Integrity Legal

It recently came to this blogger’s attention that the question of ASEAN economic integration may be a topic of discussion at an upcoming forum. In order to provide further insight it is necessary to quote directly from the official website of Asia One, AsiaOne.com:

BRUNEI – Just how close is Asean to becoming “One Asian”? That’s one of the main questions, executives, government leaders and members of civil society will tackle in the upcoming Asean 100 Leadership Forum, said Dato Paduka Timothy Ong (pic), Asia Inc Forum founder and chairman. As the convenor of the Asean 100 forum, Dato Ong hopes the forum will provide an avenue for people to agree, or disagree to “learn from each other effectively”. The One Asean question is one of two questions that Dato Ong finds important in order to help Asean businesses and leaders advance further. “Some people will say we are close, some will say we are not close, but no one will say we are already there. So how close are we and what do we need to do to get to ‘One Asean’?” The second question was made to be “slightly provocative”, where Asean 100 asked if the Philippines can be the next “Asian Tiger”…

The administration of this web log encourages readers to click upon the relevant hyperlinks noted above in order to read this insightful article in detail.

As frequent readers of this blog may be aware, there has been much discussion pertaining to the jurisdictions which comprise ASEAN (the Association of Southeast Asian Nations, Brunei Darussalam, Cambodia, Indonesia, Laos, Myanmar, Philippines, Singapore, Thailand, Malaysia, and Vietnam) especially regarding the future ASEAN Economic Community (AEC). In fact, there has been some speculation that a unified ASEAN visa scheme may be employed in order to streamline travel in the region, but such developments have yet to come to fruition. The future of ASEAN and Greater Asia is a matter of speculation for many, but there is reason to believe that the ASEAN economies will be robust in the coming years.

In matters pertaining specifically to the Kingdom of Thailand it recently came to this blogger’s attention that the amount of certain Condominiums in Greater Bangkok has apparently declined in recent months. For further clarity it is necessary to quote directly from the Property Report website, Property-Report.com:

The supply of new condominiums in Greater Bangkok has declined an estimated 10 per cent this year, while the number of new low-rise units is increasing, according to a report released by the Real Estate Information Center (REIC). Land allotment permits for low-rise units, excluding vacant land lots totalled 27,400 units in the first half of the year, up from 19,800 in the same period of last year. The increase in low-rise units is expected to equal the peak witnessed in 2005. According to the Bangkok Post, last year, low-rise permits totalled about 51,400 units, up from about 42,600 units in 2009. Meanwhile, the number of new high-rise housing construction permits in Greater Bangkok in the first quarter dropped to 260 buildings containing 1.51 million sqm from 302 buildings with 1.59 million sqm in the fourth quarter of 2010…

The administration of this web log encourages readers to click upon the hyperlinks noted above to read further.

Many foreign nationals in Thailand opt to purchase a Thai Condo since it may be possible to gain freehold title to such property. Such title is also referred to as Chanote Title in Thai. That stated, there are concerns among many foreign real estate purchasers regarding the conveyancing of such property so some opt to retain the services of an attorney in Thailand to assist with such an endeavor.

For information pertaining to legal services in Southeast Asia please see: Legal.

Tags: AEC, Asean 100, Asean 100 Leadership Forum, ASEAN Economic Community, ASEAN Visa, Asia Inc Forum, Asian Tiger, ASsociation of Southeast ASian Nations, Brunei Darussalam, Cambodia, Chanote Title, Greater Bangkok, Indonesia, Land allotment permits, Laos, Malaysia, Myanmar, Philippines, Real Estate Information Center, REIC, Singapore, Thai Condo, Thai Property, Thai Real Estate, Thailand, Thailand Property, Thailand Real Estate, Vietnam
Posted in ASEAN Business, ASEAN Visa, Thailand Condo | No Comments »

