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to the strict letter of Thailand land law, foreigners are, in general, prohibited from buying freehold land in Thailand. However, there are various exceptions in the law regarding this issue. There are also other methods available for acquiring ownership interest in buying land or property in Thailand.

Methods of "Owning" Land in Thailand

1. Investment/BOI: Thai property law may allow foreigners to own a limited amount of land based on investment of 40 million baht or more, provided that the land is used for residential purposes. Additionally, foreign companies may be able to purchase land for a limited period if they have the approval from the Board of Investment (BOI). However, these methods are not convenient or satisfactory for most people interested in acquiring property in Thailand.

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2. Leasing: Thai property law allows a 30-year maximum lease period, with the possibility of renewing the lease for another 30 years. This type of lease has become a favorite used by foreigners to own or buy land. We will work with you to draft the land and property lease, ensuring that it fully protects you and your land and property rights. One advantage of a lease is that it is fairly user-friendly and easier to maintain than forming a company.

3. Company Ownership: A Thailand-registered company may either be “Thai” or “foreign”. To be a ‘Thai” company, more than 50% of the company must be owned by Thai shareholders (The remaining shares may be held by foreigners). This “Thai” company may then legally purchase land or buy property in Thailand.

Buying property with a limited liability company is one of the most popular methods for foreign investors. This is because the Articles of Association can be written to allow greater protection for foreign minority shareholders. Thailand law generally requires that Thai nationals own a majority interest in a company if they wish to purchase land legally.

4. Condominiums: According to the Condominium Act B.E. 2522 (A.D. 1979), a condominium is defined as a building that can be have its separate portions sold to individuals or groups for personal property ownership. Foreign investors as well as other foreigners may own condominiums in the Kingdom of Thailand under certain circumstances. Certain condominium buildings allow for foreigners to purchase condos in free hold (fee simple). The condominium buildings are located in specified metropolitan areas and may have limits on the amount of units available for sale to foreigners.

5. Thai Spouse: A Thai spouse of a foreigner may be allowed to buy land or property in Thailand in his or her own name. However the married couple may be asked to sign declarations at the Land Department to state that the property belongs to the Thai spouse, prior to registration. This may have the effect of waiving any claim on the land or property by the non-Thai spouse. This may become problematic in a divorce case as it may be difficult for the non-Thai spouse to prove that the land was marital property. In this case, a skillfully drafted prenuptial agreement may come in handy to minimize the risk to the non-Thai spouse.

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Land Purchase in Thailand

1. The “Gold Standard” for land ownership is a Chanot (Nor Sor 4). The title deed must be registered at the Land Department in the province in which the land is located. It is possible for a land parcel to be commonly held by several individuals. A person whose name appears on a Chanot has all the legal rights to that land. He can also produce the deed as evidence of ownership to Government officials, prove that the land has clearly defined boundaries, and engage in legal acts upon that land as allowed by the law.

2. Lesser title deeds include a Nor Sor 3 Gor and a Nor Sor 3. Nor Sor 3 land title deeds do not have official markers designated on the land by the Land Department. Therefore, the land boundaries are less certain than with Chanot.

3. The land ownership right which is the most problematic is the ‘possessory right”. A possessory right is not evidenced by a title at the Land Department. Rather, it is shown in the form of tax payments. Buyers of land should pay attention to “possessory right”.

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Title Deed	Definition
*Chanot (Nor Sor 4)*	Full title deed
*Nor Sor 3 Gor*	*Second best title deed. It is used while awaiting measurement for a Chanot* .**
*Nor Sor 3*	Third best title deed. Although ownership may be reasonably ascertained, boundaries of the land are less certain.
Possessory Right	One of the weakest land rights. This is normally an inherited land right proven by tax payments at the local administrative office.

Land Mortgages

Land mortgages in Thailand must be made in writing and registered with the Land Department of Thailand. Mortgages do not include the buildings built on the land after the mortgage date unless they were agreed upon before the mortgage documents were signed. In addition, buildings and other immovable structures may be mortgaged separately and should be registered with the Land Department or local Amphur (province).

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Leasing Land in Thailand

1. A foreigner can obtain 100% interest for a land lease in Thailand. Unlike direct land ownership, the law allows foreigners to obtain long-term land leases.

2. Leases up to three years need not be registered but registration at the Land Department is mandatory for leases that are three years or more.

3. The maximum lease term available is 30 years, with an option to renew for an additional 30 years. Each lease renewal that is agreed upon with the landowner must be registered at the local land office. For each new registration, taxes will be levied. Land for industrial or commercial purposes may be leased for up to 50 years by a foreign company under certain circumstances, with the possibility of extending the lease thereafter.

