operation 
of the Restitution Commission will require further 
clarification before securing international donor support. 
The GoG must also work closely with APLR on outreach to North 
Ossetian NGOs and the refugees to build trust in the program. 
 The GoG must also balance this project with several of 
large-scale, government-initiated projects targeting refugees 
and Internally Displaced Persons (IDPs), including the 
Ministry of Refugees' "My House" project (reftel) and its new 
National Strategy for IDPs.  All of these projects require 
large amounts of outside donor funds necessitating a moderate 
approach to avoid donor fatigue.  We will keep encouraging 
the GoG to take these steps. 
TEFFT