Unofficial translation

MONGOLIAN LAW ON FOREST

Date: May 17, 2012                                                                                                                                                   Ulaanbaatar

LAW ON FOREST

/A revised version/

CHAPTER ONE

GENERAL PROVISIONS

Article 1 Purpose of the Law

1.1 The purpose of this Law is to regulate relations for protection, restoration, forestation,tenure, use of forests and prevention from forest and steppe fires in Mongolia.

Article 2 Legislation on Forests

2.1. The legislation on forest consists of the Constitution of Mongolia, Law on Environmental Protection, Law on Fire Security and this Law and other relevant legislation which is consistent with these laws.

2.2. If international treaties to which Mongolia is a party contain provisions inconsistent with this law, then provisions of the international treaties shall prevail.

Article 3 Definitions

3.1 Terms used in this law are to be interpreted as follows:

3.1.1“Forest” means specific ecological-geographical conditions of a complex (in-situ) environment, where trees, bushes, shrubs and other plants, lichen, moss, wildlife and microorganisms naturally co-exist;

3.1.2. “Forest fund” means all the forested areas specified in Article 3.1.1 of this Law and plus non-forested areas amid the forested areas and the environment including the area needed for forest growth;

3.1.3. “Forest resources” means amount of forest, expressed in area covered and volume of growing trees;

3.1.4. “Harvest quota” means the maximum amount of harvestwhich is allowed for a specified period of time ensuring the balance of the forest ecosystem;

3.1.5. “Tenure forest” means a part of forest fund which is protected, possessed and used by forest user groups, economic entities and organizations for a specified period on a contractual basis;

3.1.6.“Forest management plan” means a plan defining comprehensive and phase-by-phase forestry sylviculturalmeasures towards protection, sustainable use and restoration of forestson a given territorial-administrative unit or a tenure forest;

/Amendedby the Law dated July 9, 2013/

3.1.7. “Ecological-economic evaluation of the forest” means a monetary value of ecological-economic benefits derived from the amount, quality and use of forest resources;

3.1.8. “Forest user group” means a voluntary association of citizens organized pursuant to Article 481.1 of the Civil Code and Article 3.2.8 of the Law on Environmental Protection and running their joint efforts;

3.1.9. “Forest protection” means measures to prevent from the forest deteriorating factors such as outbreaks of forest and steppe fires,pest insects and diseases, sustainably use of forest recourses in conformity with the carrying capacity of forest resources avoiding loss of their natural regeneration rates, restorationof forest resources as well as to monitoring activitions and actions to cease violations;

3.1.10. “Forest use” means use of timber or non-timber forest products from forest fund in conformity with its carrying capacity according to the respective regulations, quidelines and standards;

3.1.11. “Forest product” means timber and non-timber resources in a forest;

3.1.12. “Non-timber forest product” means any resources derived from forest such as berries, mushrooms, nuts, medicinal, nutritional and commercial plants, wood barks, corks, birch sap, pitch, moss, plant detritus growing in the area of forest fund;

3.1.13. “Forest inventory and forest taxation” means comprehensive measuresto define forest protection, sustainable use and restoration activities through assessing the area, resources, distribution, composition, quality, conditions, changes of forest fund as well as estimation of greenhouse gas sequestration and study on forest biomass;

/Revised by the Law dated July 9, 2013/

3.1.14. “Afforestation” means establishment by planting trees in an area where there was previously no forest’;

3.1.15. “Forest cleaning” means measures towards forest protection and improvement of forest conditions through removal of dead or fallen trees, twigs, limbs and trees that lost their survivability due to forest fire, pest insects, diseases, storm or large amount of snow;

3.1.16. “Detrimental impacts on forest fund” means any adverse actions leading to loss carrying capacity of any element forest fund, polluting forest or degradation of forest conditions during sylvicultural or forest production activities;

3.1.17. “Fire danger sesson” means the driest periods of a year, when natural conditions are met for forest and steppe fires outbreak in a given area, namely a period from March 20 to June 10 and a period from September 20 to November 10 of each year;

3.1.18 “Prevention from forest and steppe fire” means public awareness activities and forestry sylvicultural measures by the governmental and non-governmental organizations, economic entities and individuals with the purpose to prevent from forest and steppe fire outbreaks;

3.1.19.“Forest and steppe fire detection” means detection of a fire in terms its location and area as well as its epicentre;

3.1.20. “Trans-boundary forest and steppe fire” means forest and steppe fire that occurred at the state border or along the border zone and expanded over a boundaries of two countries;

3.1.21. “Damages incurred by forest and steppe fire” means losses of human lives, damages to health, natural ecosystem and other materials due to a fire and expenses incurred by the forest and steppe fire extinguishment effort;

3.1.22. “Ecological loss incurred by forest and steppe fire” means loss of normal conditions of natural ecosystem and loss of ecological role and significance for protection of forest, its soil and water, loss of animals and plantsas well as degradation of their species` habitats, loss of natural resources and natural products due to fire;

3.1.23. “Material loss incurred by forest and steppe fire” means direct damagesto fixed or financial assets such as buildings or constrcution facilities, livestock, animals, plants, hays, fodders, livestock shelters, vehicles, equipment, gers, houses and other materials in form of breakage or loss incurred to the country, forest user groups, economic entities, organizations, or individuals due to fire;

3.1.24. “Consequence of forest and steppe fire” means what is specified in 4.1.10 of the Law on Disaster Prevention;

Article 4. Ownership of Planted Forests and Tenure Forests

4.1. As set forth in provision 1 and 2 of Article 6 of the Constitution of Mongolia, forest resources are state property under the sole authority of the Mongolian people.

4.2.A citizen acquire ownership of a forest planted by his/her own means according to the related legislation on the land in his/her ownership or tenure or a forest

user group, economic entity or organization may take ownership of a forest planted by their own means on their tenure land if it was planted according to the related legislation.

4.3.Granting ownership of a planted forest and its non-timber forest products as set forth in Article 4.2 of this Law, shall be decided uponas specified in Article 30.5 of this Law based on conclusions made by a professional scientific organization, local administration and State Administrative Central Body in charge of environment issues (hereafter referred to as “State Administrative Central Body”).

4.4.Tenure of forest resources and forest fund shall be granted as follows:

4.4.1. The State Administrative Central Body shall grant ownership of forest resources to aimags, capital, soums` tenure.

4.4.2.Soum andDistrict Citizens` Representatives Khurals, based on a proposal of Bagh or KhorooPublic Khurals, shall grant tenure rightsand right to use of forest resource to a forest user group, economic entity or organization on a contractual basis indicating specific duration and conditions.

4.5. The contract agreement set forth in Article 4.4.2 of this Law may be concluded for an initial period of one year, for the purpose of ensuring adequate preparations and further extended with an interval of ten years for at total period of 60 years.

4.6.A forest used on a contractual basis pursuant to Article 4.4.2 of this Law shall be considered as a tenure forest of the forest fund.

4.7.As set forth in Article 4.4.2 of this Law, a possessor of a tenure forest shall protect, use timber and non-timber forest products and undertake cleaning and restoration measures in the tenure forest as foreseen in a management plan according to this Law`s provisions.

4.8. Unless the legislation provides otherwise, a tenure forest may be established in either of conservation or utilization zone of forests.

4.9. The Government shall set and approve a list of tenure forests in the conservation forest zone upon the consideration of their purpose and ecological, economic and social importance.

4.10. The Government shall approve a regulation on granting tenure rights of forest to forest user groups, economic entities and organizations.

4.11.Without causing any damage to the forest, a citizen is allowed walk for travel or leisure purposes, drive livestock herds and run bee farms or subject to permission by the respective governmental organization(s) usenon-timber forest products and hunt in

the tenure forest under tenure of forest user groups, economic entities and organizations on contract basis as specified in Article 4.4.2 of this Law.

4.12. Persons other than the forest tenants who harvest timber and use non-timber forest products at permits by the respective governmental organization according to the related legislation in tenure forest as defined in Article 4.6 of this Law shall pay a certain portion of the expenses for forest fund protection, restoration and cleaning measures to the forest tenant of that forest.

4.13. The State Administrative Central Body shall approve amethodology and regulation on payment stated in Article 4.12 of this Law.

Article 5. Classifications and Land of Forest Fund

5.1. Based upon conservation and utilization regimes and ecological-economic importance, the forest fund shall be classified as follows:

5.1.1.Conservation forest zones and

5.1.2 Production forest zone.

5.2 Forested areas, planted forests, bush and shrub stands, harvesting areas, the forested areas damaged by forest and steppe fire, pest insects and diseases, glades and the area extending to 100 meters beyond the outer edge of the forest, as well as seedlings and nursery areas to the land of forest fund.

Article 6. Forest Databank System and its Regulation

6.1 The State Administrative Central Body in charge of forest issues shall have the national forest databank containing data and information on forest conditions, size of area covered by forest fund, amount of forest resources, forest composition, assessment findings, their changes and comprehensivedata on measures for protection, use and restoration of the forest.

/Amended by the Law dated August 17, 2012/

6.2 A Cabinet member in charge of environment issues shall approve a regulation for registration, reporting forms andmaintanance of the databank.

