During the past 25 years, Mongolia has transformed into a vibrant democracy, with three times the level of gross domestic product (GDP) per capita, increasing school enrolments, and dramatic declines in maternal and child mortality. With vast agricultural and mineral resources and an increasingly educated population, the prospects for long-term development are bright.2 In recent years, however, the country's economy has been on a roller coaster, facing substantial challenges caused by drops in commodity prices and weak fiscal and monetary policies.
The Mongolian economy is largely dependent on its natural resources. According to a survey by the International Monetary Fund in 2015, Mongolia has mineral deposits worth between US$1 trillion and US$3 trillion, with coal, copper, molybdenum, fluorspar concentrates and gold being the principal reserves; to date, only 25 per cent of the country has been geologically surveyed.3 After a sharp slowdown from 2014 to 2016, driven by a fall in commodity prices and declining foreign direct investment (FDI), the economy recovered in strongly 2017. Real GDP grew by 5.1 per cent, buoyed by strong coal exports, a recovery in FDI and improved business confidence.4 According to the National Statistics Office of Mongolia, GDP exceeded 27.3 trillion tugrik in 2017,5 of which the mining sector contributed approximately 22 per cent.6
As at December 2017, total trade turnover increased by 27 per cent (5.5 billion tugrik) from the previous year, reaching 25.572 billion tugrik. Total exports increased by 26 per cent (3.116 billion tugrik) and imports by 29 per cent 2.42 billion tugrik).7 Minerals constituted 89 per cent of Mongolia's total exports (with coal, copper concentrate, non-monetary gold and crude oil making up 83 per cent of the total). Exports of other minerals – iron ore, molybdenum ore, zinc ore and concentrate – constituted 6 per cent of total exports.8
Foreign direct investment (FDI) has also has been a major part of Mongolia's economic growth. FDI averaged US$1,7091.66 million between 2010 and 2018, reaching an all-time high of US$20,903.50 million in the first quarter of 2016 and a record low of US$8,444.70 million in the fourth quarter of 2010.9 Despite the record high, FDI decreased in 2016 and 2017 compared with previous years. However, in the first quarter of 2018, FDI increased by US$18,019.90 million;10 the mining sector attracted 70 per cent of all foreign investment – almost 70 per cent, according to the Bank of Mongolia.11 These statistics show the economy to be highly reliant on world commodity prices and Mongolia therefore faces the same boom and bust cycles as any resources-dependent nation.
The Mongolian capital market is finding its own unique way towards growth. Although capital markets provide the majority of long-term financing for economic development in developed countries, the situation is different in Mongolia,12 as the financial market is dominated by local banks. As at the first quarter of 2016, 95.1 per cent of financial market assets were held by the banking sector. This percentage has remained consistent for the past 25 years of the free economy.13 The other 5 per cent consists of non-bank financial institutions, insurance companies and securities companies.
The key venue for securities trading in the domestic capital market is the Mongolian Stock Exchange (MSE), with 26 years of experience in the sector. The year 2017 was an active and successful one for the MSE. Total market turnover reached 859.2 billion tugrik, the highest in its history and 57.2 per cent higher than the previous record set in 2015.14 However, that total is dominated by the sales of government bonds. In 2017, the equities market contributed 8.9 per cent to total securities turnover, of which corporate bonds constituted 1.2 per cent and government bonds 89.9 per cent.15
The growth of the MSE index in 2017 was the highest in the world.16 During 2017, 106.1 million shares in 134 companies worth 76.4 billion tugrik were traded through 249 securities trading sessions. Of that total, 58.3 per cent (44.6 billion tugrik) was traded through block trading and 41.7 per cent (31.8 billion tugrik) was ordinary trading.17 ITool JSC issued a total of 13.4 million shares to successfully raise 1.3 billion tugrik in November 2017 on the primary market of the MSE.18 This was the only primary market transaction.
