Integrity Legal

The Thai Immigration system remains in something of a state of flux, although the overall trend is positive. Many of the travel restrictions which had previously been imposed in Thailand have now been lifted. For example, Thailand Pass has been totally mothballed. However, there are presently a number of changes to Thai retirement visas which appear imminent. Notably, the Thai O-A retirement visa‘s insurance requirements appear likely to increase substantially in coming weeks. to quote directly from a entry of Legal.co.th regarding Thai retirement visa insurance:

[I]t was announced that O-A Retirement visas are going to see the insurance coverage requirement go up to 100,000 US Dollars or self-insurance thereof, so roughly the equivalent of 3 million Baht basically shown in a Thai bank account in order to maintain O-A Retirement Visa status.

Meanwhile, insurance seems to be a rather nettlesome issue as a proposed “Tourism Fee” has proven difficult to implement while many question the need for such a measure especially as the tourism sector in Thailand is tenuously recovering. Although it now appears this initiative has been suspended. Another issue recently in the news, seemingly unconnected to immigration policy, pertains to Thai real estate law. It seems proposed “Long Term Residence Visas” (albeit something of a misnomer as these travel documents do not confer permanent residence in Thailand) may allow foreigners to own Thai real estate under limited restrictions. However, even this proposal seems to be under serious scrutiny. To quote directly from a recent article in the Bangkok Post:

A property executive who requested anonymity said many Thais might disagree with the government’s attempt to attract affluent foreigners by granting them full land ownership of one rai for residential use. “It’s good that the government wants to boost the economy by attracting foreign investment,” said the executive. “Thailand is very attractive among foreigners. They want to stay here as our medical services are good, the cost of living is low, the food is superb, and we have a lot of international schools for their children.” However, some locals think it is unfair to them, as many still cannot afford to buy property.

Clearly, the notion of foreign nationals being able to acquire residential real estate in Thailand is not a settled issue. Furthermore, based upon prior announcements from the Thai Land Office it seems that land ownership in Thailand associated with LTR visa status may never be a reality in Thailand.

Tags: Bangkok, Chanote, chiang mai, condo, condominium, condominiums, condos, deed, fee simple, freehold, immigration, land, land ownership, lease, leases, long-term residence, LTR, own land, pattaya, permanent, permanent residence, permanent residency, phuket, PR, property, property thailand, real estate, real estate thailand, reside, residence, residency, resident, residents, Thai, Thai Condo, Thai Embassy, Thai Immigration, Thai Lease, Thai Leases, Thai Property, Thai Real Estate, Thai usufruct, Thai Visa, Thai Visas, ThaiEmbassy, Thailand, Thailand Condo, Thailand Immigration, Thailand Property, Thailand Real Estate, Thailand usufruct, Thailand usufructs, Thailand Visa, Thailand Visas, thaivisa, TM.9, TM9, usufruct, usufructs, visa, visas
Posted in Thailand Property, Thailand Real Estate, Thailand Visa | No Comments »

In recent weeks it has come to this blogger’s attention that some significant changes with respect to the duration of leases in Thailand have been not only proposed, but are apparently nearing a point where they might be implemented. While The Nation has taken note of the fact that various stakeholders in the Thai real estate sector have welcomed the possibility of 99 year leases for foreign investors in the Thailand property market (a proposal which has many restrictions in and of itself, including the requirements that such lease may only be possible in large industrial developments operating with the proposed Eastern Economic Corridor or EEC). Meanwhile the Bangkok Post has reported that various activist groups in Thailand are opposed to the proposal that 99 year leases be implemented. In this blogger’s view the more important issue is the fact that the implementation of new laws regarding Thai commercial leases appears very near at hand. To quote directly from the aforementioned Bangkok Post article:

[T]he government approved the land rental extension to 99 years, a policy change that will affect about 10 million people who are in need of land, he said. The cabinet’s resolution was made in a bid to promote the eastern special economic development zone to draw international investment linking the country more closely to the Asean community and beyond…

It should be reiterated that the leases at issue are of a commercial nature and appear only to be possible within specified zones, but the change is notable since for years 30 year leases were the norm in Thailand and the recent changes seem to mark a substantial shift in policy thinking. It should be noted that recently proposed changes may make it possible for foreign nationals to obtain a 50 year lease in Thailand on residential property. Clearly, all of these developments bode well for those wishing to invest in the Thailand property market.

Not everything is developing in a positive manner for everyone with respect to the use of real estate in Thailand. In recent weeks, there has been a great deal of clamor arising from the fact that officials affiliated with the Thai government have announced plans to severely curtail, if not outright ban, street food vendors in the Kingdom. To quote a recent article on the Voice of America website quoting an assistant to the Governor of Bangkok:

“The street vendors have seized the pavement space for too long and we already provide them space to sell food and other products legally in the market,” the assistant said. “So there will be no let-up in this operation – every street vendor will have to move out.”

