Ministry Land Bill Takes Aim At Foreigners

[Arkady]

Ministry land bill takes aim at foreigners

Law to be first to 'fully protect' Thai farmland

-- Bangkok Post Wed 19 August 2009

The Agriculture and Cooperatives Ministry is drafting a bill to protect rice paddies from a feared massive land grab by foreigners.

The draft law will be the first to fully protect farmland, deputy permanent secretary for agriculture Thawatchai Samrongwattana said.

The bill will set out clear measures to prohibit foreigners from buying land through Thai nominees, he said yesterday.

Recently, rumours have spread that foreign businessmen have been snapping up rice-growing land, particularly in central Thailand, through proxy Thai companies to produce rice and other crops to ensure future food supplies for their own countries, or to fend off starvation at home.

Transnational business consortiums are said to be holding the land through Thai nominees, which is against the law.

Some Thai farmers are reportedly leasing land they previously owned but have since sold to the foreigners' proxy firms, observers said.

The bill will also address land ownership by foreigners who marry Thais.

Under the draft bill, each land purchase by Thais married to foreigners would be closely scrutinised by Land Department officials and a provincial farmland protection panel, Mr Thawatchai said.

He said the bill would allow the immediate revocation of the rights of plots found to be held by foreign businesses through Thai proxies. The committee would be authorised to arrange the resale of such land.

About 60 million rai of irrigation land, including areas where the Land Department will build reservoirs, and land belonging to the Agricultural Land Reform office, would be protected by the bill, he said.

The agriculture minister will table the draft bill for the cabinet's consideration next month before submitting it to parliament for approval, Mr Thawatchai said.

"The ministry intends the bill to become law within this year," he said.

The bill would allow for a fund to be set up to protect farmland. The government would be required to allocate a budget to manage the fund and buy back land from foreigners. Farmers could also take out loans from the fund to invest in developing the land for agricultural purposes, Mr Thawatchai said.

A central committee would be set up under the bill with the prime minister as chairman. It would comprise experts and representatives from the private and agricultural sectors.

The committee would regulate the use of farmland or revoke the ownership of farmland that had been purchased through nominees.

A provincial land protection committee would also be set up and chaired by a provincial governor.

Land owners could not appeal the central committee's decision, he said.

The deputy permanent secretary said the bill had been modelled on similar laws in foreign countries, such as Japan and the US, which heavily regulate land ownership.

[Arkady]

Interesting that this should come up after investigations have failed to come up with cases of foreign companies illegally farming vast tracts of land. Nevertheless, this type of nationalistic nonsense always sells well when the government is under pressure to show some performance and there is no reason to believe this will not be the case again this time.

Even though the FBA is clearly not in the interests of the vast majority of Thai people, it is the law and foreigners who flout it to farm large tracts of land through a nominee corporate structure are asking for trouble and probably won't get much sympathy in TV. What is more sinister is the mention of foreigners holding or farming land through Thai wives. This threatens to open a review of the basis that Thai women married to foreigners are allowed to own land that Land Dept director general recently hinted at.

As things stand the Land Dept was forced to back down from its previous draconian and sexist prohibition on Thai women married to foreigners owning land due to the 1997 Constitution. Now Thai women (and men) with foreign spouses are allowed to buy land without investigation of the source of funds, as long as both spouses, whether legally married or just cohabiting, sign a declaration in the Land Office that the funds are solely the Thai spouse's and the land will not form part of the congjugal property that can be divided on divorce.

If this law proceeds, we can expect that sources of funds will be investigated, at least for agricultural land, but who knows where this might end up. The spousal declaration is rather a thin protection of the Thai position anyway as any agreement between man and wife can be voided by a court under the Civil and Commercial Code. Morever, there is already one court decision that allowed a farang, who hadn't signed the declaration, to get a share of the proceeds from the sale of land he bought in his wife's name on divorce because he was able to show the Thor Tor 3 documents to proove he remitted the money to Thailand for the purchase.

Edited August 19, 2009 by Arkady

[surayu]

Does this minister use NotTheNation as an inspirational source while drafting the new laws? what a savage! lets hope they will not use "falangs" as a new compulsory ingredient for the kao-pat...mind that big cooking pot!

[donx]

We're fuc_ked

[bangsaenguy]

Don't think they are following US policy.

[quiksilva]

I just looked out the window and the sky is still there.

This is perhaps of most interest to those in the farming forum as it specifically addresses agricultural land.