6.3 Relations connected to the databank management as set forth in Article 6.1 of this Law shall be regulated as per the Chapter 7 of the Law on Environmental Protection.

6.4 Governors of respective levels shall urgently inform on forest and steppe fire occurrence tohigher level Governors and the state administrative central bodies in charge of environment and emergency issues on regular basis.

6.5.Aimag and Capital City Governors shall submit semi-annual and annual reports on forest and steppe fires to the the state administrative central bodies in charge of environment and emergency issues.

Article 7. Forest Inventory, forest taxationand their financing /Article`s title was amended by the Law dated July 9, 2013/

7.1 Professional forestorganization authorized by the State Administrative Central Body shall execute forest inventory.

/Amended by the Law dated July 9, 2013/

7.2 State Administrative Central Body in charge of environment issues shall implement a national forest inventory with an interval of five years and update the dataon conditions of the forest fund. A forest taxation shall be implemented with an interval of ten years in order to update forest use, forest protection and forest restoration measures.

/Amended by the Law dated July 9, 2013/

7.3 In case of emergencies such as occurrence of natural disasters, forest and steppe fires, pest insects outbreaks or diseases a forest taxation can be implemented regardless of the period as provided in Article 7.2 of this Law.

7.4 Forest inventory and taxation shall be financed in the following manner:

/Amended by the Law dated July 9, 2013/

7.4.1 Forest taxation costs in the conservation and production zones in order to define resources amount of forest fund in relation with the regional development trend and the costs for the development of a state forest mangement general plan shall be financed from the state budget;

7.4.2 Costs related with setting a conservation zone and implementing forest taxation and development of forest management plan forproduction forest at decision by Aimag, Capital City, Soum andDistrict Citizens` Representatives Khural shall be financed from local budgets;

7.4.3 Forest user groups, economic entities and organizations shall finance forest taxation and implementation of forest management plans for their tenure forests, with the exception of the first forest taxation of forest user group tenure forest, which shall be financed from the local budget.

7.5 The Government shall approve regulation on conducting forest inventory and forest taxation.

/Amended by the Law dated July 9, 2013/

CHAPTER TWO

FOREST ZONES AND THEIR PROTECTION REGIMES

Article 8. Conservation Forest Zone and its Regime

8.1 Conservation forest zone shall comprise sub-tundra forests, forests in special protected areas and forests designated for training and research, green belts, prohibited forest strips, saxaulforest, oasis forests, groves and bush stands of up to 100 hectares of area, bushes, shrubs and forests on slopes greater than 30 degrees.

8.2 Prohibited strip forests shall comprise forests within a radius of 1,000 meters around lakes, mineral and other water springs, riverbanks and forestwithin 100 meters on both sides of national roads and railroads.

8.3 Boundaries of sub-tundra forest shall be defined by the State Administrative Central Body for the purpose of preserving ecological balance and preventing soil erosion in watershed areas.

8.4 Protection regimes for forests in special protected areas shall be regulated by the Law on Special Protected Areas.

8.5 To ensure ecological balance and public sanitation, the demarcation of the forests in the Capital, cities and village green belts and their boudaries shall be set as follows:

8.5.1 Boundaries of the forests belonging to the Capital City’s green belt shall be set by the Government.

8.5.2 Boundaries of the forests belonging to the green belt of the forests within a radius of 30 kilometers of cities beside the Capital city or towns shall be set by the State Administrative Central Body based on proposals of the Aimag and SoumCitizens` Representative Khurals;

8.5.3 Boundaries of the forests belonging to green belts of settled areas shall be defined by the AimagCitizens` Representatives Khural based on proposal of the SoumCitizens` Representatives Khural.

8.6 Prohibited activities inconservation forest zone include construction of roads, bridges, hydrological, power, telecommunications lines and activities other than building fire preventing dirt strips, implementing the forest thinning and cleaning measures to support forest regeneration, growth and use of non-timber forest products.

Article 9. Production Forest Zone and its Regime

9.1 Production forest zone shall comprise all the forests other than specified inArticle 8 of this Law.

9.2 Citizens, forest user groups, economic entities and organizations may use timber and non-timber forest products of production forest subject to payment of the relevant payment and fees.

9.3 Forest user groups, economic entities and organizations in possession of tenure forestfund on contractual basis shall undertake activities on the basis of forest management plans that ensure scientifically-sound forest protection and regeneration as well as sustainable use of fund.

Article 10. Forestry sylvicultural measures to be undertaken in the forests on land forstate special needs

10.1 Forestry sylvicultural measures to be undertaken in the forests on land forstate special needs shall be regulated by a special regulation.

10.2 The regulation stated in Article 10.1 of this Law shall be developed by the State Administrative Central Body based on proposals by respective agencies and approved by the Cabinet Member in charge of environment issues.

/Amended by the Law dated August 17, 2012/

10.3/Annuled by the Law dated July 09, 2013/

CHAPTER THREE POWERS OF GOVERNMENTAL AND LOCAL SELF-GOVERNING ORGANIZATIONS

Article 11. Powers of the State Great Khural

11.1. The State Great Khural shall exercise the following powers in respect to forest issues:

11.1.1. Define the state policy on forest protection, use, restoration and forestation;

11.1.2. Set maximum and minimum amount of payment fee for use of forest resources;

11.1.3. Ratify and/or withdraw from relevant international agreements and treaties on forests and forest and steppe fire;

11.1.4. Exercise other powers provided by law;

Article 12. Powers of the Government

12.1. The Government shall exercise the following powers in respect to forest issues:

12.1.1 Restrict, as provided in the law, or prohibit for a certain period of time the quota for the use, importation and exportation of timber and non-timber forest products;

12.1.2. Implement the state policy on forest and steppe forest prevention;

12.1.3.Aprrove the national programme on forest;

12.1.4 Earmark annual budget for forest resourcesprotection, restoration and forestation, as well as for exploring, designing and building of main entrance tracks in production forest zones of forested areas;

12.1.5.Allocatearea size, standards and locations of the forests among responsibilities of forest units depending on forest resources, forest conditions and utilization intensity;

12.1.6.Approve and ensure enformcenent of a regulation for estimation of damages and losses incurred by forest and steppe fire and other related regulations as well as norms/normative of fire extinguishmentequipment in relation to administrative-territorial units and their specific conditions;

12.1.7. Approve a regulation for announcement andmobilization of man-force and vehicles during the time prone to forest and steppe fires;

12.1.8.Approve the minimum supplies and techniques to be applied by the people being mobilized and a list of necessary equipment and tools for forest and steppe fireextinguishment;

12.1.9.Restrictorcease use of land, forests, plants and animals in order to maintain ecological balance and eliminate damages to the environment due to forest and steppe fire;

12.1.10. Exercise other powers provided by law.

12.2.The Government may establish a state owned legal entity to be in charge of timberproduction from forest, build forest tracks andrun tree nurseries for growing seedlings adapted toclimate.

Article13.Powers of the State Administrative Central Body

13.1 The State Administrative Central Body shall exercise the following powers inrespect to forest issues:

13.1.1 Organize implementation of state policies and legislation on protection, sustainable use and restoration of forests, forestation, forest and steppe fire prevention and maintenance of ecological balance;

13.1.2.Takedecicisions and approve rules and regulations to be followed by other state central administrative bodies and Aimagand Capital Cityadministrations in respect of forest protection and to ensure their implementation;

13.1.3 Ensure inter-sectoral and inter-regional coordination with regards to forest protection, sustainable use, restoration and afforestaiton, obtain approvals of respective standards from relevant authorities and approve legal acts independently or in cooperation with other relevant state central administrative bodies and ensure implementation thereof;

13.1.4. Set the maximum amount for annual harvest reserve in accordance with legislation;

13.1.5 Restrict or prohibit for a certain period of time the use of timber or non-timber forest products in a region upon consideration of ecological requirements and existing forest resources;

13.1.6. Approve a national forest management plan;

13.1.7.Develop, implement and monitor the implementation of an action plan according to the national programme on forest stated in Article 12.1.3 of this Law;

13.1.8. Define and assess conditions and quality of forest resources and monitor changes, use and protection of forest resources;

13.1.9 Monitor implementation of the national forest databank maintainance;

13.1.10.Issue, extent and withdraw licenses to professional forestorganizations;

13.1.11. Plan, distribute state budget allocations for activities as provided in Article 7.4.1 of this Law and assess the implementation and finance the executing entities;

13.1.12.Organize internal monitoring for forest resourcesprotection;

13.1.13. Develop and approve forest ecological-economic assessments;

/Revised by the Law dated August 17, 2012/

13.1.14.Authorize Protected Area Administrations to prohibit some activities that are allowed in the protection regimes within their designated areas during the time prone to forest and steppe fires;

13.1.15.Conclude agreements and cooperate with neigboring countries with regard to prevention and extinguishment of trans-boundary forest and steppe fires;

13.1.16. Provide respective organizations and populations with timely updates on weather conditions and forest and steppe fire occurrence;

