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 Land ownership in Thailand 

 Thepprasit Law & Accounting Office 

 (Disclaimer: Although the information in this report has been obtained from sources believed to be reliable, we do not guarantee its accuracy and such information may be incomplete or condensed.)

Some regulatory background to purchasing property in Thailand:

 Ownership of land / house with land: 

  Since 1971, a foreigner (an "alien") or a majority foreign-owned company can principally not own land or buildings with land in Thailand.
In May 1999, the Amendment of the Land Code Act came into force, making the following exception:

... Aliens wishing to acquire land in Thailand must bring foreign currency into Thailand for certain types of investments in an amount to be specified in ministerial regulations which shall in no event be less than 40 million Baht and obtain permission from the Minister of Interior. Any aliens meeting such requirements may be granted permission to own land in an area not exceeding one (1) Rai for residential purposes. The ministerial regulations have not been issued as of October 1999.


 Majority Thai owned company: 

  A law office can help with advice on property ownership through a company.

July 2006 Landholding Companies
Read this now don't get caught

 Condominiums: 

  There are three legal acts relevant to the purchase of a condominium unit by an alien, being the Condominium Act B.E. 2522 (or 1979, the Condominium Act (No. 2), B.E. 2534 (or 1991) and the Condominium Act (N. 3) B.E. 2542 (or 1999) issued on 28th April, 1999. Until recently, foreigners could only own forty percent (40%) of the aggregate unit space. This has been amended to 49% of the aggregate unit space although the ministerial regulations governing this change have not yet been issued. The new Act allows that aliens or alien juristic persons (majority foreign-owned companies) can own up to 100% of the aggregate unit space registered in a condominium up to 27th April 2004. The total development area in that case must be under 5 Rai (8000 m2) and located in Bangkok, all municipal districts and "such other areas as shall hereafter be announced by the Minister of the Interior to be foreign
owned, provided always (this is unchanged) that the funds for the purchase have been remitted from abroad".

 Who can own a condominium: 

  Basically any foreigner who can enter Thailand legally can buy a condominium.

 Currency: 

  Basically any negotiable foreign currency can be used to purchase a condominium.
The foreign currency MUST be transferred into Thailand as foreign currency and exchanged by the handling bank in Thai Baht.

 Documents needed when buying a condominium: 

  For foreigners to be eligible to purchase a condominium in Thailand they must present proof to the Land Department that the funds have been remitted from overseas in foreign currency. Without such proof the Land Department will not permit the transfer of ownership to the foreign buyer.

1. Remittances must be sent in exactly ("to the letter") the same name as that on the purchase contract, i.e. if Tom Smith is the purchaser then the name Tom Smith must appear on the remittance advice. T. Smith or Smith Enterprises are unacceptable.

2. Transfers of funds MUST be made in FOREIGN CURRENCY only and NOT in Thai Baht, i.e. if you are working in US Dollars then remit in US Dollars. Do not remit in Thai Baht.

3. Amounts transferred must be more than $5,000 in order to obtain a Thor Tor 3 form. (The bank will NOT ISSUE a Thor Tor 3 form for amounts less than $5,000.) This may mean you will have to agree to a modified installment schedule so that all amounts remitted are more than $5,000.

4. The purpose of the remittance MUST be stated on the remittance advice. This should be "FOR THE PURCHASE OF A CONDOMINIUM". The Bank of Thailand's code for this is 5.22.

 A condominium title 

  (first established under the condominium act of 1979) is a title to a part of a building or buildings with multiple owners, and a fractional interest in the land (always a Chanot) and other common assets (such as a swimming pool) and common parts of the building (such as the stair well or lobby). The title will state the
floor area of the private apartment, the ground area of the common land and the percentage interest which that apartment has in the common property. This percentage also represents the value of the voting interest in the condominium company or owners' association.

Buildings other than condominiums do not have any form of title document, but their sale or long lease can be registered at the Amphur (district) land office. Proof of ownership, must be established either from proof of construction or document showing previous sale-purchase (not to be confused with the House Registration document, which is only a register of the house's occupants).

Transfer of a building as distinct from its land requires the posting of 30 days public notice (to see if anyone wishes to contest the ownership).
Foreign nationals (aliens) may own a building (as distinct from its land) and may register such transfer of ownership into their names at the local district office.

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 Purchase of land, and/or house with land: 

  The services of a law office will be necessary when purchasing land through a company, respectively establishing a company that can acquire land/houses.

 Understanding Land Titles: 

 True title deeds, "Chanot ti din", are only to be found in the most and longest developed parts of the Thailand, and of course in Bangkok. Chanot titles, issued by the Provincial office of the Thai Land Department, are accurately surveyed, plotted in relation to a national survey grid and also marked by unique numbered marker posts set in the ground.

Most "titles" in rural Thailand are however of the Nor. Sor. Sam or Nor Sor. Sam Kor. (N.S.3.) variety and are in the strictest interpretation "land exploration testimonial deeds". They are to all practical purposes land title deeds (issued and maintained by the Amphur, the District land office) in as much as clear records of ownership are maintained, and that they may be sold, leased, used as mortgage collateral etc.
In the case of the Nor. Sor. Sam. but not the more recently issued Nor. Sor. Sam. Kor. there is however a requirement that 30 days public notice is necessary before any change of status over the land can be registered.

N.S.3. titles are in general less accurately surveyed than Chanot titles. In the case of the older (now increasingly rare N.S.3.) titles the boundaries are only recorded in relation to the neighboring plots and survey errors in length of boundary or area are not unusual.

The newer Nor. Sor. Sam. Kor. is in general much more accurately surveyed and each plot is cross referenced to a master survey of the area and a corresponding aerial photograph. For this reason whenever purchasing N.S.3. land which lacks clearly defined physical boundaries it is a wise precaution to ask the owner to stake out the boundaries and then ask neighboring land owners to confirm the vendors interpretation of the boundary.

The Chanot and the Nor. Sor. Sam. Kor. are the only titles over which register able right of ownership or lease can exist, and are as such the only ones that a prudent foreigner should consider.

Below the Chanot and N.S.3. title there are a host of other forms of land claim document such as the Sor. Kor. Nueng (S.K.1)., the Tor. Bor. Tor. Hoc. (T.B.T.6) and the Tor. Bor. Tor. Ha. (T.B.T.5.). These rights are essentially a form of squatter or settler's claim which has been filed with the district office and upon which a small fee has been paid. Unlike the Chanot and N.S.3.. it is neither possible to register a sale or lease over these land rights, nor will a bank accept them for collateral and most importantly one cannot apply for (or obtain approval to) build on such land.
In certain circumstances, based on the length of the claim and the use to which the land has been put, it is possible to upgrade these land claims (to N.S.3. or Chanot title). The steps involved in such an application and the number of government departments required to approve such an application (where such approval is often discretionary) is however quite daunting and most definitely not recommended to anyone without the best of connections at the district, provincial and (in many
cases) national level.

The newer Sor. Bor Kor. titles are very different to the above claims. These are true title deeds, accurately surveyed and pegged (like a Chanot). They may be mortgaged, planning permission for development may be sought and granted. The one significant thing that may not happen with a Sor. Bor Kor, is that it may not be sold or transferred (except under last will and testament). Many expect that this limitation will change in time or that the titles can be quickly upgraded to a full Chanot. This is not a universal interpretation of the intention of the new titles and it may be unlikely that any upgrading will granted in the near future.

 

News:

23 Feb 2009 Amendments to land law benefit buyers

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Some regulatory background to purchasing property in Thailand: Pattaya City Thailand,