The language used in the article (which I acknowledge is not an acid test though to be sure) infers that they are more concerned about Thais (including spouses) acting as nominees for these "Transnational Business Consortiums" that are engaging in this restricted businesses, which is clearly in contravention of the FBA, an illegal act which also carries a 3 year jail term.

Under the draft bill, each land purchase by Thais married to foreigners would be closely scrutinised by Land Department officials and a provincial farmland protection panel, Mr Thawatchai said.

He said the bill would allow the immediate revocation of the rights of plots found to be held by foreign businesses through Thai proxies. The committee would be authorised to arrange the resale of such land.

There's no sense in worrying over where this may or may not end up, its not there yet and nothing has been said to suggest that's the way its going.

[noahvail]

Don't think they are following US policy.

Nope, agreed. Starting n 1979, foreign individuals and corporations, and US corporations with some control by foreigners, have to report within 90 days of a purchase.

http://findarticles.com/p/articles/mi_m373...22/ai_10996651/

Note that the registration is done *after* the fact.

[jay-uk]

Seems they just don't want us farangs in Thailand anymore and doing their best to shift us one way or another

[johnnyk]

Don't get too crazed, folks. First, its just a trial balloon. Second, its aimed at furriners looking to tie up BIG tracts of good, productive rice land. There is something to be said for maintaining control of your own food supply. I doubt very much its aimed at Joe Falang and his little house.

[donx]

Don't get too crazed, folks. First, its just a trial balloon. Second, its aimed at furriners looking to tie up BIG tracts of good, productive rice land. There is something to be said for maintaining control of your own food supply. I doubt very much its aimed at Joe Falang and his little house.

I agree that this is a trial balloon. I'm just getting a bit edgy because my wife (who has never admitted to the Thai athorities that she is married) owns several rai of both rice and rubber tree land.

[Arkady]

The bill will also address land ownership by foreigners who marry Thais.

Under the draft bill, each land purchase by Thais married to foreigners would be closely scrutinised by Land Department officials and a provincial farmland protection panel, Mr Thawatchai said.

I agree with responses that suggest this is probably a trial balloon and nothing may come of it. However, what seems most threatening to those not involved in large hacienda scale farming through nominees is the bit quoted above. This ties in with the Director General's remarks made out of context in Phuket (later only partially retracted) and may suggest that something is up between the bureaucrats and politicians and that the manufactured storm in a tea cup over the phantom Moorish haciendas may be an excuse to get traction for an idea.

It is only 10 years since a ministerial regulation pursuant to the Land Code restored the rights of Thai women married or cohabiting with foreigners to own land, along with the rights of their children who were also prohibited from owning land by the earlier ministerial regulations. Since then the numbers of farang retirees who have upped sticks and moved to rural villages in Thailand to live with their Thai wives on plots of land bought with their funds in the names of their Thai wives has multiplied many times over. You can be sure that the bureacrats in the Land Dept and the Interior Ministry who were forced by the 1997 Constitution to amend the regulations were not at all happy to do so at the time and that they are even less happy with the results. For the general population and politicians these farangs are soft targets and a great way to vent mindless nationalist spleen and dstract attention from more urgent domestic shortcomings. The urban population see the farangs as low class, undesirable foreigners who have married equally low class bar girls whom they manipulate to get around Thai laws. Rural folk who don't have daughters that have married generous farangs are understandably envious. In this environment it is not hard to envisage a backlash and, since the Land Dept would be in charge of implementing any new measures to check the source of funds of Thai wives, it is also not difficult to imagine them applying the same rule to all types of land. Nearly all the moobaans where farangs have bought land in Bangkok, Pattaya, Phuket, Samui and Chiang Mai were built on what was agricultural land only a few years ago and could still be regarded as such, if it suits.

The issue would boil down to the rights of Thai women to accept gifts from their foreign husbands (and that defence raises the spectre of the Revenue Dept getting in on the act to tax the gifts). Against that the bureacrats would raise the national security argument. Before you crack up laughing, please refer to the Council of State's response to the Ombudsman's complaint that making it harder for foreign men married to Thai women to apply for Thai citizenship, compared to foreign women married to Thai men, was an infringement of the rights of the Thai wives. The Council of State ruled that the sexual discrimination was entirely justified on grounds of national security. (Possibly the Council of State had in mind the potential threat to national security posed by the growing numbers of male farang retirees living in rural villages, if they could easily get hold of Thai ID cards.)

I am not trying to cause panic. I am just suggesting keeping an weather eye this type of development. Probably the worst that could happen to most is that new regulations would make it harder or impossible for their Thai wives to buy land in future, if their wives don't have independent sources of income or wealth.

