Thai Nominee Shareholding Crackdown in Pattaya announced by DSI

[loppylugs1]

Then you signed this (or your wife) at the land office In English official script in Thai

Edited August 29, 2014 by loppylugs1

[loppylugs1]

Not forgetting this usufruct are useless

Edited August 29, 2014 by loppylugs1

[JesseFrank]

After about 8 pages I will try to explain what to do to "own" legal right for house and land.

The right way is using usufruct on land.

Let a thai buy it registered it as usufruct for lifetimes with you name in thai on the backside

Make the thai to sign a paper, where she is unable to claim the land, borrow money in it and so on.

He/she will not be able to go to the bank and borrow money on it.

You has now a land and house for you lifetime. He/she will then get it when you die

The laws

Under Thai Law, the owner of a piece of land (immovable property) can grant the right of usufruct to another person, or many people, foreigners or not. The person receiving this right of usufruct is called usufructuary. The usufructuary can enjoy, use and possess the land for a limited period of time (maximum 30 years) or for his lifetime (even more than 30 years).

Following a Supreme Court judgment, a usufruct agreement must be registered to be valid. And you

can only register a usufruct contract on land having title deeds Nor Sor Sam or higher (like Chanote).

You must register a usufruct agreement at the local land department.

A usufruct is a real right. It means that it's attached to a thing, meaning the immovable property.

Even if the owner of the land die, or if the land is sold, the usufructuary will keep his right to stay on this piece of land. Usufruct agreements are a very easy way to protect a foreigner married to a Thai spouse, in case something happens to her.

This usufruct contract ends at when the usufructuary dies (if it's done for lifetime) or when the period of time is expired according to the contract.

Sections 1417 to 1428 of the Thai Commercial and Civil Code are related to usufruct contract in T

hailand.

I have this very thing on my land. My name is listed in Thai on the chonote as the leinholder next to the land owner name (my wife). You must register this at the land office and pay taxes on the 30 year lease for it to be valid. You can then have a contact that allows you to extend or transfer the lease which gives you full control over the land and the structure and allows you to sell it when the time comes without changing the land holder name.

You should make clear that with selling "it" you mean selling the lease, because the way you write it makes it sound as you have the right to sell the land, which a leaseholder never has.

[ukrules]

So if I buy a piece of land I have to give it up in 30 years time ?

Would it be possible to create a new one every 5 years so the date stays at least 25 years in the future all the time ?

[Rimmer]

Land ownership has been discussed ad infinitum elsewhere in the forum please do not get into this on this thread, thank you.

If you go to the original post you will see they are mostly concerned with businesses associated with Tourism.

[dundee48]

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Is this really going to go as far as confiscating property bought using this method, if so it has huge implications for many

I believe it will. It's the main reason I kept my money safe and just rent a property here. Xenophobia is alive and well, this announcement just confirms it. In addition to business ownership there is nothing more that Thais dislike then foreigners owning land.

At the end of the day the activity of business ownership and land ownership has been abused for years. How many companies are there out there set up by solicitors with fictitious Thai employees to fill the quota and also companies set up with minimal (if any) trading purely so the house can be put in a company name? I suspect a lot of them, but it is a loophole and if people decided to do this it was always a risk.

I hope it blows over and everything works out or it could be a very real problem for many foreign people living here. This will not help anybody, including the Thai economy as investors will run scared. Not because they are doing anything illegal necessarily but simply because you just don't know what will be decided next. I can also imagine it will have an effect on property pricing as people look to sell and pull out their cash.

All pretty horrible really.

I'm sure I have read many many times foreigners are not allowed to own land. If it's against the law then I'm sure they wouldn't be very happy about it at all.

Funny thing is we all knew this would happen.

First all the people laughed about the student visa boy's and girl's, well now looks like their turn to laugh.

They may have lost 20-30,000 baht. This will cost some people millions. But hey like you said when laughing at the ED visa's you knew it wasn't legal !!!!

Karma maybe.

Let`s see if you`re still laughing when they come for you.

[loppylugs1]

Amazing when phrases like "on my land" or any business set up by farang to circumvent any Thai law,truly amazing. do they think for one moment in time that whatever they have set up in any way gives them a "right" here in Thailand,they can and will be swatted like a fly when the time comes

Knew one guy years ago,had it all thought out ,set such a complex web up that he was regarded as untouchable. One day a kindly reminder to go along ,with passport ,to immigration. Once there big red stamp over his visa,and ejected within 24 hours ,leaving house, possessions,the lot(including wife) behind.

