(2023.06.28-ны өдрийн орчуулга)              Unofficial translation

LAW OF MONGOLIA

June 17, 2022                                  Ulaanbaatar city

ON property appraisal

/Revised edition/

CHAPTER ONE

GENERAL PROVISIONS

Article 1.Purpose of the Law

1.1.The purpose of this Law is to regulate relations in connection with determining legal basis for conducting a property appraisal and its organization, monitoring it, establishing the rights, obligations, activities of state authorities, legal entities, and citizens under this field, and creating appraisal database.

Article 2.Legislation on Property appraisal

2.1.The legislation on property appraisal shall consist of the Constitution of Mongolia, the Civil Code, the Law on Permits, this Law and other legislative acts enacted in compliance with them..

2.2.If an international treaty, to which Mongolia is a party, provides otherwise than this Law, the provisions of the international treaty shall prevail.

Article 3.Definitions of the terms of the Law

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

3.1.1."deviation" means a circumstance in which the procedures, methodology, and instructions being used in the appraisal to be different from some of the requirements of the international valuation standards due to the specific characteristics of the given appraisal item and other circumstances;

3.1.2."third party" means a person using an appraisal report or values specified in the report or values determined based on the report in making a certain decision, or a person whose ownership right is being affected by the values specified in the appraisal report;

3.1.3."principal" means a person who made an order to be appraised or assessed the asset on behalf of itself or others if it is stated in this Law and agreements;

3.1.4."client" means a legal entity or an individual whose property under its possession and usage is being appraised as stated in the legislation or at the initiative of the principal; 

3.1.5."value" means a possible monetary expression of economic benefit estimation meeting to the share on an asset or property item determined at the result of the property appraisal;

3.1.6."value basis" means the preliminary conditions to be used for estimating the value by selecting in conformity with appraisal goals and purpose;  

3.1.7."international valuation standard" means a standard approved by the International Valuation Standards Council;

3.1.8."appraisal date" means a day when the value of the asset was determined; 3.1.9."appraisal report" means a document prepared by the appraiser in accordance with the relevant legislation and the contract with the client and principal, which containing information such as the purpose of the appraisal, the basis of value, the date, the approach and method used, the source of information used, the assumptions put forward, and the conclusion about the value;

3.1.10."appraisal legal entity" means a company obtained a special permit to engage in property appraisal activities;

3.1.11."appraiser/valuator" means a citizen obtained a right to conduct appraisal as stated in paragraph 15.1 of this Law;

3.1.12."professional pro-bono activity of an appraiser for the public" means appraisal services provided by the appraiser for the public benefit and for the rights and legal interests of the target group of society without receiving a fee from others, and activities aimed at supporting civil education;

3.1.13."property appraisal item" means a tangible and intangible property, property rights, business activities, claiming rights, liabilities and other items of civil law relations to be appraised;

3.1.14."property appraisal" means the independent activity of determining the value of property appraisal items in accordance with a specific purpose.

CHAPTER TWO

property appraisal

Article 4.Principles to be adhered to in property appraisal

4.1.The following principles shall be adhered to in the property appraisal process:

4.1.1.to be impartial;

4.1.2.to keep confidentiality;

4.1.3.to be honest;

4.1.4.to be real;

4.1.5.to comply with legislation and standard.

4.2.When conducting a property appraisal, the preparatory works in accordance with international and national valuation standards shall be fulfilled.  

4.3.The appraiser and the appraisal legal entity shall not disclose any information belongs to the confidentiality of the client and principal which was obtained during the appraisal process to others or use it for the interests of himself/herself or third parties, unless a written permission is given.

4.4.When conducting the property appraisal, the international valuation standards and the national standards, procedures and methods of property appraisal specified in paragraphs 4.5 and 7.2 of this Law shall be adhered to.

4.5.The state administrative body in charge of standardization and technical regulation matters shall approve the national property appraisal standard in compliance with the principles of international valuation standards and this Law.

