Land Lease Reduced From 30 Years To 5 Years?

[Gary A]

TIT, It all depends on where you go. The immigration office where I get my retirement extensions still requires a doctor's certificate. Why would land offices be any different?

[midas]

troll..............

Well, if you think so then don't feed it.

I'm always amazed what people post here just to get their post count up...

this matter doesn't seem to be getting resolved and I'm surprised none of the sponsors

who specialise in this area have not commented at all on this bearing in mind if it is true,

it would be a bombshell for many!

This is only a suggestion but bearing in mind if it is true this could make an interesting article

in at least of the two main English Newspapers, why not send a quick e-mail to the property journalists

and tell them what happened. They would probably have instant resources to be able to research this and

resolve this one way or another and if it's true it will certainly give them something

interesting to write about.

This is only my suggestion but at least it would be more productive than having TV members

insult each other on this forum

[harrry]

My guess is that the OP didnt want to identify the location because of potential repercussions. It possibly is an item of knowledge that may help those who can find out but I can understand him not doing so.

I am watching this carefully because even if only a trend it could have repercussions on what I do.

[Raptor7]

I just went through this reg with my lawyer.....virtually all of this is an internal government circular about technical points on the process about registering leases....this is NOT a regulation limiting registered leases to 5 years (with foreigners as lessees)...

HOWEVER....in the last part of Section 6 of this Aug. 19th 2008 circular regulation.... there is a disturbing sentence which states in rough translation:

"6. ...Where the lessee is an alien or an alien juristic person applying for registration of a long-term lease of land, investigations shall be carried out to ascertain that it is not a lease to conceal their purchase of land because if it is a lease to conceal the purchase of land by an alien, its registration may not be accepted by competent official because it is a juristic act of unlawful purpose."

There is no guidance on this meaning....I am personally perplexed by the wording....a long-term (30yr) registered land lease is a lease...not a purchase of land....how can a lease be a concealment of a purchase??.....

some lease arrangements do look like a purchase (30 yr registered lease, promise to renew for another 30 yrs, surrender of original title deed to lessee, promise to transfer land title in future if laws ever favorably change, superficies rights registered on the structure etc.), but nevertheless is a lease...NOT a purchase of land....

does anyone know how a lease can be a concealment of a purchase??? (or does this just give subjective discretionary powers to a land officer to reject registration of a 30 yr lease because he/she thinks (based on what objective standards...I dont know) that the lease is question is "concealment" of a purchase of land...

To end all speculation that this was an isolated action by a rogue office, I tried to get hold of the document serving as basis of the refusal. I managed to get the header copied, here it is:

ที่ มท ๐๕๑๕/ว ๒๑๙๔๙

มท = Ministry of Interior

กรมที่ดิน

ถนนพระพิพธ กทม. ๑๐๒๐๐

ิ

Department of Lands

๑๙ สิงหาคม ๒๕๕๑

19 August 2551

๑๙ สิงหาคม ๒๕๕๑

เรื่อง ระเบียบกรมที่ดิน ว่าด้วยการจดทะเบียนสิทธิและนิติกรรมเกี่ยวกับการเช่าที่ดินและ

อสังหาริมทรัพย์อยงางอื่น ตามประมวลกฎหมายแพงงและพาณิชย์ พ.ศ. ๒๕๕๑

From the Land department, about leasing land (etc)

เรียน ผู้ว่าราชการจังหวัดทุกจังหวัด

-> To all provinces

สิ่งที่ส่งมาด้วย ระเบียบกรมที่ดิน ว่าด้วยการจดทะเบียนสิทธิและนิติกรรมเกี่ยวกับการเช่าที่ดิน

และอสังหาริมทรัพย์อย่างอื่นตามประมวลกฎหมายแพ่งและพาณิชย์ พ.ศ. ๒๕๕๑

Sorry, time did not allow me to get more now, but I will try today to get the pages copied which contain the specifics. It's more than 100 pages, so I will not ask or order a translation of the whole thing.

However that above might already enable someone having access to these kind of things to look it up.

[yuyi]

As promised I tried to get the pages where it specifically says that a 30 year lease would not be possible anymore for foreigners. Together with the Thai lawyer we went through the document, page by page, and ... surprise surprise, it's not written there. Some phonecalls later it was clarified that:

1) That document, given as justification, does _not_ say to not register a 30 year lease anymore.

2) Another land office, e.g. Pattaya, sees no problem to register a 30 year lease for foreigners.

3) Why that land office interpretes that document as rule not to do so anymore could not be explained.

4) There's a meeting in a about week scheduled at that land office to clarify the situation.