Over the years this blogger has seen large numbers of tourists flock to the Kingdom of Thailand as well as the neighboring nations of Laos, the Union of Myanmar (referred to by some as Burma), Malaysia, and the Kingdom of Cambodia. At the same time, this blogger has also witnessed the metamorphosis of some of these tourists into entrepreneurs by remaining in some of these countries (as well as other jurisdictions in Greater Asia such as Indonesia, Vietnam, China, Taiwan, Singapore, Hong Kong, South Korea, Nepal, Macau, India, and Sri Lanka; to name only a few) in a business context for many years and; for some, even decades or a whole lifetime. Whatever the circumstances of those Americans Resident Abroad remaining in the region of economies increasingly being labeled by both the mainstream and alternative media outlets by their affiliation with the Association of Southeast Asian Nations (ASEAN) one thing is clear: the economies of Asia are set to expand at an incredible rate by relative historical comparison. Therefore, it stands to reason that there are likely to be more Americans doing business in these jurisdictions. This state of affairs is occurring at a time when the potential of the internet and the World Wide Web first noted little more than a decade ago is beginning to become fully realized by businesses large and small. As e-commerce becomes an evermore ubiquitous facet of virtually every enterprise’s business strategy it is becoming more clear that many business functions are increasingly being performed by businesses of all sizes online and, in some cases, these businesses are even being maintained from an entrepreneur’s home.

This phenomenon is interesting for this blogger to note from the perspective of an American who is resident in Bangkok, Thailand as the Thai shop-house business model of maintaining a residence and business premises within close proximity has lead to a thriving small business community in the vast metropolis that is Greater Bangkok. This thriving business community, coupled with many of the other positive factors associated with doing business in Thailand, has lead to a vibrant economy that remains conducive to further foreign investment by entrepreneurs and businesses seeking to derive economic benefits both in Thailand and throughout the Asian markets. Of possible importance to Americans resident abroad or those thinking of residing abroad are the issues noted above as well as those associated with ownership of Thai property or Thai real estate especially in the form of a Thai Condominium.

In Thailand, as well as throughout many jurisdictions in Asia, there are restrictions placed upon foreign ownership of real estate. Although there are provisions allowing for foreign ownership of Thai property in many cases it is difficult, if not impossible, for a foreign national to secure freehold title (referred to as Chanote title in Thailand) in Thai real property such as land. However, it may be possible for a foreign national in Thailand, such as an American Citizen, to conveniently secure freehold title to a Thai Condo if the provisions of various laws and regulations on this issue, such as the Thai Condominium Act, are adhered to. Meanwhile, a foreign national who owns a Condo in Thailand may be qualified to receive a Foreign House Registration Booklet (referred to as a Tabien Baan for Thais or a Foreign Tabien Baan, or Yellow Tabien Baan for foreign nationals). Taking the aforementioned factors into consideration, in conjunction with the fact that for American Citizens and American Companies in Thailand there may be benefits pursuant to the provisions of various legal instruments such as the US-Thai Treaty of Amity which may provide the privilege of virtually 100% ownership of a Company in Thailand with “National Treatment” for certain business undertakings, one is left with little doubt that there are tangible legal benefits which could be accrued to the favor of Americans resident in Thailand conducting business in the ASEAN region as well as the regions of Greater Asia. Therefore,  investing in what this blogger would refer to as a “Thai Pad” (which non-literally alludes to the IPad-like gadgets allowing for increasingly easy real time access to the internet as well as the exponentially beneficial combination of privileges accruing to owners of Thai property registered on a Yellow Tabien Baan in conjunction with the advantages which may be had for Americans resident abroad utilizing a Thai company certified under the US-Thai Amity Treaty) could prove to have been prudent by future analysts in both tangible as well as intangible terms.

For related information please see: US Company Registration.

Tags: American Resident Abroad, Americans Resident Abroad, Amity Treaty Thailand, ASEAN, ASEAN Business, ASsociation of Southeast ASian Nations, Business in ASEAN, company in Thailand, Condo in Thailand, IPad, Thai Company, Thai Condo, Thai Condominium, Thai Pad, Thai Property, Thai Real Estate, Thailand Business, Thailand Business Law, Thailand company, Thailand Condo, Thailand Condo Law, Thailand Condo Lawyer, Thailand Condominium, Thailand Property, Thailand Property Title, Thailand Real Estate, Thailand Real Estate Title, US Citizen Resident Abroad, US-Thai Treaty of Amity
Posted in American Business, Amity Treaty, ASEAN Business, Cambodia Business, China Business, Ecommerce, Laos Business, Myanmar (Burma) Business, Thailand Business, Thailand company, Thailand Condo, Thailand Property, Thailand Real Estate, Thailand Work Permit, US Business, US Company Registration, US LLC, US Taxes | No Comments »

