(2022-09-02-ны өдрийн орчуулга)                                                    Unofficial translation

LAW OF MONGOLIA

April 22, 2022                                                                                            Ulaanbaatar city

ON TREASURY FUND

/Revised edition/

CHAPTER ONE

GENERAL PROVISIONS

Article 1.Purpose of the Law

1.1.The objective of this law is to regulate relations pertaining to formation, management, safekeeping, disbursement and control of the Treasury Fund of Mongolia (hereinafter referred to as the "Treasury Fund").

Article 2.Legislations on Treasury Fund

2.1.The legislation on Treasury Fund shall consist of the Constitution of Mongolia, the Law on Central Bank, the law on Protection of Cultural Heritage, the Minerals law, this Law, and other legislative acts enacted in conformity therewith.

2.2.This law shall not be subject to relations with respect to currency regulation, possession or ownership and management of foreign currency state reserves.

Article 3.Definitions of legal terms

3.1.The specific terms used in this Law shall have the following meaning:

3.1.1."treasure" means precious metals and gemstones in any form or condition such as raw materials, alloys, chemical compounds, products, historical and cultural valuables and monuments, naturally occurring gemstone;

3.1.2."precious metal" means gold, silver, and platinum group metals such as palladium, iridium, rhodium, ruthenium and osmium;

3.1.3."precious stone" means diamond, ruby, emerald, sapphire, and pearl;

3.1.4."treasury fund" means treasury, its accessories and asset accumulation formed, managed, safe-kept, possessed and disbursed by the Bank of Mongolia on behalf of the state;

3.1.5."naturally occurring form" means precious metal and gemstone that forms naturally or found in natural state, with unique exotic shape and rare color;

3.1.6."gemstone" means precious and semi-precious stone classed by the competent authority in consideration of the internationally accepted classification;

Article 4.Treasury Fund and its classification

4.1.The treasury Fund is owned by the state.

4.2.The Treasury Fund is divided into a main fund and a transaction fund.

4.3.The main fund is composed of fixed and non-fixed components.

4.4.There is a treasure that is an indivisible property of Mongolia in the fixed component of the main fund. It is prohibited to sell, transfer or disburse it.

4.5.The non-fixed components of the main fund refer to precious metals refined or purified according to the international standard, and gemstones re-cut or repaired and polished, historical and cultural valuable monuments, and coins made of precious and other metals for reserves.

4.6.Historical and cultural valuable monuments in the fixed component of the main fund are of unique value.

4.7.The transaction fund refers to treasures that are put into transaction for production, research and memorial purposes other than specified in Articles 4.4 and 4.5 of this law.

CHAPTER TWO

POWERS OF STATE ORGANIZATION WITH REGARDS TO TREASURY FUND

Article 5.Powers of State Great Khural

5.1.The State Great Khural shall exercise the following powers with regards to the Treasury Fund:

5.1.1.to determine types and amount of treasure in the fixed and non-fixed components of the main fund;

5.1.2.to approve an annual income and expenditure amount, and performance report of the Treasury Fund;

5.1.3.to make a decision on buying or selling precious metals and precious stones from the non-fixed parts of the main fund;

5.1.4.to determine the minimum amount of mined precious metals and precious stones to be purchased to the Treasury Fund;

5.1.5.other powers stipulated in law.

Article 6.Powers of the Government

6.1.The Government shall exercise the following powers with regards to the Treasury Fund:

6.1.1.to solve an issue with the Bank of Mongolia on sale of precious metals and precious stones from the transaction fund to the extent determined by the State Great Khural;             

6.1.2.to make a decision to transfer unique historical and cultural monuments to the Treasury Fund at the request of the Bank of Mongolia;

6.1.3.other powers stipulated in legislations.

Article 7.Powers of the Bank of Mongolia

7.1.The Bank of Mongolia shall exercise the following powers with regards to the Treasury Fund:

7.1.1.to manage the Treasury Fund;

7.1.2.to keep records of movement of treasures and assets of the Treasury Fund, and to ensure payment settlement;

7.1.3.to develop a proposal specified in Article 5.1.3 of the law and submit it to the State Great Khural;                           

7.1.4.to buy treasures for the Treasury Fund, sell or trade treasures from the transaction fund and determine the price;

7.1.5.to ensure market price research of treasures;

7.1.6.to issue commemorative coins made of precious or other metals;

7.1.7.to approve a procedure for management of the Treasury Fund and make relevant decisions thereon;

7.1.8.other powers stipulated in legislations.

