I set up a company 2 years ago with the intention of buying a plot of land to build a holiday home, since then I have bought 2 plots of land that are adjoined to each other in Hua Hin totaling 136 sq wah.
The company registration is set up as 49% (English Name) 51% (Thai names of who I dont know personally), these names were given in order to set up the company. I have had no problem in buying the land,
1. Am I at risk with these so called new laws ?
2. Will I be targeted ?
3. Are the authorities looking for new company registrations to be targeted or existing ones ?
4. Should I continue with my plan to start construction this August, or sell up and get out ?
Any advice based on good knowledge would be most helpful
Regards
John Lockwood
"New Property Laws" ..... advice please !!!!!
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lockwood74
- Specialist
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Wanderlust
- Legend
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- Joined: Wed Aug 04, 2004 12:27 pm
- Location: Hua Hin
lockwood74,
Before I start I just want to correct something that you have obviously been told or read - the law has not been changed regarding these issues, but the relevant Ministry here issued a directive stating that certain regulations had previously not been enforced properly, and that now they should be (in so many words). However the wording was sufficiently open to interpretation to lead to mass confusion and debate on here and all over Thailand!
As it stands there has been no comment as to any retrospective action being taken, as in deals that have already been done, and many people think that is unlikely, although it is probably still possible legally. Also many people interpret the statement as being aimed solely at foriegners wishing to buy large tracts of land with the intention of developing and then selling property, rather than those wishing to have a home for themselves.
You will get advice from some on here telling you that there is no problem, and others telling you to pull out now, while the advice I would give you is to contact your Thai lawyer, or if you haven't got one to get one PDQ! I believe that you should probably hold fire on construction until you have had legal advice but also until the promised 'further clarification' from the Ministry transpires.
At the end of the day you (and others) were exploiting a loophole in the Thai law, because the only legal way to own land here is if you invest 40 million baht in a government scheme, and even then it is a limited amount (not sure but somewhere between 1 and 3 rai). The questions you have to ask yourself is whether you can afford to lose the money you have invested if the worst comes to fruition, and what are your alternatives? It depends on what your plan was really, if you were planning to sell up after a while, or keep it forever, or rent it out to others or just use for yourself. Whatever anyone says the position is not clear, so I wouldn't make any decisions right now - consult a good Thai lawyer.
Before I start I just want to correct something that you have obviously been told or read - the law has not been changed regarding these issues, but the relevant Ministry here issued a directive stating that certain regulations had previously not been enforced properly, and that now they should be (in so many words). However the wording was sufficiently open to interpretation to lead to mass confusion and debate on here and all over Thailand!
As it stands there has been no comment as to any retrospective action being taken, as in deals that have already been done, and many people think that is unlikely, although it is probably still possible legally. Also many people interpret the statement as being aimed solely at foriegners wishing to buy large tracts of land with the intention of developing and then selling property, rather than those wishing to have a home for themselves.
You will get advice from some on here telling you that there is no problem, and others telling you to pull out now, while the advice I would give you is to contact your Thai lawyer, or if you haven't got one to get one PDQ! I believe that you should probably hold fire on construction until you have had legal advice but also until the promised 'further clarification' from the Ministry transpires.
At the end of the day you (and others) were exploiting a loophole in the Thai law, because the only legal way to own land here is if you invest 40 million baht in a government scheme, and even then it is a limited amount (not sure but somewhere between 1 and 3 rai). The questions you have to ask yourself is whether you can afford to lose the money you have invested if the worst comes to fruition, and what are your alternatives? It depends on what your plan was really, if you were planning to sell up after a while, or keep it forever, or rent it out to others or just use for yourself. Whatever anyone says the position is not clear, so I wouldn't make any decisions right now - consult a good Thai lawyer.
One snippet I read recently is that one of the checks is going to be to see if any of the Thai shareholders actually has the funds necessary to purchase the property. It didn't say, but I assume total funds necessary remitted jointly by all Thai sharholders would be accepted as well. I think dates of deposit into various accounts would be checked as well. Pete
You are right Pete, when it first started a couple of weeks ago, the Land Office in Hua Hin had a standard information sheet which told buyers what info to bring in about their shareholders.
Last week and this week they have been transfering land to 49% foreign companies without this request of shareholder info.
Burger
Last week and this week they have been transfering land to 49% foreign companies without this request of shareholder info.