A Thai prenuptial agreement (also referred to as a Thai prenup) can provide a great deal of protection for individuals should a marital union be dissolved. A premarital agreement can also be very beneficial because it can provide certainty and transparency for the parties to a marriage. That said, a prenuptial agreement (Thai or otherwise) should be drafted in such a way that it provides protection for one’s property or real estate holdings as well as corporate assets and financial instruments. In Thailand, ensuring that a prenuptial agreement comports with all applicable formalities can be difficult which is why it is always prudent to consult with a Thai lawyer regarding such matters. For those foreign nationals with assets outside of the Kingdom of Thailand it may also be wise to consult with an attorney in the jurisdiction where one resides or maintains property in order to take all reasonable measures to ensure the integrity of one’s estate.

In Thailand, a prenuptial agreement must be registered at the time of the marriage in order for it to be enforceable by Thai courts. In a way, it may be better to think of prenuptial agreements as simply “nuptial  agreements” as the agreement does not exist until the simultaneous registration of that document and the marriage. Many Americans in Thailand opt to register a prenuptial agreement prior to the marriage that will act as a basis for a US Marriage Visa.

Corporate Assets

For those with corporate assets in the form of stocks, bonds, mutual funds, or options it is always prudent to seek information regarding a prenuptial agreement as such an agreement could protect one’s corporate assets in the event of a marital dissolution. In Thailand, those who have an ownership interest in a Thai company are wise to research prenuptial agreements prior to marriage in order try to maintain one’s holding in the event of a divorce.

Thai Property

Although foreign nationals cannot own land in Thailand, there are other property interests that one may have pursuant to Thai law, these include, but are not limited to: Thai Condo ownership, Thai usufructs, Thai 30 year leases, etc. Those with Thai real estate should consider a Thai prenup prior to marriage registration.

Marriage is a major event in one’s life. It can also have a significant impact upon the legal posture of one’s assets and interests. Therefore, those with an eye towards marriage should consult with a family lawyer within one’s local jurisdiction prior to marriage registration in order to help ensure that one’s assets are properly protected.

Tags: prenuptial agreement Thailand, Thai Company, Thai prenuptial agreement, Thai Property, Thai Real Estate, Thailand Marriage, Thailand Marriage Registration, thailand prenuptial agreement, Thailand Property, Thailand Property Law, Thailand Real Estate, Thailand Real Estate Law
Posted in prenuptial agreement, Thai Family Law, Thailand Business, Thailand company, Thailand Condo, Thailand Marriage Registration, Thailand Property, Thailand Real Estate | No Comments »

The Treaty of Amity between the United States of America and the Kingdom of Thailand (US-Thai Treaty of Amity) allows American Citizens to own virtually one hundred percent of a Thai company. This can prove highly beneficial to American expatriates in Thailand who wish to conduct business. That being said, there are restrictions to the types of activity that an Amity Treaty Company can undertake. Most notable amongst the restricted activities are: land ownership, internal communications, internal transportation, fiduciary functions, and the liberal professions.

Under Thai law, there is a de facto prohibition placed upon foreigners when it comes to land ownership. This means that foreign nationals are not permitted to take freehold title to Thai property without first obtaining permission from the Thai Minister of the Interior. This prohibition is not all-encompassing as foreign nationals are permitted to take freehold title to Thai condominiums. However, the condominium complex must comport to the relevant provisions of the Thai Condominium Act. Most notable among the requirements in the Thai Condominium Act is the provision that a Thai condo complex must be primarily owned by Thai nationals, meaning that 51% of the Condo units must be owned by Thais while 49% percent of the units may be owned by foreigners.

In many cases, a condominium complex is owned by a company in Thailand. Some opt to own a condo in this way in order to make selling the condominium easier, while others initially purchase the condo indirectly through a corporate entity. In either case, the practice is technically legal. Although, use of so-called “nominee shareholders,” is illegal in Thailand and Thai authorities are increasingly on the lookout for corporate structures utilizing nominees. That being said, the definition of “nominee” is somewhat vague.

