ICMC

Posts Tagged ‘Mongolian Law’

Compliance with the Company Law is Mongolia is still a relatively rare thing.  Most companies are not publicly listed and are owned by single shareholders so therefore do not feel the need to follow the Company Law.

Under the Company Law of Mongolia there are a number of decisions which must be approved by a shareholder’s meeting held at least once a year, including the appointment of members of a board of directors, approving annual reports, and the reorganization or liquidation of the company, amongst other matters.

While these aspects of the Company Law may not be strictly enforced in Mongolia yet, they nevertheless remain important features of properly maintaining a company.  Read the rest of this entry »

ULAANBAATAR, MONGOLIA – New Mongolian currency law takes effect on August 9, 2009.  Starting on this date, all Mongolian businesses and agencies must do business in tugrugs (often referred as tugriks), the Mongolian official currency, and not in foreign denominated or foreign currency based rates.

The Government of Mongolia passed the law in July 2009 to better control the currency fluctuations as a response to the sudden devaluation of the tugrug in March 2009.  Mongolian government is taking the currency measures seriously and have passed severe penalties for the offense.  It is well advised for companies to follow the government’s new law.

Sudden Drop in Tugrug’s Exchange Rate

As the saying goes, any port in a storm will do. As the economic downturn seemed to hit its peak around at the end of 2008 and during the first few months of 2009 the Mongolian tugrug grew increasingly weak against foreign currency. While the exchange rate had been hovering around 1170 tugrugs to the US dollar for several years, it suddenly spiked to over 1700 tugrugs per dollar in March. As a result individuals and businesses began to conduct more and more business in US dollars, British pounds or other convertible currencies.

Read the rest of this entry »