The State Great Hural has approved the Law on Supporting the Planning, Development, and Growth of Kharkhorum along with related legislative amendments, finalizing its passage in a plenary session on January 23, 2025. The draft law was initially submitted by the government on December 20, 2024, as part of its broader vision to reestablish Kharkhorum as a nationally significant city.

The initiative follows a presidential decree issued on December 20, 2022, directing the government to conduct research and develop proposals for the establishment of Kharkhorum in the Orkhon Valley. The decree emphasized the need to revitalize Mongolia’s historical capital, ensure balanced regional development, preserve the nation’s statehood heritage, and provide a safe and sustainable living environment.

Subsequently, the State Great Hural passed a resolution in July 2023 to establish Kharkhorum as a city, followed by a second resolution in 2024 confirming its status as a national-level urban center. Recognizing the necessity for a dedicated legal framework, the government proceeded with the drafting of a specialized law to regulate the city's planning and development.

The law sets forth principles for city planning, defining spatial and zoning regulations beyond those outlined in the Law on Urban Development. It also establishes governance mechanisms, stipulating that land-use rights within the city shall be granted by the city governor in accordance with general and sectoral urban planning frameworks.

Kharkhorum’s designated land area will span across three soums in Arkhangai and Uvurkhangai provinces. In accordance with the Law on the Legal Status of Cities and Towns, a city council and governor will eventually be elected by residents. Until then, the government will appoint an interim council and governor. The interim council will consist of 11 members, including three representatives nominated by the government, three from the Mongolian National Chamber of Commerce and Industry, the chairpersons of the relevant provincial representative councils, and two professionals recommended by the Ministry of Construction and Urban Development. The government will be responsible for appointing and dismissing the city governor.

The law outlines Kharkhorum’s economic structure, property, budget, and tax regulations, establishing a Kharkhorum City Development Fund to finance social infrastructure, heritage preservation, tourism development, and green urban spaces. Additionally, to encourage investment, the city will grant tax stabilization certificates under the Investment Law for projects meeting specific financial and completion criteria.

Once Kharkhorum reaches a population of 10,000 permanent residents, the first city council and governor elections will be held. Until then, the Law on Supporting the Planning, Development, and Growth of Kharkhorum will remain in force, guiding the city's establishment and growth.

Accompanying this law, amendments to the Customs Tariff and Tax Law have been approved, allowing a deferral of value-added tax (VAT) payments for up to four years on construction materials and equipment imported for state-approved development projects in Kharkhorum. Additionally, the Law on the Legal Status of Cities and Towns (Revised Version) has been adjusted accordingly, along with resolutions defining the city’s jurisdictional boundaries and regulatory measures for implementation.