Ulaanbaatar, February 20, 2025 /MONTSAME/. On December 20, 2024, the Government of Mongolia submitted to the State Great Khural of Mongolia a draft Law on Supporting Planning, Development, and Promotion of Kharkhorum City, along with the accompanying proposals. During its plenary session on January 23, 2025, the State Great Khural of Mongolia approved the draft Law and accompanying proposals.

On December 20, 2022, the President of Mongolia issued Presidential Decree No. 230, “On Restoring the Kharkhorum City,” directing the Government of Mongolia to conduct research and develop a proposal to be submitted to the Parliament. This initiative stems from the historic legacy of establishing the Capital City of the Great Mongol Empire in the Orkhon Valley and aims at creating healthy and safe living conditions for citizens, improving the accessibility of basic social services, reducing population concentration, ensuring balanced regional development, strengthening statehood traditions of Mongolia, and reviving the historical and cultural heritage.

In 2023, the State Great Khural of Mongolia passed Resolution No. 7 on “Establishing Kharkhorum City in the Orkhon Valley” and Resolution No. 72 of 2024 on designating “Kharkhorum” as a Smart City Designated as "National." The Government determined that a special law was necessary to govern the planning, construction, and development of Kharkhorum City, resulting in the drafting of this legislation.

The purpose of the Law on Supporting the Planning, Development, and Growth of Kharkhorum City is to re-establish Kharkhorum, the historic Capital City, and preserve Mongolian national history, heritage, and nomadic civilization, thereby developing sustainable tourism, ensuring balanced regional development, and creating an environmentally friendly, comfortable urban environment. It sets the legal framework for planning, building, and promoting Kharkhorum City’s development.

Following its approval, the Law clarifies the principles for planning and building Kharkhorum City, along with requirements for urban planning. It supplements the existing Law on Urban Development by specifying the types of urban planning documents and zoning regulations. Regarding land management, the Mayor of Kharkhorum City will grant land-use rights in accordance with the city’s master plan, detailed plans, technical and economic feasibility studies for projects and programs, construction projects, zoning regulations, and the annual land-management plan.

The City will occupy land encompassing the territories of three soums in Arkhangai and Uvurkhangai aimags. Until a City Council and a Mayor are elected by residents as stipulated in the Law on the Legal Status of Cities and Towns, both the council and the mayor will be appointed by the Government of Mongolia.

The City Council will have 11 members, consisting of three representatives proposed by the Government of Mongolia, the Government-appointed Mayor of Kharkhorum City, three representatives proposed by the Mongolian National Chamber of Commerce and Industry, the Chairs of the Citizens Representative Khurals of the aimags where the Kharkhorum City is located, and two representatives from professional associations recommended by the state central administrative body in charge of construction. The Mayor of Kharkhorum City will be appointed and dismissed by the Government of Mongolia.

In addition to stipulating the economic foundations, property, budget, and taxation matters of the city, the law also provides for a City Development Fund. The fund’s resources will be allocated to develop social infrastructure, preserve historical and cultural heritage, promote tourism, and finance parks, landscaping, and green spaces. For investment and its stability, the law specifies conditions under which stabilization certificates, as outlined in the Law on Investment, can be issued with special terms regarding time frame, investment amount, and completion deadlines.

Once the permanent population of the city reaches 10,000, elections for the City Council and Mayor will be held. Until that condition is met, the Law on Supporting the Planning, Development, and Growth of Kharkhorum City remains in effect. Alongside this law, the State Great Khural of Mongolia also passed amendments to the Law on Customs Tariffs and Customs Duties. Additionally, for construction projects included in the general and partial master plans for Kharkhorum City, those with technical and economic feasibility and counted as core assets, the Government of Mongolia, based on recommendations from Kharkhorum City Council, may extend for up to four years the deadline for paying value-added tax (VAT) on imported construction materials and equipment not available from domestic production, or allow partial payments of VAT over four years.