Article 5.Grounds to conduct the property appraisal

5.1.The property appraisal shall be conducted under the following grounds:

5.1.1.if the appraiser, the appraisal legal entity and a client or a principal have mutually agreed through the official letter;

5.1.2.if the appraiser will conduct property appraisal at the assignment of the employer;

5.1.3.upon the decision of an authorized person in case specifically provided by law.

5.2.The following property appraisal affecting the public interest shall be conducted by the appraisal legal entity:

5.2.1.When assessing the property appraisal item of the business entities and organizations specified in paragraph 4.2 of the Law on accounting for the purpose of financial reporting; 

5.2.2.When privatizing state and local property, selling the real estate, using them for loan collateral, or settling them for the debt or liabilities; 

5.2.3.When establishing newly or re-organizing a partially state and local owned legal entity, and changing the shared/charter capital;   

5.2.4.When putting mineral and oil deposits, natural gas assets and other natural wealth into economic circulation;

5.2.5.When returning a property appraisal items for state and local needs;

5.2.6.When shares of state-owned or partially state-owned legal entities are publicly offered;

5.2.7.When a business entity and/or an organization who holds a special permit is increasing its shared capital.

5.3.The property appraisal other than those specified in paragraph 5.2 of this Law can be conducted by the appraiser.

Article 6.A property appraisal agreement

6.1.If the appraiser, the appraisal legal entity and the client or the principal have agreed, a property appraisal shall be made on a contractual basis.

6.2.A property appraisal agreement shall be executed in writing.

6.3.A property appraisal agreement shall specify the followings:

6.3.1.Purpose of property appraisal;

6.3.2.Property appraisal item and its nature or characteristics;

6.3.3.Rights and obligations of parties;

6.3.4.Information on the coverage under the professional liability insurance;

6.3.5.Property appraisal service fee;

6.3.6.Procedure for submission of property appraisal report.

6.4.The appraiser and the appraisal legal entity shall compile as the archival unit and keep a property appraisal agreement, a property appraisal report and other attached documents thereto for at least 15 years.

Article 7.Procedure and methodology on conducting a property appraisal

7.1.When conducting property appraisal, the international and national valuation standards and the procedure and methodology specified in the paragraph 7.2 of this Law shall be adhered to.    

7.2.The State Central Administrative Body in charge of finance and budget matters shall approve and enforce the property appraisal procedure and methodology that are suitable for the nature and purpose of the property appraisal item solely or in cooperation with relevant state authorities as follows:

7.2.1.the appraisal procedures and methodologies for the financial reporting purpose by the state central administrative body in charge of finance and budget matters solely;

7.2.2.the appraisal procedures and methodologies for the auction purpose by the state central administrative body in charge of finance and budget matters solely;

7.2.3.the appraisal procedures and methodologies for the collateral purpose by the state central administrative body in charge of finance and budget matters jointly with the Bank of Mongolia or the Financial Regulatory Committee;

7.2.4.the appraisal procedures and methodologies for the appraisal of immovable property  and compensation allowance by the state central administrative body in charge of finance and budget matters jointly with the state central administrative body in charge of construction and urban development matters;

7.2.5.the appraisal procedures and methodologies on the movable property by the state central administrative body in charge of finance and budget solely;

7.2.6.the appraisal procedures and methodologies on the intangible assets and intellectual property by the state central administrative body in charge of finance and budget matters jointly with the state central administrative body in charge of intellectual property matters;

7.2.7.the appraisal procedures and methodologies on historical monuments, valuable items, treasures, and rare items by the state central administrative body in charge of finance and budget matters jointly with the Bank of Mongolia and the state central administrative body in charge of cultural matters;

7.2.8.the procedures and methodologies of financial instruments by the state central administrative body in charge of finance and budget matters solely;