Although the growth of the capital market has dramatically increased, the Mongolian primary equity market and the secondary equity market are still having trouble attracting investors. As a result, bigger business entities are more interested in issuing their securities on foreign stock exchanges, where they are able to access larger pools of capital. As at 2016, 30 Mongolian companies, mostly in the mining sector, were listed on foreign exchanges, including those in Canada, Australia, Hong Kong and the United States.19
Still, the MSE is finding its way to a brighter future. In the past 15 years, many foreign companies operating in Mongolia have traded their stocks on foreign exchanges. In that time, the domestic stock market was not closely linked with these other stock exchanges.20 In an attempt to bring the country closer to these foreign exchanges and foreign investors, the Financial Regulatory Commission of Mongolia (FRC) passed a temporary regulation for listing securities registered on foreign stock exchanges on 24 November 2017.21 This regulation streamlines the process for companies listed on certain exchanges to list their securities on the MSE. The first company to get approval from the FRC to list their four million shares on the MSE was the Erdene Resources Development Corporation, originally listed on the Toronto Stock Exchange.22 The MSE sees this as a pivotal turning point in the development of the Mongolian stock market.23
An increase in external debt has had a pronounced effect on the country's economy. At the end of the first quarter of 2017, the total external debt reached US$24.957 million, an increase of US$1.498 million on the first quarter of 2016, according to the Bank of Mongolia.24 The figure for the fourth quarter showed a further increase, to US$27.413 million (US$2.788 million more than in the fourth quarter of 2016).25 In the last quarter of 2017, government external debt increased by US$2.448 million to US$7.317 million, and the Bank of Mongolia's external debt increased by US$234 million to US$2.025 million.26
The challenges being faced by the Mongolian economy led the authorities to request aid from the International Monetary Fund (IMF). The Executive Board of the IMF approved a three-year arrangement under an extended fund facility, with a total amount through a Special Drawing Right of 314.505 million tugrik to support a programme of economic reform.27 The aim of this programme is to stabilise the economy, restore economic confidence and pave the way to economic recovery. A critical pillar of the programme is fiscal consolidation, to reduce the pressure on domestic financial markets, stabilise the external position relative to debt and restore debt sustainability. The plan also includes cuts in non-essential expenditure, a move towards progressive taxation, pension and public financial management reforms, and steps to strengthen the social safety net.28 The government that took office in 2016 has expressed a strong commitment to strengthening macroeconomic policies and implementing structural reforms to stabilise the economy and lay the foundations for sustainable, inclusive growth in the future.29
II CAPITAL RAISING
i General overview of the legal framework
Mongolia has relatively few general laws directly related to the capital market. That said, there are several key pieces of legislation that make up the foundation of the country's capital market regulatory framework: The Civil Code, The Company Law, The Investment Law and The Securities Market Law. Following the development of the capital market in recent years, the Parliament of Mongolia has passed more specific laws, such as The Investment Fund Law and The Asset-Backed Securities Law.
The Securities Market Law
The main legislation to regulate and establish the basic relations of the capital market is the amended Securities Market Law, passed on 24 May 2013. It replaced a law that had been in effect since 2002. The purpose of the renewed legislation was to set out the legal framework for Mongolia's developing capital market. It has expanded the definition of securities and introduced new financial instruments, such as depositary receipts, asset-backed securities, warrants and derivative financial instruments, including option contracts and future contracts.30 To support the development of the capital market, the amended law also introduced new international possibilities for both domestic and foreign investors and issuers of securities.31 The amended Securities Market Law also introduced new financial and capital market services, including investment funds, private pension funds, insurance funds, investment banking and custody banking services.32
The Law regulates the main procedures of capital raising through the issuance of securities. The issuer can be the government, governors of provinces or the capital city (Ulaanbaatar), and private companies.33 Securities may be issued for sale by way of public offering or closed subscription.34 A public offering of securities on the primary market should be targeted at a minimum of 50 investors. If the initial prospectus of the securities provides that the securities shall be offered by way of closed subscription, the securities must be offered through closed subscription.35
The issuer must submit its request and a securities prospectus to the FRC and register the securities before offering them to investors.36 The prospectus must include information regarding the securities issuer, its shareholders, management, organisational structure and governing persons, the assets, debts, financial condition, present and future outlook, and risks relating to the securities issuer, the securities being issued, the rights evidenced by such securities, the procedures for trading the securities and independent opinions.37
Securities issued by Mongolian companies can be traded in foreign markets and vice versa.38 Article 18 of the amended Securities Market Law specifically provides a legal entity 'registered in a foreign jurisdiction'39 with the ability to 'register with the MSE and trade its securities'.40 The amended Law expressly provides the opportunity for dual or secondary listings by foreign entities, though permission must be obtained from the FRC prior to registration with the stock exchange.41
The Investment Law
While developments in Mongolia's securities market may be significant to raising capital in the mining sector, the passing of the Investment Law on 3 October 2013 and amendments to the Minerals Law on 1 July 2014, 9 April 2015, 14 May 2015 and 21 July 2016 have had a pivotal role in encouraging increased foreign investment into the country. The Investment Law's stated purpose, provided in Article 1.1, is 'to protect the legal rights and interests of investors within the territory of Mongolia . . . to promote investment, to stabilise the tax environment, and to determine the powers of government organisations and the rights and obligations of investors'.42 Enacted in October 2013, the Investment Law replaced both the Law on the Regulation of Foreign Investment in Entities Operating in Strategic Sectors and the Foreign Investment Law. With the inclusion of several articles intended to level the playing field between foreign and domestic investors, the Investment Law also streamlined the registration process for foreign-invested entities and relaxed the restrictions on investment by foreign state-owned entities.