[jpeg]

Amazing when phrases like "on my land" or any business set up by farang to circumvent any Thai law,truly amazing. do they think for one moment in time that whatever they have set up in any way gives them a "right" here in Thailand,they can and will be swatted like a fly when the time comes

Knew one guy years ago,had it all thought out ,set such a complex web up that he was regarded as untouchable. One day a kindly reminder to go along ,with passport ,to immigration. Once there big red stamp over his visa,and ejected within 24 hours ,leaving house, possessions,the lot(including wife) behind.

Would you care to enlighten us all as to why? Was it property related?

[loppylugs1]

Amazing when phrases like "on my land" or any business set up by farang to circumvent any Thai law,truly amazing. do they think for one moment in time that whatever they have set up in any way gives them a "right" here in Thailand,they can and will be swatted like a fly when the time comes

Knew one guy years ago,had it all thought out ,set such a complex web up that he was regarded as untouchable. One day a kindly reminder to go along ,with passport ,to immigration. Once there big red stamp over his visa,and ejected within 24 hours ,leaving house, possessions,the lot(including wife) behind.

Would you care to enlighten us all as to why? Was it property related?

The guy in question had been there for ever and a day,had fingers in many pies,but for sure had beautiful house,guess he got more than a few neigbours jealous of a foreigner Had a blog site,quite a wise guy too,foretold all the happenings of 2008 couple of years before it came to being

...and I just add I know not why he was ejected,only presume he was doing something that was not officially allowed and eyes were drawn to the situation

Edited August 31, 2014 by loppylugs1

[JesseFrank]

Amazing when phrases like "on my land" or any business set up by farang to circumvent any Thai law,truly amazing. do they think for one moment in time that whatever they have set up in any way gives them a "right" here in Thailand,they can and will be swatted like a fly when the time comes

Knew one guy years ago,had it all thought out ,set such a complex web up that he was regarded as untouchable. One day a kindly reminder to go along ,with passport ,to immigration. Once there big red stamp over his visa,and ejected within 24 hours ,leaving house, possessions,the lot(including wife) behind.

Would you care to enlighten us all as to why? Was it property related?

The guy in question had been there for ever and a day,had fingers in many pies,but for sure had beautiful house,guess he got more than a few neigbours jealous of a foreigner Had a blog site,quite a wise guy too,foretold all the happenings of 2008 couple of years before it came to being

So he got banned from Thailand because he had a blog site, a beautiful house, jealous neighbors or just because you wanted to dream up a sensational story ?

Someone who gets deported don't get an "invitation" to the immigration office, he get hauled and deported. That was the give away.

[loppylugs1]

Amazing when phrases like "on my land" or any business set up by farang to circumvent any Thai law,truly amazing. do they think for one moment in time that whatever they have set up in any way gives them a "right" here in Thailand,they can and will be swatted like a fly when the time comes

Knew one guy years ago,had it all thought out ,set such a complex web up that he was regarded as untouchable. One day a kindly reminder to go along ,with passport ,to immigration. Once there big red stamp over his visa,and ejected within 24 hours ,leaving house, possessions,the lot(including wife) behind.

Would you care to enlighten us all as to why? Was it property related?

The guy in question had been there for ever and a day,had fingers in many pies,but for sure had beautiful house,guess he got more than a few neigbours jealous of a foreigner Had a blog site,quite a wise guy too,foretold all the happenings of 2008 couple of years before it came to being

So he got banned from Thailand because he had a blog site, a beautiful house, jealous neighbors or just because you wanted to dream up a sensational story ?

Someone who gets deported don't get an "invitation" to the immigration office, he get hauled and deported. That was the give away.

Up to you then

[dsfbrit]

In the last month since the news story was posted, has anyone any news of any incidents related to the original post, or has this crackdown gone the way of so many other crackdowns and investigations in LOS - nowhere? To be fair, if they are identifying the companies to investigate that could take some time.

Edited September 24, 2014 by dsfbrit

[jimmybkk]

I know of one business that was investigated by the DSI as part of this crackdown. It sounded like it was a thorough investigation too. The Thai partners were called in for interviews with the DSI. I've yet to hear if there was any fallout from the investigation, but the business is still operating now so maybe they were given the all clear.

