Current Legal position on Land/House purchase by foreigners

[Erk]

I found the article on house ownership on your website very useful.

I am currently considering buying a house in Thailand (Pattaya) and wondered if the current situation in Thailand regarding buying through a Thai Company was the same as outlined in the article.

I recently heard that the Thai Goverment were clamping down on these arrangements since most companies are only set up to purchase a house and under Thai law that is illegal. Although I believe nobody has as yet been affected I have heard that it was probable that any future cases will be pursued. Can you advise if this is true.

[dozer]

I am currently considering buying a house in Thailand (Pattaya) and wondered if the current situation in Thailand regarding buying through a Thai Company was the same as outlined in the article.

Good thing to point out, I should update the article! Yes, there has been a crack down on buying property via a Thai limited company. There is an even bigger movement to redo the foreign business act - with one of the end goals to prevent another scheme like the Taksin sale of the AIS phone company.

Going the company route requires 7 directors with majority Thai ownership. Before the easy way to control the company was to use preference shares (or some used share proxies). The government has cracked down on 'nominee' directors, those who have no real interest in the company but are at the beckon call of the controlling foreigner.

Some are still going the company route as follows: 1.) locate target property 2.) have trusted attorney form a Thai limited company with only Thai directors. 3.) Transfer property. 4.) Add foreign director as a shareholder with proxies for the other Thai directors. This method can obviously not be recommended.

Another more expensive option involves making the Thai directors NOT nominees. There is a legitimate way of doing this, but the bottom line is it is expensive, normally not justified on target properties worth under 15m.

So, for all intents and purposes the company route as a method to buy and control land is 'dead' in the vast majority of cases.

[rosegate]

I found the article on house ownership on your website very useful.

I am currently considering buying a house in Thailand (Pattaya) and wondered if the current situation in Thailand regarding buying through a Thai Company was the same as outlined in the article.

I recently heard that the Thai Goverment were clamping down on these arrangements since most companies are only set up to purchase a house and under Thai law that is illegal. Although I believe nobody has as yet been affected I have heard that it was probable that any future cases will be pursued. Can you advise if this is true.

As far as i understand & maybe I'm wrong, owning a dormant non-trading Thai company has always been illegal it's just that the Thai authorities have turned a blind eye in the past.

All they have done now has inforced the policy, as dozer has quoted a decent Thai lawyer will advise you further on other ways to own a property/land

This is a good firm of Thai english speaking Pattaya lawyers: -

http://www.swisssiam.com

[dozer]

As far as i understand & maybe I'm wrong, owning a dormant non-trading Thai company has always been illegal it's just that the Thai authorities have turned a blind eye in the past.

Actually this was a bit of a red herring. Previously everyone thought (including me) that was the key issue, ie. companies that had no trading income but owned land with foreign directors would be targeted . What happened had nothing to do with trading or not trading. It is the validity of the shareholders in the venture. It caught a lot of people by surprise I suspect, including a bunch of company holders who had carefully added some trading aspects to their company.

[jazzman]

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See also:
http://www.coolthaihouse.com/forum/viewtopic.php?t=15

SwissSiam Group is an association of Swiss based consultants for a diversity of activities. 'Their' law branch is actually the Thai firm of Puvana Co. Ltd.