7.2.9.the business appraisal procedures and methodologies by the state central administrative body in charge of finance and budget matters jointly with the Financial Regulatory Committee;

7.2.10.the property appraisal procedures and methodologies for the tax purposes by the state central administrative body in charge of finance and budget matters solely;

7.2.11.the appraisal procedures and methodologies on the livestock and animals of certified breed, strains and high-yielding breeding by the state central administrative body in charge of finance and budget matters jointly with the central state administrative organization in charge of food and agriculture;

7.2.12.the appraisal procedures and methodologies on mineral and oil deposits, and natural gas assets by the state central administrative body in charge of finance and budget matters jointly with the state central administrative body in charge of mining matters;

7.2.13.the economic appraisal procedures and methodologies on other natural wealth by the state central administrative body in charge of finance and budget matters jointly with the state central administrative body in charge of environmental matters;

7.2.14.the appraisal procedures and methods for financial reporting of budget organizations by the by the state central administrative body in charge of finance and budget matters solely.

Article 8.A property appraisal report

8.1.A property appraisal report shall be prepared to provide a real understanding with respect to a value of the respective appraisal item for the client, principal and the third party.

8.2.A property appraisal report shall meet the following requirements:

8.2.1.when determining an appraisal basis for property appraisal item should be selected in compliance with conditions and purpose of the appraisal work;

8.2.2.the property appraisal report should be notified and explained the property appraisal standard and events specified in sub-paragraph 3.1.1 of this Law. Any deviation shall not affect to the reliability of the appraisal report;      

8.2.3.A determined value of the property appraisal item shall be reasonable and clear.

8.3.The property appraisal report shall be in compliance with international and national valuation standard and include the followings:

8.3.1.the name of an appraiser and the appraisal legal entity, appraisal right and permit number, the special permit term and information on the professional liability insurance;

8.3.2.the client's and principal's name, address, and other information deemed necessary;

8.3.3.the information with respect to the third party;

8.3.4.the grounds and purpose of property appraisal;

8.3.5.the date of a property appraisal and the date of an appraisal report;

8.3.6.the description of types, nature and characteristics of the property appraisal item;

8.3.7.the information on ownership, possession and use of the property appraisal item;

8.3.8.the scope and limitation conditions of a property appraisal report;

8.3.9.the documents, information, evidence, analysis, appraisal estimates and their grounds used for property appraisal;

8.3.10.the methods used to determine a value of the property appraisal item and their compatibility;

8.3.11.a determined value of the property appraisal item;

8.3.12.a statement of an appraiser that the property appraisal has been conducted in accordance with the standards, procedures and methodologies set forth in this Law.

8.4.The property appraisal report shall be certified by signature of the appraiser or the executive director of the appraisal legal entity, and stamped by them.

Article 9.Asset appraisal service fee

9.1.If an appraiser or an appraisal legal entity has conducted an appraisal, they shall receive a service fee from the client.

9.2.If the property appraisal will be conducted on the grounds specified in sub-paragraph 5.1.1 of this Law, the service fee shall be determined by an agreement between the parties.

9.3.The standard of the property appraisal service fee specified in sub-paragraph 5.1.3 of this Law shall be determined by the Cabinet member in charge of finance and budget matter in conformity with minimum labor wage.

Article 10.Rights and obligations of the Client

10.1.The Client shall have the following rights:

10.1.1.to select an appraiser or an appraisal legal entity for conducting a property appraisal, other than those when they should be appointed by a competent person in accordance with the law;

10.1.2.to get acquainted with the property appraisal report before confirming it and receive explanations on the report;

10.1.3.to file a complaint within 30 days to the property appraisal professional organization regarding the activities and appraisal report of the appraiser and the appraisal legal entity;

10.1.4.to claim damages incurred to oneself if it is determined that the property appraisal report does not meet the requirements and standards specified in Article 8 of this Law;

10.1.5.other rights agreed by the contract.

