WT/TPR/S/297/Rev.1
12 December 2014
(14-7233)  Page: 1/81
Trade Policy Review Body  
 
TRADE POLICY REVIEW 
REPORT BY THE SECRETARIAT 
MONGOLIA  
Revision 
This report, prepared for the second Trade Policy Review of Mongolia, has been drawn up by the 
WTO Secretariat on its own responsibility. The Se cretariat has, as required by the Agreement 
establishing the Trade Policy Review Mech anism (Annex 3 of the Marrakesh Agreement 
Establishing the World Trade Organization), sought clarification from Mongolia on its trade policies and practices.  
Any technical questions arising from this report may be addressed to Messrs Masahiro Hayafuji 
(tel: 022/739 5873), and John Finn (tel: 022/739 5081).  
Document WT/TPR/G/297/Rev.1 contains the policy statement submitted by Mongolia.  
 
 
Note: This report was drafted in English. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 2 - 
 
  CONTENTS 
SUMMARY ....................................................................................................................... . 7 
1   ECONOMIC ENVIRONMENT .......................................................................................... 9  
1.1   Recent Econom ic Developments................................................................................... 9  
1.2   Trade Performance ................................................................................................... 11 
1.2.1   Composit ion of trade .............................................................................................. 11 
1.2.2   Direction of trade ................................................................................................... 11 
1.3   Foreign Dire ct Invest ment ......................................................................................... 13 
2   TRADE AND INVE STMENT RE GIME ............................................................................ 15  
2.1   Genera l Framework .................................................................................................. 15 
2.2   Legal System ........................................................................................................... 16 
2.3   Trade Poli cy Objectives ............................................................................................. 16 
2.3.1   Trade related law ................................................................................................... 17 
2.4   Trade Agreements and Arrangements .......................................................................... 19 
2.4.1   WTO ................................................................................................................... . 19 
2.4.2   Other regional and bilateral agreements .................................................................... 20 
2.5   Investme nt Regime .................................................................................................. 21 
3   TRADE POLICIES AND PRACTICES BY MEASURE ........................................................ 23  
3.1   Measures Direct ly Affectin g Imports ............................................................................ 23 
3.1.1   Customs procedur es and requirements ..................................................................... 23 
3.1.2   Custom s valuation ................................................................................................. 24 
3.1.3   Rules of origin .......................................................................................................  25 
3.1.4   Tariffs ............................................................................................................... ... 25 
3.1.4.1   Overview ........................................................................................................... 25 
3.1.4.2   Tari ff struct ure ................................................................................................... 25 
3.1.4.3   Bound rates ....................................................................................................... 25 
3.1.4.4   Applied MFN rates ............................................................................................... 26 
3.1.4.5   Tariff escalation, ta riff ranges, and tariff peaks ........................................................ 26 
3.1.4.6   Tariff- rate qu otas ................................................................................................ 26 
3.1.5   Import prohibitions, restrictions, an d licensing ........................................................... 26 
3.1.6   Anti-Dumping, countervailing, and safeguard measures ............................................... 29 
3.1.7   Standards and othe r technical requirements .............................................................. 29 
3.1.8   Sanitary and phyt osanitary requ irements .................................................................. 30 
3.1.9   Other measures ..................................................................................................... 30 
3.2   Measures Directly Affecting Exports ............................................................................. 30 
3.2.1   Export procedur es and requirements ........................................................................ 30 
3.2.2   Export taxes, charges, an d levies ............................................................................. 31 
3.2.3   Export prohibitions, restrictions, and licensing ............................................................ 31 
3.2.4   Export suppo rt and pr omotion ................................................................................. 31 
3.2.4.1   Tax concessions and subsidies for exporters ............................................................ 31 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 3 - 
 
  3.2.4.2   Free zo nes ......................................................................................................... 32 
3.2.4.3   Export financing, promotion, and marketing assistance ............................................. 32 
3.3   Measures Affectin g Production and Trade ..................................................................... 32 
3.3.1   Taxes an d incentives .............................................................................................. 32 
3.3.1.1   Corpor ate income  tax .......................................................................................... 33 
3.3.1.2   Value-added tax (VAT) ......................................................................................... 33 
3.3.1.3   Ex cise tax ..........................................................................................................  33 
3.3.2   Competition policy and price controls ........................................................................ 35 
3.3.3   State trading, state-owned enterprises, and privatization ............................................. 36 
3.3.4   Governme nt procurement ....................................................................................... 37 
3.3.5   Intellectual property rights ...................................................................................... 37 
3.3.5.1   Copyright and related rights ................................................................................. 38 
3.3.5.2   Patents .............................................................................................................. 38 
3.3.5.3   Trade-marks and geographical indications .............................................................. 39 
3.3.5.4   Plan t varieties .................................................................................................... 39 
3.3.5.5   Layout designs of integrated  circuits ...................................................................... 39 
3.3.5.6   Trade secrets ..................................................................................................... 39 
3.3.5.7   Parallel imports ................................................................................................... 40 
3.3.5.8   Enforcement ....................................................................................................... 40 
4   TRADE POLICIES BY SECTOR ..................................................................................... 41  
4.1   Agriculture ............................................................................................................. . 41 
4.1.1   Features ............................................................................................................... 41 
4.1.2   Trade ................................................................................................................. .. 43 
4.1.3   Domest ic policy ..................................................................................................... 44 
4.1.3.1   National Progra mme for Food Security ................................................................... 45 
4.1.3.2   Third Crop Campaign ........................................................................................... 46 
4.1.3.3   Livest ock Programme .......................................................................................... 46 
4.1.3.4   Index-based Livestock Insurance Programme .......................................................... 46 
4.1.4   Policy impact ......................................................................................................... 47 
4.2   Mining and Energy .................................................................................................... 47 
4.2.1   Minerals .............................................................................................................. . 47 
4.2.1.1   Featur es ............................................................................................................  47 
4.2.1.2   Policy .............................................................................................................. .. 49 
4.2.1.2.1   Petroleum ....................................................................................................... 49 
4.2.1.2.2   Other minerals ................................................................................................. 50 
4.2.2   El ectricity ........................................................................................................... .. 53 
4.2.2.1   Featur es ............................................................................................................  53 
4.2.2.2   Policy .............................................................................................................. .. 54 
4.3   Services ................................................................................................................ .. 56 
4.3.1   Banking, insurance, finance ..................................................................................... 56 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 4 - 
 
  4.3.1.1   Featur es ............................................................................................................  56 
4.3.1.2   Policy .............................................................................................................. .. 57 
4.3.1.2.1   Banks .............................................................................................................  57 
4.3.1.2.2   Other fina ncial institutions ................................................................................. 60 
4.3.1.2.2.1   Insura nce ..................................................................................................... 61 
4.3.2   Telecommunications ............................................................................................... 64 
4.3.3   Transport .............................................................................................................  66 
4.3.3.1   Air transport ....................................................................................................... 66 
4.3.3.2   Road  transport ................................................................................................... 69 
4.3.3.3   Ra il transp ort ..................................................................................................... 71 
4.3.4   Tourism ................................................................................................................ 71 
4.3.5   Cons truction ......................................................................................................... 73 
REFERENCES .................................................................................................................. 7 7 
5   APPENDIX  TABLES .................................................................................................... 80  
 
CHARTS 
 
Chart 1.1 Product composition of merchandise trad e, 2007 an d 2012 ...................................... 12 
Chart 1.2 Direction of merchandise trade, 2007 and 2012 ...................................................... 13 
Chart 1.3 Foreign direct inve stment inflows,  2007 and 2012 .................................................. 14 
Chart 4.1 Tourism in Mongolia, selected indica tors, 2004 -13 .................................................. 72 
Chart 4.2 Construction  and GDP,  2004-1 2 ........................................................................... 74 
 
TABLES 
 
Table 1.1 Selected macroeco nomic indicato rs, 2009-13  .......................................................... 9  
Table 2.1 Government ministries and selected ag encies, 2012-16  ........................................... 15 
Table 2.2 Main trade-related laws ....................................................................................... 17 
Table 2.3 WTO notifications, 1 January 2005 to 31 December 2013 ......................................... 19 
Table 2.4 Bilateral trade-related agre ements since accessi on to the WTO ................................. 20 
Table 2.5 Law on Investment - Ta x stabilization certificates ................................................... 21 
Table 2.6 Bilateral in vestment tr eaties ................................................................................ 22 
Table 3.1 Mongolia's tariff st ructure, 2004, 201 1, and 2013 ................................................... 25 
Table 3.2 Goods prohibited fr om exportation/ importation ...................................................... 27 
Table 3.3 Goods subject to im port or expo rt licence .............................................................. 28 
Table 3.4 Export taxes for certain commodities, as of January  2014 ........................................ 31 
Table 3.5 Excise taxes in Mongolia ..................................................................................... 34 
Table 3.6 Government procurement,  based on cont racts, 2008-12  .......................................... 37 
Table 3.7 Enforcement statistics relate d to intellectual property, 2008-12 ................................ 40 
Table 4.1 Agriculture to empl oyment and GDP, 2004-12 ........................................................ 41 
Table 4.2 Production of selected prod ucts, 2004-12 .............................................................. 41 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 5 - 
 
  Table 4.3 Imports of selected agricultural pr oducts, 2004-12 ................................................. 43 
Table 4.4 Exports of selected agricultural pr oducts, 2004-1 2 .................................................. 43 
Table 4.5 Budget summary of the Nation al Programme for Food Secu rity ................................. 45 
Table 4.6 Mining and minerals contribution to employment and GDP, 2004-12 .......................... 47 
Table 4.7 Mineral production , 2004- 12 ................................................................................ 48 
Table 4.8 Exports of minera ls from Mong olia, 2004- 12 .......................................................... 48 
Table 4.9 Trade in petr oleum produc ts, 2004- 12 .................................................................. 49 
Table 4.10 Strategic mineral deposits ................................................................................. 51 
Table 4.11 Revenue from licence fees, repayments for exploration costs, and royalties, 
2010-1 3 ....................................................................................................................... .. 52 
Table 4.12 Mining operations ............................................................................................. 52 
Table 4.13 Production and consumption of electricity in Mongolia, 2004-12 .............................. 53 
Table 4.14 Renewable ener gy price and tariff ....................................................................... 54 
Table 4.15 Electricity tariffs for mi ning and industry , August  2013 .......................................... 55 
Table 4.16 Financial sector to employment and GDP, 2004-12 ................................................ 57 
Table 4.17 Main banks in Mongolia, end 2012 ...................................................................... 58 
Table 4.18 Banking structure,  2008- 13 ............................................................................... 59 
Table 4.19 Bank lending by economic sect or, 2005- 12 .......................................................... 59 
Table 4.20 Indicators for non-commercia l bank financial subsector,  2005- 12 ............................ 60 
Table 4.21 Information and communicati on to employment  and GDP,  2007- 12 ......................... 64 
Table 4.22 Telecommunications se lected indica tors, 2005- 12 ................................................. 64 
Table 4.23 Mobile phone charges, 2012 .............................................................................. 65 
Table 4.24 Air transport sele cted indicato rs, 2005- 12 ............................................................ 66 
Table 4.25 Certified air transport operators .......................................................................... 67 
Table 4.26 Active air se rvices agre ements ........................................................................... 69 
Table 4.27 Road transport selected indicators, 2005-12 ......................................................... 69 
Table 4.28 Rail transport selected indicators, 2005-12 ........................................................... 71 
Table 4.29 Tourism in  Mongolia  in 2013 .............................................................................. 72 
Table 4.30 Construction to employment and GDP, 2004-12 .................................................... 74 
 
BOXES 
 
Box 4.1 Regulatory framework for banking se rvices, 2013 ..................................................... 60 
Box 4.2 Regulatory framework for insurance se rvices, 2013 ................................................... 61 
Box 4.3 Regulatory framework for non-bank financial institutions, 2013 ................................... 62 
Box 4.4 Regulatory framework for savi ngs and credit c ooperatives , 2013 ................................. 63 
Box 4.5 Market and regulatory regime fo r securities and stoc k exchanges, 2013 ....................... 63 
Box 4.6 Telecommunications in Mongolia ............................................................................. 66 
Box 4.7 Mongolia's market and regulatory regime for air transp ort subsecto rs, 2013 ................. 68 
Box 4.8 Mongolia's road  transport framework....................................................................... 70 
Box 4.9 Constructi on serv ices ............................................................................................ 75 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 6 - 
 
   
APPENDIX TABLES 
Table A3. 1 State owned enterprises , June 2013 .................................................................. 80 
 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 7 - 
 
  SUMMARY 
1. Since its previous Trade Policy Review in 2005, Mongolia has continued to maintain a 
generally open trade regime. Its economy has grown substantially, as has per capita GDP while unemployment has fallen, and the Human Development Index ranking has improved. With large 
mineral reserves and a big market in neighbouring China, the economy is likely to continue to 
grow. However, the rate of growth has fluctuat ed, and will probably continue to fluctuate 
depending on investments in mineral resources and changes to prices and volumes of exports. 
Since 2005, real GDP growth has varied from -1.3% in 2009 to 17.5% in 2011. Clearly, managing 
the fluctuations in investment, exports, and Go vernment revenues is one of the main policy 
challenges facing the country.  
2. Despite data problems, it is evident that both exports and imports increased substantially 
during the review period, with exports reaching US$4.4 billion and imports US$6.7 billion in 2012. 
The importance of minerals to the economy has increased as well; in 2012, over 84% of exports were of minerals, nearly all which went to China.  
3. The authorities are aware of the problems that can arise from dependence on a narrow 
economic base. The Millennium Development Goals-based Comprehensive National Development Strategy of 2008 states that, while mineral deposits are to be exploited, Mongolia is also pursuing 
a policy of diversification; the Strategy sets  out a number of priority areas, including 
export-orientated, private sector-led, high techno logy-driven manufacturing and services such as 
information and communication, bio- and nano-technology, transit transportation, logistics, financial mediation services, and deeper processing of agricultural products. Particular attention is 
paid in the Strategy, inter alia, to promote SMEs to produce import substitution products while 
supporting imports of advanced technologies.  
4. Foreign investment is important to the economy for both the exploitation of minerals and for 
development of other sectors. However, foreign direct investment declined from 53% of GDP in 
2011 to 20% in 2013. To some extent, this was due to the requirements under, and uncertainty about the 2012 Law on the Regulation of Foreign Investment in Business Entities Operating in 
Sectors of Strategic Importance. To address these concerns and to improve the investment 
climate, the 2012 Law and the Foreign Investment Law of 1993 were replaced by the Investment Law of 2013 (which applies to both foreign and domestic investment), which simplified investment and registration requirements, and provided greater legal precision to several terms, including the 
definition of a foreign-invested entity and a foreign government-owned legal entity. 
5. In addition to the new Law on Investment, several other laws were introduced in 2013 
which, amongst other things, are intended to improve the investment climate and promote fiscal 
stabilization including, the Fiscal Stability Law, th e Integrated Budget Law, and the Social Welfare 
Law. These legislative changes, along with the st eps taken by the Bank of Mongolia (the central 
bank) to stabilize the national currency, control inflation, and improve regulation of the commercial 
banks, should help to improve foreign and domestic investment. 
6. A number of steps have also been taken to improve customs procedures, including a 
revision of the Customs Law and the Law on Cu stoms Duties and Tariffs of 2008 which, amongst 
other things, allow for post clearance customs control, as well as the introduction of the Customs 
Automated Information System allowing for the subm ission of electronic documents and electronic 
payments. 
7. In acceding to the WTO in 1997, Mongolia bound all its tariffs, most of them at 20% 
although the applied rate is, in most cases, much lower. However, for about 60 tariff lines, the 
applied tariff of 5% is greater than the bound rate of 0%. There are also import bans on several products, including ethyl alcohol, which were adopted on the grounds of health and national 
security. Furthermore, a variety of products, including breeding animals, are subject to 
non-automatic licensing for exports and/or imports.  Export taxes are applied to a small range of 
products, although they were removed from raw cashmere in 2009. As part of the efforts to diversify exports, the Development Bank of Mong olia was established in 2011 and provides export 
finance, including pre- and post-shipment financin g, export factoring, export credit guarantees, 
and export credit insurance. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 8 - 
 
  8. Mongolia has continued to develop and apply new standards many of which are mandatory 
technical requirements and, out of a total of over six thousand, less than half are aligned with international standards. 
9. Although the economy is essentially market driven and has been privatised, there were 
about 100 fully or partially state-owned enterprises involved in many different sectors of the 
economy. According to the authorities none of these have any special rights or privileges. Between 2005 and 2011, about 90 entities were privatized while several, including the national airline 
(MIAT) and some power plants had their privatization postponed. 
10. Mongolia's laws on intellectual property rights have also undergone some changes during 
the period under review, with the Copyright Law and Patent Law revised in 2006, the Law on Trademarks and Geographical Indications amende d in 2010, and the Law on Crop Varieties and 
Seeds amended in 2011. However, enforcement actions, in terms of the number of inspections and 
other indicators, have declined since 2010 and it is not clear if this was due to better compliance or reduced enforcement. 
11. Although investment and trade in minerals dominate foreign direct investment and exports, 
agriculture still accounts for one-third of employme nt and 15% of GDP. The agriculture situation in 
Mongolia is quite particular with a short growing season and harsh winters and nomadic herding of 
livestock being the main activity. In response  to concerns about import dependence, the 
Government has introduced several programmes to promote production of some staple products 
(wheat and potatoes) and, as a result, imports of these have declined. However, it is not clear if these programmes have reduced import dependence as imports of other products, such as rice, 
have increased. The main exports are cashme re, and hides and skins of sheep and goats. 
12. Compared to the size of the Mongolian economy, the potential of the minerals sector is very 
large and the total investment in minerals over the past few years and the next few equivalent to 
several times annual GDP. Unfortunately, data for 2013 were not available at the time of writing. 
Nevertheless, in 2012 compared to 2004, the quantity  of coal, and iron ore that was produced and 
exported increased considerably while the value of exports increased by even more as prices 
increased. As production of copper in Oyu Tolgoi increases and a the expansion of the Tovan Tolgoi 
coal deposit leads to greater production, the value and volume of exports will increase further. However, concerns about unused mining licences led to a moratorium on new exploration licences in 2010 and the moratorium is to remain in effect  until a new law on minerals has been adopted. 
13. Mongolia's low population density and harsh climate mean infrastructure projects like 
electricity, telecommunications, and transport are both important and expensive. There have been 
considerable investments in each area although more is needed, particularly for road and rail 
transport. 
14. The banking and finance sector has undergone several upheavals over the past few years. 
Despite improvements in developing and applying regulations, the State had to take over three 
banks, in 2008, 2009, and 2013, and their operatio ns have been transferred to the state-owned 
State Bank of Mongolia. There remain 13 registered commercial banks, which is a lot for the size of the country even if commercial banks account for 95% of total assets in financial companies.  
15. Overall, Mongolia has made considerable progress towards improving living standards and 
investment and trade in minerals have contribute d considerably. However, managing the resource 
based boom along with the legislative, and institutional challenges it presents, and the investment in infrastructure it requires are the biggest cha llenges facing the Government. At the same time, 
the geographical and climatic situation of Mongolia makes these tasks more difficult than in some 
other countries.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 9 - 
 
  1  ECONOMIC ENVIRONMENT 
1.1  Recent Economic Developments 1.1.  Since its previous Trade Policy Review in 2005, Mongolia has resisted protectionist pressures 
and continued to maintain a generally open trade and investment regime. Its economy has grown 
substantially despite a balance-of-payments crisis in 2008/09, as has GDP per capita (Table 1.1). 
Mongolia was ranked 108
th overall on the 2012 UN Human Development Index up from 117th in 
2003.1 The economy grew by 12.4% in 2012, helped by  expansionary fiscal and monetary policies, 
and a steady growth in agriculture, and is  estimated to have grown by 11.7% in 2013. 
Nonetheless, inflation in 2012 remained high at  around 14%, primarily owing to increases in 
government spending and currency depreciation, putting pressure on the balance of payments. In response to this high inflation, the central bank  increased its policy rate to 13.25% and reserve 
requirements to 12% in 2012; the direction of monetary policy turned to expansionary in 2013. 
While exports and imports grew substantially in 2010 and 2011, they slowed down in 2012 and 
2013; foreign direct investment also slowed down in 2013. 
Table 1.1 Selected macroeconomic indicators, 2009-13 
2009 2010 2011 2012 2013a
National accounts (Per cent)  
Real GDP growth  -1.3 6.4 17.5 12.4 11.7
Nominal GDP growth (current prices) 0.5 27.7 31.8 26.4 25.2
Per capita GDP (in US$)  1,684 2,261 3,097 3,480 4,069
Unemployment rate (%) 11.6 9.9 7.7 8.2 ..
Productivity (Percentage change) 
Total labour productivity  .. 4.1 18.1 11.5 ..
Total factor productivity  .. 19.8 8.5 -10.2 ..
Prices and interest rates (Per cent)
Inflation (CPI, percentage annual change (period 
average)) 6.3 10.2 7.7 14.0 12.5
BOM policy rate (end period) 10.00 11.00 12.25 13.25 10.50
Money and credit (end period) (Percentage change) 
Broad money (M2)b 26.9 61.6 37.1 18.8 24.0
Exchange rate  
Togrogs per US$ (period average)  1,438 1,356 1,265 1,359 1,524
Nominal effective exchange rate -13.9 4.1 2.2 -5.5 -10.2
Real effective exchange rate -9.6 11.3 6.8 5.4 -3.5
Fiscal policy (Per cent of GDP unless otherwise indicated) 
Current fiscal balance 2.8 9.8 11.0 5.1 9.3
Revenue and grants 30.3 37.1 40.3 35.5 33.8
Expenditure and net lending 35.5 36.6 45.1 42.9 35.5
Overall balance  -5.2 0.5 -4.8 -7.4 -1.4
Total public debt 46.6 45.3 51.7 56.7 54.2
Domestic 3.4 16.3 25.6 27.4 23.9
External sector  
Current account balance (excluding official grants) -9.0 -14.9 -31.7 -32.8 -31.6
Net merchandise trade  -5.5 -4.7 -19.9 -22.8 -18.1
Exports 41.1 46.9 54.6 42.7 37.1
Imports 46.6 51.6 74.5 65.7 55.2
Services balance -3.6 -4.5 -13.3 -10.7 -11.0
Capital and financial account 16.1 34.9 32.8 35.4 24.5
Foreign Direct investment 10.8 25.2 53.0 43.0 20.3
Overall balance  12.1 14.1 0.3 13.3 -16.4
Terms of trade (percentage change) 6.9 -4.7 -4.3 0.2 1.0
Merchandise exports (percentage change) -26.0 54.5 66.2 -9.0 -4.4
Merchandise imports (percentage change) -34.2 53.5 82.9 2.2 -5.4
Gross official international reserves (US$ million) 1,328 2,288 2,451 4,126 2,248
(in months of next year's imports of goods and 
services) 6.9 7.1 3.9 6.5 3.5
Total external debt (US$ million; end period, % of 
GDP in brackets) 1,974 
(43.2) 1,938 
(28.9) 2,074 
(26.1) 2,775 
(29.4) 3,492 
(30.2) 
.. Not available. 
a Estimates. 
b M1 (currency) + quasi money (t ogrog denominated time deposits and foreign currency deposits). 
Source: IMF (2012), Mongolia Article IV Consultation and Third Post-Program Monitoring , Country Report 
No. 12/320, November. Viewed at: http://www.imf.org/external/pubs/ft/scr/2012/cr12320.pdf ; and 
information provided by the Mongolian authorities.  
                                               
1 UNDP online information. Viewed at: http://hdr.undp.org/en/media/HDR2013_EN_Summary.pdf. 
[17.09.2013] WT/TPR/S/297/Rev.1 • Mongolia 
 
- 10 - 
 
  1.2.  Mongolia's main export destination is China and its main export products are minerals 
(section 1.2). As described in the Millennium Development Goals-based Comprehensive National Development Strategy (Parliament Resolution on  12 February 2008), the authorities intend to 
exploit mineral deposits of strategic importance. At the same time, they wish to diversify 
Mongolia's export products, so that it will be le ss dependent on mineral resource exports. Priority 
areas including export-oriented, private-sector -led, high technology-driven manufacturing and 
services, such as information and communication, bio- and nano-technology, transit 
transportation, logistics, financial mediation services, and deeper processing of agricultural 
products. Particular attention is paid, inter alia , to promote import substitution  by providing loan 
with low interest rates to small and medium-sized enterprises, and support imports of advance technologies. In order to achieve these objectives, Mongolia intends, inter alia,  to promote human 
capital, introduce advanced technologies by establishing and operating free zones, assist the 
development of the private sector by reviewing th e business environment, and reduce red tape. To 
achieve these goals, the Government established a working group headed by the Minister of 
Cabinet to review the purpose and procedures of  licensing requirements; the working group has 
proposed to eliminate a number of licensing requirements and to formulate a new law. The authorities also consider that foreign direct investment (FDI) is important for the country's 
development and the new Foreign Investment Law will help promote FDI.  
1.3.  In 2011, the overall fiscal balance worsened by about 5.3 percentage points of GDP (from a 
surplus to a deficit); the overall fiscal deficit amounted to about 4.8% of GDP in that year and the rose to about 7.4% of GDP in 2012. With a view to strengthening the fiscal policy framework and 
promoting fiscal consolidation, various laws have been adopted, including the Fiscal Stability Law
2, 
the Integrated Budget Law3, and the Social Welfare Law.  
1.4.  The main policy objective of the Bank of Mongolia (BOM) is to ensure the stability of the 
togrog (tog), the national currency; it has focu sed on price and exchange rate stability, and 
ensuring adequate money supply.4 The BOM aims to contain annual CPI inflation to below 8% at 
end-2013 and in the range of 5% to 7% during 2014-15.5 Monetary policy was tightened between 
2010 and 2012; its policy rate reached 13.25% and the reserve requirement was raised to 12% in 
April 2012. However, in 2013, the BOM adopted a more expansionary monetary policy; the policy rate was cut to 10.5% in June 2013. The primary monetary variable is reserve money (banks' reserves plus money outside banks) and the main BOM instruments are open market operations, 
using Central Bank Bills in primary and secondary markets, as well as the government bills 
(short term) and bonds (long term),  along with reserve requirements.
6 A rediscount financing 
facility operates, and repo arrangements also exist.  
1.5.  The BOM is also mandated to support growth, manage external sector risk exposures, deepen 
financial markets, and support structural reforms. It considers that Mongolia's long-standing 
structural issues include supply shocks, especially in food and fuel, and infrastructure bottlenecks, 
which are deemed the core contributors of inflatio n historically. To address these issues, the BOM's 
Supply Shock Elimination Programme, including a warehouse financing scheme, is intended, inter alia, to stabilize prices of core commodities including retail trade, gasoline, meat, grain, and 
flour.  
                                               
2 The purpose of the Fiscal Stability Law includes establishing fiscal management principles and special 
fiscal requirements for ensuring fiscal  stability, and determining rights, obligations, and responsibilities of 
government bodies regard ing implementation and monitoring of these principles and requirements.  
3 The purpose of the Integrated Budget Law includes establishing principles, systems, composition, and 
classification of the budget, implementing "special fi scal requirements", defini ng authorities, roles and 
responsibilities of bodies that partic ipate in the budget process, and regu lating relations in connection with 
budget preparation, budget approval, spendi ng, accounting, reporting, and auditing. 
4 The BOM formulates and implements monetary polic y by regulating money supply through changes in 
reserve money to achieve its main objective of currency stability. Th e Government is not empowered to 
interfere in monetary policy setting; the BOM pr esents its targets annually to Parliament in the State Monetary 
Policy Guidelines . The BOM formally reports to Parliament in acco rdance with the Central Bank Law (Article 30).  
5 Resolution of Parliament of Mongolia, 8 November 2012, No. 57, "Monetary policy guidelines for 
2013". Viewed at: http://www.mongolbank.mn/documents/moneypolicy/monetarypolicy_guidelines2013e.pdf. [15.10.2013] 
6 Reserve money growth is tied closely to BOM go ld purchases and government loans to temporarily 
finance budget deficits. The BOM may provide the Governme nt with temporary credit, to be repaid within the 
financial year, of up to 10% of fiscal revenues accumula ted over the previous three years (Central Bank Law, 
1996).  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 11 - 
 
  1.6.  Mongolia adopts a floating exchange rate  system. The authorities state that the Bank of 
Mongolia may intervene through auctioning in the foreign exchange market only to soothe volatility.
7 The BOM adjusts its midpoint exchange rate daily and its buy-sell margins. The BOM is 
not the sole trader of gold, although the authorities indicate that it still buys most gold. There are 
no restrictions on foreign exchange transactions. Mongolia's international reserves amounted to 
about US$4.1 billion in 2012. According to the BOM's investment guidelines regarding reserves, the authorities' priority is to invest in assets  that are deemed safe and substantially liquid; 
consideration of yields is secondary. The authorities consider that dollarization of the economy has 
become less prominent; the share of foreign-cu rrency denominated assets in the total banking 
system is currently around 30% down from around 50% in 2005.  
1.7.  The 2010 revision of the Bank of Mongolia Law established the financial stability board, which 
consists of the Minister of Finance and the Governor of Central Bank and Commissioner of Financial 
Regulatory Commission, with a view to improving inter-government cooperation.  
1.2  Trade Performance 
1.2.1  Composition of trade  
1.8.  Mongolia's exports remain heavily concentrated in a few items; some 84% of exports are 
related to mining, with coal and copper repres enting about of 51% and 23% of total exports, 
respectively; the share of coal exports has increased substantially in recent years (Chart 1.1). 
Mineral fuels and transport equipment remain the main import items. 
1.2.2  Direction of trade 1.9.  China's share in Mongolia's exports increased to more than 90% in 2012 (Chart 1.2). In 
Mongolia's imports, the shares of the Russian Fe deration and China declined, while the shares of 
the EU, the United States, Japan and the Repub lic of Korea increased between 2007 and 2012.  
                                               
7 According to Article 5 of the Law on Currency Settleme nts, volatility higher th an 5% must be "brought 
to the attention of the Prime Minister". For a detailed re cord of the BOM's interventi on through auctioning, see: 
http://www.mongolbank.mn/eng/dblistforexauction.aspx .  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 12 - 
 
  Chart 1.1 Product composition of merchandise trade, 2007 and 2012 
2007 2012
(a)    Exports 
Manufactures
4.9%
Total:   US$1.9 billion Total:  US$4.4 billion
(b)    Imports 
Chemicals
6.0%Iron & steel
4.1%Transport
equipment
10.1%
Manufactures
60.4%Electrical
machines  
7.7%
Non-electrical 
machinery
11.6%Other
56.2%Copper ores &
concentrates
22.7%
Transport equipment
12.9%Machinery &
electrical 
machines
6.7%
Total:   US$2.1 billion Total:   US$6.7 billionOther mining
10.7%
Prepared foodstuff, 
beverages & tobacco
2.0%Mining
84.3%Gold
12.4%Other
11.8%
Coal
50.9%
Copper ores & concentrates
43.0%
Other manufactures
11.7%Precious metals
2.8%
Textiles & clothing  1.1%Coal
6.1%
Other semi-
manufactures
9.3%Mining
70.2%Agriculture
12.4%
Agriculture
12.1%
Mining
27.4%Other mining  
21.1%
Mineral fuels
20.5%
Fuels
26.9%Base metals &  
articles thereof
1.8%
Other mining  
0.5%
 
Note: Data are not easily comparable due to different product classification used in 2007 and 2012.  
Source: UNSD, Comtrade database (SITC Rev. 3) (2007); and the authorities of Mongolia (2012).  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 13 - 
 
  Chart 1.2 Direction of merchandise trade, 2007 and 2012 
2007 2012
(a)    Exports 
China
74.2%
Total:   US$1.9 billion Total:  US$4.4 billion
(b)    Imports 
Japan
5.1%
Korea, Rep. of
5.6%
China
31.1%Other
9.3%Russian Federation  1.8%
Belarus
1.9%Japan
7.4%
Total:   US$2.1 billion Total:   US$6.7 billionEU(27)   1.5%
Canada
9.5%
Canada
1.4%China
91.9%
Canada  2.7%EU(27)
5.6%
Other  2.1%Russian Federation
3.0%
Other
12.3%United States
3.4%
United States
2.4%Other 
2.1%
Russian Federation
27.4%EU(27)
9.2%
EU(27)
10.5%
Russian Federation
34.3%United States
8.0%
China
27.1%Korea, Rep. of
6.9%Korea, Rep. of
2.2%
 
Source: UNSD, Comtrade database (2007); and the authorities of Mongolia (2012).  
1.3  Foreign Direct Investment 
1.10.  According to the balance of payments statistics, net foreign direct investment (FDI) 
increased continuously between 2009 and 2011 from US$496 million (10.8% of GDP) to 
US$4,620 million (53.0% of GDP); th ey decreased slightly to US$4,408 million (43.0% of GDP) in 
2012 and a further decline is expected in 2013 (to about 20% of GDP). Mongolia's FDI stock amounted to US$13,151 million in 2012, compared with US$182 million in 2000.
8 FDI data, based 
                                               
8 UNCTAD (2013). WT/TPR/S/297/Rev.1 • Mongolia 
 
- 14 - 
 
  on registration, indicate that FDI is mainly in geological prospecting, oil exploration, mining; and 
trade and catering services (Chart 1.3).9 FDI was mainly from the EU and China. 
Chart 1.3 Foreign direct investment inflows, 2007 and 2012 
2007 2012a
(a)    By economic activity
Geological prospecting oil 
exploration & mining
67.4%
EU27
5.4%Korea, Rep. of
4.6%Other
8.2%
British Virgin 
Islands
5.2%Kazakhstan
2.3%
EU27
64.6
Total:  US $500.0 m illion Total:  US $3,036.0 millionTransportation
4.0%
Trade & catering 
serivces
22.3%
Other
4.7%Bank & financial services
4.4%Other
5.9%Other
4.8%
China
7.6%
British Virign
Islands
7.1%Russian Federation
3.8%Russian Federation
8.0%China
67.9%
Singapore
7.4%(b)    By originGeological prospecting oil 
exploration & mining
73.1%
Trade & catering 
serivces
18.1%
Australia
3.2%
 
a As at 30 September.  
Source: WTO calculations, based on da ta provided by the authorities.  
 
