GILS Dispute Resolution: Mongolia (2026)

Bolormaa Volodya, Kherlenchimeg Soyolkhuu

CASE:

Date: 2024.05.15-2025.04.16

Civil Court decision № 192/ShSh2025/03021 /Judge: Sh.Otgonbayar/

Brief Legal Summary

A LLC, /our client/, is a legal entity duly established in 2022 under the laws of Mongolia and is fully authorized to conduct digital advertising sales activities in Mongolia on behalf of Meta. In this capacity, A LLC provides comprehensive digital advertising services to Mongolian users, including advertisement projection, placement, processing, and publication on Meta-operated platforms such as Facebook, Instagram, and Messenger.

A LLC operates a structured advertising payment solution model, granting client companies access to pre-approved advertising accounts with integrated payment functionality. Under this arrangement, clients do not need to establish direct financial relations with Meta; instead, A LLC settles the total advertising expenditure directly with Meta and subsequently invoices each client for the amounts incurred, typically at the beginning of the following month. This model ensures uninterrupted advertising services and centralized financial management. On April 5, 2023, A LLC and E LLC entered an electronic “Agreement on Digital Advertising,” concluded in accordance with Article 42.1.1 of the Civil Code of Mongolia. The dispute arose when E LLC failed to fulfill its payment obligations under this agreement. The claim in this case was   1,011,842,835 MNT, which is equivalent of 283,826 USD. During the proceedings, the respondent challenged the calculation and payment process, disputing the amounts owed. After more than one year of court proceedings, our firm successfully represented A LLC and secured a favorable outcome. The court approved the settlement, confirmed the defendant’s payment obligations, and dismissed the case. This result reinforces the enforceability of electronic agreements and structured digital advertising payment arrangements under Mongolian law.

Our firm has also represented A LLC in numerous similar cases involving digital advertising payments, achieving a 100% success rate in resolved matters, with several additional cases currently pending before the courts. These cases represent a modern and emerging category of commercial litigation in Mongolia, involving online services, platform-based business models, and electronically concluded agreements. As digital trade continues to grow in Mongolia, such disputes are expected to become more frequent, marking the development of a new legal practice area in the country.