Burger
Hi Lockwood,
I also set a comp up last Nov to buy land and build villa, with hindsite I am now very relived that mine was one of the last to be programmed to be built, I had only paid a 100k thai baht deposit.
We was due have our land registered and break ground on my propety in the next few weeks.
Been in touch with my BKK lawyer and basicly told him that if the company needs to be restructered and its not 100% safe I will walk away.
Also been in touch wih the HH land office and asked them for clarification posted below
"Dear
Thanks for the question you sent to me yesterday. It seems that you are very worry about what you have learned from the newspaper in the UK. Anyway, the answer for your question is that as far as I concern, I did not have any idea of that rumors. What I have heard is that the Ministry of Interior has circulated the letter to the concerning authorities, and order them to investigate if there is any thing wrong in case a company registered in Thailand but owned by foreigners want to buy a peace of land. Therefore, I still think that it is firm if your company want to buy lang for business purposes. However, you must keep in mind that more than half of shareholders or partners in your company must be Thais or the capital of the company owned by foreigner must be less than 49%. So if your company lines in accordance with section 97 of the Land Law of Thailand, Then, it would be OK.
I hope that my answer could be of your help.
Regards
Swaty"
I hope this is informative for you as well?
If we can not safely purchase I will be gutted, been coming to HH for 5 years and fell in love with the place, but not prepared to gamble 150k uk pound's on structers which are open to be taken off me on a whim on a legal ruling as and when local authorites see fit.
As an aside I really feel for people who have brought houses who have this hanging over their heads
I also set a comp up last Nov to buy land and build villa, with hindsite I am now very relived that mine was one of the last to be programmed to be built, I had only paid a 100k thai baht deposit.
We was due have our land registered and break ground on my propety in the next few weeks.
Been in touch with my BKK lawyer and basicly told him that if the company needs to be restructered and its not 100% safe I will walk away.
Also been in touch wih the HH land office and asked them for clarification posted below
"Dear
Thanks for the question you sent to me yesterday. It seems that you are very worry about what you have learned from the newspaper in the UK. Anyway, the answer for your question is that as far as I concern, I did not have any idea of that rumors. What I have heard is that the Ministry of Interior has circulated the letter to the concerning authorities, and order them to investigate if there is any thing wrong in case a company registered in Thailand but owned by foreigners want to buy a peace of land. Therefore, I still think that it is firm if your company want to buy lang for business purposes. However, you must keep in mind that more than half of shareholders or partners in your company must be Thais or the capital of the company owned by foreigner must be less than 49%. So if your company lines in accordance with section 97 of the Land Law of Thailand, Then, it would be OK.
I hope that my answer could be of your help.
Regards
Swaty"
I hope this is informative for you as well?
If we can not safely purchase I will be gutted, been coming to HH for 5 years and fell in love with the place, but not prepared to gamble 150k uk pound's on structers which are open to be taken off me on a whim on a legal ruling as and when local authorites see fit.
As an aside I really feel for people who have brought houses who have this hanging over their heads
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machersjohn
- Member
- Posts: 90
- Joined: Sat Dec 04, 2004 9:37 am
I have been watching this thread and the paranoi. My take is some influensuasial person has not had his/her way and the order was invoked to look more closely ensued.
The reality is if every purchase made in a thai/ farang company was made the subject of an investigation then the thai land office would grind to a halt. This does not take into condsideration the likely hood of bribes to look the other way.
It also allows a thai person to querie the legallity of your purchase on a one to one to basis which you would be unlikely to win.
I should say that i am not in the buying categary but inthe lease situation, which i am sure will out live me.
In conclusion if you have no problem with your neighbours i doubt you will ever have a problem.
Only my interpretation
The reality is if every purchase made in a thai/ farang company was made the subject of an investigation then the thai land office would grind to a halt. This does not take into condsideration the likely hood of bribes to look the other way.
It also allows a thai person to querie the legallity of your purchase on a one to one to basis which you would be unlikely to win.
I should say that i am not in the buying categary but inthe lease situation, which i am sure will out live me.
In conclusion if you have no problem with your neighbours i doubt you will ever have a problem.
Only my interpretation
From www.property-news.com
The market suffered a serious blip last month as lawyers, developers and agents alike scrambled to interpret a new Directive from the Land Department. But had anything actually changed? Tony Adams investigates.
