Under the "Strengthening Budget and Financial Stability Project" implemented in cooperation with the World Bank, the Ministry of Finance, the Financial Regulatory Commission /FRC/, and the Mongolian Insurance Association have prepared the draft revisions to the Law on Insurance, the Law on Insurance Intermediation, and the Law on Drivers’ Insurance. Within the scope of gradually implementing legal reforms in the insurance sector, in accordance with the relevant policy and planning of the Parliament and Government of Mongolia, the draft revisions of the laws were published on the Ministry of Finance’s website in June 2022 and have carried out the public discussion step electronically, thus reflected 277 suggestions received from the professional associations, stakeholders and individuals. The revised versions of the laws were prepared for the next round of discussions.
Thus, on 17, 18, and 19 August 2022, the working group of the Financial Regulation Committee /FRC/ and the Mongolian Insurance Association held a joint vacuum meeting at the FRC building for 3 days. Shortly after the Pandemic, the Law on State Savings was approved in order to enforce financial discipline in the government, its organizations at all levels, public services, and their activities, and in connection with ensuring transparency, increasing efficiency, and limiting and monitoring waste. Therefore, these draft laws were prepared in an environmentally friendly manner, with 100% digital presentation of the drafts and information at zero cost without the use of paper handouts. In this way, the Ministry of Finance and other affiliated organizations have successfully organized a number of discussions to encourage others to set a good example of how any public discussion can be held in an environmentally friendly manner without spending budgetary money.
At the meeting, they got acquainted with the basis and research of the suggestions and were mutually agreed upon, 50 suggestions of which were related to the draft Law on Insurance Brokerage, 13 of which were related to the Law on insurance intermediation, and 10 suggestions of which were submitted on the draft Law on Driver's Insurance. Representing the Insurance Association of Mongolia, A. Anarmaa, lawyer of Mongolia Insurance LLC; J. Davaasuren, lawyer of Bod Insurance LLC; O. Gerelmaa, G. Anu-Ujin, lawyer of Monre Insurance LLC; S. Maralmaa, lawyer of Tenger Insurance LLC; and J. Batjargal, Executive Director of the Insurance Association of Mongolia; and Z. Batbold, Head of the Insurance Department, P. Tserendejid, Senior Referee, E. Sainzaya, Specialist, O. Byambasuren, Ts. Dolgorsuren, Specialist, N. Battsetseg, Senior Specialist, P. Monkhsaikhan, referent N. Dulamsuren, B. Nyam-Ochir, senior specialist of the Legal Department, who represented the Financial Regulatory Commission and N. Tuvshinjargal, senior specialist of the Ministry of Finance, project consultant B. Javkhlantsogt, representing the Ministry of Finance, held the discussion.
By including the relevant proposals in the revised draft of the insurance package laws, the boundaries of insurance categories will be clarified, the classification nomenclature will be formulated more clearly for the users, the insurance industry participants will be able to provide and develop insurance services based on advanced electronic technology, create a legal environment, develop life insurance, and compulsory insurance. Moreover, it will enable the creation of a unified system, support technology-based insurance products and services, create professional investor insurers, improve the optimal risk management system, and improve the legal environment to protect the interests of policyholders. Also, in order to improve the risk management system, legal provisions relating to the improvement of the reinsurance operation system, increasing the capacity of domestic insurers, and reducing the outflow of foreign currency by including the regulation of insuring a certain percentage of reinsurance to domestic reinsurers, enabling electronic and advanced insurance operations which creates the opportunity to use technology, develop, and create a legal environment, were all reflected in the revised draft of the Insurance Law.
By revising the Driver's Insurance Law, the quality and service of the insurance will be improved, insurance premiums and evaluations will be in line with international standards, based on actual values, government involvement will be reduced, the damage will be quickly assessed in the event of an insurance incident, compensation will be provided in a short period of time, and road accidents will be reduced and the rights of the victim will be protected in case of insurance events.
The driver's insurance fund was only responsible for providing insurance compensation to the victim due to the conditions stipulated by the law that the insurer would not provide compensation but the revised law stipulates that the insurers themselves would now be responsible for this activity, which means the victim would have the opportunity to receive insurance compensation regardless of whether the victim was insured or not. By reflecting such provisions, the reputation of the insurance industry will be increased and will enable the insurers to create a unit that is in charge of resolving the urgent services within the organizational structure and the package draft laws are being finalized to be submitted to the Parliament of Mongolia.
LAUNCHED BETA VERSION OF THE REDEVELOPED GLASS ACCOUNT PORTAL
The Ministry of Finance Mongolia has developed and successfully launched the new version of the Glass Account Portal in 2023 within the framework of the Strengthening Governance in Mongolia Project jointly implemented by the EU and the World bank.
New systems and services are added in the Intermediate service platform for fiscal and financial systems
The Ministry of Finance Mongolia has developed and successfully launched the Intermediate Service Platform (ISP) in 2022 within the framework of the Strengthening Governance in Mongolia Project. The main purpose of the system is to provide a possibility of information /web services/ exchange between the independent systems of the Ministry of Finance and other organizations in a easy and flexible way. In addition, it is solving the issues of overlapping connections and development between many information systems and organizations, transferring them to a unified standard, making it has no complexity, and more secure.
The State Great Hural has passed a law on Public Private Partnership at its plenary session
The Ministry of Finance, in collaboration with national consultants and lawyers, introduced and prepared a draft law on Public Private Partnership as part of the technical assistance provided by the EU-funded "Strengthening Governance in Mongolia" Project implemented by the World Bank. A concept of the draft law on Public Private Partnership was approved and the draft law was submitted to the State Great Hural. A working group to draft the proposed law on Public and Private Partnership held a series of successful discussions and the State Great Hural passed the law on Public Private Partnership at its plenary session held on December 9, 2022. The Law on Public Private Partnership is to come into effect on July 1, 2023.
The network infrastructure, equipment and systems of the Ministry of Finance have been located to a new data center
Since moving to a new building in 2011, the Ministry of Finance has expanded its IT operations by placing servers, network and system equipment in a dedicated server room. The traditional layout of the server room, which fails to meet data center standards, has risks such as overheating, power failure, weak physical security protection, and the resulting loss of normal equipment operation. To eliminate and reduce these risks, a data center that meets the standards is essential, and the Ministry of Finance has launched a new data center that meets international standards with the support of the Asian Development Bank in 2022.
RELEVANT REGULATIONS AND METHODOLOGIES ON THE VALUATION ARE BEING DEVELOPED IN CONNECTION WITH THE LATEST APPROVAL OF THE AMENDMENT OF THE LAW ON VALUATION
After the Law on Valuation was first approved in 2010, the new revision of the Law on Valuation was approved by the Parliament of Mongolia in 2022 which was an important event in accelerating the development of the sector. In connection with the latest approval of the amendment of the Law on Valuation, as a next step towards addressing legal environment-related challenges, the Accounting Policy Department of the Ministry of Finance has been working on development and improvement of the relevant regulations and methodologies on the valuation, its organization, and quality control matters for the further development of the valuation service and ensuring the implementation of the law.
DRAFT OF THE MID-TERM ROADMAP TOWARD IMPLEMENTATION OF ACCRUAL BASED IPSAS AND CHART OF ACCOUNTS FOR PUBLIC SECTOR ACCOUNTING BEING DEVELOPED
As part of the Strengthening Fiscal and Financial Stability project, a consulting team has been developing draft of the mid-term roadmap toward implementation of accrual based International Public Sector Accounting Standards (IPSAS), economic classification and chart of accounts for public sector accounting and reporting.