                                               
9 According to data provided by the authorities.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 15 - 
 
  2  TRADE AND INVESTMENT REGIME 
2.1  General Framework 2.1.  Under the 1992 Constitution, which was amended in 1999 and 2001, Mongolia is a 
parliamentary democracy with legislative authority vested in a unicameral parliament, the State 
Great Hural. Parliament, with the President's approval, is responsible for appointing the Prime 
Minister and the ministers that make up the exec utive arm of government (Table 2.1). Members of 
Parliament are elected for fixed terms of four years. 
2.2.  The President of Mongolia is the head of state and head of the armed forces. The President 
has the right to veto laws and resolutions of the Parliament, which can overturn the veto with a two-thirds majority vote.  
Table 2.1 Government ministries and selected agencies, 2012-16 
Ministry Agencies under the Ministry
Prime Minister, Deputy Premier and Cabinet Office
Prime Ministe r Central Intelligence Agency
Nuclear Energy Agency
Information Technology, Post and Telecommunications Authority 
Communications Technology and Post Authority 
Deputy Premie r General Agency for Specialized Inspection
National Emergency Management Agency
Authority for Fair Competition and Consumer Protection 
Center of Standardization and Measurement
Procurement Policy Department
Intellectual Property Office
Cabinet Office of the Government 
General orientation ministries 
Ministry of Environment and Green 
Development National Agency of Meteorology and Environmental Monitoring 
Forestry Authority
Water Authority
Ministry of Foreign Affairs
Ministry of Finance Customs General Administration
General Department of Taxation
Ministry of Justice National Police
General Authority for Border Protection
General Authority for State Registration
General Archival Authority
General Authority for Implementing Court Decisions 
Immigration Agency
Specific orientation ministries 
Ministry of Construction and Urban 
Development Administration of Land Affairs, Construction, Geodesy and Cartography
Ministry of Defence General Staff of Mongolian Armed Forces
Ministry of Road and Transportation Civil Aviation Authority
Railway Authority
Road Agency
Transportation Agency
Ministry of Culture, Sports and Tourism 
Ministry of Mining Mineral Resources Authority
Petroleum Authority
Ministry of Industry and Agriculture State Property Committee
Veterinary and Animal Breeding Agency
National Agricultural Extension Cente r
National Animal Gene Ban k
Inter-Provincial Pastureland Management Authority 
Crop Production Supporting Fund
Livestock Conservation Fund
State Central Veterinary and Sanitary Laboratory 
State Veterinary Laboratory for Certification of Veterinary drugs and 
Vaccines 
Ministry of Labou r 
Ministry of Population Development and 
Social Welfare General Authority for Social Insurance
General Office of social Welfare Service 
National Authority for Children
Ministry of Economic Development Invest Mongolia Agency
Development Bank of Mongolia
Ministry of Energy 
Ministry of Health 
Source: Authorities and Website of State Institutions of Mongolia. Viewed at: 
http://www.pmis.gov.mn/pmis_eng/index.php  [January 2014]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 16 - 
 
  2.3.  Mongolia is divided administratively into aimags  (provinces) and the capital city 
(Ulaanbaatar); aimags  are subdivided into soums (districts at the provincial level), which are 
further divided into baghs (villages, or sub-districts at the provincial level); the capital city is 
divided into districts and sub-districts ( horoos) . 
2.2  Legal System 
2.4.  In 2012, a number of laws were passed to re form the operation of Mongolia's judicial system, 
including the Law on the Legal Status of Lawyers,  the Law on the Legal Status of Judges, and the 
Law on the Courts, all adopted on 7 March 2012 , and the Law on Representatives of Natural 
Persons in Court, adopted on 22 May 2012. 
2.5.  The Law on the Courts, implemented fr om July 2013, reorganized the court system. 
Previously, there were administrative and general courts at both first instance and appeals levels 
below the Supreme Court. Since July 2013, the courts of first instance and the courts of appeal 
have been organized into administrative, civil, and criminal courts. The courts of first instance are at the soum , inter- soum , and district levels while the appeals courts are at the judicial district 
level. The Supreme Court has also been reorganized into three chambers to hear criminal, civil, 
and administrative cases, and the number of me mbers of the Supreme Court judges has increased 
from 15 to 24. 
2.6.  Under the Law on the Legal Status of Lawy ers, also implemented in 2013, anyone wishing to 
be called a lawyer and provide legal advice must form a limited liability partnership and be a member of the Bar Association, which requires passing the bar exam. To represent clients in court, a lawyer must also register with the Supreme Court. Foreign lawyers must register with the 
Ministry of Justice, which requires proof of membership of a law society or bar association before 
they may practice, and their practice is limited to aspects of foreign law. They may not represent clients in the courts, although they may represent clients in legal arbitration. 
2.3  Trade Policy Objectives 
2.7.  The Ministry of Economic Development has pr imary responsibility for developing trade policy 
as well as policy on investment, macroeconomic development, concessions (including 
public-private partnerships), and loans and aid.  
2.8.  In addition to the Ministry of Economic Development, several othe r Government ministries 
and agencies are responsible for differ ent aspects of trade policy including: 
• The Minister for Finance chairs the Customs Tariff Council which is responsible for 
developing customs and tariff policy, the adop tion of tariff rates, and the imposition of 
additional duties. The Customs General Administration, established under the Ministry of Finance, is responsible for enforcing the customs legislation, levying and collecting 
customs duties and other taxes, and preparing and submitting customs statistical data to 
the National Statistical Office. 
• The Centre for Standardization and Metrology under the Deputy Premier coordinates and 
manages issues related to standardization, quality certification, testing, surveillance, and 
metrology. About 80% of the Centre's income is from the provision of certification and other services. The General Agency for Specialized Inspection Agency, also under the Deputy Premier, is responsible for the inspection of imported and exported goods on 
grounds of food safety, agricultural inspections (such as for seeds and plants), 
enforcement of laws and regulations related to trade, industry, services, geology and mining, and supervising compliance with standards. 
• The Mongolian Intellectual Property Office under the Deputy Premier is in charge of all 
trade-related aspects of the intellectual property, including copyright, patents, and trademarks. 
• The Bank of Mongolia (the Central Bank), which is independent of the Government, is 
responsible for monetary and exchange ra te policies and the supervision of the 
commercial banks. The Bank is required to maintain, inter alia , financial market and WT/TPR/S/297/Rev.1 • Mongolia 
 
- 17 - 
 
  banking system stability. The Financial Regulatory Authority is responsible for regulating 
non-bank financial institutions, deposit and loan cooperatives, insurance companies, and the stock market. 
• Other ministries that participate in the trade policy formulation include: the Ministry of 
Construction and Urban Development; the Ministry of Roads and Transportation; the 
Ministry of Mining; the Ministry of Energy; th e Ministry of Industry and Agriculture; and 
the Ministry of Justice (for the drafting of laws and regulations and for the trade-related 
aspects of intellectual property).  
2.9.  In the non-governmental sector, the Mongolian National Chamber of Commerce and Industry 
(MNCCI) provides a number of trade support services, including issuing certificates of origin; registration of patents and trade-marks; arbitration of foreign trade and investment disputes; 
independent inspection of exported and imported  goods; providing export-market research and 
intelligence; organizing trade fairs, exhibitions,  and business missions; and project development.  
2.10.  There are also several business associations, which collect and share information, identify 
and deal with industry problems, discuss the trade policy issues that affect their industries, and 
represent their sectors in relations with the Government. These include the Mongolian National Mining Association, the Mongolian Exporters Association, the Mongolian Wool and Cashmere 
Association, and the Mongolian Meat Association. 
2.11.  Regular consultations between the Government and the private sector are conducted in a 
Government and Private Sector Consultative Committee. The main objective of the Committee is to improve the business and legal environment for the private sector. The Minister of Finance and 
the Chief Executive Officer of th e Mongolian National Chamber of Commerce and Industry co-chair 
this Committee.  
2.12.  The Comprehensive National Development Strategy of Mongolia of 2008 sets out the 
general objective of a favourable foreign trade environment for economic development based on 
export-oriented production and services through in creasing exports of processed products rather 
than minerals and raw materials of animal origin.
1 
2.3.1  Trade related law 
2.13.  As in most countries, the trade and trade-related legislative framework is found in many 
different statutes (Table 2.2). In nearly all cases, international agreements that Mongolia has entered into have precedence over national laws, to  the extent that there is no conflict with the 
Constitution. Under the Civil Code, the terms of international treaties may be used in the courts. 
Table 2.2 Main trade-related laws 
Legislation Year Last 
amended Description 
Customs procedures  
Customs Law of Mongolia 1996 2008 Regulates issues related to the organizational structure and legal basis 
of Customs, defining the procedures for customs control as well as 
customs clearance procedures and enforcement of the customs 
legislation 
Tariffs and other duties  
Customs Tariff Law of 
Mongolia  1996 2008 Regulates matters relating to the creation of the tariff system, principles 
for the adoption of customs duty rates, valuation, and rules for levying 
and collecting customs duties 
Excise Tax Law of Mongolia 1993 2006 Imposes excise taxes on certain imported and domestic goods and 
governs relations in respect of payment of such tax to the budget 
Law of Mongolia determining 
the amount of export 
customs duty to be imposed 
on certain commodities  1996 Imposes specific export customs duties on a number of commodities
Law of Mongolia on Free Zones 2002 
Regulates the establishment of free zones and their form, powers of 
governing bodies, monitoring mechanisms; determines the legal basis for and the realization of special tax and custom conditions 
                                               
1 Resolution of Parliament: Endorsement of the Millennium Development Goals, Comprehensive National 
Development strategy of Mongolia , Section 5.1.6. Viewed at: 
http://mofa.gov.mn/coordination/images/st ories/resource_docs/nds_approved_eng.pdf  [November 2013]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 18 - 
 
  Legislation Year Last 
amended Description 
Law on the legal status of 
"Altanbulag" Free Trade Zone 2000 2002 Determines the legal status of the Altanbulag zone and regulates issues 
related to its implementation 
Investment and concessions
Law on Investment 2013 Sets out the legal basis for domestic and foreign investment and 
provides for tax stabilization certificates 
Concessions Law 2010 Provides the legal basis for public-private partne rships and their 
regulation 
Intellectual property 
Copyright Law of Mongolia 1993 2006 Regulates matters rela ted to the protection of copyright and use of the 
works subject to copyright 
Patent Law of Mongolia 1993 2006 Regulates matters related to protection of the rights of authors of 
inventions, industrial designs, and innovations, and of patent owners, 
and the use of inventions, industrial designs, and innovations 
Law of Mongolia on 
trademarks and geographical 
indications 2010 Ensures legal guarantees for trade-marks and trade names, protects the 
rights and legal interests of owners, and regulates issues concerning the 
ownership, use, and disposal of trademarks and trade names 
Competition policy 
Competition Law of Mongolia 2010 Establishes conditions for fair competition on the market by corporate 
entities; prevents and prohibits activities of monopolization or hostility 
to competition and defines the legal basis for the institution regulating 
competition 
Government procurement  
Law on Government 
Procurement 2005 Regulates matters relating to the preparation of bidding documents, 
advertisement, opening of tenders, evaluation of tenders, and award of 
contract for public procurement of goods, works and services; 
composition and organization of Tender Committee, and control over its activities 
Company law and Licensing
Company Law 1999 2012 Regulates the establishment, registration, and reorganization of a 
company, its management and organizational structure, the rights and obligations of its shareholders, and its control and liquidation 
Law on Licensing 2001 Regulates giving, delaying, and invalidating a licence to business 
activities that might negatively affect public interest, human well-being, 
environment, and national security, and that might require specific 
conditions and expertise 
Minerals and energy  
Energy Law 2001 Regulates matters relating to energy generation, transmission, 
distribution, dispatching and supply activities, construction of energy 
facilities, and energy consumption that involve utilization of energy 
resources 
Renewable Energy Law 2007 Regulates relations on  generation of power using renewable energy 
sources and its delivery 
Minerals Law 2006 Regulates exploration, mining, and related activities 
Petroleum Law  1991 Regulates the exploration for and the protection, processing, 
transportation, storage, and marketing of petroleum 
Government Resolution of 
Mongolia on Approving the 
Model of the Stability 
Agreement, No. 46 2001 Regulates issues connected with ensuring stable tax conditions during a 
certain period for business entities with foreign investments engaged in 
exploration of mineral resources deposits 
Nuclear Energy Law 2009 Regulates the exploration for and mining of uranium 
Finance 
Banking Law 2010 Regulates the licensing of banks, the revocation of licences, the 
establishment of general principles of a bank's management, 
organization, and activities, and enforcement measures 
Law on Central Bank 1996 Establishes the legal grounds of the powers of the Central Bank of 
Mongolia, its management, organization, and activities, and regulates 
issues concerning the implementation of state monetary policy 
undertaken by the Central Bank 
Law on Currency Settlements 1994 Defines the powers of the government bodies in charge of currency 
settlement, regulates exchange controls for currency circulation by business entities, organizations, and citizens, and establishes mechanisms to sustain the Mongolian currency exchange rate 
Law on Deposits, Loans and 
Banking Transactions 1995 Regulates matters concerning the depositing of funds with banks by 
citizens and legal persons, the carrying out of transactions through the 
agency of banks and operations, and the granting and repayment of 
bank loans 
Law on Non-bank Financial Activities 2002 Establishes legal foundations for non-bank financial activities and 
regulates issues of management, organization, licensing, and suspension or revocation of licences of entities conducting non-bank financial activities 
Law on Combating Money 
Laundering and Terrorism 
Financing 2006 Establishes the legal basis for regulations to prevent money laundering
and the financing of terrorism 
Law on Bills 1995 Regulates relations between citizens and business entities concerning 
the use of bills of exchange and promissory notes as a means of payment WT/TPR/S/297/Rev.1 • Mongolia 
 
- 19 - 
 
  Legislation Year Last 
amended Description 
Law on Insurance 1997 2004 Defines the legal framework for conducting insurance activities in the 
territory of Mongolia, regulates relations between insurance companies, 
citizens, and legal entities, and creates principles for state auditing of 
insurance activities 
Securities Law 1994 2013 Regulates the issue of securities for the purpose of accumulating capital, 
the buying and selling of securities, depository arrangements, and 
clearing and settlement services, the regulation of issuers and other persons involved in the securities market and the protection of investors 
Telecommunications 
Law on Telecommunications 1995 2001 Regulates relations among state organizations, service providers, 
business entities, and individuals engaged in telecommunications and 
the creation, utilization, and protection of the telecommunications network and telecommunications services  
Law on Radio Frequency 1999 Regulates relations among state organizations, service providers, 
business entities, and individuals engaged in using radio frequencies 
Postal Law 2003 Regulates relations among state organizations, service providers, 
business entities, and individuals engaged in postal services and the creation, utilization, and protection of the postal network and postal services 
Law on Electronic Signature 2011 Regulates relations among state organizations, service providers, 
business entities, and individuals engaged in postal services and the 
creation, utilization of electronic signatures 
Tourism 
Tourism Law 2000 Regulates relations between the State, citizens, economic entities, and 
organizations with regard to tourism promotion, engagement in tourism 
activities, and provision of tourism services on the territory of Mongolia 
Source: The Mongolian authorities.  
2.4  Trade Agreements and Arrangements 
2.4.1  WTO 
2.14.  Mongolia acceded to the WTO on 29 January 1997 as the third Member to join under 
Article 12 of the Marrakesh Agreement. In the years leading up to and following accession, Mongolia adopted a number of laws to bring its legislation into line with its WTO commitments. As 
with other international agreements to which Mongolia is a party, the terms of its accession and 
other WTO agreements may be invoked in the courts. Mongolia is an observer to the Agreement on Government Procurement. It is neither a signatory to the Agreement on Trade in Civil Aircraft 
nor an observer in the Committee. Since 1 January 2005, Mongolia has made some notifications to 
the WTO but in many cases notifications are lacking (Table 2.3). 
Table 2.3 WTO notifications, 1 Ja nuary 2005 to 31 December 2013 
Legal provision Description Frequency WTO document 
Agreement on Agriculture 
Article 18.2 Export subsidies (Table ES:1) 
for 2000-06 Annual G/AG/N/MNG/8, 12/12/2007 
Article 18.2 Domestic support 
(Table DS:1) Ad hoc G/AG/N/MNG/7, 7/12/2007 
Agreement on Implementation of Article VI of GATT 1994 (Anti-Dumping) 
Article 16.4  Anti-dumping actions (none 
taken and none foreseen) 6 months G/ADP/N/193/MNG, 10/05/2010 
Article 16.5 Competent authority (none) Ad hoc G/ADP/N/193/MNG, 10/05/2010 
Agreement on Subsidies and Countervailing Measures 
Article 25.11 Countervailing duties (none 
taken and none foreseen) 6 months G/SCM/N/202/MNG, 9/08/2010 
Article 25.12 Competent authority (none) Ad hoc G/SCM/N/202/MNG, 9/08/2010 
Agreement on Technical Barriers to Trade 
Article 10.6 Food standards 
Conformity assessment Human health Labelling Metrology Consumer protection Ad hoc 
Ad hoc Ad hoc Ad hoc Ad hoc Ad hoc G/TBT/N/MNG/1, 15/12/2005 
G/TBT/N/MNG/2, 21/12/2007 G/TBT/N/MNG/3, 21/12/2007 G/TBT/N/MNG/4, 26/01/2009 G/TBT/N/MNG/5, 7/04/2010 G/TBT/N/MNG/6, 27/03/2013 
Article 10.7 Agreement with Ukraine Ad hoc G/TBT/10.7/N/54, 9/01/2008 
Source: WTO Secretariat. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 20 - 
 
  2.15.  In acceding to the WTO, Mongolia bound all its tariffs in ad valorem  terms, in its 
Schedule CXXXIV, at rates that vary from duty free to 75%, with an average bound rate of 17.3% 
and other duties and charges bound at zero. Tariffs for most tariff lines are bound at 20% (section 3.1.4.3). Mongolia has no commitments on tariff quotas, domestic support, or export 
subsidies for agricultural products (section 4.1). 
2.16.  Mongolia made various GATS commitments during its accession.
2 While it did not participate 
in the extended negotiations on financial services (Fifth Protocol, adopted 14 November 1997) or 
telecommunications (Fourth Protocol, adopted 30 April 1996), its accession commitments on 
services covered some of these subsectors. Mongolia has made no MFN exemptions. 
2.17.  Mongolia has not been a party or third party to any dispute under the WTO dispute 
settlement mechanism. 
2.4.2  Other regional and bilateral agreements 
2.18.  Mongolia does not have any regional trad e agreements with other countries. It is not a 
member of the Asia Pacific Economic Cooperation. However, as of end 2013, Mongolia was in the 
process of acceding to the Asia-Pacific Trade Agreement (APTA)3 and had several trade-related 
agreements with other countries. In many cases these pre-date Mongolia's accession to the WTO and accord reciprocal MFN treatment between the two parties. To a large extent these bilateral 
agreements have been superseded by Mongolia's accession to the WTO, although some were 
negotiated after its accession (Table 2.4). Mongolia is in the process of negotiating an Economic Partnership Agreement with Japan.
4 
2.19.  Australia, Canada, the EU, Japa n, New Zealand, Norway, the Russian 
Federation/Belarus/Kazakhstan, Switzerland, Turk ey, and the United States provide preferential 
access to imports from Mongolia under their Generalized System of Preferences arrangements. Since 2006, Mongolia has been eligible for the GSP+ arrangement in the EU.  
Table 2.4 Bilateral trade-related agreements since accession to the WTO 
Agreement Date Description 
Agreement between the government of 
Mongolia and the EEC on Trade in 
Textiles 31/12/1997 Applies to trade in textile products originating 
from Mongolia 
Trade Agreement between the 
Government of Mongolia and the 
Government of Viet Nam 13/12/1999 Accords MFN to trade, transportation, customs 
and taxation, provides for transit transportation 
through the territories of the parties, as well as 
for dispute settlement 
Trade Agreement between the 
Government of Mongolia and the Government of Cuba 9/11/2001 Accords MFN to exchange of goods and services; 
provides for the promotion of activities; related to fairs, exhibitions, and other trade activities, recognizes that sanita ry and phytosanitary 
requirements do not necessa rily create barriers to 
trade; establishes intergovernmental Commission; sets non-di scriminatory principles 
with regard to trade between the two countries 
Agreement between the Government of 
Mongolia and the Government of the 
United States concerning the 
Development of Trade and Investment 
Relations/TIFA 15/07/2004 Establishes Joint Trade and Investment Council 
and provides for further development of trade 
and investment relations between the two 
countries 
Agreement on Transparency in Matters Related to International Trade and Investment between the United States of America and Mongolia 24/09/2013 Provides for transparency and opportunity to 
comment and respond to questions on measures 
affecting trade in goods and services as well as provisions to address bribery and corruption. 
                                               
2 WTO document GATS/SC/123, 28 August  1997; and WTO document WT/TPR/S/145, 
15 February 2005, Table IV.3. 
3 UN ESCAP online information. Viewed at: http://www.unescap.org/tid/apta.asp  [January 2014]. 
4 Ministry of Foreign Affairs of Japan online information. Viewed at: 
http://www.mofa.go.jp/press/release/press4e_000137.html  [January 2014]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 21 - 
 
  Agreement Date Description 
Agreement on Economic Cooperation 
between Mongolia and Hungary 2005  
Source: The Mongolian authorities. 
2.5  Investment Regime 
2.20.  The Foreign Investment Law of 1993 and the Regulation of Foreign Investment in Business 
Entities Operating in Sectors of Strategic Importance Law of 2012 were replaced by the 
Investment Law of 2013 with effect from 1 November 2013. This law applies to both domestic and foreign-invested entities, where a foreign-inve sted entity is defined as a business entity 
incorporated in Mongolia in which foreign investors hold at least 25% equity and the foreign 
investors' capital contribution is at least US$100,000.
5 
2.21.  Under the new law, no approval is required for private investment, and registration has 
been simplified to a single registration with the Legal Entities Registration Office. Where a 
foreign-government-owned legal entity holds 33% or more of the shares in the Mongolian 
company doing the investing, permission is required from the Ministry of Economic Development in order to invest in mining, banking and finance, or media and communications. A 
foreign-government-owned legal entity is defined as a legal entity with at least 50% of its shares 
owned directly or indirectly by the government of a foreign country. 
2.22.  The Invest Mongolia Agency, under the Minist ry of Economic Development, is responsible for 
promoting and regulating investment in Mongolia, including issuing tax stabilization certificates. 
These certificates fix the maximum corporation tax,  VAT, mining duties, an d import duties at the 
level applicable at the time the certificate was granted. Investments over thresholds set out in the Law (Table 2.5) are eligible for stabilization certificates, except for those relating to the production, 
import or sale of tobacco products or alcoholic beverages. The qualifying thresholds for a 
certificate depend on the sector, the value of the investment and the region of the country. A 
qualifying investment must also create employment and introduce new technology, and must have 
completed an environmental impact assessment if required by law. 
Table 2.5 Law on Investment - Tax stabilization certificates 
Mining extraction, heavy industry, and infrastructure 
Investment 
Tog billion Validity of certificate in years Investment period 
Years 
 Ulaanbaatar Central Khangai Eastern Western  
30-100 5 6 6 7 8 2 
100-300 8 9 9 10 11 3 
300-500 10 11 11 12 13 4 
500 plus 15 16 16 17 18 5 
Other sectors 
 
Investment in MNT billion Validity 
Years Investment 
period 
Years 
Ulaanbaatar Central Khangai Eastern Western   
 10-30 5-15 4-12 3-10 2-8 5 2 
 30-100 15-50 12-40 10-30 8-25 8 3 
 100-200 50-100 40-80 30-60 25-50 10 4 
 200 plus 100 plus 80 plus 60 plus 50 plus 15 5 
Source: Law on Investment, Article 16.  
2.23.  The validity of the licence may be extended by 50% for projects over Tog 500 billion 
investment that result in the production of import substitutes and export-oriented products, are 
significant for long-term development, and that require more than three years construction. 
2.24.  Investments that took place during the five years preceding the entry into force of the 
Investment Law on 1 November 2013 may also qu alify for tax stabilization certificates unless 
already covered by existing project-specific investment or stability agreements. 
                                               
5 The Investment on Law and severa l other laws related to business and investment are available in 
English from the Invest Mongolia Agency's website. Viewed at: http://investmongolia.com/fiftanew/index.php?id=21&lang=Eng  [November 2013]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 22 - 
 
  2.25.  Mongolia has concluded 43  bilateral investment treaties (Table 2.6). 
Table 2.6 Bilateral investment treaties 
Partner Date Entry into Force 
Austria 22/05/2001 01/05/2002 
Belarus 28/05/2001 27/01/2002 
Belgium-Luxembourg 06/03/1992 15/03/2000 
Bulgaria 06/06/2000 .. 
China 26/08/1991 11/01/1993 
Croatia 08/08/2006 .. 
Cuba 26/03/1999 18/10/2000 
Czech Republic 13/02/1998 05/07/1999 
Denmark 13/03/1995 11/08/1995 
Egypt 27/04/2004 25/01/2005 
Finland 15/05/2007 19/06/2008 
France  08/11/1991 22/12/1993 
Germany  26/06/1991 23/06/1996 
Hungary  13/09/1994 29/08/1995 
India 03/01/2001 29/04/2002 
Indonesia 04/03/1997 30/10/1998 
Israel 25/11/2003 02/09/2004 
Italy 15/01/1993 11/08/1995 
Japan 15/02/2001 24/03/2002 
Kazakhstan 12/02/1994 22/03/1995 
Korea, DPR 10/11/2003 .. 
Korea, Republic of 28/03/1991 30/04/1991 
Kuwait 15/03/1998 01/05/2000 
Kyrgyzstan 04/12/1999 .. 
Lao, PDR 03/03/1994 29/12/1994 
Lithuania 27/06/2003 03/05/2004 
Malaysia 27/07/1995 14/01/1996 
Netherlands 09/03/1995 20/01/1996 
Philippines 01/09/2000 01/11/2001 
Poland  08/11/1995 05/02/1996 
Qatar 29/11/2007 .. 
Romania 06/11/1995 15/08/1996 
Russian Federation 29/11/1995 06/02/2006 
Singapore 24/07/1995 14/12/1995 
Sweden 20/10/2003 19/03/2004 
Switzerland 29/01/1997 09/09/1999 
Tajikistan 20/03/2009 16/09/2009 
Turkey 16/03/1998 25/02/2000 
Ukraine 05/11/1992 05/11/1992 
United Arab Emirates 21/02/2001 .. 
United Kingdom 04/10/1991 04/10/1991 
United States 06/10/1994 01/04/1997 
Viet Nam 17/04/2000 13/12/2001 
.. Not available. 
Source: The Mongolian authorities.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 23 - 
 
  3  TRADE POLICIES AND PRACTICES BY MEASURE 
3.1  Measures Directly Affecting Imports 3.1.1  Customs procedures and requirements 3.1.  Since its previous review, Mongolia has, inter alia,  revised relevant legislation, introduced the 
customs automated information system (CAIS), and adopted an online payment system for 
customs duties. Against the background of these ch anges, the time required for customs clearance 
has been reduced to 23 minutes (3 hours 6 minutes before adoption of the CAIS), and 
administrative offences were reduced by 3%.
1 
3.2.  Mongolia is party to the Convention on the Harmonized System, Customs Convention on the 
International Transport of Goods under Cover of TIR ("Transports internationaux routiers") Carnets, the Istanbul convention on Temporary Admission, and the Revised Kyoto Convention on 
the Simplification and Harmonization of Customs Procedures. The authorities consider that 
Mongolia has aligned national customs legislation and procedures with the global standard and taken measures to limit tariff restrictions and non-tariff barriers according to its international 
commitments.  
3.3.  The main legislation governing importation into Mongolia is the Customs Law and the Law on 
Customs Tariffs and Duties (Customs Tariff Law) . The Customs Law defines the organizational 
structure and legal basis of Customs, under the Customs Central Body, as well as the procedures 
of customs clearance and enforcement of the customs legislation. The Customs Tariff Law 
regulates matters regarding determination of the customs tariff, customs valuation, classification, and rules of origin, as well as levying, collection, and payment of customs duties. The two laws 
and their implementing regulations were last re vised in 2008 to apply a risk-management system, 
which enabled, inter alia,  accepting electronic copies of documents, adopting "preliminary customs 
declaration", allowing one customs declaration set for several shipments or numerous items 
shipped together. The revision also aimed to facilitate cooperation with customs authorities in 
Mongolia's trading partners through mutual recognition of documents and joint customs controls.
2  
3.4.  Under the Customs Law, the Customs Gene ral Administration is authorized to set up 
regulations related to customs clearance procedures in compliance with the law.3 
Order No. 638 (2010) of the Head of the Customs General Administration contains the main implementing regulations regarding customs cleara nce. According to the authorities, Customs has 
eliminated around 60 regulations with a view to reducing unnecessary documents and red tape. 
3.5.  According to Chapter 2 of the Customs La w, any person has a right to convey goods or 
means of transport across the customs frontier freely in accordance with conditions and rules stated in Mongolian laws and international treaties to which Mongolia is party.  
3.6.  The principal document for customs clearanc e is the customs declaration form (CDF). Where 
necessary, Customs may require an importer to produce other documents for the purpose of customs clearance. These include: a foreign trade contract, transport document, and permits, 
licences, certificates, and/or other documents required for goods subject to non-tariff restrictions. 
Documents for customs clearance must be provided in the Mongolian language; Customs may accept a translated copy of these documents. According to Article 27 of the Customs Law, a 
service fee for customs clearance, as approved by the Customs General Administration, must be 
paid by a declarant. Customs clearance document s must be submitted to Customs at the customs 
frontier. If Customs agrees with the submitted cu stoms value, the importer must pay the import 
duties, VAT, and any excise tax before Customs authorizes importation of the declared goods. 
3.7.  Prior declaration of customs documents is allowed if a shipment contains a variety of goods, 
requires rapid processing during particular seasons (e.g. during the harvest season and New Year), or requires special storage facilities. Simplified procedures for customs declaration, requiring fewer 
                                               