10.2.The Client shall have the following obligations:

10.2.1.to provide an appraiser with true and accurate facts and information required for property appraisal;

10.2.2.to provide with conditions and opportunities to conduct a property appraisal;

10.2.3.not to put pressure, to interfere, or to burden when conducting the property appraisal;

10.2.4.not to conceal information that may affect the reliability of the appraisal;

10.2.5.to pay the appraisal service fee according to the contract;

10.2.6.other obligations agreed by the contract.

10.3.The rights specified in sub-paragraphs 10.1.2 and 10.1.3 of this Law, and the obligations specified in sub-paragraph 10.2.3, 10.2.4, and 10.2.5 of this Law shall be applicable to the principal and the third party.

CHAPTER THREE

APPRAISER

Article 11.Right of the appraiser

11.1.The appraiser shall have the following rights:

11.1.1.to demand the client to provide with true and accurate documents and information required for property appraisal;

11.1.2.to refuse to conduct property appraisal if the client has not provided necessary information on the property appraisal item and has not fulfilled its obligations specified in the contract to create working conditions and not to interfere his/her impartiality in any form; 

11.1.3.in order to obtain necessary documents and information in the context of the conducting appraisal in accordance with sub-paragraph 5.1.3 of this Law, to submit a request jointly with the client to the competent state bodies and its relevant officials;

11.1.4.to involve other appraisers or specialists in the property appraisal on a contractual basis;

11.1.5.othe rights specified in legislation.

Article 12.The obligations of the Appraiser

12.1.The appraiser shall have the following obligations:

12.1.1.to comply with the code of ethics of appraisers;

12.1.2.to ensure an integrity or completeness of documents obtained from a client or the third parties during the property appraisal process;

12.1.3.to conduct a property appraisal at a professional level, in accordance with legislation, international and national valuation standards, and the relevant procedures and methodologies;

12.1.4.to refuse to use the information obtained in the property appraisal process for personal purposes and to inform others except as prescribed by law;

12.1.5.to compensate for the damage caused due to his/her wrongful actions;

12.1.6.to participate in a training organized by a professional property appraisal organization;

12.1.7.to issue the property appraisal report in accordance with the requirements specified in paragraph 8.2 of this Law;

12.1.8.to enter the information specified in paragraph 25.2 of this Law into the property appraisal database;

12.1.9.to be insured with the professional liability insurance of the appraiser;

12.1.10.other obligations specified in legislation.

Article 13.Impartiality of the appraisal

13.1.The appraiser and the appraisal legal entity shall be impartial from the principal, the client, and the third party in terms of work and personal communication.

13.2.In order to ensure the impartiality stipulated in paragraph 13.1 of this Law, the following things shall be prohibited for appraisers and the appraisal legal entities:

13.2.1.to receive donations and gifts as specified in sub-paragraphs 3.1.8 and 3.1.9 of the Law on the Regulation of Public and Private Interests and Prevention of Conflict of Interest in Public Service by the appraiser from clients, principals, and third parties;

13.2.2.to change the service fee depending on the value of the appraisal item, or to set a certain percentage;

13.2.3.to be a party with a common interest with the client as specified in paragraph 99.1 of the Law on Company;

13.2.4.to be a related person specified in clauses 4.1.30.a of the Law on Securities Market with an authorized official or an influential shareholder of the person who provided audit services to the client;

13.2.5.to be provided an investment with the amount of the five or more percent of the shared capital of the client during the 24 months prior to the execution of the property appraisal agreement;

13.2.6.to be provided audit services for the financial report of the appraisal legal entity for the given year by the client or the principal.

13.3.If it is deemed that the conditions and requirements of impartiality specified in paragraph 13.2 of this Law are violated, the principal, the client and the third party shall have a right to file a complaint with the professional property appraisal organization.

