SETTING UP A
COMPANY IN THAILAND
On March 3rd 2000 the Thai Foreign Business Act of 1999 took effect.
This replaced the old Act of 1972.
In a company you need 7 partners but you can according to the
investment control 100% via B.O.I. (Board of Investment). However a
normal 2m baht Thai Company foreigners can have 6 foreign shareholders & 1
Thai but the Thai holds 51% shares.
What one does
not know until they decide to form one is that certain businesses are
closed to foreigners BUT THIS IS OF NO CONCERN IF ONE JUST WANTS A
COMPANY FOR THE PURPOSES OF BUYING A HOUSE AND LAND. We help you form the company and take care of all steps for you plus search the
Title Deeds & any other request like making sure their is no lien on the
property. We also check the Courts for you.
Thailand's Land Owning Laws--from
Thai Law Office
Originally land in Thailand was owned by the people, who reserved the right to
use the land and transfer it to their heirs. Later, land was owned by the kings. The people had to request a royal grant in order to obtain land. Today land
comes under land administration laws. The Land Department and other governmental authorities, such as the Forestry Department,
is responsible for land in forest zones, Sor Por Gor in reformed land
zones & District Offices and Municipalities or Bor Tor who look after public land zones.
Land under these government departments have no effect on rights of people who owned land before the government appointed the land as a forest, public or reformed zone. The law has no retrospective effect on
peoples' rights to land under the law before it became a forest zone.
This person still maintains rights to the land.
Private land Rights:
1/. Right of possession (Possessory right), i.e. people who possess and use the benefit of land will have the right to possess
land under the Civil and Commercial Code.
2/.Ownership by someone who
has a title deed and documents concerning the land. or Sor Kor 1which is
a notification form of possessed land. There is a certificate to show
the right to the land. This maintains existing rights. Notification of [Sor
Kor 1]. December 1st 1954, the government advised all land proprietors
to notify such possession to the government as per form [Sor Kor
1]. After it was proven that such a proprietor had possessed the land
legally and used the benefit of the land, then the government would
issue [Nor Sor 3] or [Nor Sor 3 Gor] as evidence. [Nor Sor 3] and
[Nor Sor 3 Gor]are legal certificates provided that any name shown on
the title is a person who has the right to the land (according to
the principle law). This right is recognized by law and used as
evidence in any dispute with an ordinary person or the government.
Por Bor Tor 6
Is evidenced by the issuance of a tax number for paying tax when using
the land. Such land hasn't been assessed as to the personís
right to possess such land. If no land title, then it may be land in a
conserved forest, public land or land which existed under [Sor Kor 1],
[Nor Sor 3], [Nor Sor 3 Gor] or a title deed. Any of these titles
must have a [Por Bor Tor 6] as tax must be paid, the same as any land
without a title. Purchase of such land is possible by handing over the
possession of the land to the buyer along with the tax number. The
right to land under [Por Bor Tor 6] can not be used as evidence in any
dispute with authorities.
Sor Por Gor 4-01
is an allotment of land from the land reformative committee, and under
no circumstances may this land be bought or sold. It may be
transferred to heirs only.
Nor Sor 3
is an instrument certifying the use of land issued by the government
to the proprietor of land not a possessory title, i.e. it's
confirmed by law that a person holding Nor Sor 3 has the legal right to possess the land. This land title can be used as a legal document or to use the benefit of the land as an owner. Nor Sor 3 is a floating map with no parcel points. It's issued for a specific plot of land and is not connected to other land plots. This causes problems in verifying the land area. Any legal acts must be publicized for 30 days.
Nor Sor 3 Gor is a legal land title with the same legal basis as Nor Sor
3. The difference being that Nor Sor 3 Gor has parcel points on the map, and is set by using an aerial survey to set the points and the land area. It's possible to verify a nearby land area. It always uses the same scale of 1:5000.
No need to publicize any legal acts, and it's possible to partition (divide) the land into smaller plots.
Land Title Deed:
is a certificate for ownership of land. A person having their name shown on the deed has the legal right to the land, and can use it as evidence to confirm the right to government authorities. The title deed has been issued by using GPS to set the area and boundaries of the land, which is a very accurate method. Any legal acts may be done immediately, as per the right of ownership. Land partition of more than 9 plots must be carried out according to the Land Allotment Law, Section 286. [Condominiums]
may be used as drafted. [Buildings on Land]. Foreigners have the right to ownership of buildings only, where land is not included. Legal acts are unlimited. A suggestion for foreigners is to lease the land for 30 years with an option to an extension of the lease, then purchase ownership of the house built on the
land. Certainty of possession of land and house is assured, by being the owner of the house. The ownership of the land shall be leased out. If arranged as stated above, then the house will be separate from the land, and will not be a component part under the Civil Law. Ownership of buildings can be confirmed, and the lessor cannot seize the house upon expiration the lease.
( We wish to thank law adviser Kuhn Pradit
for supplying us the above info.)
your foreign currency exchange rates
for ALL YOUR LEGAL NEEDS IN THAILAND
TO LEASE A HOUSE &
TO LEASE LAND
We take the lease to the Amphur together with the nor sor sam or Kanut and
registered. It is then stamped & the land cannot then be
sold unless the lease is cancelled. A lease without doing this is useless. The first lease should be done properly by a reliable
lawyer. (We charge 10,000 baht ). Our lawyer takes the title deed to the Amphur and
gets it legalized. The wife or owner should then sign another 30 year lease
dated from the end of the first one. Most wives would agree to these procedures
by explaining to them that if they died, they
would not want their husbands thrown out! At the end of the thirty year lease,
all you have to do is get a lawyer to take it to the Amphur again. It is really
simple. A virtual 60 year lease should cover most peoples lifetime and
the wife can leave the property in her will to the children and if you die the
lease could be terminated and the property go to your children. You can also
sell a lease.
VIA A LOAN TO YOUR COMPANY:
This is an excellent way to
lease if you have a company. An owner takes a lease out on a particular
piece of land he wants to own with his own money? he loans his company
money to buy the land and the lease in effect is owned by the company
via the buyer. This then becomes an asset of the company and can be
depreciated from his or her tax registration & paid back at the