Land In Thailand

[Samuiclaudia]

Can anyone please answer the following questions?

Is it illegal for a foreigner to form a non trading company with Thai partners, who they do not know, purely in order to own the freehold of land?

If it is not illegal - what is the difference between forming a Limited company or a land holding company - what are the implications for both types?

Any help would be gratefully received

Thank

[Sumitr Man]

Is it illegal for a foreigner to form a non trading company with Thai partners, who they do not know, purely in order to own the freehold of land?

Yes.

If it is not illegal - what is the difference between forming a Limited company or a land holding company - what are the implications for both types?

N/A.

[Samuiclaudia]

Thank you.

How about if it is the case that you do, in theory, know these Thai people because they happen to be "acquaintances" of the solicitor who helped form the company?

Also, I would really like to know the difference between setting up a Company Limited partnership and a Land holding Company for ownership of land. Someone has told me that with the Land Holding Company there is no need for tax returns, audit of accounts, etc., etc.,

[dr_Pat_Pong]

Find a professional someone real fast. You are heading for deep trouble.

[Sumitr Man]

Thank you.

How about if it is the case that you do, in theory, know these Thai people because they happen to be "acquaintances" of the solicitor who helped form the company?

Also, I would really like to know the difference between setting up a Company Limited partnership and a Land holding Company for ownership of land. Someone has told me that with the Land Holding Company there is no need for tax returns, audit of accounts, etc., etc.,

What is it that Barnum said... "One born every minute"

Samui, take Dr. P's advice - look at getting professional help QUICK - BUT NOT IN SAMUI!!

Get your advice from an independent source - go to Phuket for the day if you have to, or go to Bangkok. Do not go to a lawyer who has been recommended to you by any of the people you are currently talking to.

[dr_Pat_Pong]

Thank you.

How about if it is the case that you do, in theory, know these Thai people because they happen to be "acquaintances" of the solicitor who helped form the company?

Also, I would really like to know the difference between setting up a Company Limited partnership and a Land holding Company for ownership of land. Someone has told me that with the Land Holding Company there is no need for tax returns, audit of accounts, etc., etc.,

What is it that Barnum said... "One born every minute"

Samui, take Dr. P's advice - look at getting professional help QUICK - BUT NOT IN SAMUI!!

Get your advice from an independent source - go to Phuket for the day if you have to, or go to Bangkok. Do not go to a lawyer who has been recommended to you by any of the people you are currently talking to.

Exactly correct.

[Samuiclaudia]

Thank you gentlemen for all of your advice.

My husband and I have secured a 30 year lease with the option to renew for a further 30 years with a reputable company ( owned by Thai/European people) over in Samui who have been sucessfully developing land for over 14 years and we are very happy with this situation.

Some friends of ours over here have told us that this is illegal and this is the reason for my enquiries.

Is having a 30 year roll over lease, ie a 30 year lease with the option to renew at the end of 30 years, legal and above board?

[Sumitr Man]

Is having a 30 year roll over lease, ie a 30 year lease with the option to renew at the end of 30 years, legal and above board?

Depends. Did the person who entered into the lease contract with you have title/right over the property they leased? IOW- Did you check the Land Title Deed? Are they the authoirsed signatories? IOW - Did you check the Articles of Association of the property development company and Company Affivadit (as it is known in Thailand - Certificate of Incorpoation, as it is elsewhere). Do the company have, as one of its objectives, the objective to lease land? IOW - did you check the objectives of the company. Did you check the Memorandum of Association of the company? Can the company lease to a farang (again, check the Articles of Association of the Company).

Aside from that, in general - yes, a 30+30 year lease is legal.

But, I have to assume you did Due Diligence on the deal and requested the Vendor, as an Condition Precedent to the deal, that they issue you with a legal opinion that the deal is valid AND enfoceable under Thai law - no?

[dr_Pat_Pong]

Some lawyers are saying that the option to renew is possibly a tenuous issue. She'll just have to take the word of a reputable group, or do what the savvy people do ... consult a good independent lawyer. Mind you, it sounds as though the time for that has past.

[Samuiclaudia]

Thank you wonderful people for all of your help.

The developer we are dealing with has a good reputation, has completed 7 projects on the beach, 2 in the hillside and starting a new prestigious one in the hillside - starting price for land and house being 21 mill baht. They use a reputable solicitor in Bangkok. The English contract (& Thai version) states we have the option to renew after 30 years and that if Thai law changes and foreigners can own freehold then the leasehold contract will be transferred to freehold with no further costs. Thai people have also bought with this developer and have obviously been given freehold title automatically.

I thought that starting a non trading Thai company purely to purchase land was illegal but my friends have been told otherwise. They have purchased from a Thai developer rather than a Thai/European developer. I think I also saw recently something in the Bangkok Post where, if it is ascertained that Thai nationals are allowing their signatures to be used to set up such companies, then they are liable to be fined.

Any way - thank you for putting my mind at rest

[Sumitr Man]

on the beach

in the hillside

21 mill baht

Any way - thank you for putting my mind at rest 

nothing to do with me!!

[dr_Pat_Pong]

Lotsa Mekhong does that to some people. ( It also postpones pain )