CHAPTER FOUR

PROCEDURE ON GRANTING A RIGHT OF THE APPRAISER AND THE SPECIAL PERMIT oN the PROPERTY APPRAISAL 

Article 14.Requirements for applicants taking the exam on granting a right of the appraiser and organization of the exam

14.1.The composition of the examination commission for granting a right of the appraiser and the procedure for organizing the examination shall be approved by the Cabinet member in charge of finance and budget matters.

14.2.The exam for granting a right of the appraiser shall be announced at least once a year.

14.3.A citizen who meets the following requirements shall have a right to participate in the exam for granting a right of the appraiser:

14.3.1.to have a higher education;

14.3.2.to have 2 or more years of working experience in his/her professional field;

14.3.3.to have participated in property appraisal training.

Article 15.Issuing, extending, suspending, restoring and revoking a right of the appraiser

15.1.The professional property appraisal organization shall issue a right of the appraiser for the period of 3 years to the citizen based on the result of the examination in accordance with paragraph 14.1 of this Law.

15.2.Certification and stamp shall be issued to the holder of the rights of the appraiser and the format of the certificate and stamp shall be approved by the professional property appraisal organization.

15.3.The appraiser shall have a right to submit an application to extend the period of the right of the appraiser prior to at least 30 days before its expiration.  

15.4.The following documents shall be attached to the application for extension of the appraiser's rights:

15.4.1.a copy of the "asset appraiser" certificate;

15.4.2.a receipt of payment of stamp duty.

15.5.Based on the opinion of the Professional and Ethical Council, the professional property appraisal organization shall extend the appraiser's right once for a period of three years.

15.6.The appraiser's rights shall be suspended in the following cases:

15.6.1.if the appraiser fails to fulfill the duties and requirements specified in sub-paragraphs 12.1.3, 12.1.4, 12.1.7, and paragraph 13.2 of this Law, the appraiser's rights shall be suspended for six months;

15.6.2.if the condition of suspending the appraiser's rights specified in sub-paragraph 15.6.1 of this Law is removed, the appraiser's rights shall be restored.

15.7.The appraiser's rights shall be revoked in the following cases:

15.7.1.if the appraiser made a request;

15.7.2.if the appraiser fails to submit a request to restore the appraiser's right by removing the violation during the suspension period;

15.7.3.if the appraiser fails to submit a request to extend the appraiser's right;

15.7.4.if the appraiser repeated violations specified in sub-paragraph 15.6.1 of this Law;

15.7.5.if the appraiser has been considered to be legally incompetent;

15.7.6.if the judgment of the court that the appraiser has committed a crime has entered into force.

15.8.After the property appraiser's right has been extended, if he/she fulfills the obligations specified in paragraph 12.1 of this Law, the right to conduct a property appraisal shall be to the appraiser without a period of time.

15.9.The requirements for granting appraiser rights to Mongolian citizens, foreign citizens, and stateless person who have received appraiser rights from an internationally recognized professional organization shall be governed by the procedure specified in paragraph 14.1 of this Law.

15.10.Except as specified in sub-paragraph 15.6.1 of this Law, the appraiser shall be held liable according to the appraiser's code of conduct.

Article 16.A legal entity engaging property appraisal, and conditions and requirements to be set for it

16.1.The appraisal legal entities shall conduct asset appraisal activities on the basis of a special permit obtained from the state central administrative body in charge of finance and budget matters.

16.2.The appraisal legal entity shall meet the following conditions and requirements:

16.2.1.to have at least two full-time appraisers, and the executive director shall have the right to be an appraiser for an indefinite period of time;

16.2.2.to be provided with workplaces and equipment for activities;

16.2.3.be engaged in property appraisal activities;

16.2.4.to be covered under professional liability insurance;

16.2.5.to have a procedure that complies with international and national valuation standards, procedures, and methodologies;

16.2.6.if the founder or shareholder is a foreign citizen or a legal entity, at least one-third of the total shares shall be owned by an appraiser who is a citizen of Mongolia;

16.2.7.not less than two-thirds of the total shares of the appraisal legal entity shall be owned by a citizen who has received the right specified in paragraph 3.1.11 of this Law;

16.2.8.to have conducted pro-bono property appraisal professional activities beneficial to the public at least once a year;

16.2.9.the appraisal legal entity shall electronically submit the list of appraisal work performed in the current year and the names of the appraisers, experts, and assistants involved to the property appraisal professional organization.