Edited August 20, 2009 by Arkady

[craigt3365]

I think today's article in the BKK Post raises the bar? Kinda scary if you are looking at purchasing a home now. What do you guys think? I especially was concerned about them mentioning 90% of beach front in Phuket was controlled by foreigners...as well as areas such as Pattaya, Samui, etc. They mentioned the use of Thai lawyers getting around the laws using nominee companies.

[johnnyk]

Wouldn't the 90% of Phuket beachfront controlled by foreigners be international hotels rather than individual falangs?

If so then they would be legal under BOI rules.

[craigt3365]

I think a majority would be, but there are also a lot of condos...and some pretty sweet oceanview homes! All in the million+ USD range...quite beyond my ability!!!! The agent I met with said anything above about 20M Baht are all foreign owned. I did look at some properties offered by Laguna Properties...all were foreign owned.

[quiksilva]

As I mentioned elsewhere yes I think that the article yesterday is a concerning development.

I dont think hotels are the problem. They were taking aim at residential property with dubious ownership/control structures such as those described in George's thread "what happens to the lease when you die", where the tenants have cited s541 as a way to attain a 'lease for life' which might be possible for chattels but not for real estate, yet some have been doing this for houses. The nominee structure of course is still widely used and will also be in their sights.

I would agree that the majority of the villas valued at or above THB 20 million are controlled by foreigners. But not all, I personally know some Thais who have incredible houses in Phuket, with much greater values, although they are certainly in the minority.

The study also put agricultural land in its sights too. I thought it odd, that they would highlight the case of the Hmong receiving financial support from the US to buy rice paddies, whose crop was also sold to the US as particularly interesting. But what I think they are most concerned about is foreign business groups owning vast tracts of farm land (10,000 Rai was quoted), which to an extent is understandable.

I recall the TRF said something about "nothing has been done about this for far too long". So it does seems to be a politically motivated study. It is no secret that many Thai people are firmly against the sale of land to foreigners, so those groups that want to curry favour in the political arena often play this card to gain influence.

Its interesting to note that this report was submitted by Col. Surin Pikulthong, the same gentleman who was originally selected by the coup makers to manage land grab disputes. The timing of the release of the report, is also at a politically delicate stage (what with the latest fears about red shirts starting to resurface)

Whatever the reasons and rationale for the motivation behind this, we must accept that some sectors of Thailand will always be against foreigners owning land, especially when its against the law to do so, but that report is still far from being a statement of the government's intent.

We will just have to see how it develops.

Edited August 25, 2009 by quiksilva

[craigt3365]

I just saw a special report on BBC that covers this issue from an international perspective (I think they called it a global land grab). It talked about how this is going on all over the world...foreign countries (or companies) buying or leasing large tracts of land in Asia, E. Europe and Africa. The show talked about a UK firm leasing 100 sq miles of land in the Ukraine for growing wheat. Pros and cons were discussed, but the spark was a report talking about impending (20 years from now) global water and food shortages due to increasing population and the resulting demand. Crazy...

[samran]

I just saw a special report on BBC that covers this issue from an international perspective (I think they called it a global land grab). It talked about how this is going on all over the world...foreign countries (or companies) buying or leasing large tracts of land in Asia, E. Europe and Africa. The show talked about a UK firm leasing 100 sq miles of land in the Ukraine for growing wheat. Pros and cons were discussed, but the spark was a report talking about impending (20 years from now) global water and food shortages due to increasing population and the resulting demand. Crazy...

agree, this is a global issue, not one that it purely Thailand related.

'Food security' was talked about alot right up before the economic crash last year. This 'balloon' so to speak is a offshoot of that discussion. Not aimed at joe farang per se. more amied at Mohd. Al-Akbar from Saudi or Dubai or Yu-Mi Chen from China who is looking to buy up swathes of land to guarantee their own food security.

[chiangmaibruce]

The article yesterday about foreigners owning 90% of Phuket beachfront (and elsewhere too) has now attracted over 90 comments from readers - almost all angry or concerned foreigners.

Now take a look at today's installment in the campaign:

http://www.bangkokpost.com/business/econom...hip-under-watch

I note in particular these astute comments by Patima Jeerapaet, chairman of the property committee of the Joint Foreign Chambers of Commerce in Thailand:

"Let's attract them [foreign investors] to do it within the proper legal framework," he said. "It's not disastrous that they enter to invest but they should do it right and legally. The thing is, do they know our laws?"

Can you believe this guy? What breath-taking hypocrisy

[InterestedObserver]

Seems they just don't want us farangs in Thailand anymore and doing their best to shift us one way or another

When did they ever welcome farangs to Thailand? Anybody that moves over here or makes an investment in Thailand needs to read a little Thai history beforehand. The demimondaines are not the only Thais that will relieve you of your money.