So at the moment it does indeed look very much like a rogue action of a specific land office, and that huge document, which made it looking at first as if it would be a new rule or even a new law, does not justify the claims the land office made about a max. 5 year lease for foreigners.

So let's forget it for now, and file it in the TiT folder for now. If at that meeting in the land office, in a week some new facts appear, I'll post it here. Otherwise my experience in LoS lets me predict that it'll be back to normal, when the land office guy found a way to go back to normal without loosing face.

[yuyi]

I just went through this reg with my lawyer.....virtually all of this is an internal government circular about technical points on the process about registering leases....this is NOT a regulation limiting registered leases to 5 years (with foreigners as lessees)...

So you went through the same exercise, Raptor, going through that document, and with the same result.

HOWEVER....in the last part of Section 6 of this Aug. 19th 2008 circular regulation.... there is a disturbing sentence which states in rough translation:

"6. ...Where the lessee is an alien or an alien juristic person applying for registration of a long-term lease of land, investigations shall be carried out to ascertain that it is not a lease to conceal their purchase of land because if it is a lease to conceal the purchase of land by an alien, its registration may not be accepted by competent official because it is a juristic act of unlawful purpose."

There is no guidance on this meaning....I am personally perplexed by the wording....a long-term (30yr) registered land lease is a lease...not a purchase of land....how can a lease be a concealment of a purchase??.....

This could be what confuses the poor guy from the land office there. I look forward to the meeting next week, I hope it will clarify it.

some lease arrangements do look like a purchase (30 yr registered lease, promise to renew for another 30 yrs, surrender of original title deed to lessee, promise to transfer land title in future if laws ever favorably change, superficies rights registered on the structure etc.), but nevertheless is a lease...NOT a purchase of land....

does anyone know how a lease can be a concealment of a purchase??? (or does this just give subjective discretionary powers to a land officer to reject registration of a 30 yr lease because he/she thinks (based on what objective standards...I dont know) that the lease is question is "concealment" of a purchase of land...

Yeah, there is some logic in this lease = purchase assumption, which is hard to follow.

[Nadia 2]

As promised I tried to get the pages where it specifically says that a 30 year lease would not be possible anymore for foreigners. Together with the Thai lawyer we went through the document, page by page, and ... surprise surprise, it's not written there. Some phonecalls later it was clarified that:

1) That document, given as justification, does _not_ say to not register a 30 year lease anymore.

2) Another land office, e.g. Pattaya, sees no problem to register a 30 year lease for foreigners.

3) Why that land office interpretes that document as rule not to do so anymore could not be explained.

4) There's a meeting in a about week scheduled at that land office to clarify the situation.

So at the moment it does indeed look very much like a rogue action of a specific land office, and that huge document, which made it looking at first as if it would be a new rule or even a new law, does not justify the claims the land office made about a max. 5 year lease for foreigners.

So let's forget it for now, and file it in the TiT folder for now. If at that meeting in the land office, in a week some new facts appear, I'll post it here. Otherwise my experience in LoS lets me predict that it'll be back to normal, when the land office guy found a way to go back to normal without loosing face.

This is not a new regulation, but part of several regulations combined in one regulation (reissued 19 August) as I understand it. It means if the true intention of the parties in the lease is transferring ownership of land... if the lessor is not a normal lessor any more but becomes in the agreement more the agent acting on behalf of the foreigner the official could refuse registration.... In practice this regulation may not have any consequences, as it is not new, but the land official could, if he wants, read the lease (unlikely) before he allows registration, and if he does not like certain clauses in the lease, like the option to transfer to freehold and keeping the title deed 'in pledge' by the foreigner lessee, he could refuse registration of the lease... It says again, lease is 30 years possession max

[donx]

As promised I tried to get the pages where it specifically says that a 30 year lease would not be possible anymore for foreigners. Together with the Thai lawyer we went through the document, page by page, and ... surprise surprise, it's not written there. Some phonecalls later it was clarified that:

1) That document, given as justification, does _not_ say to not register a 30 year lease anymore.

2) Another land office, e.g. Pattaya, sees no problem to register a 30 year lease for foreigners.

3) Why that land office interpretes that document as rule not to do so anymore could not be explained.

4) There's a meeting in a about week scheduled at that land office to clarify the situation.

So at the moment it does indeed look very much like a rogue action of a specific land office, and that huge document, which made it looking at first as if it would be a new rule or even a new law, does not justify the claims the land office made about a max. 5 year lease for foreigners.

So let's forget it for now, and file it in the TiT folder for now. If at that meeting in the land office, in a week some new facts appear, I'll post it here. Otherwise my experience in LoS lets me predict that it'll be back to normal, when the land office guy found a way to go back to normal without loosing face.

