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The Law on Permits effective from 1 January 2023

Mongolia • No. 06/2022 • September 2022

On 17 June 2022, the Parliament of Mongolia adopted the Law on Permits (the “PL”) which will come into force on 1 January 2023. The PL will precede the Licensing Law (2001) and intends to provide a unified framework for all licenses and permissions that are currently regulated under numerous different regulations approved by various authorities. The PL aims to reduce the burden on businesses by bringing down the number of licenses and permits (approximately 914 licenses and permits are effective at the moment but will be reduced to 363). We highlight the key changes of the PL and their impact on businesses in the below summary.

Scope of application of the law

In Mongolia, individuals and legal entities can carry out business activities freely unless an activity is prohibited by the law or subject to a license or permission under the Law on Licensing (2001) or other laws and regulations. The main purpose of the PL is to regulate all licenses and permissions under one legislation to the effect that business activities that require a license or a permit are listed under Articles 8.1 and 8.2 of the PL respectively. 
The PL will not apply to grant permissions in certain relations such as land ownership rights, visa and immigration related permits, IP rights, permits required for organizing meetings, gatherings, demonstrations and other public events, the establishment of churches or other religious organizations, representative office or branch of an international or foreign registered NGO.

Key changes

1. Categories of permits

The PL classifies all permits as set out below based on the purpose, terms and conditions, characteristic of business operations, and risk level:

License:

  • activities that pose a risk to national security, public interest, public health, environment or financial stability 
  • professional activities requiring special conditions and terms
  • activities requiring limited use of natural resources and public property for profit and industrial purposes.

Permit:

  • one off activities
  • additional activities to be conducted on the basis of a license
  • activities requiring limited use of natural resources and public property for household purposes.

2. Reducing the regulatory burden on businesses

3. Terms of permits

4. Procedure to grant/extend licenses and permits

5. Revocation of licenses and permits

Contact us

Tsendmaa Choijamts

Director, Tax and Legal services, PwC Mongolia

Tel: +976 70009089

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