BRANCHES AND REPRESENTATIVE OFFICES OF A COMPANY
A company may have Branches and Representative offices in Mongolia or in foreign countries. According to the Law of Mongolia on Company, the Rights and Obligations of the Branches and Representative offices of a Company shall be as follows:
1. A branch of a company is a unit located in a place other than the place of business of company; and may perform the principal functions of the company, in whole or in part, and may also function as the company's representative office.
2. A representative office of a company is a unit located in a place other than the principal place of business of the company and shall conduct activities of legal representation such as undertake to protect the legal interests of the company and conclude transactions on behalf of the company.
3. A company may have branches or representative offices in Mongolia or in foreign countries.
4. Unless otherwise provided in the company charter, a decision to establish a branch or representative office shall be adopted by the Board of Directors (in its absence, a shareholders meeting).
5. A branch or representative office of a foreign legal entity in Mongolia shall be registered with the registration authority.
6. Unless otherwise provided in an international agreement to which Mongolia is a party, the establishment of a branch or representative office by a company in a foreign country shall be governed by the laws of such foreign country.
7. A branch or representative office of a company shall not be deemed to be a legal entity and shall conduct its activities in accordance with procedures adopted by the establishing company.
8. The assets of a branch or representative office shall be shown in the balance sheet of the company that established such branch or representative office.
9. A branch or representative office of a company shall conduct its activities on behalf of the company that established it.
10. The establishing company shall be responsible for the consequences ensuing from the activities of its branches and representative offices.
11. Unless otherwise specified in the company charter, the Board of Directors (in its absence, the executive management) shall appoint the management of its branches and representative offices and such executive shall act on the basis of a power of attorney from the company
Source: Law of Mongolia on Company