1 ADB online information "Aid-for-Trade: Case story". Viewed at: 
http://www.oecd.org/aidfortrade/48292480.pdf  [16.12.2013]. 
2 The authorities state that the revised laws covered more than 350 standards of the Kyoto Convention 
on the Simplification and Harmon ization of Customs Procedures. 
3 Article 24.3, Customs Law. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 24 - 
 
  documents, are also available where goods ente r or leave customs bonded zones or customs 
special zones directly from or for abroad. Accelerated procedures are applicable for certain hazardous goods, blood and blood products, and donors' organs to be used for treatment purposes; customs clearance is on the basis of ex-post  completion of customs declaration forms. 
Businesses and individuals permitted for accelerated procedures are allowed to pay customs duties 
and other taxes prior to the clearance. Examination must be completed within eight working hours for dangerous goods requiring special treatment (e.g. uranium and highly toxic chemical 
substances) or animals.  
3.8.  The CAIS, which replaced the national automated system for customs information 
management (GAMAS), is used for controlling goods crossing the border, Customs declarations, lodging customs-related documents, physical examination, and release of goods. The CAIS has 
allowed Customs to accept, process, and issue import and export clearances through 100% online 
submission. An online payment system for customs duties is also available.  
3.9.  Reflecting the recent increase of foreign trade turnover, the authorities aim to make more 
use of post-clearance audit rather than border control, based on the risk-management system set 
out in the 2008 amendment to the Customs Law. They intend to adhere to international conventions to which Mongolia is party, and share the best practices of customs control that have 
proven to be efficient and effective in many other administrations.
4 To achieve this objective, 
Customs has, inter alia: developed software for the risk-management system; been training risk 
managers and operational staff; and decreased the number of physical inspection and documentary checks by about 10% since 2007. Unpaid duties are to be recovered as a result of 
post-clearance audit; the authorities consider that this practice will have a positive impact on 
Mongolia's economic development and prosperity. The authorities state that, in order to eliminate unnecessary delays in the release of goods, Customs will release goods upon declaration with no 
proof of value.  
3.10.  The Customs Law contains provisions on temporary admission into Mongolia's customs 
territories and on re-exports.
5 Provisions also exist for the operation of customs bonded zones, 
warehouses, manufacturing areas, exhibition area s, and construction areas, and for duty-free 
shops.6  
3.11.  With a view to combatting smuggling, Cust oms uses dogs trained to detect prohibited and 
restricted goods as well as narcotics. Of the 310 smuggling cases recently detected by dogs, 
79.3% related to fur skins and 20.7% to cashmere.  
3.12.  Customs decisions may be appealed within 30 days of the decision7, to a director or head of 
the Customs concerned. Appeals of decisions by th e director or head of Customs may be made to 
a higher-level of authority of the relevant Cust oms. Whose decisions may be appealed in court. 
Data provided by the authorities indicate that the number of customs offence increased to 4,030 in 
2008 but fell to 2,429 cases in 2012.  
3.13.  Mongolia does not use pre-shipment inspection procedures.  
3.1.2  Customs valuation 3.14.  Customs valuation for imported goods is administered in accordance with the Customs Tariff 
Law; the c.i.f. price of imports is used as the basis for customs valuation. The primary basis for 
determination is the transaction value. If Customs suspects that the declared value is not correct, 
and if the importer cannot justify the declared import value, Customs may apply the "deductive method", the "computed method", or the "fall-ba ck method". The authorities indicate that the 
transaction value applies to more than 70% of the total transaction value of imports. According to 
the authorities, based on the revised Customs Law, Mongolia has revised the methods of determining the customs value of imported goods. 
                                               
4 The authorities intend to keep the balance between customs control and trade facilitation to support 
national security, legitimate trade, and Customs Law compliance. 
5 Articles 96-110,135-139, Customs Law. 
6 Chapter Ten, Customs Law. 
7 Article 17.2, Customs Law. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 25 - 
 
  3.1.3  Rules of origin  
3.15.  Mongolia uses non-preferential rules of origin for imported goods for the purpose 
of, inter alia,  applying its MFN tariffs on imports.8  
3.1.4  Tariffs 
3.1.4.1  Overview 
3.16.  The Customs Tariff Law of Mongolia is the main legislation regulating matters relating to the 
customs tariff, the adoption/modification of duty  rates, customs valuation, and collection of 
customs duties.9 Tariff rates must, in principle, be approved by Parliament. The Customs Tariff 
Council, which is established on an ad hoc  basis, makes proposals to the Government on the 
development of the tariff system, including the adoption/modification of customs duty rates and 
the imposition of additional duties, such as anti -dumping and countervailing duties. Customs tariffs 
accounted for about 22.5% of Mogolia's total tax revenue in 2012.  
3.1.4.2  Tariff structure 
3.17.  Mongolia has adopted the 2012 nomenclature of the Harmonized Commodity Description 
and Coding System (HS) in 2012.  The 2013 tariff schedule consist of 5,722 lines at the HS 8-digit 
level: the first six digits refer to the common coding  of the HS; the last two digits are sub-divisions 
at the national level.  
3.18.  According to the Customs Tariff Law, Mongo lia's customs tariff consists of general rates and 
most-favoured-nation (MFN) bound and applied rates. Under the Law, MFN applied rates apply to goods from Mongolia's trading partners that offer MFN status to Mongolia (WTO Members, 
Kazakhstan, and Belarus); goods originating in other countries are dutiable according to the 
general rates, which are double the MFN applied rates. According to the Customs Tariff Law, customs duty rates may be ad valorem , specific and/or a combination of the two.  
3.19.  According to the authorities, while the relevant clause was eliminated from the revised 
Customs Tariff Law in 2008, in practice, the Government may, at its discretion, reduce or increase an applied tariff rate by up to 50% of the rate under Mongolia's tariff schedule, upon the 
recommendation of the Customs Tariff Council. 
3.1.4.3  Bound rates 3.20.  Mongolia bound all its tariffs upon accession to the WTO, at 20% for most tariff lines.
10 The 
average bound MFN rate is 17.7% (compared wi th an average applied MFN rate of 5.0%) 
(Table 3.1); the highest bound rate is 75%. In theory, this gives Mongolia considerable latitude to 
raise its tariffs within existing bindings.  
Table 3.1 Mongolia's tariff st ructure, 2004, 2011, and 2013 
(%, unless otherwise indicated) 
 MFN applied Final bounda  2004 2011 2013 
Bound tariff lines (% of all tariff lines) 100.0 100.0 100.0 100.0 
Simple average rate 5.0 5.0 5.0 17.7 
WTO agricultural products 5.1 5.1 5.2 18.6 
WTO non-agricultural products 5.0 5.0 5.0 17.5 
Duty-free tariff lines (% of all tariff lines) 0.9 0.9 0.8 1.5 
Simple average rate of dutiable lines only 5.0 5.0 5.0 18.0 
Tariff rate quotas (% of all tariff lines) 0.0 0.0 0.0 0.0 
Non-ad valorem  tariffs (% of all tariff lines) 0.0 0.0 0.0 0.0 
Domestic tariff "peaks" (% of all tariff lines)b 0.0 0.2 0.2 0.0 
International tariff "peaks" (% of all tariff lines)c 0.0 0.0 0.0 78.1 
Overall standard deviation of tariff rates 0.5 0.7 0.7 6.3 
                                               
8 Article 26, Customs Tariff Law.  
9 The current law, as amended, entered into force on 1 July 2008.  
10 WTO (2005), Trade Policy Review – Mongolia 2005, June.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 26 - 
 
   MFN applied Final bounda  2004 2011 2013 
Coefficient of variation of tariff rates 0.1 0.1 0.1 0.4 
Nuisance tariffs (% of all tariff lines)d 0.0 0.0 0.0 0.0 
Total number of tariff lines 5,513 5,430 5,722 5,722 
 Ad valorem  rates 5,461 5,380 5,671 5,634 
  (5%) 5,447 5,364 5,652 14 
 Duty-free 49 47 48 88 
 Prohibited 3 3 3 0 
a Final bound rates are based on the 2013 tariff schedule in HS12 nomenclature.  
b Domestic tariff peaks are defined as those exc eeding three times the overall average applied rate. 
c International tariff peaks are defined as those exceeding 15%. Only one tariff line exceeds 15%. 
d Nuisance rates are those greater than zero, but less than or equal to 2%. 
Note: 2004, 2011, and 2013 tariffs are based, resp ectively, on HS02, HS07 and HS12 nomenclature. 
Calculations for averages are based on national tariff line level (8-digit), excluding three lines due to prohibition (HS22071000, 22072000 and 22089010). 
Source: WTO Secretariat calculations, based on da ta provided by the authorities of Mongolia. 
3.1.4.4  Applied MFN rates 
3.21.  Mongolia applies an ad valorem  M F N  t a r i f f  r a t e  o f  5 %  t o  m o s t  i m p o r t e d  g o o d s .  T h e  
authorities' objectives of applying a uniform tariff  rate are to simplify customs processes, provide 
incentives for the efficient production of goods, refrain from protection for individual domestic 
industries, and to have low-priced import produc ts available in the domestic market. Mongolia's 
current (2013) average applied MFN tariff rate is 5.0%, unchanged since 2004.  
3.22.  The range of applied tariff rates was zero to 25% in 2013. In the same year, duty-free tariff 
lines accounted for 0.8% of all tariff lines (0.9% in 2004); these covered, inter alia,  live animals 
for breeding (horses, cows, pigs, sheep, goats), automatic data processing machines and their parts, electronic integrated circuits, diodes, transistors and other semiconductor devices, and 
various medical equipment. A tariff rate of 5% ap plies to 98.8% of all tariff lines. There are two 
other applied MFN duty rates, 15%, whic h applies to flour as a seasonal tariff
11 and to some 
vegetables (non-seasonal tariff), and 25% to beer.  
3.23.  For 60 tariff lines, the applied MFN rate (5%) exceeds the corresponding bound rate (0%).12  
3.24.  Tariff exemptions apply to some imports to  be used by small and medium-sized enterprises 
(SMEs), as provided for in Government Resolution No. 100 (2011).  
3.1.4.5  Tariff escalation, tariff ranges, and tariff peaks 
3.25.  There is effectively no tariff escalation and no evident tariff peaks, because of an almost 
uniform applied MFN rate of 5%. 
3.1.4.6  Tariff-rate quotas 
3.26.  Mongolia does not use tariff-rate quotas.  
3.1.5  Import prohibitions, restrictions, and licensing 3.27.  Mongolia does not apply any import quotas.  
3.28.  According to the Customs Law, prohibition or restriction of imports requires the 
authorization of Parliament. There has been no change in the list of prohibited goods since 2005 (Table 3.2).  
                                               
11 The duty is imposed from 1 August  to 1 April, i.e. after the harv esting period of the products 
concerned. Outside this period, the applied duty rate is 5%. 
12 These are 18 tariff lines under HS 29, and 42 tariff lines under HS30. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 27 - 
 
  Table 3.2 Goods prohibited fr om exportation/importation 
Goods 
under 
4-digit 
HS code Goods 
under 
6-digit 
HS code Commodity description Export/import 
12.11 1211.90.00 Plants and parts (including seeds and fruits), of a kind used primarily in 
perfumery, in pharmacy, or for insecticidal, fungicidal or similar purposes, 
fresh or dried, whether or not cut, crushed or powdered  Export and import 
13.01 1301.90.00 Lac. Natural viscous gums, resins, gum-resins and greasy- gums (balsams) Export and import 
29.22 2922.19.00
2922.30.00
2922.39.00
2922.49.002922.50.00 Amino-compounds with oxygen-function Export and import 
29.24 2924.10.00
2924.29.00 Carboxyamide-function compounds amide-function compounds of carbonic 
acid Export and import 
29.26 2926.90.00 Nitrile function co mpounds Export and import 
29.33 2933.39.00
2933.40.00
2933.90.00 Heterocyclic compounds with nitrogen hetero-atom(s) only Export and import 
29.34 2934.90.00 Nucleic acids and thereof salts, he terocyclic compounds:  Export and import 
29.39 2939.10.00
2939.90.00 Vegetable alkaloids, natural or reproduced by synthesis, and their salts, 
ethers, esters and other derivatives  Export and import 
  All of kind spirits  Import 
22.07  Un-denatured ethyl alcohol of an alcoholic strength by volume of 80% or 
higher: ethyl alcohol and other spirits, denatured, of any strength Import 
  Chemicals, the production of which is prohibited by an International 
Convention on the Prohibition of Production, Storage and Utilization of 
Chemical Weapons and their Proliferation Export and import 
  Poisonous chemicals, the use of which is prohibited in Mongolia /16 types of 
chemicals listed in the annex to the Order by the Minister of Environment 
No. 75 of 1997 Import 
  Poisonous chemicals used in the production of weapons, wastes thereof Export and import 
  Radioactive chemicals, wastes thereof, originating from nuclear weapons  Import 
  Parts and compounds of nuclear weapons prepared for nuclear weapon 
purposes Import 
  Dangerous wastes Import 
  Human blood, blood fractions and organs, not proven to be non-infected 
with AIDS Import 
  Donor blood and organs for medical preventive purposes that are required 
to be under strict control Import 
30.01 3001.10 
3001.20 
3001.90 Glands and other organs for organ-therapeutic uses, dried, whether or not 
powdered; extracts of glands or other organs or of their secretions for 
organ-therapeutic uses; heparin and its salts; other human or prophylactic 
uses, not elsewhere specified or included Import 
30.02 3002.10 
3002.20 
3002.90 Human blood; animal blood prepared for therapeutic, prophylactic or 
diagnostic uses; antisera and other blood fractions and modified 
immunological products, whether or not obtained by means of 
biotechnological processes; vaccines, toxins, cultures of microorganisms 
(excluding yeasts) and similar products Import 
  High-yielding animals, their semen Export and import 
01.01  Live horses, asses, mules and hinnies Export and import 
  Horses  Export and import 
01.02  Live bovine animals Export and import 
01.04  Live sheep and goats Export and import 
01.06  Other live animals Export and import 
  Camel Export and import 
05.11 0511.10 
0511.99 Animal products not elsewhere specified or included; dead animals of 
Chapter 1 or 3, unfit for human consumption. Export and import 
  Printed magazines, books, movies, videos, pictures, etc. that propagate 
pornography Export and import 
08.02 0802.90 Cedar nuts Export 
Source:  Government Resolution No. 54 of  2001, Government of Mongolia. 
3.29.  Since 2005, there has been no change in  the list of imports that are subject to 
non-automatic licensing requirements (Table 3.3). According to the authorities, the main purpose WT/TPR/S/297/Rev.1 • Mongolia 
 
- 28 - 
 
  of these requirements is to protect human, anim al, and plant health while safeguarding national 
security.  
Table 3.3 Goods subject to import or export licence 
HS Code, 
national Description Export/import 
 I. Breeding animals Export 
01011000 Pure-bred breeding horses  
01019000 Other breeding horses  
01021000 Pure-bred breeding live bovine animals  
01029000 Other breeding live bovine animals  
01031000 Pure-bred breeding live swine  
01041000 Sheep  
01042000 Goats  
01069010 Camels  
 Other live animals, raw materials originating therefrom, samples of animals for 
research purposes, semen of animals, cultures of micro-organisms  
 Very rare animals (26 types of animals listed in the Animals Law)  
 Rare animals (list to be determined by the Government)  
05079011 Antlers, filled with blood, of deer  
05079021 Horns, of deer  
05079029 Horns, of wild sheep and of wild goats  
05100011 Musk  
05100012 Penis, of deer  
05111000 Bovine semen  
05119910 Animal semen (other than bovine semen)  
05119990 Semen, of other animals other than breeding animals  
26121000 Uranium ores and concentrates  
 II. Poisonous chemicals  
(96 types of chemicals indicated in joint order No. 83/A/160 of 1998 by the 
Ministers of Environment, Health and Social Welfare) Export and import 
 III. Human blood and organs for ther apeutic and prophylactic purposes 
that require necessary control Export and import 
30011000 Glands and other organs, dried, whether or not powdered  
30012000 Extracts of glands or othe r organs or of their secretion  
30021000 Antisera and other blood fractions and modified immunological products, 
whether or not obtained by means of biotechnological processes  
30023000 Vaccines for veterinary medicine  
30029000 Other: human blood, cultures of micro-organisms  
 IV. Explosives Export and import 
36010000 Propellant powders  
36020000 Prepared explosives, other than propellant powders  
36030000 Safety fuses, detonating fuses, percussion  or detonating caps, igniters, electric 
detonators  
3604 Fireworks, signalling flares, rain rockets, fog signals and other pyrotechnic 
articles  
 V. Guns, equipment and tools for military use and their spare parts Export and import 
93.01 Military weapons, other than revolv ers, pistols and arms of heading 93.07  
93.02 Revolvers and pistols, other than those of heading 93.03 or 93.04  
93.03 Other firearms and similar devices which operate by the firing of an explosive 
charge (for example, sporting shotguns and rifles, muzzle-loading firearms, Very 
pistols and other devices designed to project only signal flares, pistols and revolvers for firing blank ammunition, captive-bolt humane killers, line-throwing guns)  
93.04 Other arms (for example, spring, air or gas guns and pistols, truncheons), 
excluding those of heading 93.07  
93.05 Parts and accessories of articles of heading 93.01 to 93.04  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 29 - 
 
  HS Code, 
national Description Export/import 
93.06 Bombs, grenades, torpedoes, mines, missiles, and similar munitions of war and 
parts thereof; cartridges and other ammunition and projectiles and parts 
thereof, including shot and cartridge wads  
 VI. Works of art, collectors' pieces and antiques  
97.05 Collections and collectors' pieces of zoological, botanical, mineralogical, 
anatomical, historical, archaeological, paleontological, ethnographic or 
numismatic interest Export 
Source: Government Resolution No. 219 of 2002, Government of Mongolia.  
3.30.  Ministries in charge of issuing import an d export licences for restricted goods include the 
Ministries of Environment, Education, Culture an d Science, Industry and Trade (MIT), Food and 
Agriculture, and Health. They are required to provide information on licensing to MIT every quarter, and to provide the official name, position, and signature of the licence holder to the 
Customs General Administration. A licence-issuing ministry must respond to a licence request 
within 21 working days. If necessary, the period ma ybe extended for a further 14 days in order to 
conduct a detailed analysis of the request. Licences are valid for one year and may be extended 
for a year, when necessary to fulfil contract.  
3.1.6  Anti-Dumping, countervailin g, and safeguard measures  
3.31.  Mongolia has not established an authority to initiate and conduct anti-dumping 
investigations. It has not taken any anti-dumping actions.
13  
3.32.  Mongolia has not imposed countervailing measures.  
3.33.  There are no provisions in Mongolia's current legislation covering safeguard measures. It 
has not applied any safeguard measures since 2005.  
3.1.7  Standards and other technical requirements 
3.34.  Since its previous Review in 2005, Mongolia has filed notifications to the WTO concerning, 
inter alia : technical regulation on imported alcohol products14, the Law on Standardization and 
Conformity Assessment15, a government decree on measures for enhancing standardization and 
conformity assessment16, labelling requirement on certain imported pre-packaged goods17, 
labelling requirement on imported measuring instruments18, cooperation agreement between the 
Mongolian National Centre For Standardization and Metrology and the Committee of Ukraine for 
Standardization, Metrology and Certification19, and technical regulation on leather manufacturing 
and trade.20  
3.35.  The main standardization and metrology laws in Mongolia are the Law on Standardization 
and Conformity Assessment (2003) and the Law on  Traceability of Measurement Uniformity, as 
amended in 2003.  
3.36.  The Mongolian Agency for Standardization and Metrology (MASM) is the government-
regulatory agency responsible for coordinating and managing metrology, standardization, and 
testing; it is also responsible for developing na tional standards and providing conformity marks to 
domestic and foreign products. The MASM acts as a WTO enquiry point and coordinates the implementation of the WTO Agreement on Technical Barriers to Trade; it is also a member of the 
International Organization for Standardization (ISO), the FAO/WHO Codex Alimentarius 
Commission (Codex), and the IEC Affiliate Country Programme.  
                                               
13 WTO document G/ADP/N/193/MNG, 10 May 2010. 
14 WTO document G/TBT/N/MNG/1, 15 December 2005. 
15 WTO document G/TBT/N/MNG/2, 21 December 2007. 
16 WTO document G/TBT/N/MNG/3, 21 December 2007. 
17 WTO document G/TBT/N/MNG/4, 26 January 2009. 
18 WTO document G/TBT/N/MNG/5, 7 April 2010. 
19 WTO document G/TBT/10.7/N/54, 9 January 2008. 
20 WTO document G/TBT/N/MNG/6, 27 March 2013. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 30 - 
 
  3.37.  Mongolian standards are developed by the decision of the National Council of 
Standardization, whose members include representatives of industries, consumers, government bodies, and testing establishments. One of the main objectives of Mongolia's standardization policy is to increase the number of national standards that are identical to international standards. 
Currently, 42% of Mongolia's 6,067 standards are id entical to international standards. About 40% 
of the Mongolian standards are quoted as mandatory technical regulations. There are also 662 food standards, of which 41.2% are identical to international standards, and 350 agricultural 
standards, of which 14.6% are identical to international standards.  
3.38.  The MASM has granted national conformity  marks to 168 products (domestic and foreign); 
conformity marks issued by selected foreign certification bodies are accepted as equivalent to Mongolia's national conformity marks. 
3.39.  Mongolia has government-level cooperation agreements on standardization and certification 
with China the cooperation agreement on the quality certification and mutual recognition of import and export commodities between the Government of  Mongolia and the Government of the People's 
Republic of China, signed in 1994; and with Ru ssia the cooperation agreement on the quality of 
import and export commodities between the Trade Mi nistry of Mongolia and the Federal Agency of 
standardization, metrology and quality certification of the Russian Federation, signed in 1996. 
In 2011, the MASM concluded a partnership agreement with the European Committee for 
Standardization (CEN).  
3.1.8  Sanitary and phytosanitary requirements 3.40.  The main laws on Mongolia's SPS requirements include the Law on Quarantine and 
Inspection for Transferring of Animals, Plants, Raw Materials and Products of their Origin through 
the State Border. Mongolia has not submitted any SPS notifications to the WTO. 
3.1.9  Other measures  
3.41.  According to the authorities, there are no legal provisions covering countertrade or 
import/export cartels; and the Government and st ate-owned enterprises do not engage in them. 
The authorities are not aware of the existence of any import/export cartels in the private sector.  
3.2  Measures Directly Affecting Exports 
3.2.1  Export procedures and requirements 3.42.  Economic entities with the State Registry Office and registered for tax for the purposes of 
customs clearance for exports must be registered. Customs clearance procedures and 
documentation requirements for exports are re gulated by the Customs Law. The principal 
document for customs clearance is the Customs Declaration Form (CDF) (section 3.1.1); Customs may require the exporter to produce additional docu ments, such as an invoice, a packing list, and 
a certificate of origin. The customs value of exported goods is their value at the Mongolian border. 
3.43.  As in the case of imports, the custom s automated information system (CAIS) offers 
electronic clearance and allows exchange of information domestically and with Mongolia's trading 
partners through the national single window. The authorities state that the automated system has 
eliminated unnecessary obstacles to exporters, minimized face-to-face contact with customs officers, and introduced internet-based export declaration for greater fa cilitation of trade. 
3.44.  Against the background of an increase in exports of mineral stock, in 2007 the Customs 
Central Laboratory started to analyse minerals, iron ores, and concentrates to determine an 
accurate customs value of the mining exports, and to assess relevant taxes.
21 According to the 
authorities, this practice plays an important role in increasing state revenue collection. The 
laboratory aims to conduct analysis and testing when professional skills for the verification of 
                                               
21 The Customs Central Laboratory is accredited by the National Agency for Standardization and 
Metrology as an entrusted laboratory for testing: narc otics and psychotropic substa nces; chemical substances; 
alcohol beverages; tobacco and toba cco products; petroleum products, gasoline, and diesel oils; wool, 
cashmere, and animal fibres; mine rals; and textiles and yarn.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 31 - 
 
  goods classification and the identification of narcotics and psychotropic substances are needed for 
the customs control of documents, goods or means of  transport, or for disputes in accordance with 
customs legislation. The authorities consider that  the laboratory's expanded activities decreased 
release time and delay of goods at border crossing points.  
3.45.  The Mongolian National Chamber of Commerce and Industry (MNCCI) issues certificates of 
origin for exporters. Rules associated with the issuance of certificates of origin are stipulated in the Regulation for Determining the Origin of Exporting Products Originated from Mongolia and Issuing 
and Verifying the Certificate of Origin, adopted on 1 March 2006. To request a certificate of origin, 
an exporter must submit to the MNCCI copies of the contract, invoice, and packing list together 
with an application form; the MNCCI normally issues certificates of origin within 1-2 business hours, provided the required documents have  been submitted. The MNCCI may conduct an 
inspection of the goods to be exported at the factory if it is deemed necessary.  
3.2.2  Export taxes, charges, and levies 3.46.  Mongolia applies export taxes on several goods (Table 3.4). The main legislation governing 
export taxes is the Law of Mongolia Determinin g the Amount of Export Customs Duty to be 
Imposed on Certain Commodities (1996). Mongolia eliminated export duty on raw cashmere in 2009.  
Table 3.4 Export taxes for certain commodities, as of January 2014 
No. Product/Commodity HS Code Tax 
1 Unprocessed camel wool (female)  5102.19.41, 5102.19.42 Tog 200/kg. 
2 Unprocessed camel wool (male)  5102.19.43, 5102.19.44 Tog 100/kg. 
3 Woods in logs, in billets and wood in 
the rough, whether or not stripped of 
bark or sapwood, or roughly squared  4401, 4403 Tog 150,000/m3 
4 Timber/balk  4403, 4406 Tog 150,000/m3 
5 Wood sawn or chipped lengthwise, 
sliced or peeled and wood continuously shaped along any of its edges, ends or faces 4407, 4409 Tog 150,000/m
3 
Source: Information provided by the Mongolian authorities.  
3.2.3  Export prohibitions, restrictions, and licensing 
3.47.  Exports of drugs and narcotics (and raw materials and equipment that can produce them) 
and certain dangerous and poisonous chemicals are prohibited (Table 3.2). Since Mongolia's 
previous review in 2005, cedar nuts have been a dded to the list of goods subject to export 
prohibition in accordance with the Law on Environment and Plants, and certain works of art, 
collectors' pieces, and antiques have been added to the list of goods subject to export licence.22  
3.48.  Mongolia does not apply any UN-related economic sanctions. 3.49.  Some items, including breeding animals, guns, explosives, and certain drugs are subject to 
export licensing requirements (Table 3.3). Mongolia has no voluntary export restraint agreements 
with other countries. Mongolia uses no price regulations with respect to its exports.  
3.2.4  Export support and promotion  3.2.4.1  Tax concessions and subsidies for exporters 
3.50.  Mongolia does not provide direct subsidies for any exported goods, including agricultural 
products. Exports are exempt from excise duties and VAT.  
                                               
22 Export licence holders may export art works and antiques for the purpos e of exhibition abroad if they 
are returned to Mongolia within two years of the exhibition.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 32 - 
 
  3.51.  In 2007, Mongolia eliminated income tax holidays for business entities with foreign 
investment that exported more than 50% of pr oduction (in the first three years) and 50% tax 
relief (in the following three years). Under the 2013 Investment Law, foreign and domestic investors are accorded equal treatment.  
3.2.4.2  Free zones 
3.52.  The concept of free zones was adopted in the Law of Mongolia on Free Zones, approved by 
Parliament in June 2002. As a part of the Millennium Develo pment Goals-based Comprehensive 
National Development Strategy, adopted by the Parliament in February 2008, the Government 
aims to establish and operate free economic zones and other zones to promote introduction and localization of advanced technologies. Relevant laws include the Law on Free Zones, the Law on the Legal Status of Atlanbulag Free Trade Zone, the Law on the Legal Status of Zamyn-Uud Free 
Economic Zone, the Law on the Legal Status of Tsagaannuur Free Trade Zone.  
3.53.  To date, the Government has designated four free zones (two free economic zones 
(Zamyn-Uud, Choir) and two free tr ade zones (Altanbulag, Tsagaannuur)).
23 Choir economic zone 
has not started operations.  
3.54.  The main objectives of establishing such zones are to intensify the production of export 
goods, to encourage foreign investment, to create employment, and to promote development of 
regions near the border with neighbouring countries. The free zones are to be formally part of 
Mongolia's customs territory, but separated from it by special check-points, and business and investment in the zones are to be subject to se parate customs duty and tax treatment from other 
parts of Mongolia; the authorities are currently di scussing how to implement these. In the zones, 
firms are to be accorded simplified entrance/exi t procedures; and special preferential conditions, 
including tax and other concessions, are to be applied in free-trade zones.  
3.2.4.3  Export financing, prom otion, and marketing assistance 
3.55.  As the mining sector constitutes more th an 90% of Mongolia's exports, the authorities 
consider it essential to diversify exports by de veloping export-oriented industries, so that the 
economy becomes less sensitive to fluctuations in world commodity prices. Thus, based on the 
Millennium Development Goals-based Comprehensive National Development Strategy, the 
Government intends, inter alia,  to establish a better institutional climate to provide financing for 
exporters, and enable exporters to enter new markets through market research and marketing consultations, so that exports of knowledge-intensive products and services may be increased.  
3.56.  The Development Bank of Mongolia was established in 2011 in accordance with the Law of 
the Development Bank of Mongolia, and started providing, inter alia,  export finance, including 
pre- and post-shipment financing, export factorin g, export credit guarantees, and export credit 
insurance.  
3.57.  Institutions involved in market research and marketing consultations are mainly the 
Mongolian National Chamber of Commerce and Industry (MNCCI) and to a certain extent the 
Invest Mongolia Agency. The MNCCI has cooperation agreements with foreign chambers of 
commerce and its own network of representatives abroad to allow it to provide export-market information to its members.  
3.3  Measures Affecting Production and Trade 
3.3.1  Taxes and incentives  
3.58.  Taxes are introduced, amended, and abolished by laws adopted by the Parliament. The 
General Taxation Law stipulates the general principles of the tax system and tax administration 
system, the rights and obligations of taxpayers, the powers and duties of tax officials, and the 
penalties and sanctions for violating the law.  
                                               
23 In accordance with Article 3 of the Law of Mo ngolia on Free Zone, free zones include: free trade 
zones, free industrial zones, free agricultural zones, fr ee tourism zones, and free economic zones.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 33 - 
 
