1. Research of Law and Regulatory
Environment for Transit
Transportation
Purev NARANTSETSEG
11 March 2008
Ulaanbaatar

2. Content
• Research Objective
• Research scope
• Structure and form of Research
• Results
• Actual issues in transit transportation
• Recommendations

3. Research Objective
– To determine difficulties and barriers in
entities of Mongolia for the conducting
transit transportation services,
– To define problems related to bilateral
agreement implementations for transit
transportation and to formulate
recommendations,

4. Research scope
• Belonging companies:
- International freight forwarding companies
- International Auto transportation companies
- Foreign Trade companies
• Date:
- from 15 January to 18 February 2008

5. Research Structure and Forms
• International Convention Ratification
• Comparative Analysis
• Total four chapters, 48 questions
-General information of companies
-Transit transportation and foreign trade of Mongolia
-Transit transportation through territory of Russia
-Transit transportation through territory of China
• Direct Interview
• Questionnaries

6. International convention ratification
Scope International
convention
Regional
agreement
Bilateral
agreement
Total
1 Railway transportation 5 4 3 12
2 Auto transportation 8 20 6 34
3 Water way transportation 1 3 4
4 Air transportation 2 2
5 Äàìæèí ºíãºðºõ õóäàëäàà, òýýâýðëýëò 2 5 3 10
6 Customs operation and activities 10 10
7 Trade and transportation 3 4 7
8 Road and transportation sector 4 7 11
9 Total number of convention and
agreement
31 40 19 90
10 Mongolian ratification 7 1 19 27

7. Results of comparative analysis
¹ Problems Transit trade and
transportation
convention of land
locked country
Railway
law
Customs
law
Regulatory
acts and
codex
1 Do not impose tax in transit goods + - √ °
2 Right to penetrate free + - - √
3 Do not impose special tax and dues
in transit traffic
+ - √ °
4 Transit dues and tariffs + - - -√
5 Providing transportation means and
facilities
+ + + +
6 Dues and charges of transportation
means and facilities
+ + - -
7 Tariffs and Charges not be higher
than tariffs and charges of states
with access to the sea
+ - - -
8 Customs and administrative
measures
+ - + +

8. 9 To sign contract for the facilitating transit traffic + + + +
10 To create conditions for the goods storage in entry, exit and
transit stages
+ - + +
11 Tariffs of storage conditions addressing to the facilitating
transit
+ - + +
12 Delay difficulties in transit traffic + + + +
13 To cooperate for delaying difficulties in transit of land locked
states
+ - - -
14 To sign contract of free zones and customs facilities + - + +
15 To provide the land locked countries on the equal rights as
a states with access to the sea
+ - - -
16 Ships with flying flag of land locked states same with those
countries have right to have access to the sea and to use
the sea ports
+ - - -
17 Rights of ships with flying flag of land locked states in
transportation on the using internal water ways
+ - - -
18 To approve rights and discounts of land locked states + - - -

9. Results of analysis
Transit transportation and foreign trade of Mongolia:
International convention ratification and implementation
-Doesn’t ratify some conventions, so have difficulties.
87.5%
Regional and bilateral agreement and implementations
-Doesn’t sign some agreement, so have difficulties.
75%
Laws implementation related to foreign trade and
transportation and implementations
-Doesn’t approve some laws, so have difficulties.
87.5%
Implementation of rule and procedure related to foreign trade
and transportation
-Doesn’t approve some rules and procedures, so have difficulties.
62.5%

10. Implementation of standard and norms related to foreign trade
and transportation
-Doesn’t approve some standards and norms, so have difficulties.
62.5%
Awards of state and administrative organizations related to
foreign trade and transportation and implementation
Resolutions of state and administrative organizations are difficult in
works of us in some times. 87.5%
Convenience to receive information related to laws and
regulations
-To buy brochures. 87.5%
Delivery of laws and legal acts from state organizations
-Give it to consumers, when they ask. 62.5%
How much time do they spend to for the composing
documentations?
- 7-12 hours 50%