This leads us back to the issue of Amity Treaty Companies. Amity Companies are specifically precluded from ownership of Thai real estate pursuant to the provisions of the Treaty of Amity, while the Thai Condominium Act allows foreigners to own a Condominium outright. This begs the question: can an Amity Treaty Company own a Thai Condo in the same manner as a foreign natural person could? This author has not adequately settled this question in his own mind and welcomes any comments regarding this issue. The provisions of the Treaty of Amity preclude land ownership and although many believe that Condo ownership is simply ownership of a unit, the Chanote does pass title to an interest in the underlying land, so there would seem to be a compelling argument that a condo owner is something of a landowner and, if so, this practice would likely be precluded under the provisions of the Amity Treaty.

Tags: Amity Treaty, Amity Treaty Company, nominee, nominee shareholder, nominees, Thai Company, Thai Condo, Thai Condominium, Thai Real Estate, Thailand Condo, Thailand Condominium, Thailand Real Estate, Thailand Treaty of Amity, US-Thai Treaty of Amity
Posted in Amity Treaty, Thailand Business, Thailand company, Thailand Condo, Thailand Property, Thailand Real Estate | No Comments »

There are many foreign nationals who have opted to take up long term residence in the Kingdom of Thailand. For many expatriates, a pivotal question regarding residence in Thailand deals with the issue of Thai property law. Under the current laws in the Kingdom of Thailand foreign nationals are effectively barred from purchasing a Freehold Chanote (Title Deed) to land in the Kingdom. This being said, foreigners are allowed to take freehold title to Thai Condos provided certain legal requirements are met, but for many foreign nationals in Thailand actual home ownership is the preferred method of living in the Kingdom.

In the past, a Thai company could be used to own Thai Real Estate, but the company had to be structured in such a way that it comported to Thai law. In recent months there has been some discussion by Thai government officials about doing away with this system of property ownership. How this will play out remains to be seen, but some foreigners, who are still interested in enjoying Thai property, are looking at other ways of structuring their interests so as to properly comport with possible future restrictions.

One method involves the bifurcation of Thai title. What this means is that the land underneath a structure is owned by a Thai while any structures on the land are owned by a foreigner. This arrangement would be legal under current Thai law, but many are confused about how such an arrangement could be set up. This is where the Yellow Tabien Baan becomes an issue.

A Yellow Tabien Baan is used by foreign nationals who live in the Kingdom. However, they are very difficult to obtain and are usually only promulgated if the foreign national has bought a Thai condo. That being said, a foreign national who is on a Tabien Baan can obtain a building permit to build a structure in Thailand. Once the structure is built, it can be owned wholly by a foreign national. A foreigner could secure long term lease to the underlying property while maintaining ownership of the structure. Use of a Thailand usufruct or superficies would also strengthen the foreigner’s property interests without violating the de facto restriction placed upon land ownership for foreigners. This is not the only benefit that a Yellow Tabien Baan can confer upon a Foreigner in Thailand as there are other major benefits that foreign nationals can enjoy by being on a Foreign Tabien Baan.

Tags: Foreign Tabien Baan, Foreign Tambien Baan, Tabien Baan, Tambien Baan, Thai Chanote, Thai Property, Thai Property Law, Thai Real Estate, Thai Real Estate Law, Thai Tabien Baan, Thai Tambien Baan, Thai Title Deed, Thailand Property Law, Thailand Real Estate Law, Thailand Title Deed, Title Deed, Yellow Tabien Baan, Yellow Tambien Baan
Posted in Thailand Business, Thailand company, Thailand Condo, Thailand Property, Thailand Real Estate, Upcoming Legislation | No Comments »

In recent days there has been speculation about Thai authorities cracking down on any Thai Company which was formed solely for the purpose of facilitating foreign ownership of Real Estate in Thailand. Unfortunately for foreign nationals, the Thai government restricts land ownership and will not allow foreign nationals to own land without Ministry of Interior approval. As a practical matter, this approval is nearly impossible to obtain so the Kingdom essentially has a De Facto ban on Real Estate ownership by foreigners. This being said, foreign nationals are still permitted to own Thailand property in the form of condominiums. A foreign national may own a Thai condo in freehold provided the condominium complex adheres to the provisions of the Thai Condominium Act.