16.3.A certificate shall be issued to the special permit holder, and the format of the certificate shall be approved by the Cabinet member in charge of finance and budget matters.

16.4.An appraisal legal entity may have a branch and the branch shall have at least one full-time appraiser. Paragraph 8.4 of this Law shall not apply to the branch executive director.

Article 17.Issuing a special permit engaging a property appraisal activities

17.1.If the applicant for a special permit to engage in property appraisal activities meets the conditions and requirements specified in paragraph 16.2 of this Law, he/she shall prepare the following documents and submit them to the state central administrative body in charge of finance and budget matters:

17.1.1.an application for requesting to issue a special permit;

17.1.2.a state registration certificate of legal entity;

17.1.3.a charter of the appraisal legal entity;

17.1.4.a procedure specified in sub-paragraph 16.2.5 of this Law;

17.1.5.a curriculum vitae of the appraisers;

17.1.6.a description of the appraiser's ethics obtained from a professional property appraisal organization;

17.1.7.a receipt of payment of stamp duty;

/This sub-paragraph was invalidated by the law as of January 6, 2023/

17.1.8.an internal procedure for information technology and security.

17.2.If the documents specified in paragraph 17.1 of this Law are deemed to meet the requirements, a special permit to engage property appraisal activities shall be granted for a period of five years by the decision of the Cabinet member in charge of finance and budget matters.

17.3.The appraisal legal entity that has obtained a special permit shall use the word "Appraisal" after its proper name.

17.4.The full-time appraiser of the appraisal legal entity shall be prohibited from working under contract for other appraisal legal entities.

Article 18.Extending a period of the special permit

18.1.At least 30 days before the expiration of the special permit to engage a property appraisal, the appraisal legal entity shall electronically submit the application for the extension of the special permit to the state central administrative body in charge of finance and budget matters.

18.2.If the conditions and requirements set forth in this Law and the legislation on permit are met, and the established standards, procedures, and methodologies are followed, the term of the special permit of the appraisal legal entity shall be extended for the period originally issued.

18.3.The following documents shall be prepared for the extension of the special permit to engage property appraisal activities:

18.3.1.an application for extension of special permit;

18.3.2.a reference on social insurance premium payment of the appraiser being worked in the main position;

18.3.3.a description of the appraiser's ethics;

18.3.4.a receipt of payment of stamp duty;

/This sub-paragraph was invalidated by the law as of January 6, 2023/

18.3.5.to have no tax debt.

18.4.In case of violation of the conditions and requirements of the special permit, the term of the special permit shall not be extended.

Article 19.Suspending a special permit

19.1.In the following cases, the Cabinet member in charge of finance and budget matters shall suspend the term of the special permit for a period of up to three months:

19.1.1.If it is determined that the conditions and requirements of the special permit specified in paragraph 16.2 of this Law are not met;

19.1.2.the appraisal legal entity that violates paragraph 17.3 of this Law.

19.2.It shall be prohibited to enter into a new property appraisal contract during the period of suspension of the activities of the appraisal legal entity and it shall not be grounds for exemption from fulfilling the obligations under the previously concluded contract.

19.3.In the event that the conditions and requirements for suspending the special permit specified in paragraph 19.1 of this Law are removed, the Cabinet member in charge of finance and budget matters shall restore the respective permit.

