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MINISTRY OF JUSTICE AND HOME AFFAIRS: A REVIEW OF THE CHALLENGES IN COMBATING TERRORISM FINANCING AND WEAPONS PROLIFERATION
Background
In a bid to combat terrorism financing and weapons proliferation, the Ministry of Justice and Home Affairs has been reviewing its strategies since 2008. The review comes as the country faces growing concerns over the risks posed by non-government organizations (NGOs), private schools, and hospitals.
Concerns over NGOs, Private Schools, and Hospitals
As reported by the General Authority of State Registration in June 2018, NGOs, private schools, and hospitals are no longer subject to profit tax starting from January 1, 2007. This has raised concerns over the weakening of state control and increased risks of financing terrorism and weapons proliferation.
Vulnerabilities in Transportation and Freight Forwarding Sector
In particular, the transportation and freight forwarding sector has been identified as a vulnerable area for terrorism financing and weapons proliferation. Despite being licensed by the Ministry of Road and Transportation Development, only around 100 out of 300 registered companies are actively engaged in operations with extended licenses. The lack of understanding among these companies about the risks posed by terrorism financing and weapons proliferation has increased the chances of high-risk activities.
Need for Joint Supervision System
The General Authority of Customs and General Police Office have been conducting supervision on information related to persons who ordered shipping, examining tax reports, safety during shipping, labor conditions, and dangerous and toxic goods. However, a joint supervision system among monitoring agencies, policy implementation regulatory ministries, legal institutions, professional associations, and state authorities is needed to prevent potential risks.
Concerns over Non-Profit Organizations
In addition, the review has highlighted concerns over non-profit organizations, which have been registered as tax payers of personal income tax and remuneration, bonus, pension benefits, real estate tax, and other taxes. According to a report by the General Authority for Intellectual Property and State Registration, 18,943 non-government organizations are operating in Mongolia.
- Only around 4,862 (25.7%) of these organizations submitted their tax statements within the time limit defined by law in 2017.
- A working group assessment made by the Asia Pacific region’s counterfeiting money laundering and financing of terrorism experts identified a high risk of committing money laundering and financing of terrorism crimes through non-government organizations.
Concerns over Foreign NGOs
The review has also highlighted concerns over foreign NGOs, with around 95 subsidiaries or representatives officially registered in Mongolia. These organizations are conducting activities in fields such as politics, economics, environment, education, health, humanitarian, and social welfare, with the majority coming from the USA, Germany, France, Great Britain, and South Korea.
Call for Collaboration
The Ministry of Justice and Home Affairs has emphasized the need for collaboration among state authorities to prevent potential risks posed by NGOs. The review comes as the country faces growing concerns over terrorism financing and weapons proliferation, and it is hoped that a joint effort will help mitigate these risks.
Sources:
- General Authority of State Registration
- Ministry of Road and Transportation Development
- General Authority for Intellectual Property and State Registration
- Asia Pacific region’s counterfeiting money laundering and financing of terrorism experts