It should be noted that what may appear to be “street food vendors” may in fact just be sellers of food in an open air environment, but occurring on private property in Thailand. Therefore, this blogger does not expect that outdoor dining on traditional Thai fare will disappear any time soon. However, it seems logical to infer that street vendors will likely be making deals with owners of Bangkok property to use their land in order to sell food. A question posed by many: why are authorities in Thailand doing this? Many of those posing this question do so for different reasons. Some note that street food is part of the tapestry of Bangkok life. Meanwhile, others note that restricting street food could have a detrimental impact upon tourism. Although this blogger does not necessarily agree with all of the restrictions being proposed with respect to street food two things should be noted. First, the thoroughfares of Bangkok have a tendency to become crowded and street food vendors had more than a tendency to exacerbate this crowding. Second, Thai authorities have continued to note issues related to the raising of government revenue and it is this blogger’s opinion that the restrictions on street food may be the government’s initiative to, at least indirectly, encourage some vendors to engage in the more regulated economy. The Value Added Tax accounts for a significant portion of Thailand’s overall revenue. Therefore, if authorities can encourage more businesses to become part of the VAT system then it stands to reason that the government could raise further revenue. This blogger knows for a fact that there are those street vendors who do pay VAT, but the percentage of such individuals in relation to the overall number of street vendors is quite small. Therefore, it seems likely that while on the one hand Thai authorities are making the streets in Bangkok more easily accessible the upshot may be a benefit to government coffers in the long run.

Tags: 50 year lease in Thailand, 99 year lease in Thailand, ASEAN, Bangkok property, Bangkok Real Estate, Eastern Economic Corridor, eastern special economic development zone, Thai Property, Thai Real Estate, Thai street food, Thailand Property, Thailand Real Estate, Thailand street food, Value Added Tax, VAT
Posted in Thailand Business, Thailand Property, Thailand Real Estate | No Comments »

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 »

It recently came to this blogger’s attention that Economic Ministers from the jurisdictions which comprise the Association of Southeast Asian Nations (ASEAN) are set to meet in Indonesia over the upcoming weeks. Of especial importance, in this blogger’s opinion, is the fact that said meeting is set to include representatives from the United States of America and Russia. In order to shed further light upon these developments it is necessary to quote directly from the official website of The Nation, NationMultimedia.com:

Free-trade partners of Asean, in addition to the United States and Russia, will join Asean economic ministers for a meeting in Manado, Indonesia, next week with the aim of tightening economic integration. Indonesia will host the Asean Economic Ministers (AEM) meeting from August 9-13. Yanyong Phuangrach, permanent secretary at the Commerce Ministry, who will lead the Thai delegation to the meeting, said the main agenda was to forge closer cooperation among Asean member states and trading partners, mainly with FTA partners and the two economic giants – the US and Russia…

Readers are strongly encouraged to click upon the relevant hyperlinks above to read this important article in detail.

In recent months there have been many positive developments in the ASEAN region as discussions pertaining to a possible unified ASEAN visa have been broached. Meanwhile, discussions pertaining to the South China Sea appear to have lessened some of the tensions between ASEAN members nations and China. However, as of yet, a final framework for dealing with the South China Sea has yet to be developed. As the ASEAN region continues to show further economic potential it stands to reason that geo-politically dominant economies will show increasing interest in the Southeast Asian region.

In news specifically related to the Thai Real Estate and Property markets, it recently came to this blogger’s attention that Singaporean and international real estate developers have noted their optimism regarding the Thai property market. In order to provide further elucidation regarding these developments this blogger is compelled to quote directly from the PropertyShowrooms.com website:

A Singapore property development company has decided to invest in a series of condominium projects in Thailand over the coming year. Speaking to Property Report, business development manager at Dalvey Developments Noel Goh described the Thai real estate sector as “a very attractive market with high growth potential”. “Moreover, property prices remain low when compared to neighbouring countries,” Mr Goh added…According to one Asian real estate expert, buyers from Hong Kong are increasingly being drawn to high-end properties in the Thai capital. Executive director for investment and project marketing at CB Richard Ellis Rebecca Shum told the Bangkok Post that the city is a “top-two destination for lifestyle” from the point of view of Hong Kong investors. She added that a rise in optimism about Thailand’s political and economic conditions is helping boost the luxury property market in the nation.

The administration of this web log encourages readers to click on the relevant hyperlinks above to read further from this article.

