As the second largest landlocked country in the world, Mongolia has developed a maritime industry whose legitimacy is often disputed by international bodies.

The Mongolian Ship Registry was first established under then Prime Minister N.Enkhbayar in February 2003, as “one of the many projects the country has undertaken to improve the investment and economy of the country,” according to its mission statement.

According to international ship registries, shippers might opt for a Mongolian registration thanks to a range of benefits, such as low taxes or no additional costs, no restrictions on crew nationality, and no restrictions on the ownership of any vessel.

A UN report from 2013 found that over the course of the decade, the Mongolian merchant fleet grew to reach a total dry weight tonnage capacity of 643,000 tons, the vast majority as bulk carriers or general cargo ships.

Inspections of these vessels under the Tokyo Memorandum of Understanding, which holds regular port state controls in the Asia-Pacific region, have raised numerous alarms, subsequently Mongolian ships have often been blacklisted. For example, in 2016, out of 108 inspections, 96 of the ships were found to have “deficiencies”, resulting in 16 detentions. Mongolia’s vessels are also present in the data-bases of  technically sub-standard ships.