  3.59.  Currently, taxes in Mongolia consist of state taxes and local taxes. State taxes include 
corporate income tax, customs duty, value-added tax, excise tax, tax on auto fuel and diesel fuel, payment for use of mineral resources, tax on price increase of some commodities, and payment for special licence for mineral exploration and use. Local taxes include personal income tax, real 
estate tax, stamp duty tax, payment for the use of natural resources, tax on auto vehicles and 
some other vehicles, licence fee for the use of natural resources (except mineral resources), land payment, and gun tax. 
3.60.  The National Tax Administration system of Mongolia (MNTA) is responsible for tax 
administration. Its main functions include organi zing and supervising the implemention of tax 
legislation, providing taxpayers with information and advice, conducting training and public awareness, and collecting tax revenue for the st ate and local government budgets. The General 
Department of National Taxation administers more than 20 kinds of taxes, while Customs 
administers customs duties. 
3.3.1.1  Corporate income tax 
3.61.  The corporate income tax rate is 10% (if annual taxable income is no more than 
Tog 3 billion), or Tog 300 million plus 25% of income (if annual taxable income exceeds Tog 3 billion). When a representative office of a fo reign economic entity transfers its profit abroad, 
the transferred amount is taxed at the rate of 20%.  
3.3.1.2  Value-added tax (VAT) 3.62.  The current VAT rate is 10% (15% until 1 January 2007). The VAT applies to both goods 
and services, as specified in Article 12 of the Value-added Tax Law 2006. The current VAT rate was 
introduced to encourage tax payment, support bu siness entities, and increase revenues from more 
companies. Goods sold, jobs performed and services rendered in Mongolia, and goods imported for sale, use, or consumption in Mongolia are subject to VAT. VAT accounted for about 31% of the 
total tax revenue in 2012.  
3.63.  VAT is zero-rated for exports and for services of passenger and freight transport between 
Mongolia and neighbouring countries. VAT exemptions apply to, inter alia : newspapers; gaseous 
fuel; equipment, materials, and fuel imported fo r the purpose of oil exploration and extraction; 
and certain services, including financial services, education, health, and tourism.  
3.64.  The General Department of National Taxa tion and the Customs General Administration are 
responsible for the administration of VAT. Any citi zen or legal person engaged in the importation of 
goods, sale or manufacture of goods, performance of work, or rendering of services in Mongolia, 
with a taxable turnover of at least Tog 10 million during the preceding year, must register for VAT purposes. The tax base is price determined by Customs in conformity with the Custom Tariff Law, 
plus customs duty, excise tax, and other taxes.  The taxable amount is defined based on the 
current market value of goods sold, jobs perfor med, and services rendered; where the price is 
uncertain, the taxable amount is defined by the tax and customs administrations. Where the 
taxable amount is expressed in foreign currency, it is converted into togrogs using the Bank of 
Mongolia official exchange rate.  
3.3.1.3  Excise tax 3.65.  In accordance with the Excise Tax Law 2006, excise taxes are levied on certain technical 
devices, items related to gambling, and individuals and legal entities that conduct certain activities 
(Table 3.5). They apply to goods produced in Mongolia and to imports; different rates may apply to domestic goods and imports. The taxes are calculated by quantity of the dutiable goods. Exports 
are exempt from excise taxes. Exemptions from ex cise tax apply to Mongolian milk alcohol distilled 
in households using simple means for personal consumption, snuff tobacco, duty-free alcohol and tobacco for passenger's personal use as authorized by the Customs authority, and hybrid 
automobiles are exempt from excise taxes. Excise tax accounted for about 7% of total tax revenue 
in 2012. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 34 - 
 
  Table 3.5 Excise taxes in Mongolia 
Goods subject to excise tax Domestic goods Imported goods 
Ad valorem  
rates Specific rates 
(US$) Specific rates (US$) 
Spirits for food sold to distillery 
producers - 1.0 per litre - 
Spirits for food sold to others - 10.0 per litre  
All types of alcoholic beverages    
up to 25° - 2.0 per litre 5.0 per litre 
25°-40° - 4.0 per litre 10.0 per litre 
40° and above - 9.0 per litre 12.0 per litre 
Mongolian milk alcohol distilled 
using a production method - 0.2 per litre - 
Wine (up to 35°) - 0.5 per litre 1.5 per litre 
Beer - 0.2 per litre  0.2 per litre 
Cigarettes and other similar 
tobacco - 2.4 per 100 pieces  2.4 per 100 pieces 
Pipe tobacco and other similar 
bulk tobacco - 1.8 per kg 1.8 per kg 
Gasoline    
Octane up to 90 - 0.0-11.0 per tonne - 
Octane over 90 - 0.0-12.0 per tonne - 
Gasoline   Imported at: Tsagaannuur, Yarant, 
Borshoo, Artssuuri, Tes, Burgastai, and Gashuun Sukhait 
Octane up to 90 - - 0-215.0 per tonne 
Octane over 90 - - 0.0-217.0 per tonne 
Gasoline   Imported at: Khankh and Ulikhan Maikhan  
Octane up to 90   0.0-223.0 per tonne 
Octane over 90   0.0-229.0 per tonne 
Gasoline   Imported at: Sukhbaatar, Zamyn-Ud, 
Ereentsav, and Altanbulag 
Octane up to 90   0.0-252.0 per tonne 
Octane over 90   0.0-259.0 per tonne 
Diesel fuel - 0-15.0 per tonne - 
Imported at: 
Tsagaannuur, Yarant, 
Borshoo, Artssuuri, Tes, 
Burgastai, and Gashuun Sukhait   0.0-221.0 per tonne 
Imported at: Khankh and 
Ulikhan Maikhan   0.0-226.0 per tonne 
Imported at: Sukhbaatar, 
Zamyn-Ud, Ereentsav, 
and Altanbulag   0.0-265.0 per tonne 
Passenger vehicles (volume of 
engine cylinder (cm3): 1,500 
and below)    
0-3 years - - 500 
4-6 years - - 1,000 
7-9 years - - 2,000 
10 years and over - - 6,000 
1,501-2,500    
0-3 years - - 1,500 
6 years - - 2,000 
7-9 years - - 3,000 
10 years and over - - 7,000 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 35 - 
 
  Goods subject to excise tax Domestic goods Imported goods 
Ad valorem  
rates Specific rates 
(US$) Specific rates (US$) 
2,501-3,500    
0-3 years - - 2,000 
6 years - - 2,500 
7-9 years - - 4,000 
10 years and over - - 8,000 
3,501-4,500    
0-3 years - - 4,500 
6 years - - 5,000 
7-9 years - - 6,500 
10 years and over - - 10,500 
4,501 and over    
0-3 years - - 7,000 
6 years - - 7,500 
7-9 years - - 9,000 
10 years and over - - 13,000 
Gaming table or roulette - 80,000 per 
physical unit per 
month 80,000 per physical unit per month 
Slot machine - 3,000 per physical 
unit per month 3,000 per physical unit per month 
Cashier or totalizer that 
provides results of gambling - 80,000 per 
physical unit per 
month 80,000 per 
physical unit per 
month 
Bookmaker centre for 
estimating the bets - 80,000 per 
physical unit per 
month 80,000 per 
physical unit per 
month 
Activities of individuals and legal entities that conduct quizzes and gambling activities 
using an electronic network, 
internet, or cellular telephone network - 25,000 per month - 
Source: Excise Tax Law of Mongolia. 
3.3.2  Competition policy and price controls 
3.66.  The main legislation concerning Mongolia's competition policy includes the Law on 
Prohibiting Unfair Competition 1993 (Competition Law); the latest amended took place in 2010. 
The amendment provided, inter alia,  further powers to the Authority for Fair Competition and 
Consumer Protection (AFCCP), which is responsible for enforcement of the legislation as well as for 
the prohibition, restriction, and curbing of activities harmful for competition; the inspection of and 
issue of conclusions on activities of entities conducting business activities; and determining dominant business entities. According to the law, the AFCCP is an independent agency headed by 
the Deputy Prime Minister; it has 42 staff.
24 The amendment also increased the amount of 
penalties.  
3.67.  Market dominance is defined as a situation where a single business entity or a group of 
business entities acting together has more than one third of market share of product.25 A business 
entity in a dominant position is prohibited from engaging in "monopolizing activities", which include halting or restricting production or sale of goods in order to create an artificial shortage or to raise prices; using its dominant position to impose additional conditions for resale; selling goods 
and products at lower-than-cost prices in order to prevent other business entities from entering 
that market or to drive them out of the market (on the other hand, if a dominant entity sells a 
                                               
24 The AFCCP is also responsible for implementing the Consumer Pr otection Law, the Advertisement 
Law, some provisions of the Law on Procurement of G oods, Works, and Services wi th State and Local Funds, 
and some provisions of the La w on Presidential Election. 
25 Article 5.2, Competition Law. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 36 - 
 
  particular good at the "lowest minimum social cost", it is not deemed to be abusing its dominant 
position); insisting on buyers not buying goods from their competitors as a condition for sale of its goods; demanding that competitors restructure or liquidate their companies through division and separation; insisting on including in a contract conditions that are not relevant to the subject of 
the contract or disadvantageous to the contracting party (such behaviour is called a monopoly).
26  
3.68.  Dominant business entities must submit an application to the AFCCP if they intend to 
restructure through mergers and acquisitions involving purchase of 20% of common shares or 
15% of preferred shares of a competing company in the related market.27 The AFCCP must review 
the application and issue a conclusion within 30-60 days. If the AFCCP considers that competition may be restricted, it may refuse the application.
28 
3.69.  Establishment of contracts and agreements aimed at restricting of competition is prohibited 
(Article 11), for example price fixing, market allocation by territory, restricting the sale to or 
purchase of goods by third parties. Bid-rigging when participating in government procurement is also prohibited. 
3.70.  Under the Law, penalties are up to 10% of turnover in case of cartels, or up to 6% of 
previous year's turnover in case of dominant companies' abuse of their dominant position. Business entities voluntarily disclosing the breach of the Competition Law may be exempted from 
administrative penalties. To date, the maximum amount of penalty actually imposed was 
Tog 17 billion (on eight companies for making cartels).  
3.3.3  State trading, state-owned enterprises, and privatization  
3.71.  Mongolia does not maintain any state-trading enterprises.
29  
3.72.  The Government has continued its programme to reduce its involvement in various sectors 
of the economy; it plans to reduce the number of state-owned enterprises (SOEs) by one third.30 
The authorities state that the private sector's share in GDP is around 80% in 2013.  
3.73.  As of November 2013, there were 98 (ful ly or partially) SOEs, covering mining, energy, 
transport, agriculture, construction, medicine, science, and telecommunications (Table A3.1). 
In 2012, income from SOEs accounted for Tog 2,871 billion, with net profits of Tog 300.5 billion. 
Between 2005 and 2011, 90 entities were privatized, generating income of Tog 65.7 billion for the 
State.31 Companies privatized during the period under  review include Gobi cashmere manufacture, 
Erdenezam LLC, Auto Impex, and Mongolamical wool manufacture. The privatization of MIAT, 
Erdernet Powerplant, Power Plant 3, and Power Plant 4 has been postponed and is still under 
consideration.  
3.74.   The authorities state that no SOEs have exclusive rights in production, sales or 
exports/imports of particular products.  
3.75.  Mongolia's laws and regulations on state-owned enterprises and privatization include 
the 1996 Central and Local Government Property Law, Privatization Guidelines (Parliament Resolution No. 48 for 2005-08, and Parliament Resolution No. 11 for 2010-12). These serve as an 
official statement of the Government's privatization policies and define enterprise- and sector-
specific objectives and priorities. Privatization guidelines for 2013-16 are currently being discussed 
in the Cabinet. 
                                               
26 Article 7.1, Competition Law. 
27 Article 8.1, Competition Law. 
28 If the authorities consider that the benefit to the economy exceeds the damage to competition, the 
AFCCP may not refuse the application. 
29 WTO document G/STR/N/7/MNG, 9 July 2001. 
30 South China Morning Post  online information. Viewed at: 
http://www.scmp.com/business/economy/article/1368258/mongolia-president-tsakhia-elbegdorj-wants-cut-state-firms-one. [16.12.2013] 
31 Between 2005 and 2008, 61 entities were privatized, generating income of Tog 61.7 billion; between 
2009 and 2011, 29 entities, generating Tog 5 billion. Between 1996-13, 1,094 entities were privatized, generating income of Tog 173.1 billion. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 37 - 
 
  3.76.  The State Property Committee, establishe d in 1996 under the Ministry of Industry and 
Agriculture, is responsible for the management of State property, supervision of state-owned enterprises, and privatization.  
3.3.4  Government procurement 
3.77.  Mongolia is not a signatory to the WTO Agreement on Government Procurement; it is an 
observer in the GPA Committee.  
3.78.  The Public Procurement Law, as amended in 2011 and entered into force in 2012, regulates 
matters concerning the preparation of bidding do cuments, advertisement, opening of tenders, 
evaluation of tenders, award of contracts for pu blic procurement of goods, works and services, 
composition and organization of the Tender Committee, and control over its activities. The law stipulates four kinds of procurement method (open tendering, price quotations, direct contracting, 
and limited tendering). The main procurement method applicable to all procurement is the open 
tendering (Table 3.6).  
Table 3.6 Government procuremen t, based on contracts, 2008-12 
(Tog billion) 
 2008 2009 2010 2011 2012
Open tendering 655,913 255,974 1,266,487 963,395 1,460,961 
Price quotation 44,106 17,650 32,484 49,695 35,697 
Direct purchases 36,673 23,556 46,930 56,162 49,460 
Limited tendering 22,850 7,827 4,635 17,215 37,745 
Source: Information provided by the Mongolian authorities. 
3.79.  The law regulates the procurement practices of the central government and of local 
governments. Procuring entities are defined as legal persons with state participation of more than 
50% that are engaged in procurement of goods, works, and services.  
3.80.  The Public Procurement Department of the Ministry of Finance is responsible for all policy 
matters related to public procurement. The Gove rnment Procurement Agency, established in 2012 
in accordance with the amended law, is a centra l purchasing agency headed by the Deputy Prime 
Minister; it is responsible for purchases of selected projects for the central and regional 
governments.32 Projects for which the Government Procurement Agency conducts purchases are 
selected annually by the Cabinet33; other procurement is conducted by the respective central 
government ministry or agency, regional government, or local government.  
3.81.  Government procurement is used as an instrument of economic policy in Mongolia. It is 
forbidden to exclude foreign bidders from tenders for contracts exceeding Tog 100 million for 
goods and services, or Tog 1 billion for works. Domestic suppliers receive a 10% margin of 
preference for goods and 7.5% for works. The law specifies threshold values for the selection of procurement procedures, open and selected tendering, and comparison of quotations.  
3.3.5  Intellectual property rights 
3.82.  Mongolia is a party to the World Intellectua l Property Organization (WIPO) Copyright Treaty, 
and the WIPO Performers and Phonograms Treaty. It is also a party to The Convention for Establishing the WIPO; Paris Convention for th e Protection of Industrial Property; Madrid 
Agreement Concerning the International Registration of Marks; Patent Cooperation Treaty; Hague 
Agreement Concerning the International Deposit of  Industrial Designs; Berne Convention for the 
Protection of Literary and Artistic Works; Protocol Relating to the Madrid Agreement Concerning 
the International Registration of Marks; Strasbourg Agreement Concerning the International Patent 
Classification; Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks; Locarno Agreement Establishing an International 
Classification for Industrial Designs; and Nairobi Treaty on the Protection of the Olympic Symbol. 
                                               
32 Each ministry handled its own procurement in accordance with the Public Procurement Law as 
amended in 2005.  
33 The list of such projects is pu blished within five days of the adoption of the national budget. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 38 - 
 
  Mongolia signed the Singapore Treaty on the Law of Trademarks in 2010 and the Beijing Treaty on 
Audiovisual Performances in 2012. 
3.83.  The Intellectual Property Office, under the responsibility of the Deputy Prime Minister, is 
responsible for administration of intellectual property rights and enforcement of intellectual 
property legislation. The Office is also in charge of settling disputes and grievances. If the 
disputing parties disagree with the decision of th e Intellectual Property Office, they may refer the 
matter to the courts.  
3.3.5.1  Copyright and related rights 
3.84.  Mongolia revised its Copyright Law in 2006,  seeking to further implement the requirements 
of the TRIPS Agreement, WIPO Copyright Trea ty, and WIPO Performances and Phonograms 
Treaty. The revised law includes new definitions, such as "phonogram", "reproduction of work", 
"right management information", "derivative work", and "work of applied art". The law, inter alia,  
provides regulation on copyright in a work created in the course of official duties, as well as commissioned work. It also extends the term of copyright protection for photographic work and 
related rights of broadcasting organizations (from 25 to 50 years).  
3.85.  The Copyright Law regulates matters relate d to the protection of copyright and issues 
arising in connection with the use of works that are subject to copyright.
34 It stipulates that 
copyrighted work is protected from its creation.35 An author may register his work or contract of 
transfer of rights; registration is not required fo r the protection of copyrights. The law also defines 
and elaborates further on related rights of perf ormers, broadcasting organizations, and producers 
of phonograms (including duration and coverage of protection). Copyrights are protected during 
the author's life plus 50 years.36  
3.3.5.2  Patents 3.86.  Under the current Patent Law, which was revised in 2006, patent protection is provided for 
20 years following the filing of the application.
37 The revised law introduced new provisions related 
to Patent Cooperation Treaty applications, employees' inventions and compulsory licensing, and clarified filing and examination procedures. The law further elaborated on the rights of creators of 
inventions and patent owners.  
3.87.  Patents are granted for methods and products, including inventions relating to 
micro-organisms, pharmaceuticals, chemicals, fertilizers, pesticides, herbicides, biotechnological processes, and biological and genetic materials. Patent applications are filed with the Intellectual 
Property Office. An application for patent must co ntain a request, a description of the invention, 
patent claims, and an abstract. The Intellectual Property Office must verify the presence of the required documents within 20 days of receipt of an application, and if all the requirements are met 
it accords the date of receipt of the application as  the filing date. The Office examines whether the 
invention meets the criteria specified in the Patent Law. It must decide within nine months from the filing date whether a patent is to be granted.
38 Successful applications are published; a patent 
is granted if no notice of opposition is received by the Intellectual Property Office within three 
months of the date of publication.  
3.88.  The Intellectual Property Office is responsible for the supervision and inspection of 
implementation of the intellectual property legislation, and appoints state inspectors in charge of 
administrative enforcement of patent rights.39 The Dispute Resolution Board of the Intellectual 
Property Office, established under the revised law, reviews disputes, except for those claiming 
                                               
34 These, as stipulated in Article 7, include scientif ic and literary works; musical works; works of fine 
art; works of decorative, applied, and theatrical arts ; works of architecture; choreographic works; works of 
contortionists and pantomime; play s and musical works; photographic works; audio-visual works; and 
derivative works, plans.  
35 Article 9. 
36 Article 13. 
37 Under Article 15 of the Patent Law, industrial de signs are protected for ten years and utility models 
seven years.  
38 The Intellectual Property Office may extend this for a further period  of up to 12 months. 
39 Article 26.1.13 of the Patent Law. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 39 - 
 
  payment for the exploitation of protected creations or compensation for losses caused by illicit 
exploitation thereof.40 
3.3.5.3  Trade-marks and geographical indications 3.89.  The Law on Trademarks and Geographical  Indications, which was last amended in 2010, 
protects trade-marks, service marks, collective  marks, certification marks, and geographical 
indications. The amendment, inter alia,  introduced new provisions related to protection of 
well-known marks, further clarified procedures of filing in line with the Singapore Treaty, and 
elaborated on the rights of trade-mark owners and users of geographical indications. A new  
provision was also introduced related to the powers of state inspectors in charge of administrative enforcement of trade-mark rights.
41  
3.90.  The Intellectual Property Office examines applications and registers relevant marks and 
geographical indications. Trade-marks are registered for ten years following the filing of the 
application; registration may be renewed. Domestic and foreign natural persons and legal entities may apply for registration of marks. Trade mark applications are filed with the Office by a natural 
or legal person wishing to register the trade ma rk; application documents must be submitted in 
the Mongolian language. If the application meets the requirements provided for in the law, the date of receipt of the application is accorded as the filing date of the application. The Office 
examines whether the sign could be considered as a trade mark and whether it is eligible for 
registration; it decides whether to register the trad e mark within 12 months from the filing date of 
the application; this may be extended for up to six months. When a trade mark is accepted, the Intellectual Property Office records it in the State Trademark Register and issues a certificate. 
Registered trade-marks and related bibliographic data are published in the Official Bulletin . 
3.91.  According to the Law on Trademarks and Ge ographical Indications, geographical indications 
are defined as a geographical name of country or region where the product is produced, identifying 
the quality, reputation, and other specifics of the product. If a geographical name of country or 
region has become a generic name in Mongolia to denote certain goods, the name may not be 
protected as a geographical indication. Applications for the registration of a geographical indication 
are filed with the Intellectual Property Office by associations and unions of manufacturers that 
manufacture goods in the indicated locality where the characteristics of the goods are associated. 
The Office records accepted geographical indications in the State Register of Geographical Indications and issues a certificate. Registered geographical indications and related bibliographic 
data are published in the Official Bulletin .  
3.3.5.4  Plant varieties 3.92.  The Law on Crops Varieties and Seeds, as amended in 2011, regulates matters related to 
the preservation of crop gene pool, variety test ing and certification, controlling the quality of 
varieties and seeds, and maintaining and disposing of national crop reserves.  
3.93.  The law provides that an author's certificate may be issued to a breeder of a new crop 
variety developed by biological process. The person who was issued an author's certificate is 
deemed the owner of that variety, and has the right to develop technological documentation, personally participate in the cultivation, execute breeder's control, receive payment for the use of 
variety, and assign his/her right to ownership. The coverage of the law is limited to crops.  
3.3.5.5  Layout designs of integrated circuits 
3.94.  Mongolia has no legal provisions on the prot ection of layout designs of integrated circuit.  
3.3.5.6  Trade secrets 
3.95.  Article 12.1.5 of the Competition Law prohibits business entities from selling, publishing and 
distributing to others, scientific, technological, industrial or commercial information and secrets without the permission of a patent owner or author.  
                                               
40 Article 28 of the Patent Law. 
41 Article 30 of the Law on Trademar ks and Geographical Indications. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 40 - 
 
  3.3.5.7  Parallel imports  
3.96.  Mongolia allows parallel imports. 3.3.5.8  Enforcement 3.97.  Violation of intellectual property rights (IPRs) may be subject to administrative penalties. 
Compensation for damages caused by infringement of the rights of an IPR owner may be awarded 
in accordance with the Civil Law. The State Intellectual Property Inspection operates under the Intellectual Property Office. Its Enforcement Division is responsible for enforcing IPR-related laws. 
The Rules on State Intellectual Inspection provides  the rules and details of inspection to enforce 
various laws for the protection of IPRs.  
3.98.  Under the Criminal Law, infringement of intellectual property rights may result in a fine 
equivalent to 51-250 times the monthly minimum wage or imprisonment up to 5 years. If 
infringement is not deemed a criminal offence, administrative penalties may be imposed in 
accordance with the Copyright Law, the Pate nt Law, or the Trademark and Geographical 
Indications Law; right holders may initiate a request for investigation; Customs also has the right 
to seize infringing goods, with or without the request of the right holder. 
3.99.  Since 2005, the State Intellectual Property Inspection has inspected 3,442  cases and 
determined 2,967  IPR infringements (Table 3.7).  
Table 3.7 Enforcement statistics rela ted to intellectual property, 2008-12 
Items 2008 2009 2010 2011 2012
Number of inspections conducted 230 281 439 332 132 
Planned 33 67 68 172 58 
Follow-up of complaints 174 73 208 146 69 
Follow-up of public media information 23 141 163 14 5 
Entities inspected 168 182 254 217 70 
Citizens inspected 12 9 63 51 207 
Number of infringements 182 241 386 327 94 
Remedies      
Confiscated goods (Tog million) 24.5 120.0 40.7 22.9 41.0 
Fines (Tog million) 15.2 43.4 25.2 21.2 4.9 
Transferred to police action 5 2 2 .. .. 
Produced      
Expert opinion 12 19 9 2 2 
Notification 48 29 76 165 23 
Acts 97 79 218 80 11 
.. Not available. 
Source: Information provided by the Mongolian authorities.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 41 - 
 
  4  TRADE POLICIES BY SECTOR 
4.1  Agriculture 4.1.1  Features 4.1.  Agriculture is important to Mongolia's economy as it accounts for about one third of 
employment and nearly 15% of GDP. Despite rapi d economic growth, mostly driven by mining, 
agriculture's contribution to GDP and employment  actually increased in 2012 compared to 2011, 
although less than in earlier years (Table 4.1).  
Table 4.1 Agriculture to employment and GDP, 2004-12 
 2004 2005 2006 2007 2008 2009 2010 2011 2012
Employment    
Total 951 968 1,010 1,024 1,042 1,006 1,034 1,038 1,056 
Agriculture, fore stry, fishing, 
and hunting 382 386 391 386 378 349 347 343 370 
GDP (Tog bn, current)          
Total 2,152 2,780 3,715 4,957 6,556 6,591 8,415 11,088 13,944 
Agriculture, forestry, and 
fishing 478 608 723 913 1,260 1,177 1,202 1,365 2,067 
GDP (Tog bn, constant 
2005)          
Total 2,592 2,780 3,017 3,640 3,964 3,914 4,163 4,892 5,493 
Agriculture, forestry, and 
fishing 549 608 654 734 768 796 664 661 801 
Agriculture          
Gross output 
(Tog bn, current) 668 852 982 1,298 1,692 1,737 1,752 1,988 2,458 
Livestock 565 738 834 1,125 1,377 1,308 1,291 1,476 1,906 
Crops 104 113 147 173 315 430 462 511 552 
Gross output 
(Tog bn, constant 2005) 691 852 929 1,067 1,143 1,208 1,015 1,035 1,242 
Livestock 578 738 786 920 962 1,002 799 770 958 
Crops 114 113 143 147 181 207 216 265 284 
Source: National Statistical Office, Statistical Yearbook  (2007 to 2012). 
4.2.  Most of the land in Mongolia is potentially suitable to agriculture, but the harsh climate, 
particularly the cold winters, short growing seasons, and low rainfall, make production difficult, and yields remain low compared to other countries. Furthermore, while livestock rearing continues 
to dominate agricultural production, the increase in the number of animals over the past few years 
(particularly goats and sheep) has led to problems with overgrazing, especially around villages. In addition, particularly severe winter weather ( dzuds ) in some years can cause livestock losses, such 
as the 2009/10 winter, which contributed to a declin e in stocks of cattle (16%), goats (29%), and 
sheep (25%) (Table 4.2). 
Table 4.2 Production of selected products, 2004-12 
 2004 2005 2006 2007 2008 2009 2010 2011 2012
Potatoes          
Area harvested 
('000 ha) 9 10 11 12 12 14 14 15 17 
Production 
('000 tonnes) 80 83 109 115 135 151 168 202 246 
Cereals          
Area harvested 
('000 ha) 173 159 126 122 154 252 259 300 306 
Production 
('000 tonnes) 138 76 139 115 213 392 355 446 479 
Cattle           
Stock 
('000 animals) 1,842 1,964 2,168 2,426 2,503 2,599 2,176 2,397 2,585 
Cattle meat 
('000 tonnes) 54 45 44 47 56 59 45 55 60 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 42 - 
 
   2004 2005 2006 2007 2008 2009 2010 2011 2012
Cow milk 
('000 tonnes) 406 426 450 466 457 494 338 459 511 
Goats           
Stock 
('000 animals) 12,238 13,267 15,452 18,348 19,969 19,652 13,883 15,935 17,559 
Cashmere 
('000 tonnes) 3 4 4 5 6 6 6 4 5 
Sheep           
Stock 
('000 animals) 11,686 12,885 14,815 16,990 18,362 19,275 14,480 15,669 18,141 
Wool 
('000 tonnes) 13 14 15 18 21 22 24 18 19 
Sheep and goat 
meat ('000 tonnes) 96 93 88 103 120 169 128 123 124 
Source: National Statistical Office, Statistical Yearbook  (2007 to 2012). 
4.3.  Agriculture in Mongolia is divided among four subsectors: (i) extensive livestock for camels, 
horses, cattle, sheep, and goats; (ii) large-area crop production for cereals and fodder; 
(iii) intensive cultivation of potatoes and vegetables; and (iv) intensive livestock rearing.1 
However, in terms of products, the agriculture sector is very concentrated, with livestock 
accounting for most production and wheat for nearly all cereals (Tables 4.1 and 4.2). 
4.4.  Most farm land in Mongolia is the proper ty of the State and is for nomadic grazing using 
publicly owned water wells. Only citizens of Mongolia may use pasture lands or purchase arable 
land, while use rights for pastures are allocated to specific user groups. About 112 million ha of pasture and 0.7 million ha of arable land remain under state management.
2  
4.5.  Different forms of land tenure are allowe d under the Land Law, which was last amended 
in 2008:  
• ownership is limited to Mongolian citizens, includes the right to manage and sell land, 
and applies to land for residential and commercial purposes; 
• possession rights may be granted for 15 to 60 years with the option to renew the rights 
for up to 40 additional years. Possession rights may be inherited, leased, or transferred. Under the Land Law, possession rights may apply to seasonal campsites and pasture but 
have only been issued to campsites; and 
• land-use rights allow the holder to use land for a specific purpose for up to five years 
with the possibility of extension. While non-Mongolian individuals or enterprises may 
obtain land-use rights they may not use them for agricultural purposes.
3  
4.6.  Private ownership is only permitted for cultivated land (9,537 km2) and not for pastureland 
(1,163,496 km2) or land for making hay (19,074 km2). A programme for privatization of land, 
which started in 2003, included the transfer of  land ownership from the state to Mongolian 
citizens, but this affected households and land for habitation rather than farming land.4 
4.7.  On the other hand, most farms and agricu ltural processing enterprises had already been 
privatized at the time of the last Trade Policy Review of Mongolia.5 According to the authorities, 
the state no longer owns or operates any commercial farms. 
                                               
1 FAO online information. Viewed at: http://www.fao.org/docrep/005/y2722e/y2722e0y.htm  
[January 2014].  
2 Dells (2008), p. 7.  
3 USAID (2010), p. 8.  
4 Chinzorig Batbileg (2008).  
5 WTO document WT/TPR/S/145, Chapter IV, paragraph 11. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 43 - 
 