Article 20.Revoking a special permit

20.1.The Cabinet member in charge of finance and budget matters shall revoke the special permit in the following cases:

20.1.1.the holder of the special permit has submitted a request;

20.1.2.it was found that false documents were prepared to obtain a special permit;

20.1.3.the property appraisal is not performed in accordance with international and national valuation standards, procedures and methodologies;

20.1.4.violated the conditions and requirements specified in paragraph 16.2 of this Law two or more times;

20.1.5.falied to comply with the requirements for the elimination of violations during the period of suspension of the special permit;

20.1.6.it was determined by the court decision that damage was caused to the client and third parties by determining the value of assets unrealistically;

20.1.7.failed to provide workplaces, documents, and other necessary information for the performance of quality control to the appraisal legal entity, or avoided to show them.

Article 21.Monitoring the implementation of legislation on property appraisal

21.1.The state central administrative body in charge of finance and budget matters shall monitor the implementation of the legislation on property appraisal as follows:

21.1.1.to monitor whether the property appraisal legal entity meets the conditions and requirements of the special permit;

21.1.2.to approve the quality control procedure for the appraisal legal entity and supervise its implementation;

21.1.3.to supervise the activities of the professional property appraisal organization and to get performed by it some government functions on the basis of the contract;

21.1.4.others prescribed by law.

CHAPTER FIVE

THE PROFESSIONAL PROPERTY APPRAISAL ORGANIZATION

Article 22.The professional property appraisal organization

22.1.The professional property appraisal organization /hereinafter referred to as "Professional organization"/ shall be a public legal entity with the membership of appraisers and appraisal legal entities, whose purpose is to ensure professional ethics and independence, and to provide professional and methodological support to appraisers.

22.2.A Professional and Ethical Council with the responsibility to handle complaints submitted by citizens and legal entities with respect to professional and ethical mistakes of appraisers shall work next to the Professional organization.

22.3.The composition and operational procedure of the Professional and Ethical Council specified in paragraph 22.2 of this Law shall be approved by the Professional Organization.

22.4.The Professional organization shall have its own charter.

22.5.The funding of the Professional organization shall consist of the following sources:

22.5.1.membership fees, donations and assistance;

22.5.2.professional examination fees and tuition fees;

22.5.3.payment for work performed under the order;

22.5.4 income from publications;

22.5.5.appraisal data and service fees.

Article 23.Functions of the Professional organization

23.1.The Professional organization shall perform the following functions:

23.1.1.to provide appraisers and appraisal legal entities with professional and methodological guidance, organization, advice, and information;

23.1.2.to grant, extend, suspend, restore, and revoke the right of the appraiser;

23.1.3.to organize training and examinations on preparing, granting a right of the appraiser, renewing and specializing the appraisers;

23.1.4.to develop national valuation standards, translate international standards, to provide with explanations and recommendations on application of them;

23.1.5.to develop international property appraisal reporting standard formats and instructions in accordance with national characteristics;

23.1.6.to take measures to protect the appraiser's legal interests and reduce risks arising from professional activities;

23.1.7.to create and operate the property appraisal database specified in paragraph 25.1 of this Law;

23.1.8.to grant, suspend or revoke the title of leading appraiser specialized in property appraisal;

23.1.9.to review the assumptions made in the appraisal report and make a conclusion.

Article 24.Management and organization of the Professional organization

24.1.The management and organization of the Professional organization as a legal entity under public law shall be determined by this Law.

24.2.The highest governing body of the Professional organization shall be the General Meeting.

24.3.The General Meeting shall consist of the representatives of members of professional organizations and shall exercise the following powers:

24.3.1.to approve the charter of the Professional organization, code of conduct of the appraisers, and procedure on the membership, to make addendum and amendments to them;

24.3.2.to discuss operational and financial reports;

24.3.3.to elect and dismiss members of the board of directors;

24.3.4.to determine the amount of the membership fee;

24.3.5.others prescribed by legislation.

24.4.The General Meeting shall be in the form of the regular and extraordinary, and the regular meeting shall be convened once in four years.