[dsfbrit]

Jimmybkk, interesting, but just one business known to be investigated and no action taken yet - not much of a crackdown so far is it ? Maybe early days and it may gather pace.

[jimmybkk]

Jimmybkk, interesting, but just one business known to be investigated and no action taken yet - not much of a crackdown so far is it ? Maybe early days and it may gather pace.

Just one business that I know of - could be a lot more out there.

I would imagine that anyone who is being investigated is probably not keen to publicize the fact - being the subject of an investigation by the Thai equivalent of the FBI is probably a good reason to shy away from any additional spotlights, and publicizing it is not likely to serve in your best interests.

There was something on TV News clippings a few weeks back that was reporting that after a similar crackdown in Chiang Mai 2 companies were found to have breached the Foreign Business Act. Maybe we won't know the outcome of their investigations in Pattaya until a similar report is released.

[dsfbrit]

I thought you may be interested to see some correspondence I had yesterday. I would rather not say who sent this email to me as I have not asked their permission to publish it. However, it was certainly disconcerting to find the DSI were actually doing what they said they would be doing. Will us 'land owners' be next?

The email that I sent:

Hi *****

I don't wish to take up a lot of your time with this.

It was nearly 2 months ago that the DSI 'crackdown' on nominee companies in Pattaya was announced.

I have looked on your website (****.com), but I could not see any update on this.

Could you just give me an update, tell me yes or no, if your company has been contacted to provide names of companies that you deal with to the DSI ?

If 'no' then just 'NO' would do as an answer.

If 'yes', then I would appreciate just knowing if they are targeting 'land owning' companies like mine, or are they after bigger fish ie: like those
in the travel industry 'abusing' the rules.

Like I say, I am not expecting a long reply, but a very short update via email or on your website would be appreciated.

regards

<dsfbrit>

Their Reply:

Dear <dsfbrit>

Yes

However for the time being they are targeting running business's like go go bars, restaurants, real estate agents and basically any business where they think it is being run and owned by the foreigner 100% yet using the Thai limited company to do this with the 51% nominee Thai's holding the shares on behalf of the foreigner.

No one has been prosecuted yet however cases are in the process.

Regards

Edited October 14, 2014 by dsfbrit

[loppylugs1]

I thought you may be interested to see some correspondence I had yesterday. I would rather not say who sent this email to me as I have not asked their permission to publish it. However, it was certainly disconcerting to find the DSI were actually doing what they said they would be doing. Will us 'land owners' be next?

The email that I sent:

Hi *****

I don't wish to take up a lot of your time with this.

It was nearly 2 months ago that the DSI 'crackdown' on nominee companies in Pattaya was announced.

I have looked on your website (****.com), but I could not see any update on this.

Could you just give me an update, tell me yes or no, if your company has been contacted to provide names of companies that you deal with to the DSI ?

If 'no' then just 'NO' would do as an answer.

If 'yes', then I would appreciate just knowing if they are targeting 'land owning' companies like mine, or are they after bigger fish ie: like those

in the travel industry 'abusing' the rules.

Like I say, I am not expecting a long reply, but a very short update via email or on your website would be appreciated.

regards

<dsfbrit>

Their Reply:

Dear <dsfbrit>

Yes

However for the time being they are targeting running business's like go go bars, restaurants, real estate agents and basically any business where they think it is being run and owned by the foreigner 100% yet using the Thai limited company to do this with the 51% nominee Thai's holding the shares on behalf of the foreigner.

No one has been prosecuted yet however cases are in the process.

Regards

Was the case methinks of shutting the eyes and the problem would go away.Was always the rumour mill, and that seems to be spreading to the O visas as well

The Thais are getting far more assertive these days ,not only on this issue but many others.

Made me laugh when a farang poster referred to "his land",right,just hope the guys that bought previously have had their moneys worth out of it

[dsfbrit]

loppylugs, back in 2005 when this company nominee/land investigation possibility was first posted on TV, there were many threads and dozens (hundreds?) of pages posted from all kinds of people. Many like me, who had land under the company nominee umbrella were really concerned about the consequences. I think you can see how we 'landowner's' don't really care much now, simply by the lack of interest in this thread and the updated post I submitted earlier today. Back in 2005, this thread would be a 'hot' topic for sure.

I think the lack of interest is due to several reasons. To begin with, I know people who have closed down their company and taken up the 30 year lease option on the land, so they are no longer concerned. Others like me, have checked out the law and know that the 'punishment' will most likely to be given 12 months to close down the company and put the land in the name of our spouse and then do the 30 year lease. A nuisance, but hardly the end of the world.

