Why Mongolia’s New Business Reforms Matter
The Mongolian government is reviewing its business licensing requirements to facilitate investments and improve the ease of doing business. The country’s regulatory environment remains complicated for businesses, and lawmakers in Ulaanbaatar are discussing revising a law on business licensing that was adopted two decades ago.
Business reforms are a key part of Prime Minister of Mongolia Luvsannamsrain Oyun-Erdene’s signature New Revival Policy, which aims to kick-start post-pandemic recovery and growth by laying a solid foundation for sustainable economic development.
The new law promises to make business-licensing processes more transparent, less bureaucratic, faster and with an option to apply online. Parliament aims to pass the new business-licensing law before lawmakers go into recess in early July, with the law taking effect on January 1, 2023.
What You Need To Know:
Businesses in Mongolia continue to encounter administrative hurdles and ambiguous rules and procedures, especially at the provincial and municipal levels. Mongolia ranked 110th out of 180 countries on Transparency International’s corruption perception index and 81st out of 190 economies in the World Bank’s ease of doing business survey.
If the new licensing law passes, permitted business activities will be divided into exclusive and basic categories, with a minimum of five and three years of validity, respectively.
The exclusive permits are designed for large businesses in mining, financial services and sectors related to national security.
The revision aims to streamline business procedures and cut the country’s 1,600 administrative permits and licenses to around 400. Review of business license applications would take around 20 days.
Oyun-Erdene's new council will be established to oversee the implementation of and changes to rules governing business-licensing authorities. The council will include representatives from the government, businesses and trade associations.
Oyun-Erdene has called for electronic registration and online licensing services to improve the business climate and cut red tape.
Halving business permit numbers by 2024 is a key part of Oyun-Erdene’s signature New Revival Policy. The move is intended to improve Mongolia’s ease of doing business and corruption perception rankings.
Mongolia recently passed several pieces of legislation as part of the country’s rapid digital transformation under the e-Mongolia program. The legislation touched on open data sharing, personal data protection, cybersecurity, digital signatures and digital assets.
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