24.5.The General Meeting shall elect a 15-member Board of directors for a four-year term, with at least three appraisers representing the Financial Regulatory Committee, the state central administration body in charge of finance and budget matters, and the state central administration body in charge of construction and urban development in the composition.

24.6.The Board of Directors shall exercise the following powers:

24.6.1.to convene regular and extraordinary General Meetings;

24.6.2.to implement operational policies and programs, to discuss and approve working plans, to monitor their implementation;

24.6.3.to approve the annual budget and discuss the financial report;

24.6.4.to elect and dismiss the Chairman of the Board of directors and determine the amount of his/her salary;

24.6.5.to appoint, dismiss, and sign contracts with the Executive director on the proposal made by the Chairman;

24.6.6.to approve the executive director's salary and bonuses, the structure and number of staff of the Office;

24.6.7.to establish, merge, liquidate, recruit or remove members of branch committees and associations, and approve their operational procedures;

24.6.8.to approve the procedure for nomination, selection and appointment of members of the professional council.

24.7.The Board of Directors shall convene a meeting at least once per quarter, and the meeting shall be valid if the majority of all members attended.

24.8.The Professional organization shall have an office to manage its day to day activities, and the Executive director shall provide with management of this Office.

24.9.The executive director of the Professional organization shall exercise the following powers:

24.9.1.to be discussed and approved the staffing, budget, performance, operational and financial reports of the Office by the Board of directors;

24.9.2.to appoint and release full-time employees of the Office;

24.9.3.to appoint and dismiss a member of the Ethical Council;

24.9.4.to represent the Professional organizations, to execute contracts and agreements with foreign and domestic organizations;

24.9.5.other powers prescribed by legislation.

CHAPTER SIX

MISCELLANEOUS

Article 25.Property appraisal database

25.1.The professional organization shall establish a property appraisal database in order to support the appraiser and the appraisal legal entity's activities and use it to determine a value of the property appraisal item.

25.2.The property appraisal database shall consist of the following information:

25.2.1.Information or data released by the market pricing research organization;

25.2.2.Information or data on market prices and exchange rates disseminated through the media and press;

25.2.3.Information on value of the property appraisal item made by the appraiser;

25.2.4.Information obtained from electronic database of property registration

25.2.5.Other information or data that can be used for property appraisal.

25.3.The procedure for creating, using, and ensuring security of the property appraisal database shall be approved by the Government.

Article 26.Professional liability insurance of the person engaging appraisal activities  

26.1.An appraiser or appraisal legal entity shall be covered by the professional liability insurance in order to compensate any damage caused to the relevant person or entity due to any mistake or fault made in the property appraisal process.

26.2.An appraiser or appraisal legal entity engaging appraisal activities shall choose an insurance organization by themself.

26.3.An amount of the professional liability insurance premium shall be determined by mutual agreement between the appraiser, the appraisal legal entity and the insurance organization.

26.4.A minimum amount of professional liability insurance premium shall be set by the Professional organization.

26.5.At the specifically requested demand by the Client or the Principal, the given appraisal work can be covered by the professional liability insurance.

Article 27.Liabilities to be imposed on violators of the law

27.1.An individual, a legal entity who has breached this law is subject to the liability in accordance with Criminal code or Law on Violations. 

27.2.Unless an official who has breached the legislation is subject to criminal liability, he or she shall be held liable as provided by the Law on Public Service. 

Article 28.Regulation on transitional stage

28.1.The holder of a special permit for property appraisal who has obtained it prior to the entry into force of this Law shall make a request to extend or renew his/her right as an appraiser in accordance with this Law within six months from the date of entry into force of this Law.

Article 29.Entry into force of the Law

29.1.This Law shall enter into force on January 1, 2023

THE CHAIRMAN OF THE STATE GREAT KHURAL OF MONGOLIA ZANDANSHATAR.G