For many, the purchase of property in Thailand can be a cumbersome and somewhat confusing endeavor as Thai law on the subject has been described as rather complex and, in some cases, byzantine. This is especially true in cases involving foreigners wishing to purchase land in Thailand since there is virtually a de facto prohibition on foreign nationals purchasing Thai land. That stated, such a prohibition does not exist in the context of a Thai lease, Thai usufruct, or Thai condominium. In fact, pursuant to the Thailand Condominium Act, foreign nationals in Thailand may be permitted to purchase a Thai Condo so long as that proposed real estate holding comports with the relevant provisions of the Act. For this reason, and many more, some opt to retain the assistance of an attorney in Thailand to assist in conducting due diligence and conveyancing matters pertaining to Thai property.

For information related to legal services in the Kingdom of Thailand please see: Legal.

Tags: AEM, ASEAN, Asean economic ministers, ASsociation of Southeast ASian Nations, Commerce Ministry, conveyancing, Conveyancing In Thailand, de facto prohibition on foreign nationals purchasing Thai land, due diligence, Free-trade partners of Asean, Hong Kong investors, Property In Thailand, purchase land in Thailand, Real Estate In Thailand, Russia, Thai capital, Thai Condo, Thai Condominium, Thai Lease, Thai usufruct, Thailand Condominium Act, Thailand Property, Thailand Property Law, Thailand Real Estate, Thailand Real Estate Law, United States
Posted in ASEAN Business, Cambodia Business, Indonesia Business, Laos Business, Malaysia Business, Russia Business, Thailand Property, Thailand Real Estate, Vietnam Business | 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 »

It recently came to the attention of the administration of this blog that a new trade complex is to be erected in Bangkok for the purpose of facilitating the trade of Chinese goods in Thailand and Greater South East Asia. To quote directly from the Voice of America News website:

Chinese state media say work will begin this month on a massive trading complex in Bangkok where Chinese manufacturers will be able to re-export their goods.

The China Daily newspaper said Thursday that the China City Complex will cost $1.5 billion and sprawl over almost three-quarters of a square kilometer. Chinese manufacturers will be able to import goods to Thailand, taking advantage of a new free trade deal, and then ship to the United States and Europe under more advantageous quotas and tariffs.

It is interesting to note that China officially became the second largest economy in the world in 2010. This plan will likely result in an increasingly prosperous trade relationship between the Peoples’ Republic of China and the Kingdom of Thailand. The Voice of America News website went on:

China has been using trade and commercial projects to improve its diplomatic and strategic standing in Southeast Asia. Thailand’s deputy minister of commerce, Alongkorn Ponlaboot, is quoted by China Daily saying the China City Complex corroborates “a strategic business-partner relationship” between China and Thailand.

China’s free-trade agreement with the 10-member Association of Southeast Asian Nations was concluded last year.

Putting aside diplomatic and strategic matters, the ambitious project could result in economic benefits for many ASEAN countries (Association of South East Asian Nations) especially Thailand. The creation of a new commercial project such as the one proposed will likely come with the added benefit of new jobs for Thais near Bangkok, new business opportunities for Thai entrepreneurs, new trade opportunities for Thai, Chinese, and other foreign investors; and an overall increase in the flow of goods, capital, labor, and resources to the Kingdom of Thailand and the Greater ASEAN region.

Each year, foreign companies and individuals opt to pursue business ventures in the Kingdom of Thailand. In some cases, entrepreneurs incorporate a Thai Company in order to maintain limited liability while conducting business. Sometimes individuals opt to do business under a Thai sole proprietorship. Partnerships often prefer the added layer of limited liability that can be conferred upon certain members of a Limited Liability Partnership in Thailand. Large ventures conducting business in Thailand occasionally opt to take their enterprise public through the registration of a Thai public company. In any case, those wishing to conduct trade or business in the Kingdom of Thailand are well advised to contact a Law Firm in Thailand as advice and counsel regarding the unique aspects of Thai law can be highly advantageous for businesses making their first appearance in the Thai market. Foreign nationals employed or working in Thailand should note that all foreigners working within the jurisdiction of the Kingdom of Thailand are required to have a Thai work permit in order to lawfully take up virtually any type of employment.

Matters pertaining to the acquisition of Thai property or Thai Real Estate within the context of multi-jurisdictional business transactions can be complex and multifaceted. For this reason it is highly advisable that foreign nationals or foreign companies conducting business in the Kingdom of Thailand retain the services of a firm to assist with Thai property matters prior to making an irrevocable decisions regarding the acquisition of Thai real estate or property.

For related information please see: US Company Registration or Legal.

Tags: Asian Business, ASsociation of Southeast ASian Nations, Business in ASEAN, Chinese Business in Thailand, SouthEast Asia Business, Thai Business, Thai Property, Thai Real Estate, Thailand Business, Thailand Property, Thailand Real Estate
Posted in Ecommerce, News, Thailand Business, Thailand company, Thailand Property, Thailand Real Estate, Thailand Visa, Thailand Work Permit | 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 »

This author recently came across a discussion of the forecast of the Thailand property market in 2010. For those who are not up to speed on the Thai property market, the year 2009 was not a particularly buoyant year for those in the Thailand real estate sector. This may be due to the fact that the overall economy around the world was not particularly vibrant. That being said, there are optimists who believe that 2010 will be a better year for Thai property.

