Mongolia recognizes 4 categories of commodities for purposes of cross-border trade. Items are classified as either:
- Forbidden;
- Licensed;
- Taxed;
- General.
An item classified as Forbidden is not allowed to pass through Customs whether by import or export. Narcotic s and related equipment for production or use are Forbidden.
Items which are not Forbidden, but which are subject to certain legal restrictions are Licensed. There must be an appropriate license for import or export. Some licenses are restricted to only export, or only import. Medical drugs and alcoholic beverages are examples of items which must be licensed. Imported or exported metals must also be accompanied by a license, however there is an exception for used aluminum drink cans. Other items which must have a license for export or import are toxic chemicals, blood and organs for donation, raw or processed uranium, firearms, historic or cultural items, and Mongolian pedigree cattle.
Some items which do not require a license are nevertheless subject to special taxation on import or export. As of September 09, 2016 changes to the law, such taxes on goat cashmere and camel wool are removed. Only processes and unprocessed timber remain subject to special taxation.