Thank you for the updated information. I agree with you on all accounts. I look forward to hearing how the land office proceeds in one week.

[Mobi]

This is not a new regulation, but part of several regulations combined in one regulation (reissued 19 August) as I understand it. It means if the true intention of the parties in the lease is transferring ownership of land... if the lessor is not a normal lessor any more but becomes in the agreement more the agent acting on behalf of the foreigner the official could refuse registration.... In practice this regulation may not have any consequences, as it is not new, but the land official could, if he wants, read the lease (unlikely) before he allows registration, and if he does not like certain clauses in the lease, like the option to transfer to freehold and keeping the title deed 'in pledge' by the foreigner lessee, he could refuse registration of the lease... It says again, lease is 30 years possession max

What you say makes a lot of sense.

I wonder why this particular regulation was reissued on August 19th? Maybe someone was getting a bit disturbed (upset?) by all these "unenforceable clauses" in leases as described by you, put in there by estate developers/agents in order to convince unsuspecting farangs that one day they can own the land.

I wouldn't necessarily assume that the land officer will rescind his decision. Maybe the lease will have to re-worded, or maybe some tea money will have to be paid.

Don't forget not much land is being transferred at the moment and land officers have to make monthly payments on cars.

I await the results of the meeting with interest.

[LoveDaBlues]

I just went through this reg with my lawyer.....virtually all of this is an internal government circular about technical points on the process about registering leases....this is NOT a regulation limiting registered leases to 5 years (with foreigners as lessees)...

HOWEVER....in the last part of Section 6 of this Aug. 19th 2008 circular regulation.... there is a disturbing sentence which states in rough translation:

"6. ...Where the lessee is an alien or an alien juristic person applying for registration of a long-term lease of land, investigations shall be carried out to ascertain that it is not a lease to conceal their purchase of land because if it is a lease to conceal the purchase of land by an alien, its registration may not be accepted by competent official because it is a juristic act of unlawful purpose."

There is no guidance on this meaning....I am personally perplexed by the wording....a long-term (30yr) registered land lease is a lease...not a purchase of land....how can a lease be a concealment of a purchase??.....

some lease arrangements do look like a purchase (30 yr registered lease, promise to renew for another 30 yrs, surrender of original title deed to lessee, promise to transfer land title in future if laws ever favorably change, superficies rights registered on the structure etc.), but nevertheless is a lease...NOT a purchase of land....

does anyone know how a lease can be a concealment of a purchase??? (or does this just give subjective discretionary powers to a land officer to reject registration of a 30 yr lease because he/she thinks (based on what objective standards...I dont know) that the lease is question is "concealment" of a purchase of land...

To end all speculation that this was an isolated action by a rogue office, I tried to get hold of the document serving as basis of the refusal. I managed to get the header copied, here it is:

ที่ มท ๐๕๑๕/ว ๒๑๙๔๙

มท = Ministry of Interior

กรมที่ดิน

ถนนพระพิพธ กทม. ๑๐๒๐๐

ิ

Department of Lands

๑๙ สิงหาคม ๒๕๕๑

19 August 2551

๑๙ สิงหาคม ๒๕๕๑

เรื่อง ระเบียบกรมที่ดิน ว่าด้วยการจดทะเบียนสิทธิและนิติกรรมเกี่ยวกับการเช่าที่ดินและ

อสังหาริมทรัพย์อยงางอื่น ตามประมวลกฎหมายแพงงและพาณิชย์ พ.ศ. ๒๕๕๑

From the Land department, about leasing land (etc)

เรียน ผู้ว่าราชการจังหวัดทุกจังหวัด

-> To all provinces

สิ่งที่ส่งมาด้วย ระเบียบกรมที่ดิน ว่าด้วยการจดทะเบียนสิทธิและนิติกรรมเกี่ยวกับการเช่าที่ดิน

และอสังหาริมทรัพย์อย่างอื่นตามประมวลกฎหมายแพ่งและพาณิชย์ พ.ศ. ๒๕๕๑

Sorry, time did not allow me to get more now, but I will try today to get the pages copied which contain the specifics. It's more than 100 pages, so I will not ask or order a translation of the whole thing.

However that above might already enable someone having access to these kind of things to look it up.

Nearly every land lease by a farang IS a concealment purchase of land.

Ex. Farang and Thai GF want to build a house. Farang cannot own land in his name so the land is registered in Thai GF name. Who actually purchases the land? The farang who has the money. The farang wants some 'protection' for the money he's spent since he cannot have the land in his name so the Thai GF gives him a lease.

