Transfer Land To Thai Wife

[fredcyber]

Forgive me if this has been proposed before but surely the simple solution for Farangs worried about their illegal Thai companies and unable/unwilling to pay the cost of transferring their property to their Thai wives is to resign as a Director of the company and install their wife as the 49% shareholder instead?

[dsfbrit]

I am always keen to see a new option of what to do if/when the new FBA comes into being - could you elaborate on this idea a bit?

[fredcyber]

As I understand it, common practice is/was for a Farang to buy a house and the associated land in the name of a thai company. He provides all of the money and receives 49% of the shares in the company. The other shares are divided between 6 thai "nominee" directors, often employees of the company that helped the Farang to set up the arrangement.

The thai directors provided none of the money thus the arrangement is illegal. The Farang seeks to protect his investment by holding undated letters of resignation or stock transfer forms from the other six directors to use should there be a problem.

Now this method of circumventing the law against foreign land ownership has been stopped and various proposals to change the Foreign business act have been made, many of these people are feeling insecure and are contemplating transferring the property to their thai wives and also terminating the company. This process is expensive and lengthy.

Therefore, although it is far from perfect, the simple resignation of the Farang director and the transfer of his shares to his replacement, a 7th thai director i.e his wife, at least makes the company wholly thai owned and thus less likely to attract attention from the authorities and it will no longer be affected by any changes made to the FBA.

In effect it is the opposite of the illegal practice which some companies have recently adopted of registering a thai company which owns the property with seven thai directors thus enabling the transfer of the land and then later replacing one of the thai directors by the Farang who purchased the property.

[p_brownstone]

Most of the Farang who took the route of opening a Thai Company to own the Land did so either because they do not have a Thai wife or, if they did, they do not trust her sufficiently to have the Asset in her name alone.

If the Farang has a Thai wife and trusts her then the easier route is simply to Register the Land in her name – forget about the problems of opening and maintaining a Company.

In a situation where a Company has already been formed with Nominees holding 51%, it’s possible that the Company would still be technically illegal, or at least subject to investigation, even if the remaining 49% of the Shares were transferred to the Thai wife – I believe it’s the use of Nominees which is the problem, and the need for them to prove that they actually bought the 51% shareholding with their own funds, not necessarily the ownership of the remaining 49%.

Patrick

[Loz]

If the Farang "lent" the money to buy the 51% owned by thais ( and then did the same for his wife when he transfered Directership to her, but had a clause stating foriture of shares on breach of loan terms, surely he would be protected.

They buy their shares legally with money "loaned" by the Farang.

The loan payments are clearly beyond their means to repay so they default. Then should anyone of the thais get naughty ideas seizing company assets, the farang steps in with his loan clause and siezes control of the ship again. Even if he has to find a new batch of directors. Secured loan against share options seems too good to be true. can it be done in thailand ?

Hope this helps.

Copywright (Loz)

[fredcyber]

I did say it was "far from perfect" and the Farang already has a company and he does not want to pay a lot of money to dismantle everything. At least this way there is now a thai company with no foreign involvement.

If he doesn't have a wife or doesn't trust her then the idea is no use to him.

[fredcyber]

I did say it was "far from perfect" and the Farang already has a company and he does not want to pay a lot of money to dismantle everything. At least this way there is now a thai company with no foreign involvement.

If he doesn't have a wife or doesn't trust her then the idea is no use to him.

[Irene]

Forgive me if this has been proposed before but surely the simple solution for Farangs worried about their illegal Thai companies and unable/unwilling to pay the cost of transferring their property to their Thai wives is to resign as a Director of the company and install their wife as the 49% shareholder instead?

Right, if you can trust the wife.

[fredcyber]

I did say it was "far from perfect" and the Farang already has a company and he does not want to pay a lot of money to dismantle everything. At least this way there is now a thai company with no foreign involvement.

If he doesn't have a wife or doesn't trust her then the idea is no use to him.

[jitagon]

This rather pertinent topic seems to have been left hanging in the air somewhat and I think, deserves to be revived. Has anyone manage to successfully transfer the 49% shares into their spouse's name? Or is it not so much the farang name which draws attention, as the 51% held by nominees that arouses interest?

Also, how much is the actual winding down of the company and transferring land/house to Thai spouse? What might be thought expensive to some, may be cheap for peace of mind to others.

[donx]

This rather pertinent topic seems to have been left hanging in the air somewhat and I think, deserves to be revived. Has anyone manage to successfully transfer the 49% shares into their spouse's name? Or is it not so much the farang name which draws attention, as the 51% held by nominees that arouses interest?

Also, how much is the actual winding down of the company and transferring land/house to Thai spouse? What might be thought expensive to some, may be cheap for peace of mind to others.

There was a thread started by forum member Mobi a while ago (end of last year?) where he discussed the process of transferring property owned by a Thai company to his wife. If I recall correctly, he said that there are issues with having his wife as one of the company shareholders. Whether his wife was already a shareholder or whether he was considering transferring shares to her I just don't remember.

Do a search and you should be able to find that thread.

EDIT: Here is the thread I was talking about.

Edited August 10, 2007 by donx

[jitagon]

Thankyou Donx for taking the time. Much appreciated.

[dsfbrit]

Forgive me if this has been proposed before but surely the simple solution for Farangs worried about their illegal Thai companies and unable/unwilling to pay the cost of transferring their property to their Thai wives is to resign as a Director of the company and install their wife as the 49% shareholder instead?

Nice try, but I don't really think this would help me personally, nor most people with a Thai wife. The cost of transferring to my Thai wife and setting up a 30 year lease in my case, is around 300,000 Baht. Bearing in mind I have to pay 15000 Baht a year for the accounts etc... the transfer would pay for itself in about 20 years anyway.

Also, the company would now not be owned by me and the dodgy company structure would still be in place as well.

Good thought though - worth discussing for sure.

[watchurback]

If the Farang "lent" the money to buy the 51% owned by thais ( and then did the same for his wife when he transfered Directership to her, but had a clause stating foriture of shares on breach of loan terms, surely he would be protected.

They buy their shares legally with money "loaned" by the Farang.

The loan payments are clearly beyond their means to repay so they default. Then should anyone of the thais get naughty ideas seizing company assets, the farang steps in with his loan clause and siezes control of the ship again. Even if he has to find a new batch of directors. Secured loan against share options seems too good to be true. can it be done in thailand ?

Hope this helps.

Copywright (Loz)

Good copyright !!!

Firstly "directorship" is spelt with an "O" !!! Therefore your copywright's ######ed straight away. Secondly what is "foriture?" - surely you mean forfiture, copywright can't be copied, but it can if the content and spelling are incorrect.

Too clever for your own good mate, and also what do you know about legalise? You are a fake!!!

From

A coward

[Duncan & Lek]

Hi,

What we did in April was to transfer 50% of my company to my wife, 45% to me and 4 lots of 1% to her daughter, mother and 2 of her sisters.

This enabled us to get rid of the nominees and make my wife MD with some of her family shareholders.

Was a marginally better alternative than closing the company down and transfering to my Wife's name and also signing away any rights to the land and paying the transfer tax.

Now just need to wait and be told this is a bad idea and then have to change it all again and not upset my wife to much.