13.1.17.Plan, manage and oversee the implementation of protection and preventive actions from outbreaks of forest and steppe fire and pest insects, loss, deterioration and pollution of forest resources and land and enforcement actions to ceaseillegal actions related to the forest use;

13.1.18.Approve forest management plans for Aimags and Capital Cityand provide support to their implementation;

/Amended by the Law dated August 17, 2012/

13.1.19.Manage forestation efforts at central and local levels in areas where harvesting took place and in forests affected by forest and steppe fires, pest insects and diseases, forestation and establishment of forest strips in the Gobi and steppe regions and greening in settled areas;

/Amended by the Law dated August 17, 2012/

13.1.20. Provide professional and technical guidance at the national level in establishment of woody and shrubbery plant seed reserve fund and establishment of tree nurseries and growing seedling;

/Amended by the Law dated August 17, 2012/

13.1.21. Provide professional and methodological assistance to forest units, forest user groups, economic entities and organizations in local areas and monitor their activities and performance;

/Amended by the Law dated August 17, 2012/

13.1.22. Approve operating rules and regulations of forest units;

/Amended by the Law dated August 17, 2012/

13.1.23.Oversee public spending for forest protection, restoration and forestation and report their performances;

/Amended by the Law dated August 17, 2012/

13.1.24.Develop and approve justifications for technologies,norms and standards of forest protection, sustainable use, restoration and forestation;

/Amended by the Law dated August 17, 2012)

13.1.25.Monitor and analyzechanges in forest resources, establish and make available forest database and review and make conclusions on whether economic entities and organizations meet the minimum requirements for aprofessional forestorganization;

/Amended by the Law dated August 17, 2012/

13.1.26. Provide diverse support in mobilization of domestic and foreing economic entities and organizations` effort into forest protection, restoration and forestation;

/Amended by the Law dated August 17, 2012/

13.1.27. Approve guidelines and regulation on development of action plans on forest protection, sustainable use, restoration and forestation by forest user groups, economic entities and organizations, operational guidenance and responsibilities of forest units and a model forest management plan;

/Amended by the Law dated August 17, 2012/

13.1.28.Plan nationwide forest and steppe fire prevention measures and actions through cleaning, thinning and building fire breaks in conservation forest zones and ensure their implementation through earmarking the necessary budget in the state and local budgets;

/Amended by the Law dated August 17, 2012/

13.1.29.Joinlty organize public awareness actions on legislation on forest and steppe fire prevention and training of citizens, forest user groups, economic entities and organizations in forest and steppe fire extinguishment techniques in cooperation with the State Administrative Central Body in charge of emergency issues;

/Amended by the Law dated August 17, 2012/

13.1.30. Cooperate with local governmental organizations in organizing mobilization of local communities into patrolling and guiding for prevention from forest and steppe fires during fire seaons;

/Amended by the Law dated August 17, 2012/

13.1.31.Develop a proposalto cease specific environment related activities within areas of the Aimagand Capital Cityduring the time prone to forest and steppe firebased on actual fire danger degree in the respective region for approval by the respective AimagorCapital City Governor;

/Amended by the Law dated August 17, 2012/

13.1.32.Oversee the implementation and cooperateonlocal administrative organizations, economic entities, organizations and individualsactivities towards forest and steppe fire prevention;

/Amended by the Law dated August 17, 2012/

13.1.33. Immediately announce about occurrence and prevention from forest and steppe fire to the public through the media;

/Amended by the Law dated August 17, 2012/

13.1.34.Engage a forest research and monitoring office or unit within its organizational structure;

/Amended by the Law dated August 17, 2012/

13.1.35. Exercise other powers provided by law.

/Amended by the Law dated August 17, 2012/

Article 14. Unit in charge of Forest Issues

/The article’s title was revised by the Law dated August 17, 2012/

14.1.Aimag and Capital City’s environmental departments shall has a unit or officers in charge of forest issues and inter-soum and soum`forest units (hereinafter referred to as “forest unit”) shall be in aimags and soums.

/Revised by the Law dated August 17, 2012/

14.2./This provision was annuled by the Law dated August 17, 2012/

Article15. Powers of the theState Administrative Central Bodyin charge of emergency issues

15.1. The State Administrative Central Body in charge of emergency issues shall exercise the following powers with respect to forest and steppe fire prevention and extinguishment:

15.1.1. Organize mobilization according to the regulation stated in Article 12.1.7 of this Law and take necessary actions to extinct the forest and steppe fire started;

15.1.2.Provide professional and metholodgical support to organization of trainings for local residents and populations in forest and steppe fire prevention, fighting and extinguishment techniques;

15.1.3.Restrict or cease certain environment related activities in a region for the purpose to prevent from forest and steppe fire.

Article 16.Powers of the Police

16.1. The Police shall exercise the following powers:

16.1.1.Detect causes and actors ofthe occurredforest and steppe fires;

16.1.2.Cease or prohibit movement of individuals and vehicles to forests during the time prone to forest and steppe fires;

Article 17.Powers of Citizens` Representative Khurals of Aimags and Capital City:

17.1. The Aimagand Capital City’s Citizens` Representative Khurals shall exercise the following powers:

17.1.1. Approve the funding required for forest protection, sustainable use, restoration and forestation as well as forest and steppe fire prevention action plans and programmes and oversee their implementation;

17.1.2.Receive information and reports of the Governor on performances of action plans and programmes for forest protection, sustainable use, restoration and forestation as well as forest and steppe fire prevention and updates on forest fund state and the databank;

17.1.3.Take decisions on taking certain parts of forest fund within its area in charge under local protection based on the proposal by the Governor and setting their boundaries and protection regimes and oversee their compliance;

17.1.4.Allocate and approve annual timber and fuel woodquotas from the forestfor the soums within the maximum limits approved by the State Administrative Central Body;

17.1.5. Approve the action plan and its budget for forest and steppe fire prevention measures to be implemted within its area in charge and oversee its implementation;

17.1.6.Approve lists of forest unitswithin its areaand their annual budgets upon the consideration of forested areas norms.

17.2.Aimagand Capital CityGovernors shall have the following powers:

17.2.1 Manage the implementation of forest legislation and decisions of the Aimagand Capital CityCitizens` Representative Khural and the Government;

17.2.2.Develop an action plan and programme on forest protection, sustainable use, restoration and forestation as well as forest and steppe fire prevention measures for approval by the Citizens` Representative Khural and ensure their implementation;

17.2.3.Deliver the forest fund updates and reports to the State Administrative Central Body;

/Revised by the Law dated August 17, 2012/

17.2.4.  Submit  a  proposal

for

annual

timber

harvest

quota

to

the

State

Administrative Central Body;

/Revised by the Law dated August 17, 2012/

17.2.5.Take actions for having assessed the damages and losses incurred by forest and steppe fire, sending a staterequest for environmental restoration, conducting research and monitoring, review their performance and ensure the implementation;

17.2.6. Monitor activities of forest user groups, economic entities and organizations on forest protection, sustainable use, restoration and forestion, ensure redress of ascertained violations if necessary and suspend the activities harmful to the forest fund;

17.2.7.Get approval for and administer funds from local budgets for prevention and control of damage from pest insects, diseases and forest and steppe fires and implement forest protection, sustainable use, restoration and forestation;

17.2.8.Establish inter-Soum forestunits to be supervised by the Aimagand Capital Citydepartments of Environment, approve their staffing and regulations and appoint or release their managers in consultation with the respectivedeparments;

17.2.9 Organize annually forest restoration and forestation activities and monitor their implementation;

17.2.10.Approve forest management plans for the forested soums and districts and monitor their implementation;

17.2.11.Make available the equipment, tools, food and other supplies according to the norms approved by the Government while exercising the powers specified in 14.1.2 of the Law on Fire Security;

17.2.12.Exercise the powers specified in 14.1.4 of the Law on Fire Security;

17.2.13. Promptly organize mobilization of necessartman-force, equipment and other available resources in the framework of its powers to extinct the occurred forest and steppe fire;

17.2.14.Approve and implement an action plan for demonstration training on prevention, detection, extinguishment and protection of lives, health and properties for citizens, economic entities and organizations;

17.2.15.Build forest and steppe fire prevention strips along the state border, regularly maintain and restore them at the state funding and organize forest cleaning and thinning activities within the border zones at local expenses;

17.2.16.Appoint disaster protection emergency offices, units and professional units to deal with forest and steppe fire extinguishmentand ensure their readiness and immediately organizeand guide forest and steppe fire extinguishment efforts;

17.2.17. Compensate the individuals, forest user groups, economic entities and organizations, if they immediately suppressed forest and steppe fires at their expenses as mobilized their man-force and equipment, from local budget and apply the Government for additional funding, when local funding is insufficient;

17.2.18.Prohibit activities timber harvest, use of non-timber forest products, going on travel within forests and other activities during the time prone to forest and steppe fires;

17.2.19. Organize and implement mitigation and remedial actions to reduce and eliminate the damages and lossed incurred due to forest and steppe fire;

17.2.20.Monitor and oversee forest and steppe fire prevention actions being organized at soum level;

17.2.21.Monitor and oversee the supplies of necessary equipment and tools as well as meals to the individuals, economic entities and organizations working in the forest and steppe fire core areas;