A permit, issued by the Ministry of Finance, is required for investments of 33 per cent or more of a company's shares by a foreign state-owned entity in the mining, banking and finance, or media and communication sectors.43 The law defines foreign state-owned entities as those entities with 50 per cent or more of their total issued shares 'owned, directly or indirectly, by a foreign state'.44 These restrictions are intended to limit the entry, the influence and dominance of foreign state-owned entities in national strategic sectors. In addition to restrictions placed on foreign state-owned entities, the Investment Law effectively increased the minimum share capital requirement for foreign investors. While the former Foreign Investment Law required a minimum capital investment of US$100,000 for foreign-invested entities,45 the new Investment Law stipulates that capital contributions must be US$100,000 per foreign investor, which is not required for Mongolian investors.46 Foreign-invested entities already incorporated in Mongolia were grandfathered in under the previous capital contribution mandates and have not been required to meet the new per-investor minimum thresholds.
In partial contrast to the Investment Law's restrictions on investment outlined above, the law has also paved the way for a streamlined company registration process. Foreign-invested entities are not required to hold both a company certificate and a foreign-invested company certificate. All company registration renewals and establishment processes are carried out solely through the Legal Entity State Registration Office, a sub-office under the country's overarching Intellectual Property and State Registration Office. In addition, the Investment Law, Chapters 5 and 6, provides investors with the ability to secure tax stabilisation certificates47 or investment agreements (or both).48 Investment agreements may be established between the government and investors who 'will make an investment of more than MNT 500 billion . . . for the purpose of stabilising its operational environment'.49 With regard to stabilisation certificates, the Investment Law includes several criteria that will be used to determine whether an entity may be issued with a certificate. Article 14 provides that the following types of taxes may be stabilised under the law: corporate income tax, customs duties, value added tax and mineral royalties.50 The law also has non-tax promotion policies for investors, such as extended terms for allocating land to investors and the issuance of multiple-entry visas for investors travelling to Mongolia.51
The Invest Mongolia Agency, which is in charge of issuing stabilisation certificates, was restructured as the National Development Agency (NDA) as of 14 May 2017. The NDA is responsible for issuing the above-mentioned certificates but has not yet implemented this new practice.
The new government of Mongolia, established by virtue of the election held on 28 June 2016, established a Council on 3 August 2016 to protect the interests of investors. The Council is set up as part of the Cabinet Secretariat of the government and reports directly to the Prime Minister. The primary functions of the Council are to protect the interests of investors, to collaborate with them in a legitimate way, to mitigate possible risks and to effectively address in-country dispute cases with investors.52 The Council will also address dispute issues raised by investors in an efficient and constructive way. The Council has been in operation since 28 December 2016.53
The government also adopted a new regulation with respect to dispute resolution, under which the Council must review and comment on every single contract that will be entered into between foreign investors and stated-owned companies or quasi-state-owned companies.54 This regulation may help to prevent or resolve potential disputes between parties before they are forced to pursue overly complicated judicial proceedings.