There has been some talk in and around government circles about reforming Thailand property law. Some believe that a reform of Thailand real estate law would provide more economic efficiency and make foreign buyers (particularly commercial buyers) more amenable to purchasing land in Thailand or other forms of property in the form of Thai condos or houses.

To quote the website ThailandPropertyNews.com:

“The initiative of this government to reform property and land taxation with a view to creating fairness sounds positive, but it will only be possible to determine the effect on the property market once the details of the proposed legislation have been finalised. “So long as the new tax legislation is on a fair basis and the tax rate not so excessively high as to discourage investment, CBRE sees this reform as beneficial for the market,“ Ms. Aliwassa Pathnadabutr, Managing Director of CBRE Thailand said. An additional measure that CBRE urges the government to consider is the extension of the long lease term from the current 30 years up to a maximum of 90 years. This will help improve the market mechanism and make large-scale commercial projects viable which would not be feasible if such developments were freehold due to the high land cost or if they were on a 30-year lease due to the limits on lease terms. The extension of the lease term will also have a direct benefit for resort destinations such as Phuket and Samui where the property markets are primarily driven by foreign demand.”

It is interesting to note that some feel that an easing of the legal restrictions placed upon Thai leases would be a net benefit to the Thai real estate market. Currently, the Thai Civil and Commercial Code places restrictions upon the length of time that a Thai lease will remain enforceable in Thailand. There are exceptions, but currently, the enforceability period is 30 years or less. Providing foreign buyers with the option of obtaining a 90 or 100 year lease might cause an increase in demand for Thai property. It will be interesting to see how the government deals with these issues and what impact any legislative changes will have upon the Thai real estate market.

Tags: Lease in Thailand, Thai Condo, Thai Condos, Thai Lease, Thai Leases, Thai Property, Thai Property Law, Thai Real Estate, Thai Real Estate Law, Thailand Lease, Thailand Leases, Thailand Property, Thailand Property Law, Thailand Real Estate, Thailand Real Estate Law
Posted in Thailand Property, Thailand Real Estate, Upcoming Legislation | No Comments »

A common method of land ownership in Thailand is through use of a Thai Limited Company. In many cases, a juristic person is incorporated to hold Thai property on behalf of the principal investors in the company.  Over the past three years the Thailand Real Estate market has been somewhat stagnant, but recently there seems to have been something of an upward trend in Real Estate transactions. This has resulted in the Ministry of the Interior raising the fees for land transactions, particularly with respect to land transactions executed on behalf of a corporation. To quote a Pattaya Times article promulgated on the website Thaivisa.com:

“‘A nationwide increase in land offices fees will go in effect on March 2,’ a spokeswoman for the Ministry of Interior announced in Bangkok. The fees for purchases and sales involving a Thai company limited which most foreigners use to buy land will go up from one percent to six and a half percent of appraised or contract value, whichever is higher. The head of the Chonburi Land Office, Director Vaiyavuth Surapruik, said, ‘In 2008 the fees were lowered to help the economy. This has stimulated the sale of properties. Since the fees were lowered almost two years ago there has been no slow-down in the number of transactions at the land office in Banglamung which services Pattaya so now fees will go back up in order to increase government revenues.’”

On the one hand, the recovery of the Thailand Property market is definitely a positive development, and hopefully a sign of an underlying upsurge in the overall Thai economy. This upswing in Thai property sales may also be indicative of an overall upward trend in the world wide economy. However, for those who are thinking of purchasing Thai property be it land or another form of Thai Real Estate such as a Thai Condo, this development will likely be viewed negatively as it will result in increased fees for the buyer or seller of Thai property.

This fee increase will also have an impact on individuals as the aforementioned article concluded:

“Property transfered between individuals will be charged three percent fees if owned for more than two years by the current owner. If owned less than two years the fee is higher, between five and six and a half percent.” [sic]

Property transfers between individual foreigners is probably as common, if not less common, than property transfer between corporations controlled by foreigners. That being said, under certain conditions a foreigner can own a Thai Condominium in freehold and therefore could be effected by these increased individual transfer fees.

For related information on this blog please see: Thailand Property Law.

Tags: Thai Company, Thai Condo, Thai Property, Thai Real Estate, Thai Real Estate Law, Thailand company, Thailand limited company, Thailand Property, Thailand Property Law, Thailand Real Estate
Posted in General Legal Information, Thailand Business, Thailand Property, Thailand Real Estate, Upcoming Legislation | 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 »