17.3. The Aimagand Capital CityEnvironment departments shall have the following powers:

17.3.1.Manage the enforcement of forest legislation within area in charge and report to the Aimagand Capital CityGovernors and the State Administrative Central Body;

/Revised by the Law dated August 17, 2012/

17.3.2. Maintain the Aimagand Capital Cityforest databank and provide the State Administrative Central Body with information;

/Amended by the Law dated August 17, 2012/

17.3.3. Provide professional guidance to its subordinate forest units and oversee their performances and activities;

17.3.4.Present proposals on forest protection, sustainable use, restoration and forestation to the Citizens` Representative Khural for approval and forward the proposals to the State Administrative Central Body for consideration, if necessary;

/Amended by the Law dated August 17, 2012/

17.3.5.Send requests for research and monitoring on occurrence of forest and steppe fires, pest insects and diseases as well as forest products withinarea in charge to professional and research institutions;

17.3.6.Levy and retain forest resource use payments and fees from their users in accordance with the legislation;

17.3.7. Manage and organize the activities of forest protection, sustainable use, restoration and forestation as well as forest and steppe fire prevention within its area in charge;

17.3.8.Present its proposal on setting up unit or appointing official in charge of forest issues at the department and appointing or releasing heads of forest units to the Aimag/Capital CityGovernor for approval;

17.3.9.Approve forest management plans of forest user groups, economic entities and organizations possessing parts of forest fundand monitor their implementation;

17.3.10.Distribute the funding allocated to the forest protection, restoration and forestation to executing entities on contractual basisand oversee and report their expenditures;

17.3.11. Oversee the activities organized for forest and steppe fire prevention at soum level;

Article 18.Powers of the Soum and District Citizens` Representative Khural:

18.1.The Soum andDistrict Citizens` Representative Khural shall have the following powers:

18.1.1. Approve the budget and monitor implementation of the actions for forest protection, sustainable use, restoration and forestation as well as forest and steppe fire prevention within its area in charge;

18.1.2.Define annual forest resource use quotas based on the legal basis and procedures in the legislation;

18.1.3. Discuss and approve the reports by the Governor with regard to forest protection;

18.1.4.Take decisions on granting tenure rights of certain parts of forests by forest user groups, economic entities and organizations on contract basis based on the proposals by Bagh and KhorooPublic Khurals and monitor the compliance with their contract commitments;

18.1.5.Annually discuss and appraise compliance with the contracts with forest user groups, economic entities and organizations possessing the parts of forests;

18.1.6.Approve the local policyand guideline on forest protection, sustainable use, restoration and forestation and monitor its implementation;

18.1.7.If necessary, have forest units or recruit an officer responsible for forest issues and approve its budget;

18.1.8.Approve an action plan and its budget for forest and steppe fire preventionand monitor its implemtmation within its area in charge;

18.2.The Soum andDistrict Governor shall have the following powers:

18.2.1.Organize the enforcement ofthe legislation and decisions by the Citizens` Representative Khural and higher authority organization(s);

18.2.2.Implement the action plan and programme for forest protection, sustainable use, restoration and forestation as well as forest and steppe fire prevention within the Soum andDistrict area;

18.2.3.Monitor the issuance of certificates of origin and licenses stated in Article 34.1 andArticle 38.1 of this Law and revoke the certificates or licenses if they are defined as illegal or unjustifiable;

18.2.4.Monitor the forest protection, sustainable use, restoration and afforstation as well as forest and steppe fire prevetion activities by the forest user groups, economic entities, redress of ascertained violations and accept the forests planted by them;

18.2.5. Prevent from outbreaks of forest and steppe fires, pest insects and diseases, as well as illegal actions and take actions for elimination of the damages incurred;

18.2.6. Conclude contracts on forest tenure rights over a certain parts of the forest fundwith forest user groups, economic entities and organizations specifying specific conditions and terms and duration based on the decision stated in Article 18.1.4 of this Law and monitor their contract compliance;

18.2.7.Take decisions, implement and monitor timber harvests within the quotas or limits set by the Soum and District Citizens` Representative Khuralbased on forest management plans of forest user groups, economic entities and organizations;

18.2.8.Get approval and implement the soum forest management plan and getthe forest resource registration and forest taxation executed by professional institution(s) within its area in charge;

18.2.9.Appoint and release heads of forest unit or the officer in charge of forest issues;

18.2.10.Annually approve and manage implementation of local action plan for forest and steppe fire prevention;

18.2.11.Get executed and accept the results of forest and steppe fire prevention stripsbuilt along railways, auto roads, herders’ winter and spring settlements, cultivation fields and buildings and facilities in forests;

18.2.12.Mobilize local communities, forest user groups, economic enitites and organizations into patrolling and guarding during the time prone to forest and steppe fires within its area;

18.2.13.Manage forest and steppe fire extinguishment efforts, develop a procedure and schedule for mobilization prior to the time prone to forest and steppe fires on annual basis and organize its follow up;

18.2.14.Issue permits to travel, hunting, timber harvest, use of non-timber forest products and other production and serives and present the requests to limit and cease the activities during the time prone to forest and steppe fires to higher authority organizations for approval;

18.2.15.Appoint a working group to estimate and appraise the damages and lossed incurred by forest and steppe fires and expenses incurred during fire extinguishment;

18.2.16.Ifa forest and steppe fire coversareas of two and more soums, its expense issue shall be presented to the Aimagand Capital CityGovernor for decision and reimbursement;

18.2.17.Manage organization of public awareness actions on forest and steppe fire prevention within the soumarea and grant parts of forest land under responsibilities of local communities, forest user groups, economic entities and organizations engaged in timber harvest and monitor their activities;

18.2.18.Promptly arrangeforest and steppe fire extinguishment groups by mobilizing man-force and technical supplies and immediately and timely inform about occurrence of forest and steppe fire and its response actions to upper level Governor and other respective organziaitons;

18.2.19.Cooperate with the police in detection of causes and conditionsof forest and steppe fires and persons, who caused the fires;

18.3 Inter-soum and soum or district forest unit shall have the following rights and obligations:

18.3.1. Designate a timber harvest area within a forest;

18.3.2.Issue certificates of origin to timber harvests and wooden materials;

18.3.3.Carry out reforestation in the forest standsaffected by timber harvesting,pest insects and conduct a general survey on distribution of pest insects within forested areas in soum or district area in charge;

18.3.4. Plant and sell seeds and seedlings and conduct ecological and economic assessment and estimation of damages to forests;

18.3.5. Carry out cleaning cutting and thining in forest stands and implementation of soumand aimagforest programme and management plans;

18.3.6.Provide professional and methodological recommendations to the forest user groups, economic entities and organizations that possess parts of the forest fund;

18.3.7. Levy forest resource use payments and fees and ensure payments thereof;

18.3.8. Implement and appraise results of the aimagand soum policy on forest protection, sustainable use, restoration and forestation;

18.3.9. Maintaing the databank;

18.3.10.Organize public awareness and trainings on forest protection, sustainable use, restoration and forestation andforest and steppe fire prevention;

18.3.11.Implement preventive and combating measures against distribution and outbreaks of forest and steppe fires, pest insects and diseases and other natural disastrial phenomena;

18.3.12.Ensure the enforcement of forest management plans of forest user groups, economic entities and organizations and redress of ascertained violations;

18.3.13.Forest unitsshall have financing funding sources from the budget and self-funding sources from the deliverablessuch as professional and methodological recommendations and consultancies;

18.3.14.Organize the activities towardsforest protection, sustainable use, restoration and planting, as well as forest and steppe fire prevention;

18.3.15. Cooperate with the soum governmentwith regard to forest and steppe fire extinguishment tasks.

Article 19. Powers ofBagh and Khoroo Public Khural and Governor

19.1.Bagh and Khoroo Public Khurals shall exercise the following powers:

19.1.1. Determine forest protection, sustainable use, restoration and reproduction activities and ensure implementation and monitoring;

19.1.2.Receivebagh and khoroo governor’s reports on the implementation of forest legislation;

19.1.3.Submit proposals and opinions to the Soumand District Citizens` Representatives Khural and Governor on granting or repealing forest tenure rights of forest user groups, economic entities and organizations;

19.2.Bagh and khoroo governors shall exercise the following powers:

19.2.1.Organize the implementation of forest legislation, decisions of Public Khurals and other higher authority organizations;

19.2.2.Organize tree and shrub planting in the areain charge and ensure broad public participation;

19.2.3. Deliver awareness notices on forest and steppe fire prevention to all residents and ensure preparedness for combating fires;

19.2.4. Promptly organize the actions to combat forest and steppe fires by mobilization ofman-force and technical supplies and immediately inform aboutprogress on response actions to upper level Governor and other respective organziaitons;

19.2.5.Grant parts of forest land in the areain chargeto local communities, forest user groups, economic entities and organizations for certain period of time and monitor their actions;

19.2.6. Provide support to the respective organizations in detection of causes and persons, who caused the forest and steppe fires and estimate their damages.