ii Market overview
According to the Bank of Mongolia's latest report on foreign investment, of 31 December 2017, total FDI was equal to US$18 billion.55 The majority of FDI was by nations such as the Netherlands, China, Luxembourg, the British Virgin Islands, Singapore, Canada, Korea and the United States. In 2016, the largest investor by country listed was China, which constituted 26.89 per cent of all FDI by country. Canada followed closely with 23.64 per cent. In 2017, however, Canada narrowly outpaced China and constituted 25.58 per cent of all FDI, with China accounting for 25.56 per cent.56 The Bank of Mongolia reported that as at the third quarter of 2017, FDI was US$702 million, of which US$285 million came from Canada and US$155 million from Luxembourg; 79 per cent of all FDI was made in the mining sector.57
According to the Bank of Mongolia, as of the fourth quarter of 2017, inflows of FDI were US$792 million. Of that sum, investment in the mining sector amounted to US$552.76 million, a significant increased (of US$228.7 million) compared to the same quarter of 2016. During this period, the countries by investment volume listed were Canada (50 per cent), the United States (9 per cent), the Netherlands (8 per cent) and China (5 per cent), all of which have been major players for many years.58 With respect to the mining sector, it has been dominated by three main actors – Tavan Tolgoi (coal producer), Oyu Tolgoi (gold and copper) and Erdenet (copper and molybdenum).59
iii Structural considerations
The amended Securities Market Law contains a number of considerations for structuring a capital-raising transaction, in addition to those described above. Generally, the Law now incorporates important requirements relating to increased transparency and ease of capitalisation. An application to register securities for approval for a public offering on the MSE must contain an application form, a detailed securities prospectus, documentation that evidences 'payment of regulatory service fees' and other items determined by the FRC's implementing regulations.60 A securities prospectus should contain specific information required by the law. In addition, Article 10.6 requires that all prospectuses be reviewed for accuracy by an authorised law firm or legal entity.61 The appointed firm or entity will thereafter issue an opinion regarding the veracity and accuracy of the information included, which will form a part of the prospectus for later review by potential buyers.62
During an initial public offering of the shares of an open joint-stock company, a securities issuer will be required to engage a legal entity to carry out underwriting activities.63 In addition, any prospective buyers of securities will be entitled to view the issuer's security prospectus free of charge.64 The amended Securities Market Law also contains reporting requirements for securities sold on the MSE, which should show evidence that the issuer is in compliance with all legal and regulatory guidelines.65
As indicated above, many of the procedures to be implemented under the amended Securities Market Law are the responsibility of the FRC, which is tasked with devising a plethora of regulatory activities, which include:
- approving procedures related to issuing securities via a public offer;
- application requirements for the registration of securities;
- establishing regulations related to issuing and registering depositary receipts;
- establishing regulations related to registering company debt instruments; and
- issuing regulations pertaining to the purchasing and sale of shares in a listed company.
These are just a fraction of the regulatory obligations with which the FRC has been tasked. It has taken time for the FRC to fully implement the Securities Market Law; however, the structural foundation has been laid and, as stated previously, the amendments to the Law mark a decisive improvement to Mongolia's overall capital market framework.
With an improved legal framework in place, the MSE has also diligently collaborated with regulatory authorities and foreign development partners. For instance, the Project for Capacity Building of Capital Market in Mongolia has been implemented by the Japanese International Cooperation Agency in cooperation with the MSE.66 The aim of the Project has been to enhance the credibility of the Mongolian capital market through several improvements to the legal framework, the capacity of market participants, and expanding the routes for Mongolian companies to raise capital from domestic and foreign markets, which was completed in December 2017.67 These continuous efforts to improve the capital market will undoubtedly prove beneficial to the country and attract more foreign investors to the mining sector.
iv Tax considerations
The Mongolian tax regime and tax rates are highly favourable compared to other developing countries. The government has been keen to improve tax regulations in order to make the country more attractive to foreign investors, while being mindful not to discriminate against local taxpayers. The general income tax rate for corporate activities has been constant at 25 per cent since 2012.68 If a corporate entity's taxable income for a year is 3 billion tugrik or less, the entity is taxed at a rate of only 10 per cent.69 Interest income and income derived from dividends and royalties is also taxed at the 10 per cent rate.
