Is a work permit required for the director of a company from the Virtual Zone in Georgia?

In 2026, new labor migration rules came into force in Georgia. Now, most foreigners working in the country must obtain a work permit (WP) and, if necessary, apply for a D1 visa or residence permit.

For many entrepreneurs, an important question arose: does the director of a Virtual Zone Person (VZP) resident company need to obtain a work permit?

In this article, we will figure out when a permit is really necessary, in which cases exceptions are possible, and why the possibility of exempting virtual zone companies from this requirement is currently being discussed.

New rules for foreign nationals working in Georgia

On March 1, 2026, Georgia launched an electronic system for registering labor migration.

Under the new rules:

• foreign nationals must obtain the right to work before starting employment;
• employment data is entered into the state system for registering labor migrants;
• after obtaining a permit, a D1 immigration visa or residence permit can be issued.

The rules apply to:

• employees;
• company directors;
• self‐employed foreigners;
• individual entrepreneurs.

Does a company director need a work permit?

The key principle of the new regulation is that if a foreign citizen is actually working in Georgia, they need a work permit.

This rule also applies to company directors.

When a director needs a work permit

A permit is required if the director:

• is a foreign citizen;
• lives in Georgia or conducts business from Georgia;
• manages the company as an executive body;
• receives remuneration or dividends related to the management of the company;
• participates in the company's operational activities.

This applies to most:

• directors of LLCs,
• founding directors,
• directors of IT companies,
• startup managers.

When a director may not need a work permit

There are several situations when a permit may not be required.

1. The director is not in Georgia

If the director:

• manages the company from abroad,
• does not work in Georgia,

they are not formally considered a migrant worker.

In this case, a work permit may not be required.

2. Special immigration statuses

Certain categories of foreigners have simplified procedures or exemptions.

For example:

• holders of certain types of residence permits;
• certain categories of investors;
• certain special economic regimes.

These mechanisms emerged after active dialogue between business and the state.

Virtual Zone Person and the issue of work permits

Companies with Virtual Zone Person status are IT companies that receive tax breaks when exporting software and IT services.

However, when new labor migration rules were adopted, an important problem arose: virtual zone companies were not included in the list of statuses with a simplified regime.

This means that formally:

• directors of VZP companies,
• foreign developers,
• foreign founders of startups.

must go through the standard procedure for obtaining a work permit.

Why this creates problems for IT companies

The lack of exceptions for Virtual Zone companies has several consequences.

Additional administrative burden

Companies must:

• submit applications for permits;
• undergo inspections;
• upload documents to the system.

Financial costs

The procedure may require:

• legal support;
• document preparation;
• administrative fees.

Regulatory risks

Violations of the rules may result in:

• fines of up to 4,000 lari;
• problems with residence permit renewal;
• difficulties in working with banks.

Why Virtual Zone did not receive an exemption

It is important to understand that exemptions in legislation do not appear automatically.

In most cases, they arise after:

• business initiatives;
• appeals from industry associations;
• consultations with the government.

If the sector does not form a consolidated position, regulation is created without its participation.

This is exactly what happened with Virtual Zone Person.

The Virtual Zone Residents Association is preparing an appeal to the government

The Virtual Zone Residents Association is currently analyzing the current regulations and considering the possibility of initiating an official appeal to the Georgian government.

The purpose of the appeal is to propose the introduction of exemptions for Virtual Zone companies.

In particular, the following options are being discussed:

• exempting VZP directors from obtaining work permits;
• a simplified procedure for IT specialists;
• a separate regime for export‐oriented IT companies.

Similar mechanisms already exist for other economic regimes.

Why it is important for companies to participate

The effectiveness of such an appeal directly depends on business support.

The more companies support the initiative, the higher the likelihood of regulatory change.

If the sector does not express its position, decisions will be made without business participation.

What companies should do now

Until the legislation is changed, companies are advised to:

1. Assess the status of directors and employees.
2. Check the need to obtain work permits.
3. Prepare documents for the electronic system.
4. Follow the explanations of government agencies.
5. Support the initiatives of industry associations.

Assistance in obtaining work permits

The law firm VZ.COM.GE assists foreign entrepreneurs and IT companies in:

• obtaining work permits;
• applying for a D1 visa or residence permit;
• registering a Virtual Zone company;
• preparing documents for the electronic labor migration system.

We also monitor changes in legislation and inform clients about possible new exceptions for IT businesses.

Conclusion

The new labor migration rules in Georgia also apply to directors of Virtual Zone companies.

In most cases, a foreign director must obtain a work permit if he or she actually conducts business from Georgia.

At the same time, the industry community is already considering the possibility of obtaining exemptions for residents of the virtual zone in order to reduce the administrative burden on export‐oriented IT companies.