CHAPTER FOUR

RIGHTS AND OBLIGATIONS OF INDIVIDUALS, FOREST USER GROUPS,

ECONOMIC ENTITIES AND ORGANIZATIONS

Article 20.Rights and Obligations of Individuals

20.1.Individuals shall have the following rights in forest protection:

20.1.1.Demand that violators of forest legislation who have caused damage to the forest fund or their health or property are held legally responsible and pay financial compensation for the damages;

20.1.2.Possess, protect and sustainably use and restore the forest in the vicinity of the residence by forming forest user groups;

20.1.3.Receive accurate information from relevant organizations about forest resources, protection and use;

20.1.4.Present a request for fuel and household consumption wood to the forest unit (if not available, to the ranger in charge of the respective area) and have them supplied under the supervision and guidance of professional forest organizations or relevant competent officials;

20.2.Individuals shall have the following obligations in forest protection:

20.2.1. Abide by and implement forest laws and regulations;

20.2.2.Urgently report violations related to illegal use,damage or destruction of forest assets to the local Governor, State Inspector and Environmental Ranger;

20.2.3. Follow cultural traditions and customs on forest protection and provide ecological education to children;

20.2.4. Strictly adhere the national fire control regulations and avoid camp fires during the time prone to forest fire and properly extinguish burning cigarettes, sparks, hot cinders or lit matches;

20.2.5. Build protection strips around their gers, houses, hay stocks and shelters and own fire extinquishing tools;

20.2.6. Households must keep ash and hot cinders in specially prepared holes or containers with covers inorder to prevent from fire outbreaks;

20.2.7.Be trained with basic techniques and practices to prevent their lives, health conditions, and properties from forest and steppe fires and suppress a fire and train their children in bewaring and taking precautions against a fire;

20.2.8. Equip auto and motorized vehicles with fire security tools and equipment and strictly adhere the requirementsfor storage of fire hazardous and imflammable substances and oily materials;

20.2.9.Avoid burning dry hays, plant covers, straws and weeds in cultivation fields and manure;

20.2.10.Participate in forest and steppe fire extinguishment efforts as a citizen, make available their private vehicles for emergency actions; take immediate actions to suppress fires and inform about it to the Governor and other respective organizations in case of detection of a fire or receiving information on the detected fire.

Article 21. Rights and Obligations of Forest User Groups

21.1.Forest user groups shall have a management plan for forest protection, sustainable use, restoration and forestation of its possessedforest fund as specified in Article 4.9 and Article 9.3 of this Law.

21.2.Forest user groups shall have by-laws consistent with laws and regulations.

21.3.Forest user groups shall report on an annual basis on the implementation of its forest protection, sustainable use, restoration and forestation program and management plan to the soum and District Citizens` Representatives Khural.

21.4.Forest user groups shall implement forest and steppe fire prevention tasks within certain parts of the forested land being possessed by them on contract basis.

21.5. Forest user groups may employ a voluntary ranger, as set forth in Article 26.8 of the Law on Environmental Protection, in the area it possesses on a contractual basis.

21.6.Not less than 80 percent of the members of a forest user group shall be permanent residents of the given territorial and administrative unit, capable of providing forest protection and monitoring on a continuous basis.

21.7.Forest user group member shall fullfill requirements set forth in Article 50.2 of the Law on Environmental Protection.

21.8.Forest user groups shall enjoy a priority right to claim possession of certain parts of the forest fund and shall submit the following documents:

21.8.1. A request for possession and protection of certain parts of the forest fund;

21.8.2.A proposal from Bagh or Khoroo Public Khural and a decisionof the Soum orDistrict Citizens` Representatives Khural granting the tenure right of certain parts of the forest resource;

21.8.3. A management plan on forest protection, sustainable use, restoration and reproduction, draft contract, a boundary list of the the forested area for possession on contract basis, its location and its distribution map;

21.8.4. A copy of cooperation agreement of the forest user group members;

21.8.5.Copies of citizen identification cards of the forest user group members;

21.9. The Soumor District Citizens` Representative Khural shall discuss about the proposal, make a decision and conclude a forest possession contract and issue a license thereof, provided the documentation fullfills the requirements prescribed in Article 21.7 and Article 21.8 of this Law;

21.10.Possession of a part of the forest fund shall be granted to a forest user group with consideration given to the number of members and capability and the areasize, resources and ecological characterisitics of the forest claimed for possession;

21.11.Relevant Soumor District Governors shall terminate the activities of a forest user group and annul the contract thereof in the following circumstances:

21.11.1. If Bagh or KhorooPublic Khurals or Soumor District Citizens` Representative Khurals have made respective proposals and decisions to discontinue the forestry activities in that forest;

21.11.2. If a meeting of all members of the forest user group decide to discontinue the possession of the part of the forestfund;

21.11.3.If the forest user group has repeatedly failed to fulfill the terms and requirements as set forth in Article21.6 and Article 21.7 of this Law, or forestprotection activities were not conducted within six months after the establishment of the contract stated in Article 21.9;

21.12.The forest user group which concluded a contract as stated in Article 21.9 of this Law shall enjoy the following rights:

21.12.1.Continuously conduct activities of the management plan within the area under its possession;

21.12.2. Use timber and non-timber forest products from the tenure forest on the basis of the management plan and possession license and market excess timber and non-timber resources;

21.12.3. Develop and submit project and program proposals for forestrysylvicultural measures to be implemented by national and local budget funding, participate in tenders;

21.12.4. Participate in forest management training, seminars as well as vocational or advanced trainings;

21.13.In addition to fulfilling the duties set out in this Law, a forest user group shall conduct activities prescribed in the contract made with the respective level Governor.

Article 22.Rights and Obligations of Economic Entities and Organizations

22.1.Economic entities and organizations shall have the following rights and obligations:

22.1.1. Implement environmental protection and forest legislation, decisions of the government, local self-governing bodies and Governor and comply with the instructions of State Environmental Inspectors and Environmental Rangers;

22.1.2.Economic entities and organizations engaged in forest industry and services shall reflect in their annual budget means for environmental damage mitigation, forest protection and reproduction activities and ensure implementation thereof;

22.1.3. Economic entities and organizations possessing certain parts of the forest fund shall have approved and implement forest protection, sustainable use,restoreation and forestation management plans for tenure forests as stated in Article 4.9 andArticle 9.3 of this Law;

22.1.4. Economic entities and organizations possessing certain parts of the forest fund shall utilize timber and non-timber resources from their tenure forests in line with management plans and contract and license terms;

22.1.5.Obtain certificates of origin from relevant forest unit (if not available, from the ranger in charge of the respective area) as specified in Article 34.4 of this Law;

22.1.6. Engage a voluntary ranger for the tenure forest land as provided in Article

26.8 of the Law on EnvironmentalProtection;

22.1.7. Economic entities and organizations interested in possessing certain parts of the forest fund shall compile the documents indicated in Articles21.8.1-21.8.3 of this Law;

22.1.8. Economic entities and organizations possessing certain parts of the forest fund shall pay the relevant taxes to the corresponding soumor district budget;

22.1.9.Comply with the duties specified in the forest legislation;

22.1.10. Implement the activities specified in the contract made with the respective level Governor;

22.1.11.Provide an annual report on implementation of forest management plans for forest protection, sustainable use, restoration and forestation toSoum or District Citizens` Representative Khural for performance review;

22.1.12. Assist in forest and steppe fire extinguishment efforts with man-force and technical supplies (equipment, tools and vehicles);

22.1.13.Obtain permits as stated in the legislation for timber harvesting, conducting research, organizing field work expeditions or groups in the forest and steppeand inform the ranger in charge of that area providing aquarantee notice to avoid forest and steppe fire; avoid travelling or other activities in forests during the time prone to fire;

/Amended by the Law dated July 9, 2013/

22.1.14.Strictyadhere regulations on use, transport and storage of fire-dangerious andinflammable substances and oily materials;

22.1.15.Equip all types of transport means or motorized vehicles in use with fire security tools and equipment and conduct pre-trip checks;

22.1.16. Economic entities and organizations possessing certain parts of the forest fundshall manage forest and steppe fire prevention and extinguishment activities at their expenses.

22.2. The soumor district Governors shall discontinue operations and cancel the contract of an economic entity or organization in possession of certain parts of the forest fund in the following circumstances:

22.2.1. A decision referredin Article 21.11.1 of this Law was taken;

22.2.2. Failure to report and have reviewed its performances as set forth in Article

22.1.11 of this Law;

22.2.3. Failure to fullfill the requirements set forth in Article 22.1.7 and Article

22.1.8 of this Law;

22.2.4. If entities have not conducted forest protection activities within six months after establishment of the contract;

22.3. The State Administrative Central Organization shall approve formats of the contracts and certificates referredin Article 22.1.9.

Article 23.Professional Forest Organizations and their Activities

23.1. A professional forest organization shall be an organization that has been certified in accordance with law to undertake forest protection, sustainable use, restoration and forestation activities at a professional level and provide methodological advice.

