Basics of Mongolia Land Law

Land in Mongolia is categorized in accordance with the unified land territory of Mongolia and, unless otherwise granted for ownership to Mongolian citizens in limited cases, is owned by the State and leased in the form of either possession or use rights.  In almost all cases, other than those for limited household use or small farming plots, the acquisition of land rights is subject to a tender process.

The unified land territory of Mongolia is classified based on the general purpose of its use and the need for its use as follows:

• Agricultural land;
• Land of cities, villages, and other urban settlements;
• Land under roads and networks;
• Land with forest resources;
• Land with water resources; and
• Land for special needs.

Under Mongolian law, there are three (3) types of rights related to land, such as Land Ownership, Land Possession and Land Use. 

Both the Constitution and the Civil Code define “landowner” as the State unless otherwise dictated by legislation allowing private ownership. The Constitution states that only Mongolian citizens may Own land. The Land Law specifically states that “land, excluding pastureland, land for common tenure and land for the state special needs, may be given for Ownership to citizens of Mongolia only.” Furthermore, the most specific legislation regarding Mongolian ownership of land, the Land Ownership Law, prohibits the transfer of the Owned land to foreign citizens through sale, trade, gift or pledge.  However, the Land Ownership Law provides that landowners may transfer to others for Use or Possession their land with the relevant Soum or District Governor’s consent.

Mongolian citizens of 18 years and over, companies and organizations may Possess or Use land in compliance with the Land Law and “Land Possession Certificate(s)” shall be given only to Mongolian citizens, companies and organizations.  There are three steps toward acquiring land Possession by a Mongolian: 1) the Governor must pass a resolution accepting the Mongolian’s request to possess land; 2) after successfully passing of the resolution, a Land Possession Agreement is created between the Government authority and the Mongolian requesting land possession; and 3) when the agreement is successfully executed, a Land Possession Certificate is issued.

 With the permission from the corresponding Governor, the land Possessor has the right to grant whole or partial Use Rights of the land to others. This granting of Use of the land to others may be on the basis of land lease agreements or other similar agreements. The Land Law allows foreign legal entities, international organizations, foreign citizens, stateless persons and business entity with foreign investment only to Use land for a certain period of time.