Issued on the 15 May by the Land Department of the Ministry of the Interior to all the provincial governors, the new Regulation established procedures for land officials to follow when dealing with an acquisition of land by a corporate entity with foreign shareholders or directors. Issued with the stated aim to “to prevent any law avoidance or buying land for the benefit of foreigners,â€
The market suffered a serious blip last month as lawyers, developers and agents alike scrambled to interpret a new Directive from the Land Department. But had anything actually changed? Tony Adams investigates.
Issued on the 15 May by the Land Department of the Ministry of the Interior to all the provincial governors, the new Regulation established procedures for land officials to follow when dealing with an acquisition of land by a corporate entity with foreign shareholders or directors. Issued with the stated aim to “to prevent any law avoidance or buying land for the benefit of foreigners,â€
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tuktukmike
- Guru
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- Joined: Mon Apr 18, 2005 1:02 am
Jw has made a good post bar one thing.
www.property-news .com
These people of course have a vested interest in this subject.
As for the Thais maybe extending the 30year lease, dont hold your breath.
I fully agree with a sort of holding company system and as i have said before if developers could get the Banks involved then we would all feel a lot safer.
But i would never invest in a private holding company set up by your lawyer or real estate agent, a lot can happen in 30 years.
My feeling is that as the subject has raised its ugly head it will not be ignored by whatever goverment comes to power in the coming months.
Mike.
BTW, I have heard of at least one property developer now offering a lease buy system in Hua Hin.
Maybe other know more details on this scheme?
www.property-news .com
These people of course have a vested interest in this subject.
As for the Thais maybe extending the 30year lease, dont hold your breath.
I fully agree with a sort of holding company system and as i have said before if developers could get the Banks involved then we would all feel a lot safer.
But i would never invest in a private holding company set up by your lawyer or real estate agent, a lot can happen in 30 years.
My feeling is that as the subject has raised its ugly head it will not be ignored by whatever goverment comes to power in the coming months.
Mike.
BTW, I have heard of at least one property developer now offering a lease buy system in Hua Hin.
Maybe other know more details on this scheme?
John
I don't know your financial position, and that is your business. I am not in the Thai property business. Now if you need the money that you have invested then you need to consider your position. BUT if you are thinking of an investment then history shows that those who make money do so when others are too frightened and get out !!!!!!!
Its more fun than shares and a better bet than England winning the world cup !
PS you can also lose your shirt ........... (as Beckham will sadly)
I don't know your financial position, and that is your business. I am not in the Thai property business. Now if you need the money that you have invested then you need to consider your position. BUT if you are thinking of an investment then history shows that those who make money do so when others are too frightened and get out !!!!!!!
Its more fun than shares and a better bet than England winning the world cup !
PS you can also lose your shirt ........... (as Beckham will sadly)
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tuktukmike
- Guru
- Posts: 728
- Joined: Mon Apr 18, 2005 1:02 am
Very interesting.
BUT if you are thinking of an investment then history shows that those who make money do so when others are too frightened and get out !!!!!!!
Was this also the thought process before the Wall Stree Crash.
I also remember comments as to how intelligent people choose to buy land and house here, so the rest of us must be stupid.
Reminds me of the story of the King With No Clothes.
Essbee,
You are too modest.
Did you not say in a previous post that you have bought land here???
Of course a crash would not affect you as you would have only paid a small price.
No one wants too see anyone lose their money on a bad investment so what is the argument here.
In the Red corner you have the Real Estate Agents who will tell you everything is wonderfull and of course no problem.
In the Blue corner you have the people who have many years of experiance of thailand who say dont invest in what you can not own.
Who is right or wrong is up to the people who read postings on this web site, but when a new poster comes along with his tongue so far up peoples backside he could tickle their tonsils you have to start to wonder.
Remember those that have most to lose will always be the most vocal, while the rest will just quote the law in Thailand.
I have taken a load of crap on this subject from people who to this day hide their interest in this post, Everyone knows my business here and certain others have been asked theirs.
To date one claimed to have only bought a plot of land and his business was his own affair, very modest.
The second refused to answer when asked what his involvment in property was even though he was given a list of options.
Is this important on this web site?. Yes.
If you are making not only opinions but trying to persuade people all is ok with property then you can bet your ass it is.
I met a couple only last week who intended to buy a house out here, they were shocked when i told them that the Thai law says that a farang can not own land.
They woke up when i asked them if they were advised to register a company and if so WHY.
It seems their real estate agents had not bothered to inform them on the basic regulations of Thailand.
So agents flame away, I will stand by my comments.(Like it or not)
Mike.
