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In 2026, new labor migration rules came into force in Georgia. Now, most foreigners working in the country must obtain the right to work (a work permit).
This requirement also affects foreign entrepreneurs, including company directors.
The issue is particularly acute for IT companies with Virtual Zone Person (VZP) status.
Let’s take a look at whether a director of a virtual zone company needs to obtain a work permit and what changes may occur in the near future.
Short answer
Does the director of a Virtual Zone company need to obtain a work permit?
In most cases, yes.
A permit is required if:
- the director is a foreign citizen,
- is located in Georgia,
- actually manages the company.
A work permit may not be required if the director:
- manages the company from abroad,
- does not work in Georgia.
At the same time, Virtual Zone companies do not yet have special exemptions, but industry associations are discussing the possibility of introducing them.
New rules for foreign nationals working in Russia
A new system for regulating the employment of foreign nationals came into effect on March 1, 2026.
Key requirements:
- Foreign nationals must obtain a work permit.
- Employee data is entered into the electronic labor migration system.
- A D1 visa or residence permit can be issued on the basis of the permit.
The rules apply to:
- employees,
- company directors,
- founders,
- self‐employed persons,
- individual entrepreneurs.
Does a company director need a permit?
As a general rule, if a foreign citizen actually works in Georgia, a work permit is required.
This also applies to company directors.
When a director needs a work permit
A permit is required if the director:
- is a foreigner,
- is located in Georgia,
- manages the company,
- signs contracts,
- participates in operational activities,
- receives income from management.
This applies to:
- directors of LLCs,
- founding directors,
- IT companies,
- startups.
When permission may not be required
1. The director manages the company from abroad
If the director:
- does not reside in Georgia,
- manages the company remotely.
he is not considered a migrant worker.
In this case, a permit may not be required.
2. Special statuses
Certain categories of foreigners have simplified regimes or exemptions.
These mechanisms have emerged thanks to active dialogue between business and the state.
However, they do not apply to all regimes.
Virtual Zone Person and work permits
Companies with Virtual Zone Person status are IT companies that export software and IT services.
The main tax advantage is 0 % income tax on IT service exports.
However, a problem has arisen in the new labor migration rules: Virtual Zone companies have not been exempted from the requirements for obtaining work permits.
This means that formally:
- VZP directors,
- foreign developers,
- foreign startup founders,
must go through the general procedure for obtaining a permit.
What consequences does this have for IT companies?
The lack of exceptions leads to several problems.
Administrative burden
It is necessary to:
- submit applications,
- upload documents,
- undergo verification.
Financial costs
Companies need:
- legal support,
- document preparation,
- procedure support.
Regulatory risks
Violations may result in:
- fines of up to 4,000 lari,
- problems with residence permits,
- difficulties during inspections.
Who needs a work permit — table
| Situation | Is permission required? |
|---|---|
| Foreign director, lives in Georgia and manages the company | Yes |
| Foreign director, visits periodically | Most likely yes |
| The director manages the company entirely from abroad. | Usually no |
| Director — citizen of Georgia | No |
| Self‐employed foreign IT specialist | Yes |
| The founder of the company who actually works | Yes |
Possible changes for Virtual Zone
The Virtual Zone Residents Association is currently analyzing the situation.
The possibility of an official appeal to the Georgian government is being considered.
The main goal is to propose the introduction of exemptions for Virtual Zone companies.
For example:
- exemption of VZP directors from permits,
- a simplified procedure for IT specialists,
- a separate regime for export IT companies.
Why the business position is important
Practice shows that exceptions only arise when the industry takes an active stance.
If the business does not form a consolidated position, regulation is created without its participation.
That is why the association is now gathering support from companies in the virtual zone.
What Virtual Zone companies should do now
Until the legislation is amended, it is recommended to:
- Check the status of the director.
- Determine the need for permission.
- Prepare documents.
- Keep an eye out for new clarifications.
- Support industry initiatives.
Assistance in obtaining permits
ESPERO Law Firm assists foreign entrepreneurs in:
- obtaining work permits,
- applying for D1 visas,
- applying for residence permits,
- registering Virtual Zone companies,
- supporting IT businesses in Georgia.
Frequently Asked Questions
Does the founder of a company need a work permit?
Yes, if he or she actually works for the company and is located in Georgia.
Does the director of an IT company need a permit?
Yes, if the director is a foreigner and manages the company from Georgia.
Does the director of Virtual Zone need a permit?
At the moment, yes, there are no special exceptions yet.
Can a director manage a company from abroad?
Yes. In this case, he may not be considered a migrant worker.
Are there any exceptions planned for Virtual Zone?
The Virtual Zone Residents Association is considering the possibility of approaching the government with a proposal to introduce special exemption mechanisms.
Conclusion
The new labor migration rules also apply to directors of Virtual Zone companies.
In most cases, foreign directors must obtain a work permit if they operate from Georgia.
However, the industry community is already discussing the possibility of introducing exemptions for Virtual Zone IT companies in order to reduce the administrative burden and maintain Georgia's attractiveness for technology businesses.