23.2. The organization referred in Article 23.1 of this Law may be in any form of ownership and shall conduct the following activities:

23.2.1.Implement forest resource protection activities;

23.2.2.Implement forest protection, sustainable use, restoration and reproduction measures, and, if certified, perform impact assessment;

23.2.3. In addition to carryingout forest restoration and forestation activities, provide professional and methodological advice to other entities and organizations, conduct trainings and develop and implement projects and programs;

23.2.4. Report about its activity performances to the State Administrative Central Organizations while being responsible for their performance accurateness;

/Amended by the Law dated August 17, 2012/

23.3. The State Administrative Central Organization shall approve a regulation for requirements and operational rules of professional forest organizations.

CHAPTER FIVE

FOREST PROTECTION AND RESTORATION

Article 24.Forest Protection Measures

24.1.Forest protection measures shall include activities for protection of forestsfrom fire, pest infestation and disease prevention and control, protection from adverse effects of human activities, maintaining natural growth and regeneration of forests and preserving the forest gene pool.

24.2.Aimag, capital city, Soum and District Citizens` Representative Khurals may prohibit the utilization of forests in the forested areas in chargefor up to three years for the purpose of protection and regeneration of forest resources.

Article 25.Participation of Non-governmental Organizations in Forest Protection

25.1.Non-govermental organizations, with the purpose of protecting forest resources, may conduct the following activities on the basis of an agreement reached with the State Administrative Central Organization and in line with provisions of Article 32 of the Law on Environmental Protection:

25.1.1. Monitor, on behalf of the public, the implementation of forest legislation, conduct inspections, demand redress for breaches, submit issues to competent organizations for resolution and sue the quilty persons to the court for compensation of the damages to the forest resource;

25.1.2. Submit proposals on forest protection to relevant State bodies and the Citizens` Representative Khural and Governor of appropriate levels;

25.1.3.Organize trainings and education activities on forest protection, sustainable use, restoration and reproduction;

25.1.4.Develop and submit projects, recommendations and methodologies for forest protection, restoration and reproduction to relevant organizations for approval and implement;

25.2.Pursuant to Article 32.2 of the Law on Environmental Protection, the State Administrative Central Organization may delegate the execution of certain government implementing agency’s duties related to forest protection, sustainable utilization, regeneration and reproduction to a non-governmental organization with a statutory purpose of forest protection and finance the implementation thereof.

Article 26.Forest and Steppe Fire Prevention

26.1. Forest user groups, economic entitites and organizations shall implement forest and steppe fire prevention measures in their tenure land under contracts at their expenses.

26.2. The following activities are prohibited to be done by citizens, economic entities and organizations in forest and steppe areas during the time prone to forest and steppe fires:

26.2.1. Make camp fires in young coniferous forest stands, burned forest stands, dry fallen tree dominant forest stands, the forests with residuals or left overs from timber harvesting, and the forest stands that are abundant with herbous plants or under a tree;

26.2.2. Use a burning method for cleaning the areas after timber harvesting;

26.2.3. Throw away the pieces of paper, cloth, and cotton consumed or infiltrated with lubricants and combustible substances in open or non-disposal sites;

26.2.4. Smoke or fire up while a vehicle or other technical equipment being supplied with fuel and gasoline or throw away inflammable or explodable waste, rubbish or ashes or matches though their windows or doors or use a vehicle without a spark arrester.

/Added by the Law dated July 9, 2013/

26.3. Make available fire extinguishing tools and equipment according to the relevant norms and standards in areas where forest is utilizedand be ready to use them in case of fire.

/Added by the Law dated July 9, 2013/

Article 27. Protection of Forests from Pest Infestation and Disease

27.1.Aimag, Capital city, Soumand District governors shall formulate pest infestation and forest disease prevention and control programs and secure the requisite allocations in the local annual budgets for implementation.

27.2.In the case that pest infestation or forest disease spreads over several territorial and administrative units, the control measures shall be implemented by a professional forest organization with the state budget financing.

27.3. Forest user groups, economic entities and organizations shall self-finance the measures to protect areas in their tenure from pest infestation and disease.

27.4. Professional forest organizations shall conduct research on pest infestation and diseases and related prevention and control measures.

27.5. No chemical substances other than those permitted by the State Administrative Central Organization shall be used for pest and disease control.

Article 28.Forest Thinning and Cleaning

28.1.The forest thinning measures to improve growth and productivity, prevent fire, pest infestation and diseases and ensure the ecological balanceas set forth in Article 28.2.1of this Law shall be only undertaken by professional forest organizations and the cleaning by forest user groups, economic entities and individuals on contract basis in addition to the professional forest organizations.

28.2.The thinning and cleaning to be done in forests shall be financed as follows:

28.2.1.Forest lightening and adjusting thinningshall be carried out at the state funding;

28.2.2.The thinning and cleaning other than specified in Article 28.2.1 of this Lawshall be completed at expenses of their contractors;

28.3.The State Administrative Central Organization shall establish the scope of the annual forest thinning and cleaning works for Aimagand Capital Citylevels, based on the respective governor’s proposal.

28.4.The forest units (if not available, the ranger in charge of that area) shall issue licenses and certificates of origin to the timber extracted in thinning and cleaning operations.

/Amended by the Law dated July 9, 2013/

28.5. The Cabinet Member in charge of Environment shall approvea regulation on forest thinning and cleaning.

Article 29.Prohibited Activities in Forest

29.1. To ensure the normal growth and regeneration of the forest and to protect it from adverse anthropogenic effects, the following activities shall be prohibited:

29.1.1. Cutting or damaging forests of up to the fifth age category, young trees of all species, as well fruit-bearing trees and shrubs such as Siberian fir, rhamnus, Asiatic poplar, elaeagnus, cornel, tamarisk, Siberian alder, mountain ash, sea-buckthorn and bird-cherry;

29.1.2. Cutting and utilizing cedar, spruce and elm without permission from the State Administrative Central Organization;

29.1.3. Logging by way of clear cutting;

29.1.4. Hay making in the forest land without explicit permission;

29.1.5.Harvesting or grazing on afforested areas, cultivar and seedlings plantations and tree nurseries;

29.1.6.Logging and extraction of non-timber forest products in tenure forestswithout endorsement by the competent body set forth in Article14.1 and Article 14.2 of this Law;

29.1.7. Harvesting, exctraction of non-timber forest products and hunting by citizens, forest user groups, economic entities and organizations without explicit permission and organizing recreational activites without explicit permission in forests during the time prone to fire;

29.1.8. Transplanting seeglings from a natural forest without permission bythe competent organization set forth in Article 14.1 of this Law;

29.1.9. Use of logs as supports or supporting materials of buildings and facilities during their new constructions, repairing and expansion works;

29.1.10. Construction and placing of buildings and facilities in forest land for the purposes other than special state needs and forestry management implementation;

29.1.11. Import of tree and shrub seedlings for the purposes other than pilot and research introduction and plantation;

Article 30. Forest Restoration and Forestation

30.1.Citizens, forest user groups, economic entities and organizations shall undertake forest restoration and reforestation activities in areas damaged by fire, pest infestation, diseases and harvested areas at the state request and with financingfrom the national and local budgets, domestic and foreign aid and donations, as well as on the basis of self-financing;

30.2. Citizens, forest user groups, economic entities and organizations shall plant

10 or more seedlings and saplings for each harvested tree.

30.3. A program and project on establishment of green belts to forest the steppe, semi-desert and desert regions and protect sources of rivers, creeks and springs, as well as pastures and crop lands, shall be financed from the state budget and other sources of funding;

30.4. The state budget allocations for forest protection and restoration as well as forestation shall not be less than the level prescribed in Article 18 of the Law on Natural Resource Use Payments.

30.5. The Cabinet Members in charge of finance and environment shall jointly approve a regulation on afforestation, forest planning, management and financing, valuation, purchasing and ownership of state forest resource.

Article 31.Organization of Reforestation

31.1.Aimagand Capital City Governors shall organize annual public tree planting campaigns during which every citizen of 16 and more yearsold shall plant and take care of one tree and every economic entity and organization shall plant and take care of not less than five trees, or make an appropriate financial donation if unable to perform the duty.

31.2.Soum, District, Bagh and Khoroo Governors shall jointly organize with professional forest organizations the selection of tree planting sites and soil cultivation and supply seedlings, maintaining and caring planted seedlings and engage the public in these activities

31.3.Seedlings grown by citizens, forest user groups, economic entities and organizations may be purchased on the basis of specific criteria.

31.4.City greening, gardening and establishment of green zones wil be regulated by the relevant law.

CHAPTER SIX

FOREST UTILIZATION

Article 32. Determination of Harvest Quota

32.1. The State Administrative Central Body shall determine the harvest quota for a given year for every Aimagand capital city, based on their proposals, forest management documents and plans.

32.2.Aimagand Capital CityCitizens` Representative Khurals shall establish the annual harvest quota for each Soumand District within the volumes set forth in Article 32.1 of this Law.

32.3.Soumand District Citizens` Representative Khurals shall establish the annual harvest quota for each forest user group, economic entity and organization within the types and volumes set forth in Article 35.1 and Article 35.2 of this Law and based on the management plan.

