Mongolia’s Legal Gambit over Oyu Tolgoi Enters New Uncertain Phase Mongolia’s high-stakes legal move against Rio Tinto is entering murkier political waters. A previously undisclosed lawsuit filed in the United Kingdom, alleging bribery during the early phases of the Oyu Tolgoi copper-gold project, was initiated under former Prime Minister Oyun-Erdene. The claim, reported by the Australian Financial Review on May 25, 2025, accuses Rio Tinto of improper payments between 2008 and 2012 to secure control over Mongolia’s flagship mine. The timing is notable. While the previous administration oversaw the filing, it is unclear whether the new government led by Prime Minister Gombojavyn Zandanshatar will continue to pursue the case with the same intensity. Zandanshatar, though a key figure in earlier tax disputes with Rio Tinto (in his capacity as cabinet chief secretary), has signaled a more cautious, consultative stance, particularly on sensitive investor issues like the Entrée Resources licence transfer. Rio Tinto will likely dismiss the bribery allegations. The suit appears primarily aimed at strengthening Mongolia’s position in an ongoing arbitration case over ?1.3 trillion (roughly $370 million) in tax disputes. It may also serve as a lever in wider negotiations related to the mine’s expansion and future terms. The lawsuit builds on longstanding domestic unease about the original 2009 Investment Agreement (IA), often portrayed by critics as lopsided. Several officials (former PM Bayar and former Finance Minister Bayartsogt) involved in negotiating the deal were later convicted on corruption charges though their sentences were commuted. In that context, reopening the legal record has domestic resonance, even if the outcomes are uncertain. But the strategy also intersects with immediate operational questions at Oyu Tolgoi. Development of Panel 1, located within licences held by Entrée Resources, a Canadian junior, is currently on hold. In a public statement, Oyu Tolgoi LLC confirmed that the mine plan had been temporarily adjusted to focus on preparing Panel 2 South, which lies outside Entrée’s licence area, for extraction. The company reaffirmed that 2025 copper production guidance remains unchanged and that the ramp-up to an annual 500,000 tonnes is still on track. However, accessing Panel 1 remains critical for fully unlocking the long-term value of the deposit for all stakeholders. The legal status of Entrée’s licences is central to this. An international arbitration ruling in December 2024 affirmed Entrée’s 20% economic interest and ordered that its two licences be transferred to Oyu Tolgoi LLC. Mongolia responded by reclassifying the area as part of the strategic deposit, which under national law entitles the state to either acquire a 34% equity stake or opt for an increased royalty arrangement. Parliament must now choose. Many lawmakers view this as an opportunity to negotiate fresh terms that go beyond the original IA with Rio Tinto, especially given significant copper, gold, and molybdenum content in the Entrée zones. Rio Tinto, for its part, argues that the 2009 IA still applies to all development, including any future work in Entrée’s area once integrated into OT LLC. No new agreement, from its perspective, is required. That legal divergence is likely to remain a key point of tension. Whether Mongolia pursues equity or royalty, a clear and timely decision will be essential. While seeking more favourable terms is politically appealing, prolonged uncertainty around the licence transfer risks delaying development and complicating investor relations at a critical moment. Ultimately, the UK lawsuit may yield tactical information. But its strategic utility will depend on how Mongolia navigates the bigger challenge: asserting national interests while preserving the predictability needed to develop one of the world’s largest copper assets on schedule.