From my point of view I am inclined to think that if 'landowning' companies like mine are not investigated during this 'crackdown', then I don't suppose we will have any problems for some considerable time to come. I mean, if the junta don't feel like cracking down on us now, then who would be inclined in the near future.

One other thought crossed my mind. If the government were to reclaim all this 'illegal' land, what exactly would they do with it. No one wants to buy any land near where I live (towards Laem Chabang near Pattaya), the only house/swimming pool/land sold recently in my village was a repossession via the bank that went for about 80 percent of the cost to build in 2004 - and it took 18 months for it to be sold at that knock-down price !

[TheCruncher]

loppylugs, back in 2005 when this company nominee/land investigation possibility was first posted on TV, there were many threads and dozens (hundreds?) of pages posted from all kinds of people. Many like me, who had land under the company nominee umbrella were really concerned about the consequences. I think you can see how we 'landowner's' don't really care much now, simply by the lack of interest in this thread and the updated post I submitted earlier today. Back in 2005, this thread would be a 'hot' topic for sure.

I think the lack of interest is due to several reasons. To begin with, I know people who have closed down their company and taken up the 30 year lease option on the land, so they are no longer concerned. Others like me, have checked out the law and know that the 'punishment' will most likely to be given 12 months to close down the company and put the land in the name of our spouse and then do the 30 year lease. A nuisance, but hardly the end of the world.

From my point of view I am inclined to think that if 'landowning' companies like mine are not investigated during this 'crackdown', then I don't suppose we will have any problems for some considerable time to come. I mean, if the junta don't feel like cracking down on us now, then who would be inclined in the near future.

One other thought crossed my mind. If the government were to reclaim all this 'illegal' land, what exactly would they do with it. No one wants to buy any land near where I live (towards Laem Chabang near Pattaya), the only house/swimming pool/land sold recently in my village was a repossession via the bank that went for about 80 percent of the cost to build in 2004 - and it took 18 months for it to be sold at that knock-down price !

If the government were to reclaim all this 'illegal' land, what exactly would they do with it. No one wants to buy any land near where I live

And that would exactly be the least of their concern.Thank you for posting the email earlier, I'm eagerly waiting to see what will happen.

Keep in mind that not everyone is in the situation that they can just transfer the property to their spouse name, otherwise they would probably have done initially at the time of purchse, and that a lease contract between men and wife has ZERO value in court.

[loppylugs1]

loppylugs, back in 2005 when this company nominee/land investigation possibility was first posted on TV, there were many threads and dozens (hundreds?) of pages posted from all kinds of people. Many like me, who had land under the company nominee umbrella were really concerned about the consequences. I think you can see how we 'landowner's' don't really care much now, simply by the lack of interest in this thread and the updated post I submitted earlier today. Back in 2005, this thread would be a 'hot' topic for sure.

I think the lack of interest is due to several reasons. To begin with, I know people who have closed down their company and taken up the 30 year lease option on the land, so they are no longer concerned. Others like me, have checked out the law and know that the 'punishment' will most likely to be given 12 months to close down the company and put the land in the name of our spouse and then do the 30 year lease. A nuisance, but hardly the end of the world.

From my point of view I am inclined to think that if 'landowning' companies like mine are not investigated during this 'crackdown', then I don't suppose we will have any problems for some considerable time to come. I mean, if the junta don't feel like cracking down on us now, then who would be inclined in the near future.

One other thought crossed my mind. If the government were to reclaim all this 'illegal' land, what exactly would they do with it. No one wants to buy any land near where I live (towards Laem Chabang near Pattaya), the only house/swimming pool/land sold recently in my village was a repossession via the bank that went for about 80 percent of the cost to build in 2004 - and it took 18 months for it to be sold at that knock-down price !

From past experience of what would happen the land registry would not recognise your purchase ,or more importantly allow to sell it. Yes,happened to me,not this country,but shaping up the same here,and it will happen here without doubt.

As stated ,something is happening since the military crackdown as I found two days ago with visa issuance,just appears to be a general resentment of farang resident

[dsfbrit]

Cruncher, sorry to hear you are in a slightly more precarious situation than I am. Back in 2004 when I had my house built, all but one person that I know could have put the land in their Thai spouse's name, but chose the company route. It was the 'done' thing then.