With the exception of the tax consideration included in the Investment Law, there is no unique tax structure that applies specifically to the mining industry. Corporate mining entities, whether domestic or foreign-invested, are taxed in accordance with the provisions of the Law on Economic Entity Income Tax. This law applies to any economic entities formed under the laws of Mongolia, their subsidiaries, representative offices,70 foreign economic entities with headquarters located in Mongolia,71 and foreign economic entities or their subsidiaries earning income in Mongolia.72 Gross taxable income deductions, many of which may be utilised by mining entities, are found in Article 12 of the Law on Economic Entity Income Tax.73 The deductions are numerous and include a variety of expenses, including social and health insurance premiums,74 raw materials, primary and auxiliary materials,75 employee bonuses, incentives and allowances for housing and transportation.76 Corporate entities may also deduct for maintenance expenses, lease payments, loan interest, customs duties, transport and labour safety expenses, and more.77
Other significant taxes that may apply to legal entities, including foreign-invested entities, are value added tax and customs duties. Any legal entity that is engaged in imports or exports of goods, the sale or manufacturing of any goods, performance of work or rendering of services in the territory of Mongolia are liable for value added tax.78 The rate payable is 10 per cent of the total sales amount of the goods, jobs or services that are subject to value added tax.79 Most imported goods are subject to a 5 per cent import duty.80
Tax exemption and incentives
With the passing of the Investment Law, several new tax incentives became available to investors. Chapter 4 of the Law, entitled 'Promotion of Investment', contains a number of incentives, which include the possibility for:
- exemption from taxes;
- provision of tax rebates;
- estimation of depreciation costs that could then be excluded from taxable income;
- having losses excluded from taxable income; and
- exclusion of employee training costs from taxable income.81
The general requirements for obtaining a stabilisation certificate are directly connected to the amount of the investment, with a minimum requirement of 10 billion tugrik. There is, however, an exception for businesses in the mining and heavy industry sectors. If an investor in these sectors wants to obtain a stabilisation certificate, the minimum investment value must be greater than 30 billion tugrik.82 In addition, the investment project must show that an environmental impact assessment has been conducted, if required.83 Investors must also demonstrate that they are using advanced technology84 and that a 'sustainable workplace' has been created.85
A stabilisation certificate allows investors to lock in a favourable tax rate for a given period of time.86 The duration of a stabilisation certificate will be determined by the total amount invested and the location in which an investment project is to be undertaken.87
Mongolia has entered into bilateral tax treaties with 25 countries, which limits the tax rate at certain levels and may give taxpayers an option to avoid double taxation in Mongolia and their respective countries. The list includes many major contributors to the global economy, such as China, France, Germany, Korea, Russia, Singapore and the United Kingdom.88
As the Mongolian economy is heavily dependent on natural resources, it is highly vulnerable to external factors such as falling global commodity prices or currency depreciation. After enjoying significant economic growth in 2011, Mongolia faced serious deficits owing to the dramatic fall in commodity prices of coal and copper in 2012. The country is still struggling to fully recover from this economic downturn.
To tackle the challenges facing the country's economy, the government has followed a programme proposed by the International Monetary Fund (IMF). Mongolian authorities met all quantitative performance criteria as required by the deadline of the end of March 2018.
Regarding structural reforms, the government has recently submitted two tax administration laws originally due in February 2017. In relation to the IMF programme, amendments to the Bank of Mongolia Law were passed in January 2018. Further, the government plans to pass a Recapitalisation Law, and the approval and publication of a non-performing loan resolution strategy is in progress but not yet complete.89
As a result of the IMF programme and the positive projection for the global commodity economy, the Mongolian economy got back on track faster than expected. Fiscal performance continues to be robust, with a 2.1 per cent of GDP primary surplus in the first quarter of 2018. However, after the strong capital inflows of 2017, the balance of payments has moderated in recent months owing to an acceleration in imports, a decline in donor flows, temporary border bottlenecks for coal exports and bond repayments.
Mongolia is also trying to achieve an investment-friendly environment and is constantly aiming to improve the applicable laws, rules and regulations. The Ministry of Finance and the tax authorities are planning to amend the old corporate income law as part of a recent push for tax reform. Further, the government has adopted a new stage in its legislative process, for holding public hearing sessions and receiving comments from stakeholders.90 The Ministry of Mining and Heavy Industry is also implementing the same methods and inviting the private sector to participate in the process of drafting the new Mining Law. Even if the government is reluctant to actually incorporate the comments and suggestions from the private sector, their inclusion in the conversation is an important step. These developments show that the government recognises the importance of a stable and engaging legal regime for crucial business sectors and investors.91
1 David C Buxbaum is the managing partner, and N Dean Boyer and Munkhbayar Batkhuu are licensed attorneys at Anderson & Anderson LLP.
3 UK Trade and Investment, Guidance, 'Doing Business in Mongolia: Mongolia's trade and export guide', updated 8 February 2018, https://www.gov.uk/government/publications/exporting-to-mongolia/exporting-to-mongolia.
5 The actual figure is 27,309,701,054,595.58 tugrik.
7 Foreign Trade Review, https://www.mongolbank.mn/documents/statistic/externalsector/tradebalancereview/2017/12e.pdf.
9 'Mongolia Foreign Direct Investment', https://tradingeconomics.com/mongolia/foreign-direct-investment.