32.4.Prior to transformation of natural states of the forest due to new timber harvests and effects by forest and steppe fires and pest insects, the entity and organization engaged in the timber harvest shall take natural regeneration support action at its expense in the year of its harvest and the professional organization shall undertake restoration and forestation measures at local budget.

32.5.Wood consumption of residents, economic entities and organiaitons of the aimags that have no forest resources for utilization shall be supplied in a regulated way and the Government shall approve fuel wood discount rates and amounts to be issued.

Article 33.Conclusion of Contracts onHarvesting

33.1. Citizens, forest user groups, economic entities and organizations possessing parts of the forest fund shall conclude contracts on harvesting with SoumDistrict forest units (if not available, from the competent official of soum or district level), based on the decision by the Soumand District Citizens` Representative Khurals;

33.2.As specified in Article 33.1 of this Law, the contract on harvesting shall include the following items:

33.2.1.Justification (relevantharvest allowance by a competent offiicial) for harvesting;

33.2.2. Duration and purpose of harvesting and volume and types of trees to be harvested;

33.2.3. Statement of the harvesting site demarcation and forest resource estimation;

33.2.4. Plan and budget for forest restoration and forest protection from fire, pest infestation and disease;

33.2.5. Terms for hand-over of the harvested sites;

33.2.6. Hand-over of the harvested site and evaluation of contract implementation.

Article 34.Harvesting License and Certificate of Origin

34.1. As specified in Article 32.2 of this Law, within the limits set by the Aimagand Capital CityCitizens` Representative Khural, the forest unit (if not available, the Soum

and District competent officials) shall issue a harvesting license and a certificate of origin to citizens, cooperatives, economic entities and organizations.

34.2. The license referred to in Article 34.1 of this Law shall indicate the name and address of a citizen, cooperative, economic entity and organization, types of timber to be harvested, harvesting volume and duration, end date for transportation and the name of the harvest site.

34.3. Transferring licenses referred to in Article 34.1 of this Law is prohibited.

34.4. Transportation and trade of the extracted beams, poles, logs, saw materials in and between aimags, Soums, cities and settlements, shall require a certificate of origin for these products as stated in Article 34.1 of this Law.

34.5. The Cabinet Member in charge of environmental shall approve a regulation on license and a certificate of origin and procedure of its issuance indicated in Article 34.1 of this Law.

/Amended by the Law dated July 9,2013/

Article 35.Harvesting Operations

35.1. A professional organization forforest utilizaition as stated in Article 23 of this Lawmay harvest timber within the volume and types permitted by the Soumand District Citizens` Representative Khuralfor the following purposes:

35.1.1.Thinning by cutting the trees and bushes negatively impacting on the forest state in order support natural regeneration of forests;

35.1.2.Cleaning through selective cutting of dried trees and the trees lost their survivability due to fires, pest insects and diseases in order to clean and make forests healthier;

35.1.3.Commercial use through cutting adult trees to supply raw wood materials;

35.2. The individuals, who obtained permits to timber harvest for household needs and the forest users, economic entities and organizations engaged in possession of parts of forest fund may harvest timber for cleaning as stated inArticle 3.1.15 of this Law in their tenure forests.

35.3.The individual, who obtained a permit and the forest users, economic entities and organizations engaged in possession of parts of forest land on contract basis are not allowed to engage in timber harvest for the purposes and ways other than that stated in Article 35.2 of this Law.

35.4. Timber harvests done in the following cases shall be regarded as Illegal:

35.4.1.If timber was overharvested thanthe volumes stated in contracts and permits and if timber was harvested without compliance with the type, purpose and harvest technology;

35.4.2. If timber was harvested without any contract and permit;

35.4.3.If timber was harvested with forged and invalid contract and license.

Artice36.Harvesting in the Areas of Other Aimags or Soums

36.1.Harvesting in the areas of other aimags or Soums shall be undertaken subject to prior consultations among the Governors concerned and within the harvest quota for the given year.

/Amended by the Law dated August 17, 2012/

36.2. In case the Aimagor Capital City Governors fail to reach an agreement as specified in Article 36.1 of this law, the State Administrative Central Organization shall make a decision.

Article 37.Processing and selling of the harvested timber

37.1.The individuals and economic entities engaged in wood production and services shall run processing and selling of the timber harvested in accordance with the Article 35.1 and Article 35.2 of this Law.

37.2.The individuals, economic entities stated in Article 37.1of this Law and tenantswill not be allowed to process and trade the timber without their licenses and certificates of origin and the timber illegally harvested;

37.3.The individuals and economic entities running the activities stated in Article 37.1 of this Law shall monitor their tenants’ activities in order to prevent from processing and trade of timber harvested without licenses and certificates of origin and the timber illegally harvested.

Article 38. Non-timber Forest Products and their utilization regimes

38.1.Soum and District forest units (if not available, aranger in charge of that area) shall issue non-timber forest product utilization licenses to individuals, forest user groups, economic entities and organizations.

38.2. The licenses specified in Article 38.1 of this Law should indicate the name and address of the forest user group, economic entity or organization, types and volume of non-timber forest products to be utilized and duration and the site of utilization.

38.3.Citizens, forest user groups, economic entities and organizations shall utilize non-timber forest products on a paid basis.

38.4.The reserve, distribution and yield of non-timber forest products in the given year should be considered in the provision of the license prescribed in Article 38.1of this Law to citizens, forest user groups, economic entities and organizations.

38.5.Collection of pine nuts is allowed for household purpose when the nut yield is medium and for different purposes when the nut yield is high.

38.6.The Cabinet Member in charge of Environment shall approve a procedure for non-timber forest product protection and sustainable use.

38.7. Export of unprocessed non-timber resources shall be prohibited.

38.8.Protection zones of pine nut, wild berries, mushroom, medicinal and usefull plants growing in the forest land shall be established and put under responsibilities and stewardship of localc communities, forest user groups, economic entities and organizations on conrace basis.

CHAPTER SEVEN

MISCELLANEOUS

Article 39. Economic Incentives for Forest Protection

39.1. The Government shall reward citizens, cooperatives, economic entities andorganizations for successful control of forest hazards and assimilation of advancedtechniques and a procedure for such distinction shall be developed and approved by the Government.

39.2. Pursuant to Article 54.4 of the Law on Environmental Protection, citizensshall be rewarded for accurate reporting of breaches of forest legislation tocompetent public bodies or officials, or for assistance in detecting and exposing such illegal acts.

39.3. Pursuant to Article 54.5 of the Law on Environment Protection, a state inspector shall be rewarded 15 percent of the proceeds from the sale of illegally procured beams, poles, logs, saw materials and non-timber forest resources for exposing the said legal violation.

39.4.The quality seedlings, planted trees, bushes, shrubs and forests planted by individuals, forest user groups, economic entities and organizations shall be purchased by the Government according to the respective regulations or reward in other ways;

39.5. The Cabinet Members in charge finance and environment shall jointly approve guidelines for incentives set forth in Articles 39.2-39.4 of this Law;

39.6. Expenditures incurred by the state and local self-governing bodies in carrying out forest protection, restoration and forestation activities and monitoring the implementation of the forest legislation, shall be financed from state and local budgets.

39.7.Funding for forest and steppe fire prevention activities shall be set in the Aimag, Capital City, Soum and District budgets.

39.8.Expenditures of elimination of forest and steppe fire consequences shall be covered by the state budget, but they shall be compensated by quiltypersolns after they are detected and defined.

39.9.Expenditures incurred in the mobilizations during the time prone to forest and steppe fire occurrence as stated in Article 12.1.7of this Law may be covered by the Government.

39.10. A compensation shall be provided for citizens, forest user groups or economic entities and organizations that have combatted forest and steppe fire at their own cost in accordance with a relevant regulation.

/Added by the Law dated July 9, 2013/

Article 40. Payments and Fees

40.1. Forest asset utilization fees and duties shall consist of the fee for a forest asset utilization license and the duty for the utilization of non-timber forest products.

40.2.Acording to the respective regulations, individuals, forest user groups, economic entities and organizations shall pay the following fees:

40.2.1.Fee of the license/permitissued by the professional forest organization;

40.2.2.Fee of licesnse/permit for use of non-timber forest products;

40.2.3.Fee of certificate of origin to wood and wooden materials;

40.3. The fees stated in Article 40.1 and Article 40.2 of this Law, compensatory duties of illegally harvested wood wooden materials and non-timber forest products and the compensatory duties prescribed in Article 42.1 of this Law shall be channeled to the budget as legally stated.

40.4. Setting, releasing and discounting of the fees and payments stated in Article

40.1 and Article 40.2 of this Law shall be regulated by the relevant law.

40.5.The persons obtained licenses and certificates of origin for forest resource use, permits from the professional forest organization shall pay fees of the licenses and

certificates of origin to the Environmental Fund as set forth in 5.4.2 of the Law on Special Government Fund.

Article 41.Educational Training and Scientific Provisions of Forests

41.1. Within the framework of formal and informal educational systems, the Government shall approve and implement ecological programs to improve people’s knowledge and awareness of forestry issues and forest protection skills and practices.