  4.1.2  Trade 
4.8.  Mongolia has a trade deficit for agricultur al products and both imports and exports have 
increased considerably over the past few years. Since 2004, the structure of imports has changed somewhat, as imports of some commodities (such as  wheat, flour, and potatoes) have tended to 
decline while imports of processed agricultural products (such as sugar, candy, and beverages) 
have increased steadily (Table 4.3). 
Table 4.3 Imports of selected agricultural products, 2004-12 
  2004 2005 2006 2007 2008 2009 2010 2011 2012
Cigarettes million pieces 765 629 761 1,512 1,867 1,549 1,321 1,824 2,138
US$ million 9.3 8.6 11.9 24.8 35.1 29.6 30.2 47.6 59.3
Alcoholic 
beverages million litres 14.6 9.4 12.0 19.9 23.0 11.9 21.0 25.2 32.1
US$ million 11.0 7.4 9.6 18.3 21.8 11.3 19.0 25.4 33.4
Flavoured 
flour products '000 tonnes 5.8 6.1 6.7 9.2 11.2 9.2 11.9 14.8 15.0
US$ million 5.5 7.1 8.4 12.6 21.2 16.1 20.4 58.1 30.8
Granulated 
sugar '000 tonnes 33.7 26.9 26.3 36.7 42.9 26.3 38.0 37.4 44.9
US$ million 8.7 7.0 8.8 13.3 16.8 10.7 18.8 23.0 23.0
Soft drinks million litres 4.9 4.2 5.5 6.6 9.9 7.2 12.5 20.2 22.7
US$ million 2.0 1.8 2.9 3. 8 7.2 0.6 10.0 16.4 20.1
Rice '000 tonnes 26.7 13.8 19.1 28.4 27.9 19.0 25.9 12.0 31.6
US$ million 5.4 3.7 5.2 8.1 11.1 6.4 14.7 5.6 17.2
Flour '000 tonnes 79.3 103.9 105.6 112.3 132.9 105.7 65.2 67.7 50.1
US$ million 17.0 20.0 21.3 29. 0 54.7 30.4 15. 6 24.1 16.6
Vegetable oil '000 tonnes 0.6 0.2 0.1 3.6 1.3 6.7 8.7 5.1 6.0
US$ million 0.5 0.2 0.1 3.8 2.1 7.2 10.7 8.4 8.4
Margarine '000 tonnes 3.6 4.6 5.1 5.2 4.7 3.2 5.1 5.0 5.7
US$ million 2.6 3.6 4.0 5. 5 7.7 3.9 6.5 7.1 7.8
Wheat '000 tonnes .. .. 102.2 92.8 171.3 114.7 66.2 7.4 4.1
US$ million .. .. 20.1 21.4 60.4 30.8 12.0 1.7 1.0
Potatoes '000 tonnes 38.4 41.0 35.6 30.2 35.4 23.2 8.5 5.8 3.2
 US$ million 3.2 3.1 3.6 3.6 5.1 3.2 1.8 1.9 0.9
.. Not available. 
Source: National Statistical Office, Monthly Bulletins of Statistics  various issues. 
4.9.  Exports of agricultural products from Mongolia are mostly cashmere, combed goat hair and 
leather (Table 4.4).  
Table 4.4 Exports of selected agricultural products, 2004-12 
  2004 2005 2006 2007 2008 2009 2010 2011 2012
Greasy 
cashmere 000 tonnes 0.0 0.4 1.7 1.5 1.9 3.6 3.1 2.8 3.6
US$ million 0.7 13.4 63.1 63.4 77.2 91.7 104.9 131.9 145.4
Combed goat 
down 000 tonnes 0.8 0.9 1.4 1.8 1.6 1.6 1.0 0.5 0.5
US$ million 44.1 52.8 81.7 114.3 98.7 68.4 68.8 57.4 47.8
Sheep or lamb 
skin leather million dm2.. 92.2 147.5 180.1 183.3 128.7 150.9 331.5 182.5
US$ million .. 16.4 24.5 25. 0 26.9 13.1 13. 6 28.2 16.1
Intestines 000 tonnes 0.3 0.3 0.3 0.3 0.4 0.4 0.6 0.7 0.4
US$ million 6.5 6.9 4.5 4.4 5.3 5.6 8.1 11.9 10.6
Goat or kid 
skin leather million dm2.. 16.3 54.2 36.2 29.4 82.9 106.0 120.9 61.1
US$ million .. 2.8 8.0 5.4 4.6 7.8 7.8 9.9 6.5
Sheep wool 000 tonnes 8.3 6.8 6.4 9.1 9.3 4.7 7.9 8.4 4.5
US$ million 6.3 5.6 4.5 8.4 9.3 4.9 7.6 8.3 5.4
Horse meat 000 tonnes 3.4 5.0 8.8 7.1 6.1 8.6 10.9 3.9 1.5
US$ million 2.8 4.8 10.3 9 .8 11.0 14.5 19. 0 8.8 4.8
Frozen beef 000 tonnes 5.0 2.8 2.7 3.9 4.2 8.8 3.8 5.8 1.0
US$ million 5.0 3.2 4.4 6.3 8.5 17.8 8.1 13.9 3.3
.. Not available. 
Source: National Statistical Office, Monthly Bulletins of Statistics, various issues. 
4.10.  Mongolia does not have any tariff quota commitments in the WTO, nor has it reserved the 
right to use the agricultural special safeguard. 
4.11.  The average bound tariff on agricultural products is 18.6% while the average applied MFN 
tariff in 2013 was 5.2%; the average non-agricultural bound tariff is 17.5% and applied MFN tariff 
is 5.0%. This indicates that, in applied terms, tariffs on agriculture and non-agricultural goods are 
about the same. Within agriculture there is not much variation in applied tariff rates from one product group to another except for beer (HS 22.03), which is taxed at 25%. Imports of WT/TPR/S/297/Rev.1 • Mongolia 
 
- 44 - 
 
  undenatured ethyl alcohol (HS 2207.10.00 and 2208.90.10) and denatured ethyl alcohol 
(2207.20.00) are banned.6  
4.12.  Mongolia does not apply taxes on exports of agricultural goods, except for a tax on exports 
of unwashed camel wool of Tog 200/kg (female)  and Tog 100/kg (male). In 2007, Mongolia 
obtained an extension until 2012 of its accession commitment to withdraw the tax on exports of 
cashmere7, but eliminated them in June 2009.8  
4.13.  According to its most recent notification to the WTO Committee on Agriculture, Mongolia did 
not use export subsidies for the calendar years 1998-2006.9 
4.1.3  Domestic policy 4.14.  The Ministry of Industry and Agricultur e is the primary public agency responsible for 
formulating and implementing agricultural policy. Major policy initiatives are subject to the 
approval of the Government and laws must be passed by the Parliament. Other ministries are 
responsible for areas related to agriculture and food production, such as the Ministry of Finance for taxes, the Ministry of Environment and Green Deve lopment, the Ministry of Education and Science, 
the Ministry of Health. The main legislation affecting agriculture is set out in the Food Law, Food 
Safety Law, Land Law, Water Law, Law on Protection of Animal Genetics and Health, Law on Border Inspection and Quarantine for animal and Plant Products, Law on Cropping, and the Law on 
Hygiene and Sanitation. 
4.15.  Several entities responsible for specific agriculture-related services operate under the 
Ministry of Industry and Agriculture, including: 
• the National Agricultural Extension Center (NAEC), which operates and manages 
extension services through its headquarters in Ulaanbaatar and its offices around the 
country; 
• the Veterinary and Animal Breeding Agency, which is responsible for animal health and 
disease control, including responses to disease outbreaks where it works with the 
National Emergency Management Agency and the General Agency for State Inspection
10; 
• the Agricultural Commodities Exchange, which started trading in 2013; 
• the National Centre for Livestock Gene Bank, which provides artificial insemination 
services; and 
• the Biocombinat, which is a state-owned veterinary medicine factory. 
4.16.  A considerable number of international and regional agencies as well as bilateral 
development organizations are involved in developing and financing agriculture-related projects in 
Mongolia. 
4.17.  Domestic policy has focused on increasing production as a way to improve food security and 
rural development and is set out in the Agriculture Sector Development Strategy (2006-15), the 
National Programme for Food Security (2009-16), the Third Crop Campaign (2008-2010), and the Livestock Programme (2010-2021), each of which has been preceded by other development plans, 
frameworks, and strategies. Other Government programmes, such as the National Development 
Strategy and the Green Development Programme also include agriculture. 
                                               
6 Mongolian Customs online information. Viewed at: 
http://ecustoms.mn/tax.php?wmid=115&wmsid=151  [August 2013]. 
7 WTO document WT/L/695, 1 August 2007. 
8 WTO document G/C/W/652, 27 September 2011. 
9 WTO documents G/AG/N/MNG/1, 10 August 1998; G/AG/N/MNG/3, 29 April 1999; G/AG/N/MNG/6, 9 
June 2000; and G/AG/N/MNG/8, 12 December 2007. 
10 Purevkhuu (2009).  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 45 - 
 
  4.1.3.1  National Programme for Food Security 
4.18.  The overall goal of the National Programme  for Food Security is: "to ensure sustainable 
supply of nutritious, secure and accessible food, which enables healthy livelihood and high labour productivity of the population, involving partic ipation of the citizens, government, public and 
private sectors." Most of the 13 main objectives of the programme relate to higher standards and 
quality, better nutrition, and education, but they also include the stable supply of food through 
domestic production to substitute for imports.
11 This objective is to be achieved by increasing 
production through better use of fertilizers, mo re irrigation, bringing more land under crops, 
improving education and training for producers, and better extension services. The total budget for the programme is US$1,298.3 million for 2008-16 of which the Government share is US$460.6 million, US$269.9 million is  expected to come from donors, and the rest from the 
private sector (Table 4.5). The biggest items in the budget are: 
• the creation of an investment fund to provide grants, loan guarantees and leasing to 
agricultural producers, food processors and light industry; 
• the irrigated crop production programme; and 
• the renovation of crop equipment programme which would subsidise the cost of farm 
machinery. 
Table 4.5 Budget summary of the Nati onal Programme for Food Security 
(US$ million) 
 
2008-12 
2013-16 
Government 
Donors and 
NGOs 
Private 
Total 
Training for food processing and agricu ltural producers 7.86 5.24 5.1 5.0 3.0 13.1
Food safety laboratories 8.4 5.6 7.0 7.0 .. 14.0
Research 5.1 3.4 3.5 3.5 1.5 8.5
Investment fund 300.0 200.0 150.0 150.0 200.0 500.0
Meat production 9.8 6.6 6.8 6.5 3.1 16.4
Milk production 24.1 16.0 15.3 14.5 10.3 40.1
Poultry production 1.2 0.8 0.3 0.2 1.4 2.0
Fish production 0.7 0.5 0.2 0.2 0.7 1.2
Crop diversification 9.0 6.0 2.8 1.9 10.3 15.0
Irrigated crop production 112.5 75.0 90.9 15.1 81.5 187.5
Renovation of crop equipment 107.3 71.5 89.4 11.6 77.8 178.8
Fertilize r 2.3 1.5 1.5 1.8 3.1 3.8
Plant production 2.6 1.7 1.0 0.5 2.8 4.3
Vegetables and potatoes 7.2 4.8 2.5 4.0 5.5 12.0
Food safety 1.8 1.2 0.5 1.0 1.5 3.0
Integration of agricultural and processing factories 114.0 76.0 9.9 27.6 152.5 190.0
Food safety standards and laboratories 1.2 0.8 1.0 0.7 0.3 2.0
Food-reserve 11.9 7.9 17.1 1.7 0.5 19.8
Prevention of food borne diseases 0.9 0.6 0.8 0.7 .. 1.5
Establish Mongolian brand name 1.1 0.7 0.5 0.3 1.0 1.8
Improve nutrition education 7.6 5.0 7.0 5.3 0.3 12.6
Strengthen nutrition research 3.9 2.6 2.4 2.8 1.3 6.5
Prevent micronutrient deficiency 2.9 1.9 2.7 2.0 0.1 4.8
Production of food fortified with minerals and vitamins 2.9 2.0 2.3 1.8 0.8 4.9
Consumer health education 0.7 0.5 0.7 0.5 0.1 1.2
Food access improvement 0.4 0.2 0.4 0.2 .. 0.6
Drinking water supplies 26.3 17.6 39.0 3.5 4.0 43.9
Total 773.7 515.6 460.6 269.9 .. 1,289.3
.. Not available. 
Source: Government of Mongolia (2009), National Programme for Food Security (2009-16) , pp. 17-43 . 
Viewed at: http://gafspfund.org/sites/gafspfund.org/files/Documents/Mongolia_5_of_9%20National%20Food%
20Security%20Programme.pdf .  
                                               
11 Government of Mong olia (2009), p.8.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 46 - 
 
  4.1.3.2  Third Crop Campaign 
4.19.  The Third Crop Campaign seeks to increase production of crops in order to reduce import 
dependence while ensuring food safety through bringing abandoned land back into production and improving yields.
12 This is to be achieved through increased use of machinery, renovation of 
existing irrigation systems and building of new ones, and greater use of inputs and training 
programmes. The programme relies on direct support from the Government through direct government purchases of 100,000 tonnes of whea t into the state reserve and subsidies of:  
• 30% of the market price for wheat;  
• up to 50% of the cost of agricultural machinery; and  
• up to 50% of the cost of pesticides. 
4.20.  The Government provided Tog 22.5 billion for machinery and technology in 2008 with 
requirements for a further Tog 60.5 billion in 2009 and Tog 65.3 billion in 2010.
13 
4.1.3.3  Livestock Programme 4.21.  The Livestock Programme (2010-21) drew on a World Bank report on the livestock sector in 
Mongolia.
14 I t  s e t s  o u t  f i v e  p r i o r i t y  a r e a s  w i t h  a  n u m b e r  o f  o b j e c t i v e s  u n d e r  e a c h .  T h e  p r i o r i t y  
areas are:  
(i) improve the legal framework and support services (veterinary and training);  
(ii) improve production practices, including breeding services;  
(iii) disease prevention and control measures;  
(iv) improve pasture management, fodder, and water supply systems as well as risk 
management; and  
(v) improve the processing of livestock products, including meat, skins, and wool.15  
4.22.  It was also reported that the budget for the total programme was Tog 1.4 billion of which 
35% would be from Mongolia and the rest from the World Bank and other donor organizations.16 
4.1.3.4  Index-based Live stock Insurance Programme 
4.23.  Mongolia's climate, along with the number of livestock raised on open pastures, mean that 
the frequent severe winters ( dzud) cause high levels of livestock mortality in particularly bad 
years. The damage to the rural economy from these losses can be severe: the value of livestock 
lost in the 2010 dzud was estimated at US$477 million and affected over half of herder 
households. To reduce the impact on households , the Government, with support from the World 
Bank, introduced the Index-based Livestock Insurance Programme as a pilot programme in 2005. 
Since 2005, it has been gradually extended throughout the country. In 2012 it was reported that 
10,000 herder households and 5 local insurance firms were participating.17 Under the programme, 
a herder is compensated whenever losses in the lo cal area exceed 6% of the value of livestock. 
Payments are based on the average loss in the area rather than on any specific herder's losses. 
For losses of up to 30% the compensation is paid by the insurance company (the Basic Insurance 
                                               
12 The previous two crop campaigns were in 1957 and 1976. 
13 Galsanbuyan (2009). 
14 World Bank (2009). 
15 Government of Mongolia (2010). 
16 WWF (2010). 
17 Goodland (2012). WT/TPR/S/297/Rev.1 • Mongolia 
 
- 47 - 
 
  Product), for losses greater than 30%, the balance is paid by the Government (the Disaster 
Response Product).18 
4.1.4  Policy impact  4.24.  Overall, agricultural programmes and policies have succeeded in their objectives of making 
Mongolia self-sufficient in some crops, as imports of potatoes and wheat have fallen while 
domestic production has increased. However, im ports of agricultural goods generally, and of 
processed products (including rice and goods made from wheat), as well as the deficit in trade in 
agricultural goods, have increased. The increase in  imports is driven primarily by economic growth, 
while production is based on livestock and exports are based on cashmere, which depends on economic performance in the export markets and livestock numbers in Mongolia.  
4.2  Mining and Energy 
4.2.1  Minerals 
4.2.1.1  Features 4.25.  Mongolia's rapid economic growth over th e past few years is based on the investment in, 
and the production and export of minerals. Mongolia is a major producer of several minerals 
including coal, copper, and fluorspar. With extensive reserves, it has the potential to increase production considerably; production of copper and gold from Oyu Tolgoi alone could account for 
one third of GDP by 2020
19 while total investment in the mining sector over the past and the next 
few years could be several times current GDP. 
4.26.  Mining represented over 18% of GDP in 2012 up from 17% in 2004 (Table 4.6) and the 
sector is expected to continue to grow strongly as exploitation of already-discovered deposits gets 
under way. In 2012, exports of minerals represented about 89% of total goods exports. Taxes, 
royalties, and other payments related to minerals represent almost half of government revenue. In terms of their contribution to GDP in 2012, me tal ores contributed the most, although coal 
production has been increasing more quickly. Production at Oyu Tolgoi copper gold mine started in 
late 2013 and will increase production of metal ores  while production at Tavan Tolgoi coal deposit 
will also increase. 
Table 4.6 Mining and minerals contribu tion to employment and GDP, 2004-12 
 2004 2005 2006 2007 2008 2009 2010 2011 2012
Employment   
Total 951 968 1,010 1,024 1,042 1,006 1,034 1,038 1,056 
Mining and quarrying 34 40 42 44 47 35 34 45 47 
GDP (Tog billion current)          
Total 2,152 2,780 3,715 4,957 6,556 6,591 8,415 11,088 13,944 
Mining and quarrying 366 608 1,113 1,341 1,324 1,286 1,913 2,329 2,600 
GDP (Tog billion constant 2005)          
Total 2,592 2,780 3,017 3,640 3,964 3,914 4,163 4,892 5,493 
Mining and quarrying 550 608 646 684 673 711 737 791 862 
Mining and quarrying          
Gross output (Tog billion current) 765 978 1,628 1,939 1,961 2,158 3,097 4,168 4,535 
Coal and lignite 64 73 105 148 211 483 927 1,842 1,881 
Crude petroleum 4 11 19 32 45 147 206 329 480 
Metal ores 674 866 1,460 1,711 1,656 1,439 1,881 1,896 2,050 
Other mining and quarrying 24 28 44 49 70 89 83 101 124 
Mining and quarrying          
Gross output 
(Tog billion constant 2005) 927 978 1,033 1,034 1,036 1,059 1,166 1,277 1,380 
Coal and lignite 67 63 74 83 91 123 235 288 266 
Crude petroleum 12 11 20 46 64 102 119 139 199 
Metal ores 820 866 909 877 852 808 781 823 884 
Other mining and quarrying 29 28 30 29 29 26 31 27 31 
Source: National Statistical Office, Statistical Yearbook  (2007 to 2012). 
                                               
18 Mahul, Betlete, and Goodland (2009). 
19 U.S. Geological Service (2012), p. 18.1. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 48 - 
 
  4.27.  In volume terms, production of coal, iron  ore, and petroleum have increased rapidly over 
the past decade while gold has declined (Table 4.7). In the future, copper production should increase quickly as commercial production at Oyu Tolgoi started in 2013. Various reports indicate that the decline in gold production may be less than official statistics indicate; illegal mining, which 
avoids royalties and environmental laws, has increased although the State has been making efforts 
to improve regulation of the sub sector.
20 
Table 4.7 Mineral production, 2004-12 
  2004 2005 2006 2007 2008 2009 2010 2011 2012
Coal '000 tonnes 6,795 7,784 7,886 8,815 9,807 13,164 25,246 30,940 28,561
Copper with 
concentrate '000 tonnes 517 516 538 543 525 533 522 514 518
Fluorspar concentrate '000 tonnes 148 134 138 132 143 115 141 116 157
Gold (mine output, Au 
content) kg  19,237 24,122 22,561 17,473 15,184 9,803 6,037 5,703 5,995
Iron ore '000 tonnes 34 168 180 265 1,387 1,379 3,203 5,678 7,561
Molybdenum with 
concentrate '000 tonnes 2,346 2,469 3,022 4,002 3,795 5,264 4,348 3,977 3,934
Zinc concentrate '000 tonnes - 23 110 155 144 142 113 105 119
Petroleum (crude) '000 bbl 216 201 367 833 1,174 1,870 2,181 2,549 3,636
Source: National Statistical Office of Mongolia, Monthly Bulletin of Statistics (2005 to 2012).  
4.28.  Nearly all production of minerals and oil is exported, except for coal where a significant 
amount is consumed domestically for heating and electricity generation. Therefore, the trends in 
the volume of exports are similar to the trends for quantities produced. However, the total value of exports also depends on prices and, in the case of copper, export volumes have been fairly steady over the past few years while export values have fluctuated considerably (Table 4.8). Most 
minerals are exported to China except for fluorspar, and gold; fluorspar goes to the Russian 
Federation and Ukraine and gold, in most years, to Canada.  
Table 4.8 Exports of minerals from Mongolia, 2004-12 
Product description  2004 2005 2006 2007 2008 2009 2010 2011 2012
Coal US$ million .. 27 46 116 185 306 882 2,273 1,902
'000 tonnes .. 2,218 2,380 3,269 4,169 7,113  16,726  21,296 20,916 
Copper concentrate US$ million 284 326 635 812 836 502 771 969 839
'000 tonnes 563 587 600 608 583 587  569  576 575 
Refined copper US$ million 7 8 16 22 19 12 20 21 2
tonnes 2,654 3,001 2,365 3,167 2,604 2,321  2,800  2,361 2,120 
Fluorspar ores and concentrates US$ million 21 25 35 45 59 48 69 95 103
'000 tonnes 289 311 355 360 349 314  406  407 429 
Gold, unwrought or semi manu US$ million 242 331 270 235 600 308 178 110 122
tonnes 19 24 15 12 22 11  5  3 3 
Iron ores US$ million .. .. 11 16 92 89 254 442 533
'000 tonnes .. .. 313 240 1,013 1,596  3,564  5,802 6,416 
Molybdenum ores and 
concentrates US$ million 20 47 48 75 82 50 52 47 38
'000 tonnes 2 2 3 3 4 7  5  4 4 
Zinc ores and concentrate US$ million .. .. 91 176 155 122 143 143 131
'000 tonnes .. .. 106 133 138 151  120  121 141 
Crude petroleum US$ million 6 9 20 53 102 116 155 253 336
'000 bbl 180 188 338 812 1,059 1,939  2,071  2,554 3,568 
.. Not available. 
Source: National Statistical Office of Mongolia, Monthly Bulletin of Statistics (2005 to 2012).  
4.29.  Petroleum production and exports have increased over the past few years (Tables 4.7 and 
4.9) with China importing practically all production. However, there is no oil refinery in Mongolia 
and refined oil products are imported from Russia. In value terms, Mongolia has a trade deficit for 
oil products (Table 4.9).  
                                               
20 Mining Examiner,  "Mongolia turns thousands of illegal gold miners into formal workers",  
29 November 2013. Viewed at: http://www.911metallurgist.com/blog/m ongolia-turns-thousands-of-illegal-
gold-miners-into-formal-workers  [February 2014]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 49 - 
 
  Table 4.9 Trade in petroleum products, 2004-12 
Product description  2004 2005 2006 2007 2008 2009 2010 2011 2012
Exports  
Crude petroleum US$ million 
'000 tonnes 6 
25 9 
26 20 
46 53 
111 102 
144 116 
264 155 
282 253 
348 336 
487 
Imports  
Petrol US$ million 
'000 tonnes 97 
270 123 
255 175 
280 239 
346 362 
366 223 
323 229 
285 350 
325 474 
389 
Diesel US$ million 
'000 tonnes 98 
258 157 204 271 468 274 398 720 820 
271 310 388 428 416 499 647 717 
Jet fuel US$ million 9 11 29 29 34 11 14 28 44 
'000 tonnes 23 19 41 39 32 15 16 25 36 
Mazut US$ million 2 1 2 3 4 2 2 4 3 
'000 tonnes 11 5 6 8 7 5 5 7 4 
Source: National Statistical Office of Mongolia, Monthly Bulletin of Statistics (2005 to 2012).  
4.30.  Although several large known deposits of minerals in Mongolia are actually producing or are 
being developed, there has never been a detail ed geological survey of the country. As of 
end-2013, about 30% of the country had been mapped at 1:50,000 with plans to increase 
coverage to 40% of the country by 2016. Maps by private companies are the property of the 
company and are not publicly available, although  copies are given to the Ministry of Mining. 
4.2.1.2  Policy 4.2.1.2.1  Petroleum 
4.31.  As of December 2013, the Petroleum Law of 1991, with some amendments, was still in 
force, although a draft bill had been submitted to the Parliament in June 2013.
21 Under the current 
law, which applies to all hydrocarbons, all petroleum deposits belong to the State. The State may provide mine tenure permits to contractors while the local authorities provide land tenure permits 
for exploration and exploitation of petroleum depo sits. In addition to the Petroleum Law of 1991, 
the Law on Petroleum Products of 2005 created th e legal basis for regulation of the supply of 
petroleum products and refining operations and, in 2008, the Parliament allowed the Government 
to regulate petroleum prices through adjustments to taxes. Other legislation affecting petroleum 
exploration and exploitation includes the Consti tution, Land Law, Subsoil Law, Environmental 
Protection Law, and National Security Law.  
4.32.  The Ministry of Mining is responsible for Government policy in the sector and the 
preparation of draft laws and regulations, while the Petroleum Authority of Mongolia (PAM), which is a department within the Ministry, is the implementing agency.  
4.33.  The PAM negotiates production-sharing contracts with oil companies for exploration, 
development, and production. Exploration permits ma y be issued for up to five years, extendable 
twice for two years each time, while oil field development permits may be granted for up to 20 years, extendable twice for periods of five years each time. The terms for exploration or 
production and the rights and responsibilities of the Government and the contractor are set out in 
production-sharing contracts between the Petroleum Authority and the contractor, including royalties, tax deductible costs, the amount of prod uction to be shared with the Authority, signature 
bonuses, and production bonuses.  
4.34.  In general, a production sharing contract:  
(i) requires the oil company to bear all costs and risks for exploration and exploitation;  
(ii) should production start, allows the oil company up to 40% of the oil to be used to 
cover expenses for exploration and production; 
(iii) normally sets the Government's share at about 40% of the remaining 60% (which is 
usually taken as a financial payment); and 
                                               
21 InfoMongolia.com online information Renewed draft bill on Petroleum Law of Mongolia was submitted, 
28 June 2013. Viewed at: http://www.infomongolia.com/ct/ci/6197  [February 2014] WT/TPR/S/297/Rev.1 • Mongolia 
 
- 50 - 
 
  (iv) leaves the remainder for the contractor. Royalties are payable on all production 
(except the Government's share). In addition, taxes and other charges are payable.22 
4.35.  It has been reported that Mongolia has ab out 2.4 billion barrels of proven reserves; total 
potential remains unknown but could be in the region of 4 to 6 billion barrels.23 Although reserves 
are considerable, exploration and extraction costs ar e high due to the small size of the basins, the 
nature of the oil deposits and the harsh winters, which complicate production.24  
4.36.  Mongolia has 28 exploration blocks covering 560,000 km2. As of July 2013, it had concluded 
21 production-sharing contracts with 16 companies for 21 exploration blocks. In 2012, the 
Government's share from current production was 871,000 bbl (about 24% of total production) worth about Tog 108 billion. 
4.2.1.2.2  Other minerals 
4.37.  With the exception of petroleum, the main legislation on ownership, exploration, and 
extraction of minerals is the Minerals Law of Mong olia of 2006, which states that related legislation 
consists of the Constitution, Land Law, Subsoil Law, Environmental Protection Law, and National 
Security Law. In addition, exploration for and mining of uranium is controlled through the Nuclear 
Energy Law of 2009. 
4.38.  A draft new Mineral Law was submitted to th e Parliament in December 2012 but it has yet 
to be passed. Under the current Mineral Law, mi neral resources are the property of the State, 
which may grant exploration and extraction rights. Licences may only be granted to legal persons, 
and tax payers in Mongolia, formed and operating under the laws of Mongolia; this requirement must be met for the full duration of the licence. 
4.39.  The law divides deposits of minerals into three categories:  
(i) deposits of strategic importance, defined as a deposit "that may have a potential 
impact on national security, economic and social development of the country at the 
national and regional levels or that is producing or has a potential of producing more 
than five (5) percent of total Gross Domestic Product in a given year";  
(ii) deposits of common minerals, refers to abundant sediments and rock concentrations 
that could be used for construction material; and 
(iii) deposits of conventional minerals, which applies to all deposits not covered under 
deposits of strategic importance or common minerals.  
4.40.  The State has the right to participate in the exploitation of strategic deposits by up to 50% 
where it has funded the exploration work, or 34% where it has not. As of end-June 2013, 
15 mineral deposits had been classified as strategic deposits (Table 4.10). Similarly, under the Nuclear Energy Law, the State may take ownership of 51% of the shares of a project if a related 
deposit was discovered through State funded exploration work, or 34% where it was not. These 
conditions may be applied when existing exploration and mining licences are re-registered.  
                                               
22 The Mongolian authorities; and Hart Nurse Ltd (UK)  and Ulaanbaatar Audit corporation LLC (Mongolia) 
(2012), p. 10.  
23 Wolf Petroleum online information. Viewed at: http://www.wolfpetroleum.net/mongolia/oil-in-
mongolia  [February 2104].  
24 Oxford Business Group (2012), Energy . Viewed at: 
http://www.oxfordbusinessgroup.com/news/striking-bla ck-gold-going-underground -maximise-oil-potential .  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 51 - 
 
  Table 4.10 Strategic mineral deposits 
Name Minerals Resources  
Oyu Tolgoi Copper, gold, 
molybdenum Copper: 37 million tonnes 
Gold: 1,300 tonnes 34% owned by the State and 66% by 
Turquoise Hill (a subsidiary of Rio Tinto). Production expected to begin in 2013. 
Tavan Tolgoi Coal 1,400 million tonnes The State-owned Erdenes Tavan Tolgoi 
owns one block with plans for an initial 
public offering for 10% of the shares 
Nariin Sukhait Coal 500 million tonnes Operated by Mongolyn Alt, Qinhua-
MAK-Nariin Sukhait LLC and South Gobi Energy Resources. 
Tsagaan 
Suvarga Copper, molybdenum Copper: 324,000 tonnes  Exploration has been done by the 
State, additional geological exploration 
is required. 
Shivee ovoo Lignite 555 million tonnes 90% owned by the State. Plans to 
develop by the Ministry of Mining, Erdenes MGL and the State Grid Corporation of China. 
Asgat Silver Silver: 2,247 tonnes 
Copper: 76,746 tonnes Licence held by Mongolian-Russian JVC 
Mongolrostsvetmet. 
Tumurtein ovoo Zinc, lead Zinc: 885,300 tonnes Licence held by a Mongolian-Chinese 
JVC by stability agreement.  
Dornod Uranium 28,868 tonnes 51% owned by the State. 
Gurvan Bulag Uranium 16,073 tonnes To be developed by a Mongolian 
company in agreement with the Mongolian Nuclear Energy Agency.  
Mardai Uranium 1,104 tonnes Emeelt Mines, a subsidiary of Western 
Prospector holds the exploration 
licence. 
Baganuur Lignite 240 million tonnes In operation by Baganuur Joint Stock 
Mining Company controlled by the Government (75% share). 
Tumurtei Iron 229.5 million tonnes (ore) State owned. 
Boroo Gold Gold: 38 tonnes 
Silver: 5 tonnes In operation by a subsidiary of 
Cenerra Gold of Canada. 
Erdenet Copper, molybdenum Copper: 4.8 million tonnes 
Molybdenum: 131,034 
tonnes In operation. Erdenet Mining 
Corporation a Mongolian (51%)-
Russian (49%) joint venture. 
Burenkhaan Phosphorite 162.56 million tonnes (ore)  
Source: Ernst & Young (2012), Mongolia Mining and Tax Guide 2012/13 , p. 9; and the Mongolian authorities. 
4.41.  Under the Law, except for reserved areas and special-purpose territories, any legal person 
may conduct reconnaissance for minerals in any part of the country, after notifying the State, the 
Mining Resource Authority, and the local auth orities of the area concerned. However, an 
exploration licence is a requirement for a mining licence. Applications for exploration licences must be made to the Mining Resource Authority and must not overlap reserve areas, special-purpose 
territories, existing licensed areas, or areas subject to a pending licence application. Licences must 
be for areas between 25 and 400,000 ha but there is no limit on the number of licences any legal 
entity may have. If the Authority rejects the application it must inform the applicant within 
30 days, if it does not reject the application it passes it to the local authorities who have 30 days 
to approve or reject it. If accepted, the applicant must pay the licence fee within ten days for the first year, whereupon the Authority issues a three year exploration licence, which may be renewed. 
4.42.  A similar process applies to applications for mining licences. Mining licences are valid for 
30 years and may be extended twice for periods of up to 20 years each. 
4.43.  In 2010, the Parliament imposed a moratorium on new exploration licences, which was 
extended until the adoption of a new law on minera ls. According to the authorities, the moratorium 
was needed to address problems under the existi ng system, where licences had been issued but 
not used.  
4.44.  The Law on Regulation of Foreign Investment in Business Entities which Operate in Sectors 
of Strategic Importance (Foreign Investment Regulation Law) of 2012 was replaced by the 
Investment Law of 2013, with effect from 1 November 2013. The new Law simplified the registration and approval systems for new invest ments, including the requirement that foreign WT/TPR/S/297/Rev.1 • Mongolia 
 
