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Gagik Aghbalyan

Three Term Mayor of Gavar: Family Businesses Profit from Municipal Budget

On October 2, 40-year-old Gourgen Martirosyan was reelected the mayor of Gavar, a small town of around 20,000 on the southwestern shore of Lake Sevan in Armenia, for the third time.

He’s been at the job since 2005, and served one term as deputy mayor before that.

As mayor, Martirosyan receives an annual salary of 3.2 million AMD (US$6,600). Nevertheless, Martirosyan owns five pieces of land and buildings in Gavar and a 2010 Toyota Land Cruiser Prado 4 worth around 15 million AMD.

According to the financial disclosure filed by Martirosyan when he announced his candidacy for reelection, his only other source of income was the rents he receives from leasing his property.

In fact, the non-profit Gavar Municipal Services and Improvement Agency (GMSIA), an arm of the municipality, pays 2 million to Martirosyan annually to lease one of his properties.

Mayor Martirosyan has declared 200 million AMD and US$200,000 in cash.

Family Businesses

Gourgen Martirosyan founded GavarTrans, a passenger transport company. In 2008, Martirosyan handed over his 50% share in the company to Yervand Martirosyan, his father. GavarTrans also operates a natural gas filling station for vehicles.

GavarTrans periodically gets contracts from the Gavar Municipality. Often, they have nothing to do with transportation.

In 2014, the GMSIA purchased 71 two-wheel garbage receptacles from GavarTrans for 3.266 million AMD ($6,730 at today’s exchange rate).

In December 2015, the Gavar Municipality purchased 710,000 AMD worth of transportation services from GavarTrans.

GavarTrans does business with other communities as well. In 2010, the Saroukhan village council paid GavarTrans 4.562 million AMD for buses to transport village students to school in Gavar and back.

GavarTrans has also been singled out for deceptive business practices. Armenia’s State Commission for Economic Protection (SCEP) has charged the company with filing low trip price (500AMD) to win the Yerevan-Gavar-Yerevan transportation route tender and then charging passengers 1,000 AMD.

The SCEP has charged the company with filing low-ball figures to win other transportation routes as well, and has levied fines of 10 million AMD for exploiting its position as market leader.

Gavar Municipal Budget Used to Enrich Relatives

Yervand Martirosyan, father of Gavar mayor Gourgen, has shares in several companies and is sole owner of Yeryouna LLC, a company that produces gypsum in Gavar.

Yervand Martirosyan has a 32% share in Hyeland Fruit, a company that operates a hothouse in Gavar. 

In January 2016, the Gavar mayor signed a decree to lease a 13-hectare parcel of arable land to Hyeland Fruit at a sweet-deal price of just 6,500 AMD annually until 2040.

A month later, the Gavar Municipal Council rezoned a 14-hectare parcel of land owned by Hyeland Fruit, allowing the company to build a hothouse enterprise on the site.

Photos: Gavar Municipal Council meetings (Gavar Municipality Facebook)

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