‘Securities Markets Law’, first passed in 1994 and then revised in 2002, has been in effect. Following the development of the capital markets, there is an increased demand and necessity from companies to issue new securities and raise capital from domestic and foreign markets. Thus, the reform of the capital markets legal and regulatory environment such as improving the service standards and strengthening professional participants in the securiies market has become a pressing issue.

     The revised ‘Securities Markets Law’ reflects better protection of the rights of investors, more transparency in the market and clear specification of the types of professional operations in the securities market and requirements thereof. The proposed draft law sets out the role of the competent government authority, its power in the securities market and the specific methods to ensure the implementation of the law. Furthermore, the Law clearly defines the legal status of self-regulatory organization, their power, responsibilities and membership issues, also providing for the requirements for public offer of securities, disclosure requirements in the prospectus, accountability and responsibility of the issuer to minimize the risks for shareholders and matters relating to the issue of depository receipts based on underlying securities.

     The approval of the revised draft “Securities Markets Law” would be a major step in developing Mongolian capital market legal environment in line with international standards.

   

Public Relations Department

MONGOLIAN STOCK EXCHANGE