- 52 - 
 
  government-owned entities obtain approval from the Mongolian Parliament or Government for 
investments in the mining and other sectors (section 2.5). 
4.45.  Under the Law on Environmental Resource Utilisation Fee, the Law on Environmental Impact 
Assessment, and some other legislation on envi ronmental protection as amended in 2012, the 
water utilization fee is based on the economic value of the water used. 
4.46.  In addition to general taxes, the Government collects royalties on sales under the Mining 
Law. Royalties are charged as a percentage of the sales price which, for exported products, is the 
international market price. The standard royalty rate is 2.5% for coal and 5% for other minerals. A 
surtax royalty effective 1 January 2011, replaced  a windfall-profits tax on copper and gold. The 
surtax royalty applies to 23 minerals with rates varying from zero to a maximum of 5% in all cases, except copper where the maximum is 30%. The actual rate depends on the price and the 
degree of processing, with the objective of encouraging mineral processing in Mongolia. Licence 
fees, payments for exploration costs, and royalties are important contributors to government revenue (Table 4.11). 
Table 4.11 Revenue from licence fees, repaymen ts for exploration costs, and royalties, 
2010-13 
(Tog billion) 
 2010 2011 2012 2013
Licence fees 31,662.7 37,743.2 39,227.7 35,815.8 
Repayments for exploration costs 3,170.7 2,000.1 2,066.3 2,367.3 
Royalties 169.0 382.6 442.2 463.4 
Source: The Mongolian authorities.  
4.47.  Mining has attracted a lot of foreign investment, and several foreign companies have 
significant operations either in production or planned, in some cases as joint ventures with 
Mongolian enterprises. In addition, some mines are operated by companies that are wholly or partly owned by the State (Table 4.12). 
Table 4.12 Mining operations 
Mineral Main operating company Location Annual capacity 
Coal Qinhua MAK Naryn Sukhait LLC 
(Mongolia-China joint venture) Naryn Sukhait Mine, Omnogovi 
Aymag 200,000 tonnes 
Cement Khutul Cement and Lime Factory Darhan, Dahran-Uul Aymag 500,000 tonnes 
Coal Baganuur Joint Stock Co. 
(Govt 75%, public 25%) Baganuur Mine, Tov Aymag 3,000,000 tonnes 
Coal Govt 95%, public 5% Shivee Ovoo Mine, Dundgovi, 
Aymag 2,000,000 tonnes 
Coal SouthGobi Energy Resources Ltd 
(Ivanhoe Mines Ltd 80%) Ovoot Tolgoi Mine, Omnogovi 
Aymag 4,500,000 tonnes 
Coal Mongolyn Alt (MAK) Group Eldev Mine, Dornogovi Aymag 500,000 tonnes 
Coal Mongolyn Alt (MAK) Group Naryn Sukhait Mine, Omnogovi 
Aymag 3,000,000 tonnes 
Coal Qinhua MAK Naryn Sukhait LLC 
(Mongolia-China joint venture) Naryn Sukhait Mine 1,500,000 tonnes 
Copper 
concentrates Samsung Corp 51%, Erdenet 
Mining Corp (Mongolia-Russia joint venture) 49% Erdent Ovoo Mine, Orkhon 
Aymag 20,000,000 tonnes 
Copper 
cathodes Erdenet Mining Corp 51%, Strand 
Holdings Ltd 49% Erdmin solvent extraction-
electrownning plant 3,000 tonnes 
Copper-gold Turquoise Hill (Rio Tinto) Oyu Tolgoi 150,000 tonnes Cu 
700,000 oz Au 
Fluorspar Mongolrostsvetment LLC Bor-Undur Mine and processing 
plant, Hentiy Aymag 450,000 tonnes 
Fluorspar Mongolrostsvetment LLC Urgen Mine, Dornogovi Aymag 120,000 tonnes 
Gold Centerra Gold Inc Boroo operation 3,000 kg 
Limestone Mongolyn Alt (MAK) Group Khukh Tsav quarry 108 million tonnes 
Molybdenum Erdenet Mining Corp Er denet, Bulgan Aymag 3,000 tonnes 
Steel Darkham metallurgy plant  Darhan, Darhan-Uul Aymag 100,000 tonnes WT/TPR/S/297/Rev.1 • Mongolia 
 
- 53 - 
 
  Mineral Main operating company Location Annual capacity 
Tungsten  Hovd Gol area, Bayan-Olgiy 
Aymag 150 tonnes 
Zinc 
concentrates Tsait Minerals Co Ltd 
(China-Mongolia joint venture) Sukhe Bator, Suhbaatar Aymag 70,000 tonnes 
Source: U.S. Geological Service (2012), 2011 Minerals Yearbook [Advance Release], December, p. 18.1. 
Viewed at: http://minerals.usgs.gov/minerals/pubs/country/2011/myb3-2011-mg.pdf  
[February 2014]; the Mongolian authorities; and other sources. 
4.2.2  Electricity 
4.2.2.1  Features 4.48.  Installed capacity for generating electricity in Mongolia was about 1,062 MW in 2011, 
although only about 80% of this is available due to aging power plants. The transmission and 
distribution network has also been unreliable and is one reason for the high level of transmission 
losses and internal use by electricity stations, which exceed household use
25 (Table 4.13).  
Table 4.13 Production and consumption of electricity in Mongolia, 2004-12 
(kWh unless otherwise stated) 
 2004 2005 2006 2007 2008 2009 2010 2011 2012
Statistical yearbooks          
Resources – total 3,474 3,586 3,713 3,896 4,198 4,195 4,576  4,812 5,182 
Gross generation 3,303 3,419 3,544 3,701 4,001 4,039 4,313  4,536 4,816 
Import 171 168 168 195 198 157 263  276  366 
Distribution total 3,474 3,586 3,713 3,896 4,198 4,195 4,576  4,812 5,182 
Consumption 2,357 2,534 2,620 2,829 3,093 3,034 3,376  3,453 3,773 
Industry and construction 1,459 1,569 1,627 1,746 1,918 1,883 2,094  2,141 2,339 
Transport and communication 99 106 109 117 129 126 140  144 157 
Agriculture 26 28 24 26 33 32 36  36 40 
Households 568 609 629 695 742 728 810  829 907 
Other 207 222 230 246 272 265 296  303 3301 
Losses transmission/distribution 480  420 442 442 436 494 505  644 675 
Station internal use 629  621 630 615 653 649 672  691 712 
Export 8  12 21 10 16 18 22  24 21 
Electricity production per capita 1,312  1,342 1,374 1,415 1,504 1,491 1,564  1,693 1,762 
Statistical bulletins          
Generation 2,692  2,817 2,933 3,078 3,360 3,396 3,654  3,902  4,096 
Thermal energy (thousand Gcal) 6,966  7,342 7,349 7,282 7,444 7,852 8,072  8,420  8,672 
Source: National Statistic Office of Mongolia, Statistical Yearbook and Statistical Bulletin (various issues).  
4.49.  Over 90% of electricity is generated from seven coal-powered combined heat and power 
plants, with diesel generators, hydro, and wind/solar providing the rest.26 In 2012, 
4,096 million kWh were generated along with 8.7 m illion Gcal of heat, which, given Mongolia's 
harsh winters, is important for heating households and businesses. Mongolia is a net importer of electricity, although imports are low relative to total generation, at 366 million kWh in 2012. 
Generation and consumption of electricity have increased steadily over the past few years with 
mining accounting for an increasing proportion of demand; this trend is expected to continue as new mines start producing. In 2010, about two thirds of electricity was consumed by industry and construction (including mining).  
4.50.  The energy sector has been the target of considerable investment and assistance from 
abroad. It was reported that, between 1990 and 2008, the sector received US$347.9 million in loans and US$227.4 million in grants from other countries, international banks, and financial 
institutions.
27  
                                               
25 Institute of Energy Economics, Japan (2012).  
26 Tovuudorj (2013). 
27 Zorigt (2009) . WT/TPR/S/297/Rev.1 • Mongolia 
 
- 54 - 
 
  4.51.  Mongolia has into four electric power systems:  
• Central Energy System (CES), which accounts for about 80% of production and 
consumption. The CES has five coal-burning combined heat and power plants and an interconnection to the Russian Federation; 
• Western Energy System (WES), which operates on electricity imported from the Russian 
Federation;  
• Eastern Energy System (EES) has one coal powered combined heat and power plant; 
and 
• Altai-Uliastai Energy System in the mid-west of Mongolia, which connects some districts 
not connected to the WES or CES; 
4.52.  In addition, the city of Dalanzadgad in the south has a coal powered combined heat and 
power plant and there are about 600 small dies el generators of between 60 and 1,000 kw 
supplying local municipalities.  
4.2.2.2  Policy 
4.53.  The Ministry of Energy is responsible for developing and implementing policies and laws on 
electricity. The Energy Regulatory Commission is responsible for regulating the sector; the National Dispatching Center is responsible for matching supply and demand as well as monitoring 
licence holders; the Energy Development Center is responsible for implementing energy policy, 
supporting policy and decision-making in the Mini stry with professional studies, as well as 
implementing certain activities such as feasibility studies and technical control of projects financed through the State budget; and the National Renewa ble Energy Center promotes renewable energy 
technologies.  
4.54.  The principle legislation governing the energy sector is set out in several laws, including: 
• the Energy Law of 2001, last amended in 2012, which sets out the legal basis for 
unbundling the sector and the establishment, under Government Decree No. 164, of 
18 state-owned companies for generation, transmission, and distribution. It also provides the legal basis for the Energy Regula tory Authority (now the Energy Regulatory 
Commission (ERC)) and the licensing of energy companies; 
• the Renewable Energy Law of 2007, which sets out the licensing requirements for 
producers of electricity from renewable sources (including hydro). It also sets out a range of possible tariffs that the Energy Regulatory Commission may apply to buyers of 
electricity from generators connected to the grid and the regulatory boards of aimags  
and Ulaanbaatar for stand-alone power sources (Table 4.14); and 
• the Concessions Law of 2010, which provides the legal basis for public-private 
partnerships and their regulation. 
Table 4.14 Renewable energy price and tariff 
(US$ per kWh)  
Source Tariff 
Generators connected to the grid  
Wind 0.080 to 0.950 
Hydro 0.045 to 0.060 
Solar 0.150 to 0.180 
Stand-alone generators  
Wind 0.100 to 0.150 
Hydro  
Plant capacity < 500 kW 0.080 to 0.100 
Plant capacity 501 to 2,000 kW 0.050 to 0.060 
Plant capacity 2,001 to 5,000 kW 0.045 to 0.050 
Solar 0.200 to 0.300 
Source: Law of Mongolia on Renewable Energy, Article 11. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 55 - 
 
  4.55.  In addition to the laws affecting electr icity generation, transmission, and distribution, 
Government policy is set out in a number of programmes including the Program on Integrated Power Energy System to integrate the regional networks into a national grid; and the National Renewable Energy Program. Furthermore, as electricity is central to development, it is included in 
development programmes such as the National Development Strategy and the Government Action 
Plan 2012-16. Given the nomadic life of many herder  households, provision of electricity to them 
has been particularly difficult. Under the 100,000 Solar Ger programme, the Government, with 
assistance from the World Bank and others, provid ed solar kits at subsidized prices to nomadic 
herder households.
28 
4.56.  Current policy is to address a capacity shortage of 100-150 MW, expected to emerge in 
2013-16, by building a new coal-fired combined heat and power plant, increasing capacity in 
existing thermal plants, commissioning a new wind-park, and increasing imports. Similarly, 
heating capacity is to be increased by building a new heat plant in Ulaanbaatar and improving infrastructure to deliver more  heat from existing plants.
29 
4.57.  The Energy Regulatory Commission, respon sible for regulating the energy sector, has the 
authority to set prices for heat and electricity; set the methodologies to calculate prices for fuel used to generate electricity; and make provisions for the functioning of an electricity market. It is 
also responsible for issuing licences for the import and/or export of electricity, licences for 
transmission lines of more than 5 MW, and, with the permission of the State Central Administrative Authority, licences for the generation, distributi on, and supply of electricity. It monitors and 
evaluates the activities of licence holders. Regulatory decisions by the ERC may be appealed in the 
Administrative Court if an energy enterprise disagrees with the ERC decision. 
4.58.  Following the restructuring of the electricity sector under the Energy Law of 2001, Mongolia 
has operated a single buyer system in the Centra l Energy System. The Central Regional Electricity 
Network purchases imported electricity and electricity generated by the five power plants in the 
region; it then sells the electricity to distribution companies (three private and seven state joint-stock companies). The Energy Regulatory Commission sets wholesale and retail prices for 
electricity in the Central Regional Electricity Network. In addition to the single buyer market, a 
spot market has operated since 2006 and an auctio n market since 2007. The National Dispatching 
Center operates both the spot and auction markets.
30  
4.59.  The current consumer tariff structure is co mplicated: for domestic consumers, rates depend 
on the city/region, the time of day, and the amount used per month; and for enterprises, 
since 2011, higher charges have applied to mi ning activities than to other enterprises 
(Table 4.15). The ERC regularly reviews tariffs at each stage in the network; prices doubled 
between 2002 and 2011 to Tog 88/kWh for industrial users in the Central Energy System31 and 
increased again in August 2013 (Table 4.15). 
Table 4.15 Electricity tariffs for mining and industry, August 2013 
(Tog/kwh) 
 Central Energy 
System Eastern Energy 
System Dalanzadgad Western 
Energy System Altai-Uliastai 
energy system 
Mining industries 
Simple mete r 130.0 130.0 100.0 100.0 100.0
Time-use mete r   
06-17h00 130.0 130.0 .. .. ..
17-22h00 234.0 234.0 .. .. ..
22-06h00 60.0 60.0 .. .. ..
Industrial users, enterprises, and organizations
Simple mete r 105.6 105.6 100.0 100.0 100.0
Time-use mete r   
06-17h00 105.6 105.6 .. .. ..
17-22h00 178.6 178.6 .. .. ..
22-06h00 60.0 60.0 .. .. ..
                                               
28 World Bank online information. Viewed at: 
http://www.worldbank.org/en/results/2013/04/08/portable-solar-power-for-nomadic-herders  [February 2014]. 
29 Ministry of Energy (2013) .  
30 Energy Regulators Regional Associ ation online information. Viewed at: 
http://www.erranet.org/About Us/Members/Profiles/Mongolia  [September 2013]. 
31 Tserenpurev and Osgonbaatar (2012). WT/TPR/S/297/Rev.1 • Mongolia 
 
- 56 - 
 
   Central Energy 
System Eastern Energy 
System Dalanzadgad Western 
Energy System Altai-Uliastai 
energy system 
Transport   
24 hr 60.0 .. .. .. ..
Public lighting   
06-19h00 105.6 105.6 .. .. ..
19-06h00 60.0 60.0 .. .. ..
.. Not available. 
Note: A specific methodology is also used to calculate tariffs for unmetered use of electricity and special 
rates apply to vulnerable households. 
Source: Energy Regulatory Commission  online information. Viewed at: http://www.erc.mn  
[December 2013]. 
4.60.  The ERC has issued a considerable number of licences for electricity generation over the 
past few years with associated generation tariffs, and has approved power purchase agreements 
with the transmission companies. Recently, gene ration licences have been issued to several 
private sector enterprises, including: New Mining Energy for a 60 MW generating licence; and to Erdenes MGL for a 600 MW licence at Tavan Tolgoi, a 450 MW licence at Oyu Tolgoi, a 600 MW licence at Booroljuut, a 600 MW licence at Chandgana, and a 600 MW licence at Erdenetsogt.  
4.61.  Under the Law on Energy, access to transmission and distribution networks must be 
non-discriminatory but it does not require identical treatment for all parties for technical terms and conditions or for tariffs charged; it has been reported that in practice there is discrimination.
32  
4.62.  It has been stated that: "The revenues generated by existing power stations are less than 
the overall costs required to generate energy which is why power stations are heavily indebted. As a result, the Mongolian energy sector is not particularly attractive in terms of new investment. At 
present, the Mongolian Government has neither a framework in place, nor strategies or incentive 
mechanisms to encourage energy efficiency and ener gy savings. In most cases, the actors in the 
energy sector, industrial users and end users are not fully aware of how they can save energy and 
be more efficient."
33 
4.63.  In response the authorities noted that the main priorities for the Government are to create 
the institutional framework for private sector participation, to improve the efficiency of the energy sector, to facilitate the development of renewa ble energy, to improve economic and financial 
performance of state-owned energy companies, and to promote competition in the sector. A strong 
legal, institutional, and regulatory framework would reduce investors’ risk and encourage long-term commitment to investment through concessions, independent power producers, and 
power purchasing agreements. Furthermore, the Energy Master Plan, last updated in 2004, is 
being reviewed with assistance from the Asian Development Bank. This has included a study of the financial viability for the heat and power sectors by energy region, which showed that, with the exception of the Ulaanbaatar district heating company, all companies had shown poor levels of 
profitability in recent years, although liquidity an d solvency were generally high. Increasing private 
sector investment would, therefore, require a reform of energy tariffs, which were increased several times over the past few years, most recently in August 2013.  
4.3  Services 
4.3.1  Banking, insurance, finance 4.3.1.1  Features 
4.64.  In acceding to the WTO, Mongolia made full commitments on financial services in both 
market access and national treatment for cross-border supply, consumption abroad, and commercial presence, while supply through the presence of natural persons was unbound.  
4.65.  The financial and insurance services sector in Mongolia is relatively small, contributing 
Tog 503 billion or 3.6% to GDP in 2012 and employing 17,400 people or 1.6% of total 
                                               
32 European Bank for Reconstruction and Development (2010), p. 226. 
33 GIZ online information. Viewed at: http://www.giz.de/en/ worldwide/17721.html  
[February 2014]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 57 - 
 
  employment. Although the sector has grown strongly  over the past few years, in both real and 
nominal terms, it suffered from the impact of the financial crises in 2008 when its contribution to 
employment and GDP contracted in real terms before recovering quickly in 2010 (Table 4.16).  
Table 4.16 Financial sector to employment and GDP, 2004-12 
 2004 2005 2006 2007 2008 2009 2010 2011 2012
Employment    
Total 951 968 1,010 1,024 1,042 1,006 1,034 1,038 1,056 
Finance and insurance 16 16 17 17 20 12 15 17 17 
GDP (Tog bn current)          
Total 2,152 2,780 3,715 4,957 6,556 6,591 8,415 11,088 13,944 
Finance and insurance .. .. .. 155 236 213 240 381 503 
GDP (Tog bn constant 2005)          
Total 2,592 2,780 3,017 3,640 3,964 3,914 4,163 4,892 5,493 
Finance and insurance .. .. .. 130 170 143 144 199 250 
.. Not available. 
Source: National Statistical Office, Statistical Yearbook  (2007 to 2012). 
4.66.  The banking sector in Mongolia has undergone several disruptions since it was privatized in 
the early 1990s, with crises in 1994, 1996, and 1998 caused by several factors, including: a legacy 
of directed lending; high Government borrowing; poor accounting; low banking standards; and a 
lack of regulation.34 With support from the Asian Development Bank and the IMF, considerable 
progress was made in the 2000, to improve domestic  regulation and the security of the financial 
sector.35 However, domestic banks were, and remain, exposed to Mongolia's narrow economic 
base. The 2008 global financial crises led to falls in the prices of coal and copper, with a 
corresponding fall in GDP and an increase in non-performing loans and withdrawals of deposits from some banks. As a result, two banks were ta ken over by the Bank of Mongolia (Anod in 2008 
and Zoos in 2009) and the State Bank of Mongolia took over their operations. The crises also led 
to an IMF-supported stand-by arrangement being put in place in April 2009; this was successfully completed in October 2010.
36 
4.67.  While commodity prices recovered quickly and Mongolia's economy performed strongly in 
the 2009-12 period, the fragility of some banks was again exposed in 2013 when another bank, Savings Bank, had to be taken over by the State and was merged with the State Bank. 
4.3.1.2  Policy 
4.68.  The Ministry of Finance is responsible for implementing policy for the financial sector; the 
Bank of Mongolia is the regulator for the banking sector (Box 4.1), and the Financial Regulatory Commission is the regulator for other financial institutions (non-bank financial institutions, savings 
and credit cooperatives, securities companies, insurance companies, and the operations of the 
capital markets sector, which comprise the Mongolia Stock Exchange (MSE) and the Securities Clearing House and Central Depository (SCHCD)) (Boxes 4.2 to 4.5). 
4.3.1.2.1  Banks 
4.69.  Legislation governing the commercial banks is set out in several laws and regulations 
including: 
• Law on Central Bank, which sets out the role of the Bank of Mongolia with its main 
objective as the stability of the currency, issuing banknotes, and managing official 
international reserves, and its role as the fiscal intermediary of the Government. It also establishes the Bank of Mongolia as the regulator of the banking sector and as lender of 
last resort to banks, and assigns to it the right to set compulsory reserve levels for 
banks, implementing a unified interest rate policy, and imposing credit limits on banks; 
                                               
34 WTO document WT/TPR/S/145, 15 February 2005, Chapter IV, paragraphs 52-53. 
35 Asian Development Bank (2008a). 
36 IMF (2011). WT/TPR/S/297/Rev.1 • Mongolia 
 
- 58 - 
 
  • Law of Banking, which sets out the procedures for obtaining a banking licence, the 
activities banks are permitted to engage in, reporting requirements, etc., as well as setting out a number of restricted activities. It also extends the role of the Bank of Mongolia as regulator by allowing it to set criteria to apply to commercial banks, such as 
liquidity and other prudential requirements; 
• Law on Deposits, Loans and Banking Transactions, which sets out the basic rights and 
duties of banks and their clients including minimum information and transparency 
requirements; 
• Law on Combating Money Laundering and Terrorism Financing of 2006; and 
• Law on Currency Settlements, which requires that the Bank of Mongolia set exchange 
rates for the togrog against the main currenc ies used in international trade. However, 
the Parliament is legally responsible for currency policy, while the commercial banks may 
establish their own exchange rates based on market demand. 
4.70.  In addition to the laws on banking, the Bank of Mongolia has issued regulations providing 
details on the implementation of the laws, including regulations on corporate governance for 
banks, banking licences, prudential ratios for ba nks, and conditions for imposing conservatorship 
on banks (when the Bank of Mongolia effectively takes over a bank for failing to meet prudential 
requirements).  
4.71.  The commercial banks dominate the financial sector in Mongolia, representing about 95% of 
total assets. As of mid-2013, there were 13 re gistered commercial banks, one of which is 
state-owned and 4 of which are majority foreign-owned. Although Mongolia has a lot of banks 
relative to the size of its population, the market  is essentially dominated by 4 banks (Table 4.17). 
Table 4.17 Main banks in Mongolia, end 2012 
(Tog million) 
Name Foreign 
investment Number of 
branches Assets Deposits/
current 
accounts Loans Total 
equity 
Golomt Ban k Yes (15%) 92 2,527,327 2,056,530 1,427,922 187,207
Trade and Development Ban k Yes (..) 45 2,700,479 1,438,845 1,533,272 239,876
Khan Ban k Yes (64%) 512 2,796,470 2,148,932 1,731,042 231,778
Savings Banka .. .. .. .. 558,720 ..
State Bank of Mongoliaa State owned 33 316,697 280,554 180,033 31,196
Chinggis Khan Bank Yes (100%) 2 110,808 62,523 71,385 29,109
Capitron Bank No 24 120,882 101,821 63,644 11,691
Xac Bank Yes (..) 107 1,077,703 516,023 630,919 97,832
Ulaanbaatar City Bank 24 532,314 206,532 286,517 36,625
Capital Ban k Yes (..) 63 325,597 165,341 198,086 23,925
National Investment Ban k Yes (..) 4 42,012 28,133 24,904 7,605
Credit Ban k Yes (..) .. 12,283 548 1,898 9,692
Transport Development Ban k .. .. .. .. .. ..
Erel Ban k .. 44,399 29,203 31,374 12,303
.. Not available. 
a The State Bank of Mongolia's total assets and liabilities increased by nearly 400% in the third 
quarter of 2013 when it took over the activities of Savings Bank. 
Source: Financial reports of banks. 
4.72.  The banking sector in Mongolia is small relative to other countries, but has grown rapidly 
despite the recent crises; total deposits and loans have increased significantly (Table 4.18). 
However, although the Bank of Mongolia has made and applied regulations, the banking sector still 
carries a considerable volume of non-performing loans, and doubts have been raised about the 
banks' reported capital asset ratios, which may be overstated. From the start of 2012 to the end 
of 2013, the Bank of Mongolia increased the liq uidity ratio from 18% to 25% and the capital 
adequacy ratios for the five most important banks from 12% to 14%. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 59 - 
 
  Table 4.18 Banking structure, 2008-13 
  2008 
31 Jan. 2008 
31 
Dec. 2009 
31 
Dec. 2010 
31 
Dec. 2011 
31 
Dec. 2012 
31 
Dec. 2013 
31 July 
Total assets Tog billion 3,295 3,650 4,422 6,246 9,372 11,992 16,097 
Total deposits Tog billion 1,502 1,339 1,856 2,730 3,858 4,886 5,212 
Deposit interest rate % .. 13.6 12.9 10.7 10.5 11.7 11.80 
Total loans Tog billion 2,133 2,636 2,655 3,228 5,598 6,941 6,063 
Loan interest rate % 17.3 20.4 20.8 17.9 15.5 18.2 17.3 
Non-performing loans Tog billion 68 189 462 371 327 306 451 
Bank of Mongolia policy 
rate % 8.4 9.75 10.00 11.00 12.3 13.3 10.5 
Consumer price index % for year 19.9 22.1 4.2 13.0 8.9 14.0 8.3 
.. Not available.  
Source: Bank of Mongolia, Annual Report  (various years). Viewed at: 
http://www.mongolbank.mn/eng/aboutus.aspx .  
4.73.  Mongolian banks are exposed to a number of external factors both indirectly, because of the 
narrow economic base, which relies on production and exports of minerals to a single market, and directly, because over one third of loans and deposits are denominated in U.S. dollars, leading to suggestions that a prohibition on foreign-currency lending should be phased-in for unhedged 
borrowers.
37  
4.74.  Bank lending increased considerably over the five years to 2012 and become more 
concentrated in the construction and real estate sectors, which accounted for 13% of total lending 
at end-2005 and 27% at end 2012 (Table 4.19). 
Table 4.19 Bank lending by economic sector, 2005-12 
Sector  2005 2006 2007 2008 2009 2010 2011 2012
Total lending  (Tog billion) 859 1,222 2,055 2,635 2,655 3,228 5,598 6,941 
Agriculture % 6.7 8.2 7.6 2.6 5.8 4.4 3.0 2.7 
Construction % 8.9 9.1 15.6 14.5 14.4 10.8 11.8 13.0 
Manufacturing % 16.2 12.8 13.0 14.5 15.5 14.1 11.3 11.5 
Mining % 9.0 7.5 6.3 6.4 13.2 12.0 12.0 11.5 
Real estate activities % 2.4 3.0 2.5 5.4 7.1 13.6 14.1 14.0 
Wholesale and retail 
trade % 33.2 31.5 29.2 22.7 18.0 18.6 17.0 16.4 
Other % 23.5 27.9 25.7 33.8 26.0 26.5 29.8 30.9 
Source: IMF (2011), Mongolia: Financial System Stability Assessment , Country Report No. 11/107. Viewed 
at: https://www.imf.org/external/pubs/ft/scr/2011/cr11107.pdf ; and Bank of Mongolia Quarterly 
Loan Report of Banks  (various issues). Viewed at: 
http://www.mongolbank.mn/eng/liststatistic.aspx?did=2_2 .  
4.75.  In addition to reducing dollarization an d improving banks' reserves, recommendations for 
reform for banking regulations include:  
• replacing the blanket deposit guarantee schem e, which expired in November 2012; this 
was achieved with the Law on Insurance of Bank Deposits of 2013, in effect in 
January 2013; 
• strengthening the anti-money laundering and financing of terrorism framework by full 
implementation of the action plan agreed with the Financial Action Task Force for the Financial Intelligence Unit in the Bank of Mongolia. The FIU was established under the 
Law on Combating Money Laundering and Terrorism Financing of 2006.
38 
                                               
37 IMF (2012), paragraphs 41-42. 
38 IMF (2012). WT/TPR/S/297/Rev.1 • Mongolia 
 
- 60 - 
 
  Box 4.1 Regulatory framework for banking services, 2013 
Supervisory authority: Bank of Mongolia 
Preferential and bilateral policies: None  
Licensing: General prudential, fiduciary, and reporting re quirements applied equally to domestic and
foreign-owned banks. 
Prudential regulations: 
Capital adequacy ratio:   Capital to risk-weighted assets    >12% 
     Tier-1 capital to risk-weighted assets  >9% 
Liquidity ratio:   Liquid assets to total liabilities   >25% 
Credit concentration risk ratio: Loans an d guarantees to single borrower  <20% 
Forex risk ratio:   Total currency     <40% 
     S i n g l e  c u r r e n c y      < 1 5 %  
Determination of interest rates and fees: Bank s may determine interest rates and fees freely  
Specific provisions ag ainst money laundering:  the l aw on Combating Money Laundering and Terrorism 
Financing of 2006 sets out regulations, while the Fi nancial Action Task Force monitors banks and other 
financial institutions.   
Bank deposit insurance scheme: Law on Insurance of Bank Deposits, adopted in January 2013, established 
the Deposit Insurance Fund run by the Deposit Insurance Corporation. The scheme is to be funded primarily 
by banks through quarterly premiums of 1% of share ca pital up to a maximum of 0.125% of deposits, with 
provisions for reduced premiums when the fund equals 10 % of all deposits or additional premiums if there are 
insufficient funds to meet compensation. The Law provid es for compensation up to Tog 20 million per person 
or legal entity.  
Source: The Mongolian authorities.  
4.3.1.2.2  Other fina ncial institutions 
4.76.  Apart from the commercial banks, the fina ncial services sector consists of insurance, 
savings and loans cooperatives, the securities market, and non-bank financial activities (Table 4.20). The Financial Regulatory Commission (FRC), established under the Law on FRC Legal Position of 2005, is responsible for regulating an d supervising all financial institutions except the 
commercial banks. Several other laws also regulate activities of the non-banking financial 
institutions: 
• Law on Insurance of April 2004, and Law on Insurance Intermediaries of April 2004
39;  
• Law on Savings and Credit Cooperatives of October 2011, deals with non-profit legal 
entities providing licensed savings and loan services;  
• Law on Securities Market of May 2013, revised earlier law on Securities Market of 
December 2002, and covers exchange traded or over-the-counter trades of securities 
and derivative instruments, their issuance , trade, transfer of ownership rights, 
payments, and clearing and deposition. This law applies to the Stock Exchange and the Securities Clearing House and Central Depository; and 
• Law on Non-Bank Financial Activities of December 2002, covers a variety of financial 
services provided by non-bank financial institutions including lending; factoring; financial leases; financial guarantees; issuing of payment instruments; electronic payments and 
remittance services; foreign currency exchange; trust services; investment in short-term 
financial instruments; and the provision of investment and financial consultancy and information services.  
Table 4.20 Indicators for non-commercial  bank financial subsector, 2005-12 
 2005 2006 2007 2008 2009 2010 2011 2012
Non-bank financial institutions 
Operating income Tog million 7,371 8,785 13,090 18,247 26,338 29,004 45,211 67,651
Operating expenses Tog million 2,594 2,792 5,089 5,968 11,121 8,767 14,467 23,281
                                               
39 Unofficial English translatio ns of these laws are available from the FRC. Viewed at: 
http://www.frc.gov.mn/engnew/  [October 2013]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 61 - 
 
