Like many countries around the world, Mongolia`s economy contracted by 5% due to the economic impact of the COVID-19 pandemic. Nevertheless, circumstances have created a number of new government-backed restructuring, lending and financing initiatives in the market to provide additional support to mitigate the impact on businesses and households. Prime Minister Luvsannamsrain Oyun-Erdene came to power in early 2021 and immediately launched and led a 30-year long-term development policy for Mongolia (Vision-2050), which was approved by the Great Hural State in 2020. In 2020, a new $600 million Mongolian government bond (the « Nomadic Bond ») was also issued to repay the five-year Mazaalai bond, which matured in April 2021. Undraa Sergelenbaatar is a partner at Melville Erdenedalai LLP. His practice covers various aspects of corporate and commercial law, with a particular focus on corporate, banking, finance, securities, mining, infrastructure projects, compliance and regulatory law. Prior to joining the firm, Undraa worked for 8 years as a senior legal and compliance lawyer in a leading Mongolian mining conglomerate listed on the Hong Kong Stock Exchange. She is a member of the Mongolian Bar Association and admitted to the Bar Association in Mongolia. As part of these amendments, a new concept of « ultimate owner » was introduced, which was later replaced by « final owner », which was defined in April 2018 in the amendment of the previous Law on Registration of Legal Entities to meet the definition of the Money Laundering and Terrorist Financing Act.
Under such a change, ultimate owner is defined as a person who, alone, or persons who, collectively, directly or indirectly, exercise a substantial share of control over the corporation, its business and assets. Under the proposed amendments under the revised tax laws, the definition of ultimate holder has been further revised to be a person holding more than 30% of the shares or voting rights in legal entities holding exploration and mining licenses, land rights, petroleum and radioactive licenses. Under current IRS law, a sale of shares held directly or indirectly in a legal entity holding exploration or mining licenses and/or land ownership rights is treated as a « rights sale » related to exploration or mining licenses or land ownership rights subject to a 30% withholding tax. o Law on the Military Duty of the Citizen and the Legal Status of Soldiers The Military Investigation Service is part of the Criminal Investigation Department of the National Police Department. Investigators are plainclothes police officers who have been specially trained to solve military crimes. The military criminal investigation procedure corresponds to that of the civilian judicial system. In order to promote the secondary listing of foreign and domestic legal entities, the Financial Supervisory Authority approved in January 2018 the « Rules on Secondary Listing of Securities of Legal Entities Listed on a Foreign Stock Exchange in Mongolia and Listing of Securities of Legal Entities Listed on the Mongolian Stock Exchange for Listing on Foreign Exchanges. The Mongolian legal system was influenced by the Romano-Germanic legal system between civil law and public law.
In 1924, after the declaration of Mongolia`s first constitution, the nation established military justice systems with the help of Soviet military legal advisers. After the constitutional amendments of 1940 and 1992, there were some changes in the military justice system. Until 1992, Mongolia shared a military justice system with Russia, but fundamental changes began in 1992 after the adoption of a constitution based on democracy and freedom. Today, Mongolia has military justice systems based on the disciplinary rules of the Mongolian Armed Forces. these rules are approved by the President, as are the rules on extrajudicial sanctions. All criminal and civil cases are dealt with by the civil judiciary. The firm offers its clients a range of services in key business areas related to Mongolia`s development and growth. Our work in the country is multifaceted and covers a variety of legal industries and disciplines, including: There are also no defense lawyers specifically dedicated to the military justice system. Anyone who qualifies as a civilian lawyer may also serve as a defence lawyer in the military. The role of defence counsel includes advising and advising on legal matters, drafting motions, appeals, motions and other types of legal documents, participating as a representative or counsel for the client`s defence in administrative proceedings, and participating as counsel for the client`s defence in criminal proceedings. Sidley has acted on behalf of Mongolian public and private companies, investors, international corporations, private equity funds and international banking institutions.
Our lawyers currently serve as lead counsel on several major transactions in Mongolia. You can see a list of representative questions in the « Experience » section below. There are no prosecutors specifically for the military in Mongolia. On the contrary, civilian prosecutors who meet the requirements of legal education also serve as prosecutors in the military judiciary. The prosecutor must be a Mongolian citizen, have at least a law degree, have legal professional experience, preferably in prosecution, meet the professional qualification requirements and have no criminal record. In accordance with Article 9 of the Investment Law, the Investment Protection Council of Mongolia (the « Council ») was established by Government Decision No. 10 of 3 August 2016 and Prime Minister`s Decree No. 136 of 22 December 2016. The main tasks of the Council are to assist and provide services to the Government of Mongolia (the « GoM ») with respect to the protection of investors, legal rights and interests in accordance with the Government`s top priority and to organize negotiations for the settlement of disputes between investors and the Government or government agencies.
The Council conducts and carries out its activities under the authority of the Government and the Secretary of the Supreme Cabinet. Sidley is involved in some of the largest projects currently underway in Mongolia. Our team is familiar with the policy and legal frameworks that influence the implementation of large-scale initiatives, including those that are expected to involve significant foreign investment. We reviewed relevant new foreign investment laws in Mongolia and parliamentary regulations supporting a number of proposed projects. Our lawyers have prepared, reviewed and submitted tenders and tenders for the award of major contracts in accordance with Mongolian tender rules. In addition, we have drafted concession contracts, joint venture documents, technical and financial advisory agreements, and engineering, procurement and construction contracts. The range of legal services in Mongolia is divided between international and Mongolian law firms. Local Mongolian companies practice Mongolian law and international firms practice international law, although cooperation between the two is common, as the various offerings are complementary in certain circumstances. Local companies continue to dominate the market, with Melville Erdenedalai LLP, MahoneyLiotta LLP and KhanLex Partners LLP leading the way in corporate, banking and financial services. MDS & KhanLex LLP is another leading national firm. Australian law firm Minter Ellison Lawyers is a particularly strong international law firm that operates in the jurisdiction and offers a similar offering to local law firms while offering international expertise.
4.8 Publication and entry into force of legislation On 3 December 2015, the Mongolian Parliament adopted the revised version of the Criminal Code. The revised Penal Code entered into force on 1 November. September 2016. According to the revised Criminal Code, offences are divided into two types depending on the length of the custodial sentence: (i) minor and (ii) serious. There are five types of sanctions: (i) fine, (ii) community work (forced), (iii) restriction of the right to travel, (iv) imprisonment and (v) deprivation of rights. Legal persons, as well as persons who have committed offences in the territory of Mongolia, are now subject to criminal prosecution under the revised Criminal Code.