41.2. The Government shall organize training and scientific education activities on forests as follows:

41.2.1.Introduce basic forest protection knowledge to pre-school educational institutions and secondary schools;

41.2.2. On a basis of estimating the demand in forestry professionals, developand implement a program on forest protection, basics of forest science and legislation at vocational training centres, colleges and tertiatry educational institutions;

41.2.3.Introduce research findings, new ideas, advanced technologies and techniques in production through enhancing the forestry research and monitoring, processing and applicaiton of advanced technologies and techniques and making innovation investments;

41.2.4.Promote knowledge of forests, customary forest protection practices and forest legislation through the mass media.

Article 42.Compensation of the damages to the forest resource

42.1. Citizens, forest user groups, economic entities and organizations shall be liable to compensate for the direct damages caused to forests and forest resources in consequence of their illegal activities:

42.1.1. Ifprohibited activities are run;

42.1.2. If timber is harvested illegally;

42.1.3. If non-timber forest products are collected and harvested without a permit;

42.1.4. If damages and adverse impacts are provided to forest resource;

42.1.5. If a forest stand is destroyed when production, services and the economic activities e.g. extraction of mineral resources are run;

42.1.6. If other illegal activities are engaged;

42.2.State Environmental Inspector shall sue the violators to enact compensation payments for the direct damages specified in Article 42.1of this Law and the resultant forest regeneration expenditures.

/Amended by the Law dated July 9, 2013/

42.3.Direct payment of the compensation specified in Article 42.1 of this Law shall not provide the grounds for exempting violators from legal liability under criminal and administrative penal laws.

42.4. The amounts of compensation payments for illegal harvesting and utilization shall be set by for timber on the basis of ecological-economic evaluation and for non-timber forest products, on the basis of market prices prevailing at the time of the breach;

Article 43.Setting of Damages incurred by Forest and Steppe Fire

43.1. Damages incurred by forest and steppe fire shall be set by a working group organized at the respective level Governor’s decision within 30 days after the fire was put off.

43.2. Damages by the forest and steppe fire include ecological and material losses and all the direct and indirect expenses incurred to combating with the forest and steppe fire.

43.3. If damages are incurred by the fires from outside in the tenure forests and the forests planted by individuals, forest user groups, economic entities and organizations at their expenses, the Government shall be responsible for the damages and reforestation shall be done at the state funding.

Article 44.Organizaiton of Mobilizations for Forest and Steppe Fire Extinguishment

44.1. Governors of all levels shall immediately mobilize man-force and technical supplies for extinguishment of a forest and steppe fire stared within their area in charge and individuals, economic entities and organizations must abide the Governor’s demands related to the task.

44.2. Individuals under 16 years old, pregnant women, men above 60 years old and women above 55 years old will not be mobilized for forest and steppe fire extinguishment.

44.3.If the forest and steppe fire crossing over the state border and areas of Aimags and Capital City, Soums and Districts is beyond local capacities to suppress it, the President of Mongolia shall make decision on mobilization of army personnel and the Judicial Decision Execution Bodyshall take decision on mobilization of the individuals, who are committed to do compulsory or forced labor by the court decisions.

44.4.The governmental organization and competent official shall manage the meal, transport means, tools, fuels and other necessary materials needed for the individuals mobilized for forest and steppe fire extinguishment.

Article 45.Compensations and Reimbursements to the Individuals and Public Servants Mobilized for Forest and Steppe Fire Extinguishment

45.1.If an individual and public servant mobilized for forest and steppe fire extinguishmentlost his/her lives and faced health risks, the following allowance and compensations shall be issued to his/her family members:

45.1.1. If an individual is temporarily incapacitated, he/she shall be paid with allowance and his/her salary differences while he/she is in hospital or under treatment;

45.1.2.If an individual is permanently incapacitated, he/she shall be paid with allowance of disabled persons and plus his/her salary difference;

45.1.3.If he/she needs to have an artificial organ, its cost shall be covered;

45.1.4. If he/she lost his/her live, family members of the victim shall be paid with survivor’s benefit and plus the victim’s salary difference;

45.2. When an individual and public servant lost his/her live during combating with a forest and steppe fire, all the funeral and transport related expenses shall be covered by the Governmnent.

45.3.When an individual and public servant lost his/her live during combating with a forest and steppe fire, his/her family members shall be paid with one time grant.

45.4.The grant amount shall be set by the Government.

Article 46 Financing

46.1.The Aimag, Capital City, Soum and District shall have forest and steppe fire prevention and protection expenditures in their annual budgets.

46.2.Expenditures of elimination of forest and steppe fire consequences shall be covered by the state budget, but they shall be compensated by quiltypersolns after they are detected and defined.

Article 47.Liabilities for Violation of Legislation

47.1. A violator of the forest legislation shall be subject to criminal and administrative liabilities based on the nature of the violation and the scope of the damages.

47.2. If criminal liability is not warranted, the judge, state environmental inspector, or ranger shall impose the following administrative penalties:

47.2.1. for failure to clean up a harvesting site, or for breach of harvesting and non-timber forest product utilization techniques, a citizen shall be fined with five times of a minimum monthly salary rate and a forest user group, an economic entity or organization with fined with fifteen times of a minimum monthly salary rate;

47.2.2. for failure to take preventative measures from forest fire, pest infestation and diseases of their tenure forest as stipulated in contract, a forest user group, economic entity or organization shall be fined with three times of a minimum monthly salary rate;

47.2.3. for failure to comply with fire hazard prevention and control requirements, a citizen shall be fined with five times of a minimum monthly salary rate and a forest user group, an economic entity or organization with fined with fifteen times of a minimum monthly salary rate;

47.2.4. for harvesting timber and fuel wood and use of non-timber forest products without a license, transportation, sale or purchase of uncertified beams, poles, logs and saw materials, for breach of conditions and terms specified in the license, confiscation of all illegal harvested materials and accrued income, a citizen shall be fined with five times of a minimum monthly salary rate and a forest user group, an economic entity or organization with fined with fifteen times of a minimum monthly salary rate;

47.2.5. for harvesting without a contract or in violation of contract terms and conditions, the illegally harvested materials and accrued income shall be confiscated and a forest user group, an economic entity or organization with fined with four times of a minimum monthly salary rate;

47.2.6. for utilization of timber and non-timber forest products in excess of the limit specified in management plans in violation of contract terms and a forest user group, an economic entity or organization with fined with fifteen times of a minimum monthly salary rate;

47.2.7. for breach of Article 8.6 of this Law, the illegally harvested materials and accrued incomes shall be confiscated, a citizen shall be fined with two times of a minimum monthly salary rate and a forest user group, an economic entity or organization with fined with fifteen times of a minimum monthly salary rate;

47.2.8. to redress the breach of an official who issued a harvesting license exceedingthe annual harvest quota in breach of Article 42.2 of this law, the official shall be fined with 20 times of a minimum monthly salary rate;

47.2.9. for issuance of groundless utilization contracts and licenses/permits for harvesting and harvest of non-timber forest products and certificates of origin for transportation to other places, or issuance of incompletely maintained or forged licenses/

permits, or issuance of the licenses/ permits after the materials were transported, the official shall be fined with 10 times of a minimum monthly salary rate;

47.2.10.for breach of Article 37.2 and Article 37.3 of this Law, the accrued income from the processed and traded wood shall be confiscated, a citizen shall be fined with four times of a minimum monthly salary rate and an economic entity or organization with fined with 10 times of a minimum monthly salary rate;

47.2.11. for conducting the prohibited activities stated in Article 29 of this Law, the illegally harvested materials, accrued income and used vehicles and equipment shall be confiscated, a citizen shall be fined with 10 times of a minimum monthly salary rate and a forest user group, an economic entity or organization with fined with 25 times of a minimum monthly salary rate;

47.2.12.when detected that contaminated impacts are given on forest resource, a citizen shall be fined with three times of a minimum monthly salary rate and a forest user group, an economic entity or organization with fined with five times of a minimum monthly salary rate and for non-compliance of the contract obligations, an economic entity and organization shall be fined with four times of a minimum monthly salary rate;

47.2.13.for failure of the powers in Articles 18.2.10-18.2.18 of this Law, the Soum and District Governor and official shall be fined with 10 times of a minimum monthly salary rate; for failure of the obligations in Articles 20.2.4-20.2.10 of this Law, a citizen shall be fined with a minimum monthly salary rate or arrest for 7-30 days and a forest user group, an economic entity or organization with fined with eight times of a minimum monthly salary rate or refrain the rights up to for two years;

47.2.14.for misappropriation of funding for forest and steppe fire prevention measures and elimination of damages by forests an steppe fires, the official shall be fine with 10 times of a minimum monthly salary rate and have the damages recovered.

47.2.15. for failure to comply the obligations set forth in Article 26.2 and Article 26.3 of this Law, a citizen will be fined with two times more of minimum monthly salary and an economic entity and organization with four times more of minimum monthly salary.

/Added by the Law dated July 9, 2013/

47.3.for failtureand inadequate performance of obligations to prevent, protect and combat with forest and steppe fire, the Governor and public servant shall be taken with a disciplinary action.

SPEAKER OF THE PARLIAMENT

D. DEMBEREL