4. There are numerous obstacles faced by foreigners who wish to buy land or purchase property in Thailand. To avoid these obstacles, many foreigners choose to acquire land on a 30-year leasehold with an option for extension. This is the simplest and most straightforward way for foreigners to acquire property in Thailand. In addition, a lease stays valid even in the event that the property or the land is sold.

5. A foreigner’s lease rights are formally recognized by the Thai law. The land lease is executed and registered only once, after which very little legal maintenance is required. In comparison, a limited company has several shareholders who may have interests that are different from yours, and this could translate into potential risks for you and your objectives. Also, a company requires regulatory compliances such as yearly balance sheets to be filed with the Tax Department.

6. Even a well-constructed land lease and a separate option agreement to extend the lease between the landowner and the lessee cannot guarantee the timely renewal of the lease. A landowner may refuse to sign any registration for the lease extension beyond the 30-year expiration. Although the lessee can sue the landowner for breach of contract, the legal process entailed may be costly and time-consuming. Other drawbacks include the difficulty in obtaining a mortgage for a lease (as opposed to direct ownership); a lower resale value; and potential lawsuits from the landowner for lease violations.

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Forming a Company for Land Ownership

1. The main advantage of forming a company is that it allows foreigners to acquire ownership interest in a freehold land in Thailand. Unlike land leases, the ownership is permanent as long as the company stays in existence and does not sell or transfer the land. Forming a company may make sense for people seeking to hold land for long-term or investment purposes, to provide for their future heirs, or for those contemplating doing business in Thailand. Also, with ownership, it is possible to mortgage the land and/or subdivide the land for resale. This is a right normally conferred by land leases.

2. Many foreigners consider hiring or using Thai shareholders to act as their nominees when using a Thai company to buy land. The main problem with Thai nominees is that once they become shareholders, they have legal share ownership of the company and are no longer "nominees". Although you can reduce the shareholders' control of the company, other mechanisms must be put in place to legally protect your interest, like having all parties sign a power of attorney.

3. The second issue to consider, before registering a Thai company to purchase land or buy property, is maintaining regulatory compliance of the company. Thai law requires balance sheets to be filed yearly and a company address must be maintained. Technically, inactive companies (companies not earning income) are subject to de-listing. Therefore, an active company is better for purchasing property or buying land in Thailand.

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Regulations for Foreign Ownership of Condominium

1. In order to purchase a condominium certain requirements must be met, for example: 1: A foreigner has permanent residence in Thailand in accordance with Thai Immigration Law, or 2: A foreigner is allowed into or resides in Thailand in accordance with Thai Investment Promotion Law, or 3: A foreign legal entity is in accordance with the Announcement of the Foreign Business Act BE 2542 (AD 1999), and has been granted an Investment Promotion Certificate in accordance with the Investment Promotion law, or 4: A foreigner or foreign legal entity who brings foreign currency into Thailand, or brings in Baht currency from the account of a person residing abroad, or uses foreign currency from their deposit account. This requirement is normally met by the presentation of a Dor Tor 3 form which is provided by the bank receiving an incoming remittance from abroad.

2. In many areas of Thailand a foreigner or foreign legal entity can acquire up to, but not exceeding, 49% of the total floor area of the combined condominium units. However, more that 49% of ownership may be allowable in certain condominium buildings in Greater Bangkok and various other municipalities and districts according to Ministerial Regulations.

3. Most Foreigners purchase a condominium by showing evidence of an incoming remittance of foreign currency into their bank account from abroad as demonstrated by a valid Dor Tor 3 form from a Thai Bank.

4. Property ownership of a condominium can be inherited if the heir to ownership meets one of the original criteria for foreign ownership. Otherwise the condominium must be sold within one year of inheritance. Similarly, inheriting ownership of more than 49% of total condominium floor area must conform to certain regulations, namely that the condominium not occupy more than 5 rai, that it not exist outside of Greater Bangkok or other designated municipalities, and that it has at least 40 units in a building registered for at least one year.

5. A lawyer is recommended to review the documents concerning the condominium and to supervise the transfer.

6. Condominiums may be leased to foreigners for periods of up to 30 years and may have options to renew. Leases of greater than 3 years are required to be registered with the Land Department.

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Entering into a lease, or forming a company to buy land or purchase property - both methods have its advantages and disadvantages. It would be wise to examine your individual needs and obtain legal counsel from knowledgeable and trustworthy attorneys before you make a decision.