CHAPTER THREE

MANAGEMENT ACTIVITIES AND ORGANIZATION OF TREASURY FUND

Article 8.Activities of Treasury Fund

8.1.The following activities refer to the Treasury Fund:

8.1.1.to sell and purchase;

8.1.2.to store and deposit;

8.1.3.to safe-keep and place;

8.1.4.to increase and spend;

8.1.5.to produce and ensure production;

8.1.6.to evaluate and have evaluated;

8.1.7.to ensure purification;

8.1.8.to repair and maintain;

8.1.9.to organize exhibitions;

8.1.10.to inform, print, publish, advertise;

8.1.11.to register and count;

8.1.12.others.

Article 9.Unit for Managing the Treasury Fund

9.1.The Bank of Mongolia shall have a unit to manage activities specified in Article 8 of this law.

9.2.The President of the Bank of Mongolia shall determine the structure, staff and salary of the Treasury Fund's management unit within the budget of the Bank of Mongolia.

9.3.The Treasury Fund shall have a professional council in charge of making suggestions and opinions on purchase of treasures.

9.4.The President of the Bank of Mongolia shall approve a procedure for composition and operation of the professional council specified in Article 9.3 of the law.

Article 10.Income of the Treasury Fund

10.1.The income of the Treasury Fund consists of treasures sold, gifted, donated or transferred by citizens and legal entities to the Government in accordance with laws and legislations.

Article 11.Expenditure of treasury transaction fund

11.1.Expenditure shall be made from the Treasury transaction fund as follows:

11.1.1.sell precious metals, gems and coins at prices set by the Bank of Mongolia;

11.1.2.deduct depreciation incurred during the repair and refining process of precious metals and gems.

Article 12.Registration of the Treasury Fund

12.1.The Bank of Mongolia shall maintain records of treasure and other assets of the Treasury Fund and register them in the register and database of the Treasury Fund.

12.2.The Bank of Mongolia shall keep accounting of assets of the Treasury Fund and specify it in its financial statements.

12.3.The President of the Bank of Mongolia will approve the registration and database procedure specified in Article 12.1 of this law.

Article 13.Storage of Treasures

13.1.The treasure shall be stored or hoarded in a special place and container without losing quality.

13.2.The Bank of Mongolia may hoard treasures and provide relevant work and services on the basis of an agreement concluded with an owner, an owner citizen or a legal entity.

Article 14.Security and Protection of Treasury Fund

14.1.The Treasury Fund is under the special state protection.

14.2.The State Special Security Department will ensure a security and protection of the Treasury Fund according to the contract concluded with the Bank of Mongolia.

14.3.Transferring, placing or transporting treasures from the Treasury Fund to other places shall be carried out as per the procedure specified in Article 14.4 of this law.

14.4.The procedure for transportation, security or guarding and protection of treasures shall be jointly approved by the President of the Bank of Mongolia and the Head of State Special Security Department.

CHAPTER FOUR

RIGHTS AND OBLIGATIONS OF INDIVIDUAL, LEGAL ENTITY AND OTHER ORGANIZATIONS

Article 15.Rights and Obligations of Individual, Legal Entity and Other Organizations

15.1.Individuals, legal entity or other organizations owning treasures within the territory of Mongolia are obliged to ensure a determination and certification of treasures or articles made of them to be sold to the treasury fund by an authorized assaying agency, or by a central state administrative body in charge of assaying issues.

15.2.Individuals, legal entity or other organizations have the right to claim or negotiate the price of treasures to be sold, stored or hoarded in the treasury fund.

15.3.Upon the request of the Bank of Mongolia, a state central administrative body in charge of cultural issues shall provide records and information on historical and cultural unique valuables and monuments.

CHAPTER FIVE

MISCELLANEOUS

Article 16.Inspection

16.1.An authorized person or internal audit unit of the Bank of Mongolia shall conduct auditing for activities of the Treasury Fund.

16.2.The Bank of Mongolia shall conduct an inventory for the Treasury Fund on an annual basis and submit a report to the State Great Khural.

Article 17.Liability for Violation of Legislations

17.1.If the act of an official who violates this law is not criminal, he or she shall be liable as provided in the Civil Service Law and applicable laws.

17.2.Any person or legal entity who violates this law shall be charged with the liability specified in the Criminal Law or Law on Violation.

Article 18.Validity of the Law

18.1.This law shall be entered into effect on June 1, 2022.

CHAIRMAN OF THE STATE GREAT KHURAL OF MONGOLIA G.ZANDANSHATAR