Regulator
of Openness of Exploitation Production Ts.Tsolmon answers questions.

How is the openness in
Mongolia today?

The
number of exploitation production companies is not stable in Mongolia. There
are so far 125 companies that reported to our organization in 2009. The number
was 64 in 2006, 102 in 2007 and 115 in 2008. But the figures given to us from
the Government does not agree with ours. In 2006, 134 companies reported to the
Government. Even though there was no difference in 2007 and 2008, in 2009,
total of 363 companies reported to the Government. But according to information
from Mineral Department, there are over 6000 special licenses. Approximately
1000 of them are exploitation licenses. State Registration Authority on the
other hand said exploitation licenses are about 600. After seeing all these
numbers, we are guessing there are about 450 exploitation licenses, and 170 of
them are active.

Are there many companies
that make right reports and cooperate with you? Is it true that foreign
invested companies cooperate with you more?

Boroo
Gold and Erdenet can be taken as good examples of cooperation. Generally
speaking, exploiting companies support our operation.

What about financial
reports?

This
regulation came into force in 2006. That year, a random choice of 25 companies’
financial reports showed a total discrepancy of MNT3 billion short. In 2007,
audit reports of 34 leading companies found MNT750 million unaccounted for. In
2008, 46 companies were selected and there was MNT420 million that could not be
accounted for. The companies all explained they had donated this money.

Financial
audits are done by international organizations. In 2008, Hart Noirs Company
made a joint inspection with UB Audit Corporation, choosing companies that paid
more than MNT100 million in tax. There are things that are still not
understood, like what Erdenet Company did with MNT 1 million, how Mongol Gazar
spent MNT11 million on environmental protection, and what happened to the MNT
25.7 million which was said to have been donated to a soum in Khentii province
by Mongolrostsvetment. We still have a long way to reach corporate
transparency.