BUT if you are thinking of an investment then history shows that those who make money do so when others are too frightened and get out !!!!!!!
Was this also the thought process before the Wall Stree Crash.
I also remember comments as to how intelligent people choose to buy land and house here, so the rest of us must be stupid.
Reminds me of the story of the King With No Clothes.
Essbee,
You are too modest.
Did you not say in a previous post that you have bought land here???
Of course a crash would not affect you as you would have only paid a small price.
No one wants too see anyone lose their money on a bad investment so what is the argument here.
In the Red corner you have the Real Estate Agents who will tell you everything is wonderfull and of course no problem.
In the Blue corner you have the people who have many years of experiance of thailand who say dont invest in what you can not own.
Who is right or wrong is up to the people who read postings on this web site, but when a new poster comes along with his tongue so far up peoples backside he could tickle their tonsils you have to start to wonder.
Remember those that have most to lose will always be the most vocal, while the rest will just quote the law in Thailand.
I have taken a load of crap on this subject from people who to this day hide their interest in this post, Everyone knows my business here and certain others have been asked theirs.
To date one claimed to have only bought a plot of land and his business was his own affair, very modest.
The second refused to answer when asked what his involvment in property was even though he was given a list of options.
Is this important on this web site?. Yes.
If you are making not only opinions but trying to persuade people all is ok with property then you can bet your ass it is.
I met a couple only last week who intended to buy a house out here, they were shocked when i told them that the Thai law says that a farang can not own land.
They woke up when i asked them if they were advised to register a company and if so WHY.
It seems their real estate agents had not bothered to inform them on the basic regulations of Thailand.
So agents flame away, I will stand by my comments.(Like it or not)
Mike.
Last edited by tuktukmike on Tue Jun 27, 2006 2:40 am, edited 1 time in total.
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tuktukmike
- Guru
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- Joined: Mon Apr 18, 2005 1:02 am
As an add on these are the lawyers recomended by the British Embassy for good and honest advice.
*
A list of Lawyers
LAW SOCIETY OF THAILAND
7/89 Building 10, Rajdamnoen Avenue, Phra Nakorn, Bangkok 10200
Tel + 66 (0)2629 1430 www.lawyerscouncil.or.th/
(Monday – Friday at 0900 – 1600 hrs)
BANGKOK LAWYERS
CRIMINAL, FAMILY (AND COMMERCIAL WHERE INDICATED)
BANGKOK LEGAL ASSOCIATES LIMITED
ITF Tower II 17th Floor
140/38 Silom Road
Bangkok 10500
Tel +66 (0)2231 6096 to 8
Fax +66 (0)2231 6099 and 2231 6976
Email: blalaw@hotmail.com
Members :
MR PUTTRI KUVANONDA Attorney-at-Law
MR VORATHUM JIRANANDA, Attorney-at-Law
MR SAROJ PATTANARACH, Attorney-at-Law
MR PRASERT SANGWAREE, Attorney-at-Law
General Practice, Litigation both Civil and Criminal, Consultation
English speaking lawyers
MARUT BUNNAG INTERNATIONAL LAW OFFICE
Forum Tower, 22nd Floor
184/130 – 136 Ratchadapisek Road
Huaykwang
Bangkok 10320
Tel +66 (0)2645 2556 to 67
Fax +66 (0)2645 2568 to 69
www.marut.th.com
Email: marut@loxinfo.co.th
MR RUJIRA BUNNAG, Attorney-at-Law
General Practice, Litigation both Civil and Criminal, Consultation
English speaking lawyers
SINGH, KRIANGSAK AND SURACHAI LAW OFFICE