   2005 2006 2007 2008 2009 2010 2011 2012
Provisions Tog million 853 515 747 1,299 1,800 2,247 2,115 2,323
Number of NBFI No. 148 163 137 132 177 182 195 212
Insurance  
Premiums Tog million 7,435 10,231 13,823 21,267 23,259 31,769 47,487 78,208
Reimbu rsements Tog million 2,407 3,465 3,375 4,900 5,511 8,827 10,172 19,575
Number of institutions No. 20 20 15 15 17 17 17 18
Savings and credit cooperatives  
Interest income Tog million 25,141 17,109 8,311 11,093 10,764 11,171 12,373 15,426
Interest expenses Tog million 9,413 10,027 5,655 6,516 6,169 6,361 7,385 8,323
Total savings Tog million .. 11,387 25,960 27,672 29,898 34,779 7,385 8,323
Total credit Tog million ..13,601 19,291 32,878 32,215 34,861 43,843 47,086
Number of institutions No. 532 537 168 209 212 179 162 148
Stock market  
Registered companies No. 392 387 383 376 358 336 332 239
Market capitalization Tog billion 55 131 716 515 620 1,374 2,169 1,800
Stock trades Tog million 654 2,547 12,604 60,349 23,182 62,873 109,111 144,747
Government bond 
trading Tog million 6,768 4,462 39,599 1,495 ..30,000 236,731 0.5
Company bond trading Tog million 2,664 961 851 502 .. .. 4,395 310
.. Not available.  
Source: Bank of Mongolia, Annual Report  (various years). Viewed at: 
http://www.mongolbank.mn/eng/aboutus.aspx .  
4.77.  In addition to the various laws covering financial services institutions, other than 
commercial banks, the FRC has also issued a number of regulations, guidelines, and codes in each 
of the sub-sectors it regulates (Box 4.2 to 4.5) . Under the Banking Law, the FRC is required to 
work with the Bank of Mongolia and the Financial Intelligence Unit on anti-money-laundering and combating the financing of terrorism. However, although the laws and other rules may have 
established a fairly comprehensive legal framework, and coordination of activities with other 
regulators is required, there are some doubts about their implementation and the extent of 
cooperation.
40 
4.3.1.2.2.1  Insurance 
4.78.  There are 16 general insurance companies and one life insurance company operating in 
Mongolia. Under the Law on Insurance, insurance is  either long term or ordinary, each of which 
may be divided into compulsory or voluntary. The only compulsory insurance is for vehicle drivers, 
introduced in October 2011, with effect from 1 January 2012. This compulsory driver insurance 
partly explains the recent increase in premiums and reimbursements in insurance (Table 4.20).  
4.79.  There are no state-owned insurance companies operating in Mongolia, since Mongol Daatgal 
(non-life insurance) and Tushig Daatgal (agricultural insurance) were privatized in 2003; however, 
the State has stakes in some smaller insurance companies. Although Mongol Daatgal remains the 
biggest insurance company, its market shar e (premium revenue) declined from about 
three quarters in 2003 to one quarter in 2011, as other companies grew more quickly. Mongol 
Daatgal is owned by Angara Insurance of Russia and Chinggis Khan Bank.  
Box 4.2 Regulatory framework for insurance services, 2013 
Supervisory authority: Financial Regulatory Commission 
Preferential and bilateral policies: None 
Licensing: A licence from the FRC is required to operate as an insurer in Mongolia. The insurer may not engage in 
other economic activities. There is no time-limit on the duration of a licence provided all legal requirements are met.  
Approval from the FRC is required for any person to hold 10% or more of the shares in an insurance company and 
such a person must also obtain prior approval before disposing of these shares. 
There are no additional requirements on foreign insurers and intermediaries beyond obtaining written approval from 
the FRC. 
Cross-holdings are prohibited between insurance brokers/agents and insurance companies, and between 
brokers/agents and the directors of insurance companies. 
                                               
40 Asian Development Bank (2008a); and IMF (2011).  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 62 - 
 
  Prudential regulations:  
Capital requirements:  General insurance   Tog 5 billion 
    Long term insurance    Tog 7 billion 
    Reinsurance   Tog 15 billion 
Solvency requirements: General insurance   100% 
    Long-term insurance  125% 
Annual actuarial review required. 
Actuarially determined reserves for incurred but not reported risks.  
Reinsurance: Each insurance company may organize its own reinsurance, such as Mongol Daatgal's agreement with 
HannoverRe for losses over Tog 300 million up to Tog 6,000 million.41  
Source: The Mongolian authorities.  
4.80.  Over the past few years, insurance premiums and non-bank financial institutions' turnover 
have increased significantly, although they remain small compared to the commercial banks. 
Furthermore, savings and credit cooperatives have not fully recovered from a severe contraction in 
2008, when the number of cooperatives and their tu rnover fell sharply (Table 4.20). There were 
several reasons for the crises among the savings and credit cooperatives, but poor management 
and regulation meant many of them were very fr agile if not already insolvent when the general 
financial crises hit Mongolia.42 The Law on Savings and Credit Cooperatives of 2011 was intended 
to close some loopholes in the previous law, which were blamed for having led to irregularities and 
the subsequent demise of many cooperatives with total losses of Tog 79 billion. 
Box 4.3 Regulatory framework for non-bank financial institutions, 2013 
Activities: Lending, factoring, financial leases, financial guarantees, issuing payment instruments, electronic 
payments and remittance services, foreign exchange, trust services, investment in short term financial instruments, 
investment and financial consultancy or information services. Non-bank financial institutions are prohibited from 
accepting deposits or opening deposit accounts for clients. 
Supervisory authority: Financial Regulatory Commission 
Licensing: Licencing authority: FRC 
Applications must be accompanied by documents confirming the entity has the minimum capital available, charter, 
business plan, financial statements, etc. Licence validity is normally three years, renewable. Normal reporting, 
transparency, fiduciary and prudential requirements apply equally to domestically owned and foreign owned non-bank 
financial institutions.  
Prudential regulations: Prudential ratios on reserve fund, liquidity, capital adequacy, loan loss provisioning, foreign 
currency exposure and other criteria shall comply with requirements set by the Committee on Financial Regulations 
under the FRC Resolution No. 191 of 2008 (Regulation to calcul ate and maintain the prudential ratios of NBFIs applies 
to the NBFIs). 
Minimum capital requirements are determined by FRC upon consideration of the national economic situation, inflation 
rate, liquidity and specifics of the NBFIs from Tog 20 million to Tog 1,000 million.  
Source: The Mongolian authorities.  
                                               
41 Eurasia Capital (2010). 
42 Tur-Od Lkhagvajav (2012). WT/TPR/S/297/Rev.1 • Mongolia 
 
- 63 - 
 
  Box 4.4 Regulatory framework for savings and credit cooperatives, 2013  
Supervisory authority: Financial Regulatory Commission 
Licensing: Licencing authority: FRC 
According to Resolution of the FRC No 60 of 2012 (General Regulation for Savings and Credit Cooperatives), savings 
and credit cooperatives shall:  
• verify that the documents are completed required by Articles 2.1 and 2.2; 
• verify that the founding members have made a founding contract, and supply supporting showing that 
more than 30% of the share capital has been mobilized; 
• verify members of the Board of Directors, Supervision Committee and Loan Committee, the executive 
director, and the accountant meet the requirements set out in Article 2.1.8 of the Resolution; and 
• provide a business plan developed in accordance with Annex 5 of the Resolution 
Under the Resolution, a savings and credit cooperative has th ree months after submitting an application for a licence 
in which to complete documentation. 
A licence is valid for 3 years. 
Prudential regulations: There are no minimum capital requirements for obtaining a licence. 
Under Resolution of the FRC No 180 of 2012, savings and cr edit cooperatives are required to make provisions for 
losses on loans and other assets and adjust the provisions each time there is a change in assets based on the 
following schedule: 
• current loans  no amount specified in the Resolution 
• overdue loans  5% 
• non-performing loans: 
o substandard 25% 
o doubtful  50% 
o bad  100% 
• the sum of outstanding non-performing loans should not exceed 5% of the loan portfolio 
• the sum of loans to SCC members and related parties should not exceed 30% of total equity 
• other prudential regulations relating to assets, asset structure, and the capital fund 
Source: The Mongolian authorities; and WTO Secretariat.  
4.81.  Mongolia's stock exchange has seen a considerable increase in total capitalization and 
trading over the past few years, although the number of registered companies has declined. The 
decline in numbers listed follows de-listing of companies by the FRC, mainly on the basis that they 
have not followed the exchanges disclosure rules or for concentration of equity ownership 
(Table 4.20). The top 4 companies by market capita lization account for over half of total market 
capitalization, and the majority of the top 20 are mining companies. 
Box 4.5 Market and regulatory regime for securities and stock exchanges, 2013  
Supervisory authority and licensing organ : FRC  
Licensing: Under the Law on Securities Market and accompanying regulations, the FRC may grant 16 different types 
of licence relating to the securities market: brokerage; de aling; investment advice; securities trust; underwriting; 
securities ownership rights registration; securities trade clearing; securities trade settlement; centralized depository 
of securities; other operations  ordered by and on behalf of clients; cust ody; securities trading; investment funds; 
investment management; financial rating; and other operations prescribed as  regulated by the FRC. 
Validity: three years with the possibility of an extension for an additional three years. 
Transferability: licences are non-transferable. 
Limitations on number of licences: there are no restrictions  on the number of licences that may be held, but under 
Article 51 of the Law on Securities Market, a regulated person or entity may only combine certain activities: 
• a person authorized to undertake brokers' operations may conduct securities dealing and underwriting and 
investment advisory operations; 
• an organization authorized to undertake securities central depository operations may conduct custodian, 
clearing and settlement operations; 
• a legal entity authorized to undertake custodian operations may conduct securities' registration 
operations;  
• a legal entity authorized to undertake custodian operations may conduct settlement operations; and 
• operations as permitted by the FRC.  
Additional criteria for foreign firms: There are no restrictions related to foreign ownership of securities operators 
provided they are registered entities in Mongolia  as limited liability or public limited companies.  
Source: The Mongolian authorities.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 64 - 
 
  4.3.2  Telecommunications 
4 . 8 2 .   I n  a c c e d i n g  t o  t h e  W T O ,  M o n g o l i a  m a d e  f u l l  c o m m i t m e n t s  o n  v a l u e  a d d e d  i n  
telecommunications services in both market access and national treatment for cross-border supply, consumption abroad, and commercial presence; supply through the presence of natural 
persons was unbound, except for horizontal limitations affecting managerial and technical skills in 
short supply in Mongolia.
43 There are no restrictions on foreign investment in telecommunications, 
including mobile services, beyond licensing and other technical requirements, which are applied to 
foreign and domestic companies alike. 
4.83.  Although the information and communication sector employs relatively few people (1.4% of 
total employment) and contributes only 2.6% to GD P, it is critical to the functioning of the 
economy and has grown strongly in both nominal and real terms over the past few years 
(Table 4.21).  
Table 4.21 Information and communicati on to employment and GDP, 2007-12 
 2007 2008 2009 2010 2011 2012
Employment ('000 persons)   
Total 1,024 1,042 1,006 1,034 1,038 1,056 
Information and communication 11 11 10 15 12 15 
GDP (Tog billion current)       
Total 4,957 6,556 6,591 8,415 11,088 13,944 
Information and communication 166 221 216 246 295 369 
GDP (Tog billion constant 2005)       
Total 3,640 3,964 3,914 4,163 4,892 5,493 
Information and communication 132 158 169 180 190 226 
Source: National Statistical Office, Statistical Yearbook  (2007 to 2012).  
4.84.  With a large area and small population, a significant portion of which are nomadic herders, 
telecommunications in Mongolia face particular difficulties. The land-line system is focused on Ulaanbaatar, although the number of land lines has been in decline for some years while mobile phone subscriptions have increased rapidly (Table 4.22). At the same time, internet subscriptions 
have also increased many of which undoubtedly use VOIP. 
Table 4.22 Telecommunications selected indicators, 2005-12 
 2005 2006 2007 2008 2009 2010 2011 2012
Revenue from telecommunications 
services (Tog million) .. .. 246,801 343,405 380,059 401,631 459,007 563,149
Telephone line subscriptions ('000) 151  157 150 152 143 143 132 149
Mobile phone subscriptions ('000) 571  770 1,175 1,746 2,209 2,533 2,942 3,426
Wireless telephone subscriptions
('000) 23  45 25 35 45 45 45 44
Internet service providers (No.) 26  24 34 30 56 77 85 67
Internet cafés (No.) 115  105 105 110 120 200 180 158
Internet subscriptions ('000) 22  26 30 42 106 200 458 696
.. Not available. 
Source: National Statistical Office, Statistical Yearbook  (2007 to 2012).  
4.85.  The Information Technology, Post and Te lecommunications Authority (ITPTA), under the 
Prime Minister of Mongolia, is responsible for developing policy and preparing legislation on the telecommunications sector. Mongolia is a member of the International Telecommunication Union. 
4.86.  Development policy for the information communications sector is set out in the 2013 
Mid-term Strategy for the Development of the IC T Sector, which is being implemented according 
to the E-Government Master Plan, the E-Mongolia National Programme, and the National 
Broadband Programme up to 2015. The objective is to complete a fibre-optic network using 
modern transmission technology (DWDM) with consideration being given for the most recent internet communications protocol (IPv6) with universal data service.  
4.87.  The legal framework for telecommunications is set out in several laws, including: 
                                               
43 WTO document WT/TPR/S/145, 15 February 2005, Table IV.3. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 65 - 
 
  • Law on Communications of 2001, which revi sed the Law on Communications of 1995 and 
sets out the legal basis for the regulation of communications generally in Mongolia; 
• Law on Radio Wave of 1999, which regulates relations on the allocation, usage, 
protection, ownership, and possession of radio waves; and 
• other laws applying to licensing of businesses and competition that apply to 
telecommunications companies, while rules and procedures of the Communications Regulatory Commission of Mongolia provide more detailed regulations under the laws.  
4.88.  The Communications Regulatory Commission  (CRC) of Mongolia was established under the 
Communications Act of 2001 as the independent regulator for the communications sector. Its responsibilities include: competition issues among communications enterprises, networks and services for fixed-line and wireless telecommunications, broadcasting (television, radio, and 
satellite transmission), spectrum management, and regulation of telecommunications, the postal 
services, and the internet. 
4.89.  Until 2007, the backbone network in Mong olia was owned and operated by the Mongolia 
Telecom Company (MTC) of which the State owns 51% and KT of Korea owns 40%. In 2007, the 
fully state-owned Information Communication Network Company (Netcom) took ownership of, and now operates the national backbone and access ne twork, including international, long-distance, 
rural and local transmission networks and local loops.
44 The backbone consists of about 1,400 km 
of digital microwave, 20,000 km of optical cable lines, and more than 400 satellite-based systems 
(VSAT). MTC continues to own the last  mile and switching for voice only. 
4.90.  In addition to the national backbone, Mobicom Corporation, Railcom and Gemnet LLC have 
their own fibre-optic and microwave infrastructure45:  
• Mobicom Corporation, which is the largest mobile phone company in Mongolia, also 
provides internet and satellite services and wireless local loop (WLL); 
• Railcom, a subsidiary of the state-owned Mongolian Railways, leases the lines to the 
Mongolia Telecom Company; and  
• Gemnet LLC, a private company, offers inte rnational transits, internet wholesale, and 
channel-rent services through its 1,118 km of fibre-optic cable, which crosses Mongolia 
and connects with China and Russia. 
4.91.  Mobile phone subscriptions have continued to grow strongly and exceed the total 
population. There are four mobile phone operators. Mobicom is the leader, even though it is also 
the most expensive, as it offers the widest coverage extending to the population centres of each 
province and most soums . With a market share of more than  30%, Mobicom's pricing structure is 
subject to approval by the CRC (Table 4.23 and Box 4.6).  
Table 4.23 Mobile phone charges, 2012 
(Tog per minute) 
 MobiCom Skytel Unitel GMobile 
In network 70 60 0 0 
Out of network 110 70 35 30 
Source: Oxford Business Group (2012), The Report, Mongolia 2012 . Viewed at: 
http://www.oxfordbusinessgroup.com/news/striki ng-black-gold-going-underground-maximise-oil-
potential . 
                                               
44 Information, Communications, Technology and Post Authority of Mongolia (2011), p. 25. 
45 Communications Regulatory Commission online information. Viewed at: 
http://www.crc.gov.mn/en/m ain.php?cid=1&do=5&did=0  [October 2013]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 66 - 
 
  Box 4.6 Telecommunications in Mongolia 
Main actors  
Number of companies providing value-added telecom services:  
NetCom owns and operates most of the backbone. MTC owns the last mile and leases lines from Mongolian 
Railways Authority and NetCom. Gemnet  offers international transit, inte rnet wholesale, and channel rents 
services through its fibre optic cable.  
Name and market shares of the leading co mpanies for mobile te lephones services: 
Number of operators: 4:Mobicom: 42.8%; Unitel: 28.6%; Skytel: 16.7%; and G-Mobile: 11.9% 
Name and market share of the broadband internet services providers: Total: 85; Market leaders (by number 
of contracts, 2012): Gemnet; Mobinet; RailCom  
Foreign ownership participation in telecom companies: Mongolia Telecom Company, 40%; Mobicom 60%. 
State ownership: Mongolia Telecom Company 51% ; Information Communication Network Company 
(Netcom) 
SOE, 100%. 
Establishment of new companies, mergers or closures during the review period: None.   
Interconnection and competition issues 
Interconnection regime: Since 1 February 2012 the CRC has applied a non-discriminatory interconnection 
price and revenue sharing among te lecommunications operators.  
Pricing: Under the Law on Communications, the pricing plan for enterprises that have more than 30% 
market share must be approved by the regulator.  
Regulation 
Regulatory supervision: Under the Communications Act of 2001, the CRC is responsible for regulating the 
communications sector (including post and telecommunications), including competition issues, provision of 
networks and services for fixed and wireless telecommunications, television, radio, satellite transmissions, 
spectrum management, postal serv ices and internet services.  
Facility sharing: BTS towers and shel ters are shared when facilities are financed by the Universal Service 
Fund. 
Number portability: Number portability is not possible. 
Spectrum management: The CRC assigns spectrum based on demand.  
Transparency: Interconnection requirements should be disclosed on websites of telecom companies while 
pricing and interconnection fees are disclosed to the CRC only.  
Universal service: A Universal Service fund started to function at end-2008. Each service provider 
contributes to the fund at a rate of 2% of pre-tax profits.  
Source: The Mongolian authorities.  
4.3.3  Transport 
4.3.3.1  Air transport 4.92.  The domestic aviation market in Mongolia is small, comprising a number of flights linking 
Ulaanbaatar and other principle towns, run by several domestic air carriers, some of which also 
operate regional international flights. The state- owned MIAT Mongolian Airlines does not operate 
domestic flights. The number of domestic and international passengers and the amount of freight 
carried by air transport within, from, and into Mongolia have increased since 2005, and recovered 
quickly from the decline in 2009 (Table 4.24).  
Table 4.24 Air transport selected indicators, 2005-12 
  2005 2006 2007 2008 2009 2010 2011 2012
Freight Tonnes 2,016 2,165 1,887 1,847 1,369 1,642 2,929 4,011 
Mail  445 471 434 401 320 381 429 409 
Luggage  394 325 297 263 349 272 393 480 
Freight  1,177 1,370 1,156 1,183 700 988 2,107 3,122 
Passengers Thousand 335 365 388 366 309 397 574 770 
International  205 234 266 263 236 276 379 442 
Domestic  130 131 122 103 73 121 195 328 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 67 - 
 
    2005 2006 2007 2008 2009 2010 2011 2012
International flights Number 50,545 58,598 65,329 69,922 64,899 72,984 84,077 88,981 
Overflights  47,109 54,537 61,245 65,543 60,778 67,936 77,975 82,628 
Landings/takeoffs  3,436 4,061 4,084 4,379 4,121 5,048 6,102 6,353 
Domestic flights  6,677 6,748 4,330 4,140 4,321 6,748 8,590 10,819 
Source: National Statistical Office of Mongolia, Statistical Yearbook, various issues. 
4.93.  Under Mongolia Civil Aviation Regulation 139, there are 17 airports with licensed 
aerodromes, of which ten are owned and operated by the Civil Aviation Authority of Mongolia (CAAM). These airports include Chinggis Khaan, near Ulaanbaatar, the only international airport in 
Mongolia. Of the 17 licensed airports, 8 have pa ved runways and runway lighting systems. A new 
international airport is under construction near Ulaanbaatar and is scheduled to become operational in 2016. Two new domestic terminals were completed in 2012: Deglii Tsagaan Airport 
in Uvs province, and Altai Airport in Gobi-Altai province.
46 In addition to the 17 airports, there are 
five licensed aerodromes, all owned and operated by the CAAM. 
4.94.  The principle legislation on civil aviation is the Civil Aviation Law of 1999, which states that 
regulations applying to civil aviation should comply with international conventions and agreements 
to which Mongolia is a party. The Ministry of Roads and Transportation is responsible for 
developing policy on air transport while the C AAM is the government agency responsible for 
overseeing and regulating civil aviation, including setting and applying safety standards in 
compliance with the Chicago Convention, and the licensing and certification of air operators. The 
CAAM is also responsible for providing air traffic services, and operating airports.  
4.95.  In 2013 the Parliament approved the State Po licy in the Civil Aviation Sector through 2020. 
The policy recognizes the importance of air transport for a large, landlocked country with a low 
population density, and sets a number of objectiv es including improved regulatory environment, 
gradually opening the sector to competition through "open-skies" agreements, and developing a passenger and air freight hub at the new airport near Ulaanbaatar to service northern Asia. The 
policy also emphasizes the importance of air navigation; in 2009, air navigation services for 
international overflights accounted for nearly all of CAAM's US$72 million income. About US$25 million of this went to the Government.
47 Other aspects of the regulatory regime are 
detailed in Box 4.7. 
4.96.  The CAAM has certified 18 air operators, including 5 foreign operators (Table 4.25). Table 4.25 Certified air transport operators 
Airline Certificate number MCAR 
MIAT Mongolian Airlines AT-003 121 
Aeromongolia AT-009 121 
Eznis Airways AT-011 121 
Mongolyn Alt "MAK" AT-014 135 
A-jet Aviation AT-015 135 
Sky Horse New AT-016 135 
Blue Sky Aviation AT-017 135 
Hunnu Air AT-018 121 
Hunnu Air service AT-018/3 135 
Geosan AT-019 135 
Thomas Air AT-021 135 
Fly Adventure  AT-023 135 
Air Cargo Mongolia AAT-002 301 
Aeroflot FAOC-001 129 
Korean Air FAOC-002 129 
Air China FAOC-003 129 
Tianjin Airlines FAOC-005 129 
Turkish Airlines FAOC-006 129 
Source: The Mongolian authorities.  
                                               
46 ICAO (2013), pp. 7-8. 
47 Oxford Business Group (2012) .  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 68 - 
 
  Box 4.7 Mongolia's market and regulatory regime for air transport subsectors, 2013 
Computer reservation services  
General regulatory framework: There are no specific regu lations relating to comput er reservations services. 
Economic characteristics: Both domestic and foreign based enterprises with or without a branch office in 
Mongolia may provide computer reservation services.  
Selling and marketing of air transport services  
General regulatory framework: Regulation of Civil Air Transportation of 1998 
Aircraft repair and maintenance 
General regulatory framework: Civil Aviation Law of 1999 and Rule 145 on Aircraft Maintenance 
Organisations - Certification 
Number of certified repair stations: 24 operators have been licensed to provide air maintenance operations 
in Mongolia, of which 10 are Mongolian based enterprises. 
Ground handling services 
General regulatory framework: No regulations. 
Main providers: All ground handling  services are provided by CAAM. 
Airport management services 
General regulatory framework: Civil Aviation Law of 1999 and Rule 139 on Aerodrome Certification and 
Operation and Rule 157 on the establishment, use and alteration of Aerodromes. 
Economic characteristics: See Table 4.24. 
Commercial aviation 
General regulatory framework: Civil Aviation Law of 1999 and regulations by CAAM. 
Source: The Mongolian authorities.  
4.97.  Mongolia has 36 bilateral aviation safety ag reements. However, only five of these are active 
(with China, Germany, Japan, Korea, and the Russian Federation)48 and they have been criticized 
for their restrictive coverage and failure to encourage competition, resulting, amongst other things, in high aviation fuel prices.
49 Mongolia is also a signatory to the Multilateral Agreement on 
the Liberalization of International Air Transportation (MALIAT) (with Brunei Darussalam, Chile, 
Cook Islands, New Zealand, Samoa, Singapore, Tong a, United States) for cargo services only, with 
effect from February  2008 (Table 4.26).50 
4.98.  Mongolia is a member of ICAO, and the Civil Aviation Authority is seeking full membership 
of the ICAO TRAINAIR PLUS training development assistance programme in 2014. MIAT Mongolian 
Airlines is a member of IATA.  
                                               
48 Civil Aviation Authority of Mongolia, online information. Viewed at: 
http://www.mcaa.gov.mn/e n.php/page/detail/id/21  [February 2014]. 
49 InterVISTAS LLC (2011), p. 20; and Chem onics International Inc (2011), p. 74.  
50 MALIAT online information. Viewed at: http://www.maliat.govt.nz/country/mongolia.php  
[September 2013]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 69 - 
 
  Table 4.26 Active air services agreements 
Partner 
Date 
Entry into 
force 
5th 
7th 
Cabotage 
Cooperation 
Designation 
Withholding 
Pricing 
Capacity 
Stat 
Active agreementsa 
Russian 
Federation 08/09/1997 08/09/1997 Y N N CS Multi SO DA PD Yes 
Japan 10/07/1999 25711/1993 N N N CS Multi SOE FP and 
DA PD Yes 
Germany 29/05/1998 29/05/1998 Y N N N Multi Other DA PD Yes 
China 08/04/1989 08/04/1989 Y N N N Multi SOE DA PD Yes 
Korea 23710/1991 23/10/1991 N N N CS Single SOE DA PD Yes 
EUb 03/04/2009 n.a n.a n.a n.a n.a n.a n.a n.a n.a n.a 
n.a: Not applicable. 
a Inactive agreements with: Austria; Belarus; Bulg aria; Denmark; Egypt; Finl and; France; Hong Kong, 
China; Iceland; India; Democr atic People's Republic of Ko rea; Kazakhstan; Kyrgyzstan; 
Luxembourg; Macau, China; Malaysia; the Nether lands; Norway; Philippines; Poland; Romania; 
Singapore; Sweden; Switzerland; Thailand; Turkey; Ukraine; United Arab Emirates; 
United Kingdom; Viet Nam. 
b The Agreement between the European Community and the Government of Mongolia on certain 
aspects of air services replaces "certain provisions in existing bilateral agreements between EU 
Member states and Mongolia with an agreement recognising that consistency between EU law and 
provisions of bilateral air serv ice agreements between Member states of the European Union and 
Mongolia will provide a sound legal basis for air services between the European Union and Mongolia and preserve the continuity of such air services."
51 
Note:  "5th" stands for fifth freedom rights; "7th" for seventh freedom rights; "CS"  for code sharing; "IP" for 
in progress; "Stat" for statistics; "Y" for yes; "N" for no; "Multi" fo r multi-designatio n; "Single" for 
single designation; "SO" for su bstantial ownerhip "SOE" for substantial ownership and effective 
control; "PPoB" for principal place of business; "D A" for double approval; "FP" for free pricing; and 
"PD" for pre-determination.  
Source: The Mongolian authorities.  
4.3.3.2  Road transport 
4.99.  With a large surface area, low population  density and an economy that depends on bulk 
exports, road infrastructure is important to th e economy. Furthermore, the amount of freight, 
number of passengers, and number of vehicles using roads have been increasing steadily over the 
past few years (Table 4.27) and are projected to continue increasing as the economy expands and mineral production increases. However, the road network has been characterized as 
"underdeveloped and dilapidated" and "has been  recognized as a bottleneck in the country's 
development."
52 
Table 4.27 Road transport selected indicators, 2005-12 
  2005 2006 2007 2008 2009 2010 2011 2012
Roads     
Hard cover  km 2,279 2,393 2,597 2,671 2,824 3,016  4,063 4,349
Gravel cover  km 1,980 1,980 1,962 2,000 1,994 2,072  1,959 1,959
Improved soil  km  1,868 1,908 1,902 1,874 1,874 1,647  1,611 1,611
Total  km  6,127 6,281 6,461 6,545 6,692 6,734  7,633 7,919
Carried freight  '000 tonnes  8,082 9,189 9,207 9,256 10,564 12,610  25,635 32,899
 million tonne km  311 458 662 782 1,161 1,834  4,910 4,461
Passengers  million  188 191 205 227 229 247  292 314
 million passenger 
km  640 648 870 1,215 1,536 1,480  2,322 2,263
Vehicles passenger cars  87,792 94,442 110,150 127,538 153,906 172,583  208,514 228,650
 trucks  27,435 29,389 33,676 41,138 47,291 61,841  75,090 83,718
 buses  11,067 11,726 13,038 15,780 16,136 16,366  22,547 21,642
 other  3,623 3,960 5,125 6,003 6,735 3,696  6,391 11,463
Source: National Statistical Office of Mongolia, Statistical Yearbook (various issues).  
                                               
51 EU Treaties Office Database on line information.  Viewed at:  
http://ec.europa.eu/world/agreements/prepareCreateTr eatiesWorkspace/treatiesGeneralData.do?step=0&redir
ect=true&treatyId=8261  [February 2014]. 
52 Asian Development Bank (2011), p. 1. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 70 - 
 
  4.100.  Less than half of Mongolia's 6,734 km of roads, have hard cover; these are mostly in and 
around Ulaanbaatar with one hard cover road connecting the capital with the Russian Federation and another under construction to connect with China. Away from Ulaanbaatar and its surrounding areas, most urban centres are connected by gravel  and dirt roads of varying quality. The network 
of hard-cover roads has nearly doubled since 2005  while the number of vehicles has nearly tripled 
and carried freight quadrupled (Table 4.27). 
4.101.  A large portion of vehicles are imported second hand, principally from Japan despite the 
fact that these vehicles are right-hand-drive while traffic in Mongolia drives on the right. The 
import of second hand vehicles is one factor that accounts for the large portion (nearly half) of cars and trucks over 11 years old. 
4.102.  The Ministry for Roads and Transportation is responsible for developing policy and 
preparing legislation on roads and road-based tran sport. Government policy is set out in a number 
of documents including the National Developm ent Strategy 2007-2021, the National Transport 
Strategy for Mongolia, the Transit Mongolia programme, the Mongolian Road Master Plan 
2008-2020, and 15-year investment programme developed by the Ministry of Roads and 
Transportation.  
4.103.  Since the early 2000s, roads policy has focused on construction of five north-south 
highways and one east-west highway, including the Mongolian sections of the Asian Highway 
Network
53 and the Central Asia Regional Economic Cooperation (CAREC) corridors.54 In addition, 
paved access roads from provincial urban centres to the main road network are being constructed. However, it has been reported that, despite a tripling of the road construction budget, from 
Tog 30 billion in 2006 to Tog 94 billion in 2009, results have been modest and well behind 
government targets.
55 
4.104.  Licensing requirements for the provisio n of passenger and freight transport apply to 
foreign and domestic firms (Box 4.8). 
Box 4.8 Mongolia's road transport framework 
Regulatory framework 
Establishment/domestic regulatory framework:  
Licensing requirement: For licences to transport passengers and freight within Mongolia a permit and agreement from 
the Ministry of Roads and Transportation is required along with technical requirements, applied equally to foreigners 
and Mongolian nationals. Licences for transport of good s or passengers between Mongolia and other countries are 
subject to terms of the transport agreement between Mongolia and the other country. 
For passenger transport, the transport company and the Minist ry agree on the transport route, schedule, and type of 
vehicles to be included in the licence. 
Capacity regulation: There are no specific limits to market share in road transport, and there are no exceptions for the 
road transport subsector in the Law on Competition. 
Pricing: There are no regulations on pricing for freight. Pa ssenger transport in Ulaanbaatar is regulated by the city's 
transport department. 
International regulatory framework : 
International transport conventions: Customs Convention on  the International Transport of Goods under the Cover of 
TIR Carnets; the Convention on the Contract for the Intern ational Carriage of goods by Road; and the Convention on 
Road Traffic and on Road Signs and Signals. 
Intergovernmental agreements: Russian Federation, China, Republic of Kazakhstan, Ukraine, Belarus, Turkey, and 
Kyrgyz Republic. 
Source: The Mongolian authorities.  
4.105.  Apart from four public-transport companies operating in and around Ulaanbaatar, all road 
transport enterprises are private sector entities. 
                                               