In a journal written about the Thai housing market this author found the following quotation:

“[O]n May 15, 2006, the Ministry of Interior issued a policy to all provincial governors regarding the avoidance of foreign land ownership laws. The policy sought to prevent the purchase of land for the benefit of a foreigner in accordance with Section 74 of the Land Code. It directs officials to be more vigilant in scrutinizing land purchases of land by entities with foreign shareholders or directors, or where reasonable grounds exist to believe that a Thai is a nominee shareholder on behalf of a foreigner. The policy requires competent officials to carefully scrutinize the supporting evidence submitted for consideration, while paying particular attention to the occupation, duration of work and the monthly income of the Thai shareholder. If, following the investigation, the competent official’s opinion is that the transfer registration represents an avoidance of law or that a Thai is trying to purchase land for a foreigner’s benefit, he should investigate further and submit the case to the Land Department for ministerial advice.”

As can be gathered from the above quote, the Thai government places a great deal of administrative discretion in the hands of local land office personnel when it comes to the issue of foreign ownership of Thai property. It would appear that these administrative prerogatives will be brought to bear against those that use nominee shareholders to own land or Real Estate in Thailand. In this legal environment, it may be wise for foreign nationals to carefully assess their options in order to ensure that the best decisions are made with regard to property investment. In any case, it would be wise for anyone thinking of investing in the Kingdom of Thailand to consult an attorney in order to come up with a coherent strategy.

Tags: Thai Property, Thai Property Law, Thai Real Estate, Thai Real Estate Law, Thailand Property, Thailand Property Law, Thailand Real Estate, Thailand Real Estate Law
Posted in Thailand Business, Thailand company, Thailand Condo, Thailand Property, Thailand Real Estate, Upcoming Legislation | No Comments »

Many people in Thailand, both foreign and Thai, choose to incorporate Thai businesses. Thailand is one of Southeast Asia’s major trading locales and as a result many individuals and business concerns need a corporate presence in the Kingdom of Thailand. In many cases, companies are incorporated with substantially similar articles of incorporation. That being said, some companies opt to incorporate with unique provisions regarding different types of shareholder rights in the corporate charter. These different types of rights can have a major impact upon the running of the business because these rights can have a collateral impact upon employee compensation, shareholder vote tabulation, and banking issues. Therefore, an understanding of share classification can be helpful to those who are thinking of incorporating a Thai company.

In the articles of association (also known as articles of incorporation) of a Thai limited company, one could denote the rights associated with different share classifications. Therefore, some shares could simply hold an equity interest in the company while not having any voting rights at shareholder meetings. Other types of shares could hold little or no equity in the company, but maintain voting rights regarding the Directors of the company. If a company owns Thai property, there could be specific shares that have certain rights in relation to the Thai property concerned. For example, a Thai company that owns Thai real estate could place special rights in the hands of certain shareholders with regard to said real estate. If a Thai company owns a Thai Condo, then share classification could be used to delineate the rights of individuals with regard to the Condo premises.

For those who are interested in Thai limited companies certified under the US-Thai Amity Treaty, these same principals could apply to an Amity Company. One shareholder could retain a sizable equity holding while another holds certain voting rights. The same could be said about a Thai limited company that has obtained a Foreign Business License. A company such as this could incorporate special shareholder rights in the provisions of the articles of association or incorporation.

These issues bleed into the realm of Thai Immigration because the shareholder in a Thai company could apply for a Thai business visa. The basis for such an application could be an impending shareholder’s meeting that the foreign national must attend. The approval of such an application would depend upon the Thai Embassy or Consulate concerned. If present in the Kingdom on another type of visa, an O visa, for example, it may be possible for the shareholder to attend a meeting in order to vote his or her shares.