ITF Silom Palace Building, 28th Floor
160/686-688 Silom Road
Suriyawong, Bangrak
Bangkok 10500
Tel +66 (0)2634 0201 to 03
Fax +66 (0)2634 0204
Email: dgalegal@scoms.com
Partners:
MR KRIANGSAK NUNTASEN, Attorney
MR SINGH LEKHAKUL, Attorney
MR SURACHAI DANAITANGTRAKUL, Attorney
Provides general legal advice with emphasis on criminal and civil
litigation and commercial laws
English speaking lawyers
SIAM GLOBAL ASSOCIATES
Suite 606, Nai Lert Building
87 Sukhumvit Road, Klogtoey Nua
Vadhana
Bangkok 10110
Tel +66 (0)2650 3510 to 12
Fax +66 (0)2650 3512
www.sgalegal.com
Email: sgalegal@cscoms.com
Partners:
MRS CHANINAT LEEDS, Attorney at Law
MR CHATCHAI NA CHIANGMAI, Attorney at Law
MS ATCHARA INTARA, Attorney at Law
MS SAWITREE NGAKOM, Attorney at Law
General practice, Civil Disputes and Criminal cases
English speaking lawyers
SAKULTHUN & ASSOCIATES LEGAL CONSULTANTS
1095/164 East Tower
Bangna Trad Road Km 3
Bangna
Bangkok 10260
Tel +66 (0)2744 3080 to 82, (0)2744 0941
Fax +66 (0)2744 3080 to 82 ext 22
Email: skulthun@loxinfo.co.th
Members:
MR WATTANA KREEPANIT, Attorney
MRS PARICHAT SUNGPUAK, Attorney
MR SOMCHAI YUANGKARN, Attorney
General Practice, Litigation both Criminal and Commercial of domestic and international laws and Consultation
English speaking lawyers
*
A list of Lawyers
LAW SOCIETY OF THAILAND
7/89 Building 10, Rajdamnoen Avenue, Phra Nakorn, Bangkok 10200
Tel + 66 (0)2629 1430 www.lawyerscouncil.or.th/
(Monday – Friday at 0900 – 1600 hrs)
BANGKOK LAWYERS
CRIMINAL, FAMILY (AND COMMERCIAL WHERE INDICATED)
BANGKOK LEGAL ASSOCIATES LIMITED
ITF Tower II 17th Floor
140/38 Silom Road
Bangkok 10500
Tel +66 (0)2231 6096 to 8
Fax +66 (0)2231 6099 and 2231 6976
Email: blalaw@hotmail.com
Members :
MR PUTTRI KUVANONDA Attorney-at-Law
MR VORATHUM JIRANANDA, Attorney-at-Law
MR SAROJ PATTANARACH, Attorney-at-Law
MR PRASERT SANGWAREE, Attorney-at-Law
General Practice, Litigation both Civil and Criminal, Consultation
English speaking lawyers
MARUT BUNNAG INTERNATIONAL LAW OFFICE
Forum Tower, 22nd Floor
184/130 – 136 Ratchadapisek Road
Huaykwang
Bangkok 10320
Tel +66 (0)2645 2556 to 67
Fax +66 (0)2645 2568 to 69
www.marut.th.com
Email: marut@loxinfo.co.th
MR RUJIRA BUNNAG, Attorney-at-Law
General Practice, Litigation both Civil and Criminal, Consultation
English speaking lawyers
SINGH, KRIANGSAK AND SURACHAI LAW OFFICE
ITF Silom Palace Building, 28th Floor
160/686-688 Silom Road
Suriyawong, Bangrak
Bangkok 10500
Tel +66 (0)2634 0201 to 03
Fax +66 (0)2634 0204
Email: dgalegal@scoms.com
Partners:
MR KRIANGSAK NUNTASEN, Attorney
MR SINGH LEKHAKUL, Attorney
MR SURACHAI DANAITANGTRAKUL, Attorney
Provides general legal advice with emphasis on criminal and civil
litigation and commercial laws
English speaking lawyers
SIAM GLOBAL ASSOCIATES
Suite 606, Nai Lert Building
87 Sukhumvit Road, Klogtoey Nua
Vadhana
Bangkok 10110
Tel +66 (0)2650 3510 to 12
Fax +66 (0)2650 3512
www.sgalegal.com
Email: sgalegal@cscoms.com
Partners:
MRS CHANINAT LEEDS, Attorney at Law
MR CHATCHAI NA CHIANGMAI, Attorney at Law
MS ATCHARA INTARA, Attorney at Law
MS SAWITREE NGAKOM, Attorney at Law
General practice, Civil Disputes and Criminal cases
English speaking lawyers
SAKULTHUN & ASSOCIATES LEGAL CONSULTANTS
1095/164 East Tower
Bangna Trad Road Km 3
Bangna
Bangkok 10260
Tel +66 (0)2744 3080 to 82, (0)2744 0941
Fax +66 (0)2744 3080 to 82 ext 22
Email: skulthun@loxinfo.co.th
Members:
MR WATTANA KREEPANIT, Attorney
MRS PARICHAT SUNGPUAK, Attorney
MR SOMCHAI YUANGKARN, Attorney
General Practice, Litigation both Criminal and Commercial of domestic and international laws and Consultation
English speaking lawyers