53 AH4 and AH32 which crosses Mongolia along the ea st-west axis, and AH3 on the north-south axis. 
The highways cross at Ulaanbaatar. 
54 CAREC (4a) connecting th e Russian Federation and China throug h western Mongolia and CAREC (4b) 
connecting the Russian Federation and Chin a through Ulaanbaatar and central Mongolia. 
55 Asian Development Bank (2011), p. 12. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 71 - 
 
  4.3.3.3  Rail transport 
4.106.  Mongolia has a total of 1,815 km of railway. Most of this (1,110 km) is the 
Trans-Mongolian Railway connecting the Trans-Siberian Railway from Ulan Ude in the Russian Federation to Erenhot (and on to Beijing) in China. In addition, there are several spurs from the 
Trans-Mongolian Railway to urban centres or mines in Mongolia (such as Baganuur and Erdenet) 
and, in the east, a spur from the Trans-Siberian Railway that terminates in Choibalsan. Mongolian 
railways use the Russian gauge (1,520 mm), requiring a change to standard gauge (1,435 mm) at 
the border with China.  
4.107.  Mongolia depends on railways to carry freight. About half of freight originates and 
terminates in Mongolia and half is international trade (Table 4.28). A significant, though declining, portion of freight is transit traffic between the Russian Federation and China, about 90% of which 
is crude petroleum and timber carried through Mongolia to China for processing.
56 
Table 4.28 Rail transport selected indicators, 2005-12 
  2005 2006 2007 2008 2009 2010 2011 2012
Total Km 1,815 1,815 1,815 1,815 1,815 1,815 1,815 1,815
Freight turnove r Million tonnes km 9,948 9,226 8,361 8,261 7,852 10,287  11,419 12,143
Carried freight '000 tonnes 15,586 14,800 14,073 14,647 14,172 16,804  18,448 20,445
Local '000 tonnes 7,559 7,337 7,513 8,016 7,656 8,304  8,574 9,890
International '000 tonnes 8,028 7,443 6,560 6,631 6,515 8,500  9,874 10,555
Exit '000 tonnes 1,468 1,814 1,776 2,565 2,955 4,639  5,966 6,576
Entry '000 tonnes 1,166 1,163 1,310 1,727 1,264 1,546  2,018 2,446
Transit '000 tonnes 5,393 4,466 3,473 2,338 2,297 2,315  1,889 1,534
Passengers '000 persons 4,227 4,323 4,482 4,359 3,118 3,516  3,832 4,000
Source: National Statistical Office of Mongolia, Statistical Yearbook (various issues).  
4.108.  Most indicators show a declining or stable tr end for rail traffic, except for international exit 
freight (exports), which increased due to exports of minerals.  
4.109.  The Ministry of Roads and Transport is re sponsible for developing policy and legislation on 
railways. Under Resolution No. 82 of the Government and the 189th Decree of the State Property 
Committee of March 2008, the Ulaanbaatar Railway Mongolian-Russian Joint Stock Venture (UBTZ) became the national operator of railways. UBTZ was 50% owned by RZD of the Russian 
Federation, 25% by the state-owned Erdenes MG L mining company, and 25% by the Mongolian 
Railway State Owned Shareholding Company (MTZ).  UBTZ is the sole operator of the railway. 
4.110.  The Mongolian Railway Authority is the railways regulator. It has the authority to issue 
licences for the construction of new railways. State Policy on Railway Transportation in Resolution 
No. 32 by the Parliament on 24 June 2010, sets out an ambitious project for railway construction of 1,100 km in the first phase, 900 km in the second phase, and 3,600 km in the third phase. The 
first phase would link Oyu Tolgoi copper/gold mine and Tavan Tolgoi coal mines to the existing line 
crossing the country and link this existing line to the spur of the Trans-Siberian line in the east of Mongolia. Construction under phases 1 and 2 started in 2013, with a projected cost of US$5.2 billion and completion date in 2016.
57  
4.3.4  Tourism 
4.111.  In acceding to the WTO, Mongolia made fu ll commitments on tourism and travel services in 
both market access and national treatment for cross-border supply, consumption abroad, and 
commercial presence; supply through the presence of natural persons was unbound. In the 
previous TPR of Mongolia, the authorities indicated that there were no restrictions on foreigners providing tourism services, other than guide-interpreters, who must be Mongolian citizens and 
meet certain training and grading requirements.
58 
4.112.  Mongolia offers a number of attractions ranging from the landscape to historical sites, with 
considerable potential for further development, particularly adventure-based holidays, ecological 
                                               
56 Asian Development Bank (2008b), p. 40. 
57 Ministry of Roads and Transportation (2013).  
58 WTO document WT/TPR/S/145, 15 February 2005, Chapter IV, paragraph 96.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 72 - 
 
  excursions, and winter activities.59 According to the authorities, 412,931 tourists visited Mongolia 
in 2013, representing a sharp decline from the record of 475,892 in 2012. The most recent data 
for receipts from tourism are for 2011 and show a decline compared to earlier years. Furthermore, as the economy has grown rapidly, receipts as a percentage of GDP declined from over 10% in 
2004 to under 3% in 2011 (Chart 4.1). However, the authorities noted that in 2013 tourism 
represented US$262.2 million in exports or 10% of total export earnings for goods and services.  
Chart 4.1 Tourism in Mongolia, selected indicators, 2004-13 
0%2%4%6%8%10%12%
050100150200250300350400450500
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Number of arrivals,
'000 (left axis)
International tourismreceipts, US$ million
(left axis)
International tourism
receipts, % of GDP(right axis)
Source: The Mongolian authorities (number of arrivals ); and World Bank online information. Viewed at: 
http://data.worldbank.org/ [February 2014]. 
4.113.  Data from the National Statistics Office show  that, in 2012, nearly half of all tourists were 
from China and one fifth from the Russian Fede ration. However, the majority of these were 
reported to be small traders.60 In 2013, there were 750 registered tourism enterprises employing 
4,050 people; about 84 of the enterprises had foreign investment. Around 400 hotels offer 
18,000 beds (Table 4.29).  
Table 4.29 Tourism in Mongolia in 2013 
Hotels and ger camps 
Accommodation type Number Numb er rated Beds Rooms and ger 
Hotel 402 61 18,000 6,850 
Tourist camp 349 83 14,000 2,900 
 
Tour operators 
Registered with Mongolian Tourism 
Association Foreign invested companies Employees Drivers 
750 84 2,050 2,000 
Source: The Mongolian authorities. 
4.114.  Several impediments to development of tourism have been identified, particularly general 
infrastructure such as roads, airports, and communications as well as tourist-orientated investment such as hotels, and restaurants. In addition, the rapid expansion of the mining sector 
has attracted many skilled workers away from tourism.
61 
4.115.  The Ministry of Culture, Sports and Tour ism is responsible for policy and preparing draft 
legislation on tourism. The Mongolian National Tourism Center, which was set up in 2009, is responsible for tourism promotion, including promotion of investment in tourism-related facilities. 
Since 2011, the Mongolian Tourism Association (a non-governmental organization) has been 
                                               
59 Bayasgalan (2012).  
60 Oxford Business Group (2012), p. 196.  
61 Ts Orgodol (2012).  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 73 - 
 
  responsible for licensing tourism enterprises. The Tourism Law of Mongolia of 2000, last amended 
in 2010, sets out the responsibilities of the "tourism organization" (the National Tourism Center), grading of hotels and tourist resorts, licences for hotels of 3 stars or more, promotion of tourism, and provision of tourism-related services. According to the authorities, a new law on tourism is 
being prepared, with assistance from the UN World Tourism Organization. 
4.116.  Hotels and tourism resorts catering for foreigners receive the same support and 
depreciation allowances as other export-related enterprises. Tour operators who bring foreign 
tourists into Mongolia (inbound tourism companies) are exempt from VAT.  
4.117.  The general policy for tourism was set out in the Millennium Development Objectives of the 
National Development Policy. Under the government programme for 2012-16, tourism was identified as one of the sectors to be de veloped to reduce dependence on mining.
62 Government 
policy established six regions for tourism developm ent, (roughly speaking, a central, northern, 
eastern, southern, and western region plus the re gion around Ulaanbaatar). The projects covered 
by the regional plans include general infrastructure (airports) as well as tourism/leisure-related 
centres such as theatres, museums, parks, and st adiums, which are to be financed from public 
expenditure.63 
4.118.  According to the authorities, the 2012-16 programme emphasizes special interest, eco, 
and heritage tourism, while the Ministry of Culture, Sports and Tourism seeks to promote 
sustainable tourism through conservation, including protecting the Khangai region, which is the main tourist destination. The Ministry's policy is to support new theme parks, museums, and resort 
complexes through private and public partnership and joint investments.  
4.3.5  Construction 
4.119.  In acceding to the WTO, Mongolia made full commitments on construction and related 
engineering services in both market access and national treatment for consumption abroad and 
commercial presence. Cross-border supply and su pply through the presence of natural persons 
were unbound except for measures affecting the en try and temporary stay of natural persons with 
managerial and technical skills, which are in short supply in Mongolia, and fall within the following 
categories: business visitors, intra-corporate transferees, and professionals under a service 
contract.
64  
4.120.  The construction sector in Mongolia has grown strongly over the past few years and its 
contribution to GDP more than doubled in real terms between 2004 and 2012. However, it has 
followed an exaggerated track of general economic  performance as its contribution to GDP fell by 
over 40% between 2007 and 2009 and then recovered rapidly as the economy improved 
(Chart 4.2). Construction is also important in em ployment, representing 5.6% of total employment 
(Table 4.30).  
4.121.  In line with its contribution to GDP, the gross value of production for construction has also 
increased, reaching Tog 811 billion in 2012. Residential building (including residential elements of 
mixed projects) accounted for 39% of the value of production, while roads and bridges accounted 
for 9%.65  
4.122.  The construction industry faces several natural difficulties, including the harsh climate, the 
risk of earth quakes, and the lack of vocational workers. However, economic growth, urbanization, 
and the low quality of pre-1990 buildings and other construction works have required, and 
continue to require significant investment in the sector. While the sector has expanded considerably since 2004, further investment is prob ably needed to improve the supply and quality 
of housing, other building, and infrastructure throughout the country.  
                                               
62 KPMG Audit LLC (2012), p. 14.  
63 Purevsuren Gombosuren (2011).  
64 WTO document GATS/SC/123, 28 August 1997. 
65 National Statistical office of Mongolia (2013), Tables 9.3-9.5.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 74 - 
 
  Chart 4.2 Construction and GDP, 2004-12 
(Tog billion, constant 2005 ) 
020406080100120
01,0002,0003,0004,0005,0006,000
2004 2005 2006 2007 2008 2009 2010 2011 2012GDP (left axis)
Construction (right axis)
 
Source: National statistical Office of Mongolia, Statistical Yearbook  (2007 to 12).  
Table 4.30 Construction to employment and GDP, 2004-12 
 2004 2005 2006 2007 2008 2009 2010 2011 2012
Employment '000 persons    
Total 951 968 1,010 1,024 1,042 1,006 1,034 1,038 1,056 
Construction 39 49 56 60 67 50 49 52 59 
GDP Tog billion current          
Total 2,152 2,780 3,715 4,957 6,556 6,591 8,415 11,088 13,944 
Construction 50 59 63 106 122 36 107 173 226 
GDP Tog billion constant 
2005          
Total 2,592 2,780 3,017 3,640 3,964 3,914 4,163 4,892 5,493 
Construction 51 59 62 91 58 52 60 82 103 
Source: National Statistical Office, Statistical Yearbook  (2007 to 2012).  
4.123.  The State has played an important role in the expansion of the sector as both 
legislator/regulator and as an important source  of demand: the budget for urban development 
alone was Tog 240 billion for 2013.66 In addition several aid agencies and the Asian Development 
Bank have contributed to specific projects. 
4.124.  The Ministry of Construction and Urban De velopment is responsible for policy formulation, 
coordination of policy implementation, preparing legislation, developing technical requirements, 
monitoring the sector, construction policy, urban development, housing, public utilities. Under the 
Ministry there are a number of state-owned enterp rises including: the Construction Development 
Centre; the Public Housing Corporation; and the Design and Research Development Institution. 
Other ministries are also responsible for aspects of the construction sector related to their responsibilities, such as the Ministry of Roads and Transportation, and the Ministry of Energy. 
4.125.  The construction sector is regulated under several laws including:  
• Law on Construction of 2008, which sets out the responsibilities of each level of 
government at both central and local levels, as well as the legal basis for applying 
technical requirements to buildings and their design, and building materials; 
                                               
66 Mongolian Briefing online information," The Status  of Construction and Urban Development Projects". 
Viewed at: http://mongolia-briefing.com/news/2013/04/the-status-of-construction-and-urban-development-
projects.html  [December 2013]. WT/TPR/S/297/Rev.1 • Mongolia 
 
- 75 - 
 
  • Law on Housing of 2011, which sets out the responsibilities of each level of government 
at both central and local levels. The Law requires the regional and local authorities to develop plans for housing and associated infrastructure, and provides the legal basis for the Housing Finance Corporation under the Ministry; and 
• Land Law of 2002, according to which only Mongolian citizens may own land. Under the 
Land Possession Law, while foreigners and legal entities may not own land, they may have usage rights.
67 
4.126.  The Ministry is also preparing new legi slation on urban development, cadastral system, 
geodesy and cartography, and compulsory purchase of land, as well as developing a building and planning code.
68  
4.127.  Government policy is set out in several documents, including the National Development 
Strategy of 2008, and the Government Action Plan 2012-2016. The State is also directly involved 
in construction through other projects, such as the Urban Development Master Plan to 2020 for Ulaanbaatar, the 100,000 homes project, and th e Sainshand Industrial Complex Project. In 
addition, the authorities noted that the Government intends to develop the main urban centres of 
aimags  and soums .  
4.128.  The rapid growth of the construction sect or and competition for resources from the mining 
sector, along with the relatively short production season, have led to some bottlenecks in access to 
seasonal labour, materials, and design. Some reports have noted the increase in the costs of materials as a result of supply constraints
69, while other reports have stated that the construction 
sector has responded to the shortage of skilled labour by hiring foreign workers.70 There are laws 
limiting the number of foreigners working on building sites and a head tax is applied to foreigners; 
however, it has been reported that they outnumber Mongolians in the construction sector, although there are quotas set for the number of fo reign workers (Box 4.9). Furthermore, the civil 
engineering work already under way and work planned for the near future require participation of 
foreign firms.
71  
Box 4.9 Construction services 
Regulation: The Ministry of Construction and Urban Developm ent is responsible for policy formulation and 
coordinating its implementation, preparing legislation, technical regulations, and overseeing the 
construction, building materials, urban development, land  affairs, housing and public utilities sectors. Other 
government ministries are al so responsible for construction law and re gulation for their area of authority. 
The principal laws on construction are the Law on Construction, the Law on Housing, the Land Law, and 
Law on Utilization of Urban Settlement’s Water Su pply and Sewage. The Ministry is also preparing 
legislative reforms intended to cove r several shortcomings in the current  laws, including urban development 
and a cadastral system. 
Professional associations: Mongolia's profession associations include the Mongolian Constructors' 
Association, Association of Construc tion Material Producers, Association of Engineers, and the Union of 
Mongolian Architects. 
Membership of the appropriate professional association is  required in order to prac tice as an architect or 
civil engineer 
Establishment/licensing requirements: In addition to the general criteria required for all enterprises, 
some specific criteria must be met to obtain a licence to provide construction services, such as 
qualifications of each engineering and technical worker, references from clients and evidence of work, and 
other proof if available. In addition, to obtain a licenc e in Mongolia, a foreign ente rprise must have a licence 
from its country of registration or operation. 
An employment quota for non-Mongolians is set annual ly by government resolution. For the construction 
sector, the foreign employee quota is up to 25% of total employees, depending on the number of 
employees and capital. 
                                               
67 Laws and regulations are availabl e from the Ministry of Construction and Urban Development. Viewed 
at: http://www.mcud.gov.mn  (Mongolian only) [January 2014]. 
68 Baigalmaa (2013).  
69 IMF (2012), p. 9. 
70 Cambridge Education Ltd, MEC LLC (2010), p. 35.  
71 Oxford Business Group (2012), p. 192.  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 76 - 
 
  Recognition of qualifications: Qualifications obtained abroad for architects, civil engineers, and other 
construction service providers are recognized. 
Foreign presence: As of end-2013, there were five foreign architects and civil engineers registered in 
Mongolia. 
Materials: There are no requirements to use domestically  sourced materials for construction works.  
Source: The Mongolian authorities.  
4.129.  The authorities stated that they plan to  reduce the sector's dependence on imports by 
increasing domestic production of some inputs, such as cement, aggregates, and steel, with the objective of becoming self-sufficient within a fe w years. However, there are no requirements to 
use domestically sourced raw materials (Box 4.9).  
 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 77 - 
 
  REFERENCES 
Asian Development Bank (2008a), Financial Sector in Mongolia - Transition to a Market Economy 
Built on Successful Financial Reforms , October. Viewed at: 
http://www.adb.org/sites/default/fi les/CAPE-MON-Financial-Sector.pdf . 
Asian Development Bank (2008b), Transport and Trade Facilitation - Potential for Better Synergies 
in Mongolia, Evaluation Study, SAP:MON 2008-26. Viewed at: 
http://www.oecd.org/count ries/mongolia/42228028.pdf . 
Asian Development Bank (2011), Mongolia Road Sector Development to 2016, Mandaluyong City, 
Philippines. Viewed at: http://mongoliagrowthgroup.com/wordpress/wp-content/uploads/2012/04/ADB-Mongolia-Road-
Sector-Development-Report.pdf . 
Baigalmaa G (2013), Current Situation and Future Trends in Mongolian Construction and Urban 
Development Sector, Vice Minister for Construction and Urban Development, presentation to the 
Poland-Mongolia Economic Forum, Warsaw, 21 January. Viewed at: 
http://www.paiz.gov.pl/files/?id_plik=19416 . 
Bayasgalan S (2012), How to develop tourism in Umnugobi Province,  presentation prepared for 
the UN World Tourism Organization. Viewed at: 
http://asiapacific.unwto.org/sites/all/files/pdf/mongolia_2.pdf  [September 2013]. 
Cambridge Education Ltd, MEC LLC (2010), Labour Market Study in Support of the Technical and 
Vocational Education and Training Project, Final Report,  Millennium Challenge Account-Mongolia, 
Vocational Education and Training Project. Viewed at: 
http://www.labornet.mn/files/LM S%20Final%20Report%20ENG.pdf . 
Chemonics International Inc (2011), Building a Market Economy in Mongolia, Final report of the 
Economic Policy Reform and Competitiv eness Project (EPRC), June. Viewed at: 
http://pdf.usaid.gov/pdf_docs/pdacw516.pdf . 
Chinzorig Batbileg (2008), Land Privatization in Mongolia,  presentation to the International 
Seminar on Land Administration Trends and issues in Asia and Pacific Region, Kuala Lumpur, 
Malaysia, August 19-20. Viewed at: 
http://www.csdila.unimelb.edu.au/pr ojects/PCGIAPLASeminar/report s/presnetation s/9.Land%20Pr
ivatization%20in%20Mongolia%20(1).pdf  [January 2014]. 
Dells K. (2008), Management and Privatization of State-Owned Agricultural Land - Case Studies 
from eastern Germany and Ukraine - lessons learned for countries in transition , FIG/FAO/CNG 
International Seminar on State and Public Sector Land Management, Verona, Italy, 
September 9-10, 2008. Viewed at: 
http://www.fig.net/commission7/verona_f ao_2008/papers/09_ sept/4_4_dells.pdf  [January 2014]. 
Eurasia Capital (2010), Mongolia Daily, 16 June. Viewed at: 
http://www.eurasiac.com/files/mongolia_daily/Mongolia_Daily_160610.pdf . 
European Bank for Reconstruction and Development (2010), Mongolia Country Profile . Viewed at: 
http://www.ebrd.com/downloads/leg al/irc/countries/mongolia.pdf  [February 2014]. 
Galsanbuyan D. (2009), Agricultural Machinery & Technology Revnovation for Food Security and 
Agricultural Sustainability in Mongolia, presentation for the 4th APCAEM GC/TC Meeting, Thailand, 
10-12 February. Viewed at: http://un-csam.org/PPT/mn-index.htm  [January 2014]. 
Goodland G. (2012), Risk management: the case of the livestock sector in Mongolia , presentation. 
Viewed at: 
http://www.fao.org/fileadmin/templates/rome20 07initiative/FAO_WB_TCIO_CC_Meeting_May_201
1/ANDREW_1.PDF .  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 78 - 
 
  Government of Mongolia (2009), National Programme for Food Security, Ulaanbaatar. Viewed at: 
http://gafspfund.org/sites/gafspfund.org/file s/Documents/Mongolia_5_of_9%20National%20Food
%20Security%20Programme.pdf .  
Government of Mongolia (2010), Resolution of State Great Khural, National Action Plan for 
Approval . Viewed at: 
http://mofa.gov.mn/coordination/index.php?option=com_content&view=article&id=182:mongolian
-livestock-national  [January 2014]. 
Hart Nurse Ltd (UK) and Ulaanbaatar Audit corporation LLC (Mongolia) (2012), Mongolia Extractive 
industries Transparency Initiative (MEIT) , Mongolia Sixth EITI Reconciliation Report 2011 , 
November. Viewed at: http://eiti.org/files/Mongolia-2011-EITI-Report-PartI.pdf . 
ICAO (2013), Overview of Civil Aviation Sector in Mongolia, ICAO Working Paper, A38-WP/324, 
EC/37, TE7142, 12 September. Viewed at: 
http://www.icao.int/Meetings/a 38/Documents/WP/wp324_en.pdf .  
IMF (2011), Mongolia: Financial System Stability Assessment , Country Report No. 11/107, May. 
Viewed at: https://www.imf.org/external/p ubs/ft/scr/2011/cr11107.pdf .  
IMF (2012), Mongolia Article IV Consultation and Third Post-Program Monitoring , Country Report 
No. 12/320, November. Viewed at: http://www.imf.org/external/p ubs/ft/scr/2012/cr12320.pdf .  
Information, Communications, Technology and Post Authority of Mongolia (2011), The White Paper 
on ICT Development of Mongolia, Mongolia. Viewed at: 
http://www.forum.mn/res_mat/2 011/White%20Paper %20on%20ICT%20Dev elopment,%20Mongo
lia%20-2011.pdf . 
Institute of Energy Economics, Japan (2012), Country Presentation: Mongolia,  Presentation for the 
group training course in energy policy (B) (Mongolia), August. Viewed at: http://eneken.ieej.or.jp/data/4481.pdf  [February 2014]. 
InterVISTAS LLC (2011), Impact of international air service liberalization on Mongolia, Mongolia 
Economic Policy Reform and Competitiveness Pr oject (EPRC), Ulaanbaatar, March. Viewed at: 
http://s3.amazonaws.com/zanran_storage/www.eprc-
chemonics.biz/ContentPages/2469766420.pdf . 
KPMG Audit LLC (2012), Investment in Mongolia. KPMG Audit LLC. Viewed at: 
http://www.kpmg.com/MN/en/IssuesAndInsig hts/ArticlesPublications/Investment-
2012/Documents/InvestmentInMongolia2012.pdf  [September 2013]. 
Mahul O., Betlete N., Goodland A. (2009), Innovations in Insuring the Poor, Index-based Livestock 
Insurance in Mongolia, IFPRI, 2020 Vision for Food, Agriculture, and the Environment, Focus 17, 
Brief 9, December, Washington. Viewed at: 
http://www.ifpri.org/sites/default/ files/publications/focus17_09.pdf  [January 2014]. 
Ministry of Energy (2013), Development of  Mongolia Energy Sector, Ulaanbaatar.  
Ministry of Roads and Transportation (2013), Railway Developments of Mongolia, presentation to 
the Seminar on the Development of a Comprehensive Transport and Logistics network in 
North-East Asia Subregion 21-22 March, Korean. Viewed at: http://www.unescap.org/ttdw/common/Meetings/TIS /Logistics-in-NEA-2013/Logistics-in-NEA.asp  
[December 2013]. 
National Statistical office of Mongolia (2013), Mongolian Statistical Yearbook 2012, Tables 9.3-9.5, 
Ulaanbaatar. 
Oxford Business Group (2012), The Report, Mongolia 2012. Viewed at: 
http://www.oxfordbusinessgroup.com /product/report-mongolia-2012  WT/TPR/S/297/Rev.1 • Mongolia 
 
- 79 - 
 
  Purevkhuu T. (2009), National disease notification system and legislation and its enforcement on 
HPAI,  presentation for the 2nd OIE regional meeting on strengthening animal health information, 
Tokyo/Kyoto, Japan, 7-10 September. 
Purevsuren Gombosuren (2011), Present Situation of Tourism in Mongolia and Future Trends,  
presentation for the 5th UNWTO Asia/Pacific Executive Training Program on tourism Policy and 
Strategy, 13-16 June, Brunei Darussalam. 
Tovuudorj P. (2013), Mongolian National Energy Agenda and Policy Measures: Scope for 
subregional co-operation, presentation to the Senior Officials Committee on Energy Co-operation 
in Northeast Asia, Eighth Session, UN ESCA P, 10-11 April, Ulaanbaatar. Viewed at: 
http://www.unescap.org/esd/En ergy-Security-and-Water-
Resources/energy/trade_and_cooperation/cooperation/soc8/documents/4-Mongolia.pdf . 
Ts Orgodol (2012), Mongolian tourism must develop, interview in Mongolian Economy, 4 June. 
Viewed at: http://mongolianeconomy.mn/en/w/2269  [September 2013]. 
Tserenpurev T., Osgonbaatar J. (2012), Introduction of Renewable Energy Sector in Mongolia and 
their Policy Environment,  presentation to the Multi-stakeholder workshop on Wind Energy, 
International Renewable Energy Agency, 13-14 April 2012, Copenhagen. Viewed at: http://www.irena.org/Menu/Index.aspx?mnu=Cat&PriMenuID=30&CatID=142  [September 2013]. 
Tur-Od Lkhagvajav (2012), Overview of Micro-finance Regulation in Mongolia,  presentation to the 
Asia-Pacific Forum on Financial Inclustion, Shanghai, 25-27 June. Viewed at: http://www.adbi.org/files/ 2012.06.25.cpp.se ss3.6.lkhagvajav.microfina nce.regulation.mongolia.pd
f [December 2013]. 
U.S. Geological Service (2012), 2011 Minerals Yearbook [Advance Release], December. Viewed at: 
http://minerals.usgs.gov/minerals/pu bs/country/2011/myb3-2011-mg.pdf  
[February 2014]. 
UNCTAD (2013), World Investment Report . Viewed at: 
http://unctad.org/en/pages/PublicationWebflyer.aspx?publicationid=588  [17.02.2014]. 
USAID (2010), Property Rights and Resource Governance  - Mongolia, Washington DC. Viewed at: 
http://usaidlandtenure.net/sites/default/files/country-profiles/full-
reports/USAID_Land_Tenure_Mongolia_Profile.pdf . 
World Bank (2009), Mongolia Livestock Sector Study, Volume I - Synthesis Report, 
Report No. 50277-MN, 15 September, Washington. Viewed at: http://www-
wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2012/06/05/000425970_20120
605105544/Original/502770ESW0P0960phesis0Report0final.docx . 
WWF (2010), Livestock program to help herders approved.  Viewed at: 
http://wwf.panda.org/who_we_are/wwf_offices/ mongolia/?193435/Livestock-program-to-help-
herders-approved  [January 2014]. 
Zorigt D. (2009), The Current State of Energy Sector in Mongolia, Development Trends . Viewed at: 
http://www.mzv.cz/file/760235/Energy_s ector_situation__policy_Eng.pptx . WT/TPR/S/297/Rev.1 • Mongolia 
 
- 80 - 
 
  5  APPENDIX TABLES 
Table A3. 1 State owned enterprises, June 2013 
State-owned companies 
Name Shares owned by the State 
Power Plant-2 shareholding company 100 
Power Plant-3 shareholding company 100 
Power Plant-4 shareholding company 100 
Darkhan power plant 100 
Erdenet power plant 100 
Dalanzadgad power plant 100 
Ulaanbaatar Electricity di stribution network 100 
Erdenet-Bulgan power grid 100 
Baganuur, south-east regional power grid 100 
National electricity distribution network 100 
Western regional power station 100 
Eastern regional power station 100 
Southern regional power grid 100 
Ulaanbaatar power station 100 
Darkhan power station 100 
Baganuur power station 100 
Nalaikh power station 100 
Dulaan Shariin Gol 100 
Altai Uliastai power station 100 
Ulaanbaatar AZZA 100 
Tuv AZZA 100 
Khuvsgul AZZA 100 
Darkhan AZZA 100 
Uvurkhangai AZZA 100 
Arkhangai AZZA 100 
Govi-Altai AZZA 100 
Dornogobi AZZA 100 
Bulgan AZZA 100 
Zavkhan AZZA 100 
Orkhon AZZA 100 
Selenge AZZA 100 
Kharkhorin AZZA 100 
Uvs AZZA 100 
Khovd AZZA 100 
Auto Zam ТТТ 100 
Baganuur AZZA 100 
Erdenesant AZZA 100 
Khargui state-owned company 100 
Talin-Zam state-owned company 100 
Darkhan metallurgical manufacture 100 
MIAT  100 
Khutuliin Tsement Shokhoi 100 
Stock exchange 100 
Orgil Rashaan Suvilal resort 100 
Mongolian Railway 100 
Erdenes MGL 100 
Erdenes Tavan Tolgoi 100 
Medeelel Kholboonii Suljee 100 
Mongolian Post 100 
Mongolian Securities Clearing Ho use and Central Depository 100 
National operator center 100 
Sainshand Industrial complex 100 
Mon-Atom 100 
Biocombinat 100 
Mongol kino negtgel 100 
Geologiin sudalgaanii tuv Ge ological research center 100 
Geological laboratory 100 
National renewable energy center 100 
Liquid fuel transship facilities 100 
National tourism center 100 
Tsagaan Shonkhor 100 
Mongol Tamga 100 
Turiin Uilchilgee 100 
Construction development center 100 WT/TPR/S/297/Rev.1 • Mongolia 
 
- 81 - 
 
  State-owned companies 
Name Shares owned by the State 
Energy development center 100 
Mongol-Us  100 
Zavkhan pedigree breeding center 100 
Bayankhongor pedigree breeding center 100 
Gobi-Altai pedigree breeding center 100 
Khuvsgul pedigree breeding center 100 
Uvs pedigree breeding center 100 
Tuv pedigree breeding center 100 
Sukhbaatar pedigree breeding center 100 
Dornod pedigree breeding center 100 
Dundgobi pedigree breeding center 100 
Umnugobi pedigree breeding center 100 
Bulgan pedigree breeding center 100 
Khentii pedigree breeding center 100 
Civil Aviation general authority 100 
State Bank 100 
Development Bank of Mongolia 100 
Mongolia-Korean oriental medicine center 100 
Biotechnological manufacture 100 
MOH-ZAVKHAN unit 100 
Erchim Corporation 100 
Armono Corporation 100 
Traditional medicine science and industrial corporation 100 
ХХХ Tutorial manufacture 100 
IT Park 100 
Baganuur 75 
Shivee-Ovoo 90 
Autoimpex 51 
Kino art university 51 
Erdenet Uildver 51 
Mongolrostsvetmet LLC 51 
Telecom Mongolia 54.7 
Monsame ХХК 80 
UB Railways 50 
Source: Information provided by the Mongolian authorities.  
 
__________