Tags: Amity Treaty, Amity Treaty Company, Corporate Law, Limited Company Thailand, Shareholder Classification, Thai Company, Thai Limited Company, Thailand company, Thailand limited company, Treaty of Amity Company, US-Thai Amity Treaty, Voting Rights
Posted in Amity Treaty, Thailand Business, Thailand company, Thailand Condo, Thailand Embassy, Thailand Property, Thailand Real Estate, Thailand Visa | 22 Comments »

Thailand has become a major epicenter of trade in Southeast Asia. The Kingdom also remains one of the most important trading partners of the United States of America, the European Union, and the United Kingdom. Many businesspeople who do business in Thailand must deal with restrictions imposed upon foreigners under the Thai Foreign Business Act. American Citizens enjoy some benefits under the provisions of the US-Thai Amity Treaty. This Treaty was promulgated in the mid-60′s. In Thailand, Treaties are considered the “law of the land,” and are considered superior to locally drafted legislation (this notion is similar to many of the ideas codified in the American Constitution, specifically the Supremacy Clause).  As the Amity Treaty is the “law of the land,” it supersedes the Foreign Business Act.

A Thai Limited Company certified under the provisions of the Treaty of Amity is a good vehicle for conducting business in Thailand, but the Treaty does have caveats and Companies conducting certain types of business cannot obtain Treaty Certification. Most importantly for some, Amity Treaty Companies cannot own land. Even though an Amity Company is accorded “National Treatment,” the company is barred from holding property in the form of Thai Real Estate. Although, technically it may be possible for an Amity company to purchase a Condo in Thailand.

Aside from ownership of Thai property, there are other activities which an Amity Company cannot engage in, such as: Inland Transportation, Communications, Fiduciary Functions, and the Practice of Professions. Each of these types of activity are reserved to Thai nationals and/or Thai Companies. Even still, the Amity Treaty provides American Citizens with the opportunity to own virtually 100% of a Thai company. For many types of businesses the Amity Treaty is a perfect solution to the problems imposed upon foreigners by the Foreign Business Act.

Some have postulated regarding the possibility of using American Citizens as nominees in order to obtain Amity Treaty benefits. This is basically impossible as nominee shareholders are illegal under current Thai law. That being said, delineating whether or not an American Company is “American,” could be difficult. The relevant agencies of the Thai Ministry of Commerce adjudicate Amity Treaty Certification applications on a case by case basis and come to a decision based upon the makeup of the corporate shareholders in question.

An Amity Treaty Certificate is somewhat similar to a Foreign Business License. However, the two documents are issued based upon different legal foundations. There are some US Immigration benefits accorded to Thai nationals under the US-Thai Treaty of Amity in the form of E visas, but there is not a direct counterpart found under Thai Immigration law.

Tags: Amity Treaty, Amity Treaty Company, Thai Company, Thai Limited Company, Thailand company, Thailand limited company, Treaty of Amity, Treaty of Amity Company, US-Thai Amity Treaty, US-Thai Treaty of Amity
Posted in General Legal Information, Thailand Business, Thailand company, Thailand Condo, Thailand Property, Thailand Real Estate, US Visa and Immigration | 5 Comments »

Thailand is one of the major trading centers in Southeast Asia. As a result, many foreign nationals wish to conduct business in the Kingdom of Thailand. However, the Thailand Foreign Business Act precludes foreign ownership of Thai companies. Strictly speaking, foreign ownership is not technically illegal, but operating such a company for profit is against the law.

When we say, “foreign ownership,” we mean foreign majority ownership as foreign nationals are allowed to own a minority stake in a Thai company, up to forty-nine percent. If a Thai owns fifty-one percent of a company in Thailand, then that company is considered to be a “Thai Company.”

There are some who incorporate “Thai companies” that utilize so-called “nominee shareholders.” A nominee is one who owns shares in a Thai company on behalf of another. A nominee is not an “active shareholder,” in a company. Under current Thai corporate law nominee shareholders are illegal. However, defining what constitutes a “nominee shareholder,” can be difficult.

Thai law does provide for a way around the restrictions imposed by the Foreign Business Act. There are ways to license a Thai Company, with majority foreign ownership, to conduct business in Thailand.

On method of facilitating a foreign company to conduct business in Thailand is through a Foreign Business License. These documents can be difficult to obtain and the process for obtaining a Thai foreign business license can be very time consuming. Once granted the license will specify the exact nature of the business and the company will be precluded from conducting any other type of activity, unless another license is obtained.

