Jurisdiction - Mongolia
Reports and Analysis
Mongolia – Regulatory Framework For Investment: Overview.

5 November, 2013


Legal News & Analysis – Asia Pacific – Mongolia


The key features of the Investment Law are:


  • It applies to both foreign and domestic direct investments.
  • It consolidates the registration process for setting up a subsidiary by stipulating that private investment from foreign sources need only register with the Legal Entities Registration Office (“LERO“).
  • No approval requirements are imposed on foreign private investment.
  • It increases the minimum capital requirements for foreigninvested entities in Mongolia which have two or more foreign shareholders by requiring that each foreign shareholder contributes US$ 100,000 if foreign investor(s) hold a 25% or more interest therein.
  • It provides the definition of a foreign state-owned legal entity (“FSOE“) as “a legal entity in which a foreign state directly or indirectly holds more than 50 per cent of the entity’s issued shares”.
  • It removes the classification of strategic economic sectors for foreign private investment, but maintains the approval requirements for certain equity investments made by FSOEs in those sectors that were regarded as strategically important under the SFI Law.
  • It appoints the Ministry of Economic Development (“MED“) as the approval authority for certain investments by FSOEs.
  • It establishes an ad hoc board with a mandate to issue opinions on applications for tax stabilisation certificates made under the Investment Law.
  • It provides legal guarantees to protect investment in Mongolia and sets out tax and non-tax incentives so as to promote investment in Mongolia.
  • It offers tax stabilisation incentives in the form of “tax stabilisation certificates” and “investment agreements”.

In addition to the repeal of the SFI Law and the Foreign Investment Law, 9 other laws, including the Law of Mongolia on the State Registration of Legal Entities, enacted on 23 May 2003, as amended (“Legal Entities State Registration Law“), are amended in order to implement the Investment Law. Further, the Law of Mongolia on the Implementation Procedure for the Investment Law (“Implementation Procedure“) was approved to provide for application of the Investment Law to existing investment.




2. Scope Of The Law, State Regulation Of Investment

3. General Framework For Investment

4. General Legal Guarantees And Obligations

5. Promotion Of Investment

6. Sanctions, Conclusion


Hogan Lovells


For further information, please contact:


Michael Aldrich, Partner, Hogan Lovells
[email protected]


Chris Melville, Partner, Hogan Lovells
[email protected]


Anthony Woolley, Hogan Lovells
[email protected]


Nominchimeg Odsuren, Hogan Lovells
[email protected]


Solongoo Bayarsaikhan, Hogan Lovells
[email protected]


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