12 The Northeast Asian Economic Review, Vol. 3, No. 2, October 2015, Capital Market Development in Mongolia, at 18.
13 Mongolian financial structure research 2016, https://marketinfo.mn/sudalgaa/zah-zeeliin-sudalgaa/10.
14 Annual Report of MSE 2017 at 4.
15 ibid., at 10.
16 Interview with the chief executive officer (CEO) of the Mongolian Stock Exchange, https://www.pressreader.com/mongolia/the-ub-post/20180207/281496456735152.
17 Annual Report of MSE 2017, at 10.
19 The Northeast Asian Economic Review, Vol. 3, No. 2, October 2015, Capital Market Development in Mongolia, at 22.
22 News article from Erdene Resource Development Corporation, 14 June 2018, https://www.erdene.com/site/assets/files/4039/2018-06-14_nr-2.pdf.
24 External Debt Statistics of Bank of Mongolia, https://www.mongolbank.mn/documents/statistic/externalsector/bopreview/bopreview_201701e.pdf.
25 External Debt Statistics of Bank of Mongolia, https://www.mongolbank.mn/documents/statistic/externalsector/bopreview/bopreview_201704.pdf.
27 IMF Press Release No. 17/193.
29 IMF Press Release No. 17/198.
30 Securities Market Law, Articles 5.1, 4.1.7.
31 id. at Articles 17, 18.
32 Introduction to the Securities Market Law, 2013, http://mba.mn/media/mba/content/holbooni%20medeelel/Unet_tsaasnii_tuhai_huuliin_taniltsuulga-2013.pdf.
33 Securities Market Law, Article 7.1.
34 id. at Article 6.1.
35 id. at Articles 11.1, 11.2.
36 id. at Article 9.1.
37 id. at Article 10.3.
38 Introduction to the Securities Market Law (see footnote 32).
39 Sara K Phillips and David C Buxbaum, The Mining Law Review, Third Edition (editor, Erik Richer La Flèche), Law Business Research (2014).
40 Securities Market Law, Article 18.1.
42 Investment Law, Article 1.1 (2013) (Mong.).
43 id. at Article 21.1.
44 id. at Article 3.1.11.
45 Foreign Investment Law, Article 11.1 (repealed 2013) (Mong.).
46 Investment Law, Article 3.1.5. (2013) (Mong.).
47 id. at Article 15 (2013) (Mong.).
48 id. at Article 20 (2013) (Mong.).
49 id. at Article 20.1.
50 id. at Articles 14.1.1 to 14.1.4.
51 id. at Article 12.1.
54 Government Resolution No. 160, dated 7 June 2017.
55 External sector overview, Bank of Mongolia, https://www.mongolbank.mn/documents/statistic/externalsector/bopreview/bopreview_201704.pdf.
58 External sector overview, Bank of Mongolia, https://www.mongolbank.mn/documents/statistic/externalsector/bopreview/bopreview_201704.pdf.
59 International Journal of u- and e- Service, Science and Technology, Vol.9, No.3 (2016), 'Foreign Direct Investment in the Mongolian Mining Sector', at 255.
60 Securities Market Law, Article 9.5 (revised 2013) (Mong.).
61 id. at Article 10.6.
62 id. at Articles 10.6, 10.7.
63 id. at Article 11.3.
64 id. at Article 11.4.
65 See, generally, Securities Market Law, Article 12 (revised 2013) (Mong.).
68 Trading Economics, https://tradingeconomics.com/mongolia/corporate-tax-rate.
69 Law on Corporate Income Tax, Article 17.1.
70 id. at Article 3.1.1.
71 id. at Article 3.1.2.
72 id. at Article 3.1.3.
73 id. at Article 12.
74 id. at Article 12.1.3.
75 id. at Article 12.1.1.
76 id. at Article 12.1.4.
77 id. at Articles 12.1.6, 12.1.7, 12.1.10, 12.1.14, 12.1.21, 12.1.23.
78 Law on Value Added Tax, Article 5.1.
79 id. at Article 11.1.
81 Investment Law, Articles 11.1.1-11.1.5 (2013) (Mong.).
82 id. at Articles 16.2 to 16.3.
83 id. at Article 16.1.2.
84 id. at Article 16.1.4.
85 id. at Article 16.1.3.
86 id. at Articles 14.1.1 to 14.1.4.
87 id. at Articles 16.2 to 16.3.
89 International Monetary Fund, Executive Summary, 8 June 2018.