After 2005, I think you are right and the 30 year lease became more the norm. Well at least with the farang who were aware of the issues with the company ownership route.

Yes I have read those threads that say usufruct and 30 year leases have no legal standing if they are between Thai spouse and a farang husband. I won't start debating the whole thing here(nor the 30+30+30 year leases), there are other threads that debate those issues in depth.

For what it is worth, the DSI said they were going after a certain set of companies and they are exactly the ones mentioned in my email ie bars, AGoGo's, estate agents, etc... so the company 'owning' land was not and is still not on the DSI agenda. I will get another update next month and post it here to see if the DSI are sticking to their current remit.

[dsfbrit]

loppylugs1, I have no intention of selling. I have been married to my wife for 12 years now and unlike in 2004, I would now be quite prepared to put the land in her name without the 30 year lease if need be - If that were the only way I could stay living here as I love it here for sure.

Mind you, my naturally cautious streak would mean I would try to put the house in my name if possible. Still I will cross that hurdle if and when it arises.

I am not sure the military are against the farang. The military crackdown seems to be simply implementing laws that were already in place.

No new laws have been added as such. That is not quite true now I come to think of it, as the overstay punishment has become more severe and the Ed Visa seems to have been tightened up, however the visa rules 'crackdown' actually started under the previous government. Still this is all off topic so I won't comment further.

[loppylugs1]

Not getting involved in property issue,once bitten twice shy. I am awaiting compulsory medical insurance or return to your own country to get police clearance for retirement visa (be OK there ,but just the hassle). Having to go to that giant aircraft hanger in BKK for first time couple of days ago was an eye opener for sure

[loppylugs1]

loppylugs1, I have no intention of selling. I have been married to my wife for 12 years now and unlike in 2004, I would now be quite prepared to put the land in her name without the 30 year lease if need be - If that were the only way I could stay living here as I love it here for sure.

Mind you, my naturally cautious streak would mean I would try to put the house in my name if possible. Still I will cross that hurdle if and when it arises.

I am not sure the military are against the farang. The military crackdown seems to be simply implementing laws that were already in place.

No new laws have been added as such. That is not quite true now I come to think of it, as the overstay punishment has become more severe and the Ed Visa seems to have been tightened up, however the visa rules 'crackdown' actually started under the previous government. Still this is all off topic so I won't comment further.

Have a read of the Bangkok Post,today's issue The country does not just appear to be becoming unfriendly,it is

[brewsterbudgen]

loppylugs1, I have no intention of selling. I have been married to my wife for 12 years now and unlike in 2004, I would now be quite prepared to put the land in her name without the 30 year lease if need be - If that were the only way I could stay living here as I love it here for sure.

Mind you, my naturally cautious streak would mean I would try to put the house in my name if possible. Still I will cross that hurdle if and when it arises.

I am not sure the military are against the farang. The military crackdown seems to be simply implementing laws that were already in place.

No new laws have been added as such. That is not quite true now I come to think of it, as the overstay punishment has become more severe and the Ed Visa seems to have been tightened up, however the visa rules 'crackdown' actually started under the previous government. Still this is all off topic so I won't comment further.

Have a read of the Bangkok Post,today's issue The country does not just appear to be becoming unfriendly,it is

Care to tell us why?

[inzman]

Read the post article on Thai nominee holding companies. It's very informative.

[loppylugs1]

"Nominee loopholes in the firing line"

Worrying times ahead. As the e mail spelt it out earlier in the thread it was only a matter of time before events unfolded for them in- particular. It is not just "loophole " purchasers ,but all long time ex-pats potentially in the firing line,least I have just renewed the 12 month visa leash

[Rimmer]

A post with a forbidden link has been removed

[hawker9000]

"Nominee loopholes in the firing line"

Worrying times ahead. As the e mail spelt it out earlier in the thread it was only a matter of time before events unfolded for them in- particular. It is not just "loophole " purchasers ,but all long time ex-pats potentially in the firing line,least I have just renewed the 12 month visa leash

The writing has been on the wall for a long time. You heard it here first... And this won't be the end of it for sure. Thai xenophobia is (and has been) on the rise. Foreigners remain cheap and easy scapegoats for all of Thailand's problems, even among some foreigners themselves!

[dsfbrit]

Well it has been nearly a year now. Have there been any significant events in that time or has this 'crackdown' gone the way of most other crackdowns - nowhere?