11. Level of single window service in the composing
documentation
-Some services are slip, but this is better than others. 50%
in which locating country do you compose documentations
easy?
-Started country 50%
in which country do you have difficulties related to
documentations?
-Arriving country 87.5%
-Transit country 75%
What measurements are related to difficulties to compose
documentations?
-For time 75%
-Communicate to many organizations 62.5%
Language problems in the using documentations
-There are problems and barriers related to documentations, so
should follow carriage and goods. Very difficult. 50%

12. Transit transportation through territory of Russia:
Auto transportation scope for transit through territory of
Russia
-To the European country or sea port 62.5%
Auto road conditions of Russia
-it is ok, but difficult in some place. 75%
Regulations in road traffic
-Have difficulties depending on the policemen. 50%
Tax and dues related to transportation
-Road fees and dues 62.5%
What is difference of this fee and dues from domestic
transporter fee and dues?
-High. 50%

13. Unofficial tax, dues and bribes
-Pay to customs officials. 50%
-Pay to professional auditing officials. 50%
-Pay to policemen. 50%
Transit transportation by railway
-Have not discounts for land locked countries. 50%
Agreement between the Mongolian Government and
Government of Russian Federation on the transit
transportation to have access to the sea through Russian
territory and implementations.
-The provisions to give extra discounts in transit transportations
and services are not implemented. (5th article 3) 50%
Boundary, customs and professional auditing
-Relationships between departments and board have not been.
50%

14. Transit transportation through territory of China:
Transit transportation by railway
-There are not discounts of land locked country. 75%
Agreement between the MPR Government and Government of
Chinese Republic on the transit transportation to have access
to the sea through Chinese territory and implementation.
-The provision about opportunity for transit transportation by
vehicles' of Mongolia is not implemented. (4th article a) 62.5%
-Opportunity to use port sea and storage is not implemented.
(7th article 1) 62.5%
-The provisions to impose export and import taxes, other tax and
preliminary tax in goods, luggage is not implemented. (7th article 3)
50%
Law and legislation information related to transit
transportation
-Receive information in boundary port. 62.5%
China auto road condition
-well. 50%

15. Actual issues
• Transit transportation and foreign trade of Mongolia
– Difficulties relating to the documentations. (for timeframe and relating to the arriving countries)
– Not ratifying relevant international conventions and agreements.
– Not approving some laws relating to the foreign trade and transportation.
– Difficulties of awards of the state and administrative organizations.
–
• Transit transportation through territory of Russia
– Information relating to the transit transportation is taking in the boundary ports.
– Customs and auditing officials and policemen have taking unofficial fees, payments, dues and
bribe.
– The provision on tariffs with extra discounts in transit transportation and services are not
implemented. (5th article 3)
• Transit transportation through territory of China
– Land locked countries have not discounts in transit transportation through railway.
– The opportunity to use sea ports and storages is not implemented. (7th article 1 )
– Law and regulatory Information relating to the transit transportation is taking in the boundary
port only.
– The provision about opportunity to conduct transit transportation through automobile of
Mongolia is not implemented. (4th artcle a à)

16. Implementing measures
• From side of laws and regulations
– To ratify the relevant international conventions,
– To reflect and to amend the land locked countries discounts and rights in regional and bilateral
agreements,
– To approve laws relating to the foreign trade and transportation and to create law and
regulatory favorable environment.
• Institutional
– To create conditions to provide implementations of international conventions and bilateral
agreement,
– To formulate rules, procedures, norms and standards to support foreign trade and transit
transportation,
– State and administrative decisions should be optimum, easy to understand and without
difficulties for businessmen.
– To create the information intensive providing system on the international laws and regulations
of the transit transportation and trade for businessmen.
• Unofficial dues, fees and bribe
– To decide by support and participation of the international organizations ,
– To create the monitoring system for the implementing discounts and rights of land locked
states,
– To relate with relevant professionals and governments of contracting countries.

17. Explaining: + There is regulation to regulate this problem
- There is not regulation to regulate this problem
√ Bilateral agreement between government is fitting to the provision of multilateral conventions
-√ Bilateral agreement between government is not fitting to the provision of multilateral conventions
° Article of Mongolia laws is not fitting to the international conventions
THANKS