Another method of facilitating foreign ownership of a Thai company is through the US-Thai Amity Treaty. As the name suggests, the US-Thai Treaty of Amity and Economic Relations is a bilateral agreement between the Kingdom of Thailand and the United States of America. A company certified under the terms of the Treaty is given “national treatment,” allowing it to operate in the same way as a “Thai Company.” The major exception being that an Amity Treaty Company is precluded from owning real estate in Thailand. Other types of Thai property could be owned by an Amity Company, such as a Thai Condo. Also, the provisions of the Treaty grant the aforementioned benefits exclusively to United States Citizens. Therefore, this method of certification is not for everyone.

The Australia-Thai free trade agreement provides some special benefits to Australians in Thailand as Australian Citizen may be allowed to own a majority stake in certain types of Thai companies.

A final method of licensing a foreign company in Thailand is through the Board of Investment or BOI. A BOI company can receive special benefits in the form of rights to operate and some BOI companies can own land. That being said, BOI companies are very difficult to incorporate and require a great deal of legal expertise to set up. BOI Companies are generally not advisable for those thinking of establishing a small Thai business. For large enterprises, such a setup may be advisable due to the fact that a Thailand visa and/or work permit is generally easier to obtain for a BOI company.

Tags: Amity Company, Amity Treaty, Amity Treaty Company, Board of Investment Company, Board of Investment Thailand, BOI Company, Foreign Business License Thailand, Thai Company, Thai Foreign Business License, Thailand company, Thailand Company Incorporation, Thailand Company Setup, Thailand Foreign Business License, US-Thai Amity Treaty, US-Thai Treaty of Amity
Posted in Legal Opinion, Miscellaneous, Thailand Business, Thailand company, Thailand Condo, Thailand Property, Thailand Real Estate, Thailand Visa | No Comments »

For many people living in Thailand, the prospect of owning property would be considered highly beneficial. Unfortunately, Thai law places great restrictions upon foreign nationals who wish to purchase property. That being said, no such restrictions are placed upon those who wish to lease Thai real estate.

In Thailand, the Civil and Commercial Code provides for leases of varying lengths of time. A lease’s enforceability is based, in part, upon the length of the lease. For example, a common misconception among many foreigners is based upon the idea that a lease can be unrecorded and enforceable for a period exceeding 3 years. However, this is not the case as parties to a Thai lease exceeding 3 years must record the instrument upon the Chanote (Title Deed) in order for a subsequent court to enforce the provisions agreed therein.

In Thailand, the longest lease that one can practically obtain has a duration of 30 years. A novel approach to acquiring what amounts to a longer lease would utilize multiple 30 year leases in which the date of lease commencement coincides with the end of the prior lease. For example, one could acquire a 30 year Thai lease that begins in 2010. Then acquire another 30 year lease to the same property, only this lease does not come into effect until the day after the prior 30 year lease is expired in 2040. As a result of these efforts, the leasee would effectively have a lease that runs for sixty years, but in reality, the applicable Thai laws have been adhered to because the 60 year lease period is the product of two legal leases each for no more than 30 years.

Although this type of legal configuration may be possible in theory, these types of staggered lease agreements, like any legal construct in Thailand, may not be practically feasible as the officers at the Thai land department may not accept the documentation and thereby could preclude this legal instrument from being recorded on the Chanote. Each Thai land office interprets the rules and laws differently. Therefore, retaining experienced counsel in the form of a Thai attorney to assist in recording leases and other property instruments may be beneficial to a foreigner in Thailand as the attorney could assist in facilitating the recordation of a rarely seen legal instrument.

Another issue that may be of interest to foreigners is the use of a Thai usufruct. A usufruct allows a foreigner to retain lifetime rights of use in the underlying Thailand property. Therefore, this type of instrument can act as a sort of “lifetime Thai lease,” as the beneficiary of the usufruct could use the Thai property until his or her death. It should also be noted that different rules apply to those looking to purchase a Thai condo because it may be possible for a Foreign national to purchase a Thai Condo in freehold.

Tags: Thai Chanote, Thai Lease, Thai Property, Thai Property Law, Thai Real Estate, Thai Real Estate Law, Thailand Chanote, Thailand Lease, Thailand Lease Agreement, Thailand Property, Thailand Property Law, Thailand Real Estate, Thailand Real Estate Law
Posted in General Legal Information, Legal Opinion, Thailand Condo, Thailand Property, Thailand Real Estate | No Comments »