[Livinginexile]

The problem is whenever farangs start populating an area land prices go through the roof and Thai's get priced out. There has to be a point when the authorities say "enough".

Remember when they froze all the foreigners bank accounts that didn't have work visa's in 97? Millions were lost with no recourse.

When the axe drops in Thailand it is sudden and without warning.

I fear the axe is about to drop

Edited August 25, 2009 by Livinginexile

[quiksilva]

The article yesterday about foreigners owning 90% of Phuket beachfront (and elsewhere too) has now attracted over 90 comments from readers - almost all angry or concerned foreigners.

Now take a look at today's installment in the campaign:

http://www.bangkokpost.com/business/econom...hip-under-watch

I note in particular these astute comments by Patima Jeerapaet, chairman of the property committee of the Joint Foreign Chambers of Commerce in Thailand:

"Let's attract them [foreign investors] to do it within the proper legal framework," he said. "It's not disastrous that they enter to invest but they should do it right and legally. The thing is, do they know our laws?"

Can you believe this guy? What breath-taking hypocrisy

I know Khun Patima and would have to say that his statement was poorly worded. I think he is trying to say that Thailand should be open to foreign investment in agriculture (not something I unconditionally agree with) but it should be carefully managed.

The problem with that, is that there is no proper legal framework for foreign land ownership especially when it comes to the agricultural business, because this is a restricted activity that is highly unlikely to change any time soon. In fact if anything I think this sector will be very last to open up.

Edited August 25, 2009 by quiksilva

[cmsally]

Sounds more like there are vested interests looking to position themselves and take advantage of any foreign investment.

More like welcome the incoming money and let them gain as long as we gain more.

As far as agricultural land I believe certain Thai conglomerates have been busy buying up vast tracts of land. Maybe they don't like the competition.

This looks more and more as though they want to narrow down the competition, there are domestic interests looking to retrench and position for the upswing. Maybe those who lost out in '97

[craigt3365]

Did you read the post today? Says the officials in Phuket reviewed all the land deals and all were 100% correct and legal. No foreigners own beach front land. HA! I guarantee you they own some...via Thai companies. But, are these Thai companies 100% legal? A grey area from what I understand?

[InterestedObserver]

Did you read the post today? Says the officials in Phuket reviewed all the land deals and all were 100% correct and legal. No foreigners own beach front land. HA! I guarantee you they own some...via Thai companies. But, are these Thai companies 100% legal? A grey area from what I understand?

Phuket land office investigating itself. An oxymoron if I ever heard one.

[chiangmaibruce]

Hi all. Does anyone know if the new Land Bill that was proposed to be introduced in September (mentioned in the OP of this thread), was actually introduced. And if not, where is it in the pipeline? Thanks

[klikster]

Don't get too crazed, folks. First, its just a trial balloon. Second, its aimed at furriners looking to tie up BIG tracts of good, productive rice land. There is something to be said for maintaining control of your own food supply. I doubt very much its aimed at Joe Falang and his little house.

The Mekong starts as a trickle high on a plateau in Tibet.

[Arkady]

Hi all. Does anyone know if the new Land Bill that was proposed to be introduced in September (mentioned in the OP of this thread), was actually introduced. And if not, where is it in the pipeline? Thanks

Just to follow up on this I noticed in the Royal Gazette there was a question put to the PM in Parliament by a Democrat MP asking about foreigners buying up agricultural land about the time this news came out in August 2009. The detailed answer from the PM's office was published in full in the RG in December 2009 and as garbled summaries in the newspapers at the same time.

The answer detailed recent investigations in various parts of the country that had effectively not found evidence of any wrongdoing. It also discussed in detail all the ways that foreigners can legally own land and all the known methods they use to try to get around the law, along with the measures currently in place to prevent them circumventing the law. The declaration made by Thai-foreign couples that allows the Land Dept to approve Land transfers to Thais with foreign spouses without further investigation was mentioned as if it was regarded as a positive and practical measure and no suggestion was made that would be amended in any way.

I think the government dealt with the issue in a way that made clear it thought the problem was scare mongering and grandstanding by politicians, rather than foreigners buying up agricultural land, and the Agricultural Ministry's ridiculous initiative died a death under the current government. That is not to say it won't be revived by a future government, eager for cheap brownie points from foreign scapegoats.

Edited December 15, 2010 by Arkady

[chiangmaibruce]

Thanks for the update Arkady