Land Ownership By Partly Foreign Owned Thai Co. Ltd.

[EvilDrSomkid]

I am currently reading Philip Wylie's book called:

"How to establish a successful business in Thailand"

It is certainly a very useful and interesting book, although it does seem geared towards people wanting to invest in a guesthouse and similar.

The point is, in the the 1st chapter it is mentioned that only 100% Thai owned companies are allowed to own land.

I am sure I have read other places, on TV as well, that a Thai company with minority foreign shareholders is allowed to own land.

Did this change after May 15th 2006? This is a date mentioned in the book that laws were tightened up.

I have done a search here, but can't really find the answer. So what's the deal?

The thing is, my wife wants to move out of her current rented business premises and buy a piece of land with a warehouse on it. She owns part of the company and there are a few other shareholders.

We are planning that I buy part of the shares from the other shareholders and I become an employee, set up a new section in this company to run my activities instead of setting up a completely new company

with all the associated risks.

It would be very unfortunate if my owning say 15% would block her being able to buy land for the company.

Alternately, would I be able to buy shares in the company AFTER the company owns the land?

I would really appreciate clarification on this.

Edited April 20, 2010 by EvilDrSomkid

[chiangmaibruce]

OK, I'll begin with another book recommendation. It's called Your Investment Guide to Thailand and you can read about it at www.silkwormbooks.com

One of the things it provides is a summary of the more common ways for foreigners to hold or control Thai property, including via the company route.

Generally speaking, Thai companies with minority foreign ownership can buy property PROVIDED that it is not simply a nominee arrangement to circumvent the land ownership laws. Further, if the foreigner/s own more than 40% of the company then the proposed property purchase will be subject to additional scrutiny.

In your case there appears to be a real functional/trading company that will buy the property and actually use the property as part of the business. Further, your interest will be quite minor. I really don't think you will have a problem, but of course you might wish to seek expert legal advice just to confirm that.

Edited April 20, 2010 by chiangmaibruce

[EvilDrSomkid]

OK, I'll begin with another book recommendation. It's called Your Investment Guide to Thailand and you can read about it at www.silkwormbooks.com

One of the things it provides is a summary of the more common ways for foreigners to hold or control Thai property, including via the company route.

Generally speaking, Thai companies with minority foreign ownership can buy property PROVIDED that it is not simply a nominee arrangement to circumvent the land ownership laws. Further, if the foreigner/s own more than 40% of the company then the proposed property purchase will be subject to additional scrutiny.

In your case there appears to be a real functional/trading company that will buy the property and actually use the property as part of the business. Further, your interest will be quite minor. I really don't think you will have a problem, but of course you might wish to seek expert legal advice just to confirm that.

Thanks for your reply cmb.

Any particular reason for the other book recommendation?

We want to do everything legally. My wife's company is a running, profitable company for 5 years already. There would be no nominee trickery. I think that me buying a 15 to 20% share will be slightly before she buys the property. It will be the business premises.

We will try to find reliable legal advice.