Basically, the Thai GF is a 'straw buyer' and this is what the Thai government is addressing.

[Naam]

Maybe the lease will have to re-worded, or maybe some tea money will have to be paid.

a logical conclusion.

[Mobi]

Nearly every land lease by a farang IS a concealment purchase of land.

Ex. Farang and Thai GF want to build a house. Farang cannot own land in his name so the land is registered in Thai GF name. Who actually purchases the land? The farang who has the money. The farang wants some 'protection' for the money he's spent since he cannot have the land in his name so the Thai GF gives him a lease.

Basically, the Thai GF is a 'straw buyer' and this is what the Thai government is addressing.

Sorry, but I must disagree. The law permits anyone, including farangs, to lease land for 30 years. If a Thai GF/wife friend/or any Thai buys land and leases it to a farang for 30 years that is perfectly legal. At the end of thirty years, the lease expires and the Thai GF/wife friend/or any Thai has unhindered freehold ownership of the land, and any farang in physical possession of the land at that time can be legally evicted. No law has been broken

I fail to see how your “straw purchase” can apply, unless some of these other clauses and conditions mentioned by Nadia and others are also included in the lease. If it is a straight 30 year lease between a Thai and a farang then there should be no problems.

The subject of the origins of the money to buy the land is another matter but is not the point under discussion here.

[Raptor7]

Nearly every land lease by a farang IS a concealment purchase of land.

Ex. Farang and Thai GF want to build a house. Farang cannot own land in his name so the land is registered in Thai GF name. Who actually purchases the land? The farang who has the money. The farang wants some 'protection' for the money he's spent since he cannot have the land in his name so the Thai GF gives him a lease.

Basically, the Thai GF is a 'straw buyer' and this is what the Thai government is addressing.

Sorry, but I must disagree. The law permits anyone, including farangs, to lease land for 30 years. If a Thai GF/wife friend/or any Thai buys land and leases it to a farang for 30 years that is perfectly legal. At the end of thirty years, the lease expires and the Thai GF/wife friend/or any Thai has unhindered freehold ownership of the land, and any farang in physical possession of the land at that time can be legally evicted. No law has been broken

I fail to see how your "straw purchase" can apply, unless some of these other clauses and conditions mentioned by Nadia and others are also included in the lease. If it is a straight 30 year lease between a Thai and a farang then there should be no problems.

The subject of the origins of the money to buy the land is another matter but is not the point under discussion here.

I totally agree with you Mobi....a lease IS a lease...NOT a purchase of land....(underlying motivations for the lease, payment structures for the lease, contractual renewal options beyond the initial registered 30 years term, possession of title deed document, etc. are other issues---however,, the fact remains that the legal transaction is a lease NOT a purchase of fee absolute title to the land).

However, the 19th August 2008 regs have that very broadly worded Section 6 as follows:

"6. ...Where the lessee is an alien or an alien juristic person applying for registration of a long-term lease of land, investigations shall be carried out to ascertain that it is not a lease to conceal their purchase of land because if it is a lease to conceal the purchase of land by an alien, its registration may not be accepted by competent official because it is a juristic act of unlawful purpose."

There are no objective guideposts given to allow a "competent" (or even "incompetent") official to somehow conclude that a lease is a concealment of a purchase....IMO this leaves lots of subjective room for a front desk "official" to claim that a particular lease is somehow a "concealment" of a purchase and therefore refuse (rightfully or on a whim) the completion of the lease registration.....we will have to see if this is actually implemented or just another ignored stupid pronouncement...

[excaliber]

... Maybe the Sunbelt legal team can comment ?

Well, that's what I'm hoping for. Sunbelt or Indo Siam might have access to some facts, at least I hope they do.

I wouldn't hold your breath, I've written to them (sunbelt) several times, emails & on-line chat and NEVER received any kind of response. I think they screen all the mail and select & respond to the high ticket subjects. I doubt I'll "try" to contact again.

Edited October 3, 2008 by excaliber

[Mobi]

They haven't been writing on this forum for months. Are they still sponsors?

There was a time when Greg would become involved in almost every issue concerning visas, work permits and real estate.

I have my own thoughts as to why they have gone silent, but one thing is for sure, They are into many other business fields now, food franchises and such like , which are probably more profitable and less hassle than legal questions over farangs buying/leasing property.

And let's face it, there is no right or wrong answer on many of these issues, as so often its all down to the whim of the local officials, and how anti farang they are. Often they make decisions which are not strictly in accordance with the regulations, so is it any wonder that lawyers don't want to get involved, and make definitive statements in this forum?

[GungaDin]

Sunbelt Asia

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Last Posted on: 2008-08-26 22:52:21