some bad news for Farang house owners

[Faustian]

One wonders if his comments were directed to certain individuals who own land in Phuket. Quite a lot of farang do, via Chanote title deeds, you can acquire plots fairly easily but the price is prohibitive! One wonders if certain powerful individuals have designs on acquiring some more of this land for a knockdown price....

[unit731]

Hi,

 

"Adopt more sensical laws that allow foreign ownership of land in Thailand (limits could be allowed)."

 

Right. Limited purchase to a max of 1 rai, within city limits for residential purposes only. That would likely sort out 99% of farangs wanting to buy a house here.

 

As you said though, ain't gonna happen.

 

Sanuk!

 

 

I wonder how this is approached in other destinations such as Costa Rica or Panama. Lot's of US/Canada people going to Costa Rica and Panama. Do they have ownership of homes.

 

I had an aquaintence obtain a deeded piece of property in a development in Baja Mexica. The brochure looked beautiful. One thing, though, the land was owned by the Mexican government with a 30 year lease. My acquaintence still has the deed in his filing cabinet and has no plans to do anything with this land.

[ThaiHome]

Here's what the Phuket Land Office said last Friday

TH

 

Link

 

How can I legally purchase property for a Thai spouse?

Having read the recent article in the Gazette about foreigners not being allowed to use their spouses to purchase property, [Phuket Gazette, May 31, â??Land chief warns foreigners against buying land using Thai nomineesâ?Â] Iâ??m left wondering how it is possible for me to buy my wife a house here in Thailand?

 

In the country where we were married, the law of the land states that all of the money we have is now â??ourâ? money, rather than simply mine or hers.

 

Given this state of affairs and this apparent new legislation, is it now impossible for us to purchase a house in Thailand?

 

Graham Rance,Singapore/UK Friday, June 5, 2009

 

â??As your wife is a Thai national, of course she is able to purchase property here in Thailand. If she has her own account, but doesnâ??t have the necessary funds, then you cannot use her as a nominee and use your own money. Such an action would see your land title revoked.

 

Should you decide to move forward and purchase a property together using funds from a joint bank account established either inside or outside of the Kingdom, you and your wife will have to sign an agreement stating that the house lawfully belongs to her.

 

In the event of a divorce, you waive all rights to a share of the property.

 

Under Thai law, marrying a Thai national does not grant you an entitlement to property accrued during your marriage.

 

The only way for a foreign national to purchase property in Thailand is to do so under the condominium 40% rule, which allows foreign nationals the right to own a total of two fifths of the floor space of a condominium development.

 

In summary, you and your wife may purchase a house in Thailand, but it can only be registered in her name. Should you divorce, you will be entitled to nothing.

 

For more information on all property-related laws, contact the Phuket Provincial Land Office at 36 Damrong Road, Muang, Phuket 83000. T: 076-212103 F: 076-212103.â?Â

 

Friday, June 5, 2009 A Phuket Provincial Land Officer

 

[ThaiHome]

Someone from TV did some serious research has come up with following.

 

Here is the Link to the Dept of Land website.

Go to 'English Language Information' about half-way down on left hand side, then open item no. 1 which is in English.

 

TH

 

 

I have gone through the English information of the website of the Department of Land (thanks Burgernev, I previously missed that link halfway down on the left )!

For those interested, this post describes how to reach the page with the English translations of pretty much every law affecting foreigners on land ownership.

 

I will not copy the entire texts, rather the parts of importance, directly affecting pretty much everything discussed in this thread!

 

 

QUOTE

3. Application for ownership in land by a Thai national who has an alien spouse or ex- spouse or by a Thai national who is a minor child of an alien

 

3.1 In the case where a Thai national who has an alien legitimate spouse applies for permission to purchase land or accept a transfer of land in a similar case during marriage or cohabitation as husband and wife with an alien, as the case may be, if after the inquiry the applicant and the alien spouse have given a joint written confirmation that the money which that Thai national will expend on the purchase of the land is wholly the separate property of that Thai national and not the community property or the jointly acquired property, the competent official will proceed with the registration of rights and juristic act.

This is in my opinion a little bit dubious, in that they specifically write that it should be the money of the Thai partner which will be spent on the property.

However, the standard form used by the Department of Land (DoL) does not mention funds, but only specifies that the property will remain the sole property of the Thai partner. But if you will read further down, they have a specific rule allowing the Thai partner to accept land as a gift!

 

 

QUOTE

In the case where a Thai national whose spouse is an alien intends to purchase land or condominium unit but fail to give a joint written confirmation to the competent official as the alien spouse is being abroad, in this instance, an alien spouse shall make the statement declaring in written at the Royal Thai Embassy, Royal Thai Consulate or Notary Public that the money which that Thai national will expend on the purchase of the land or condominium unit is wholly the separate property of that Thai national and not the community property or property which an alien spouse has co-ownership in it. The competent official shall declare that the alien is an actual spouse of the Thai national and then submit to the competent land official who will proceed with the registration of rights and juristic act.

Allows the foreign partner to sign the paper at a Thai consular post if he is not in Thailand, negating the need for him to be physically present in Thailand.

 

 

QUOTE

In the case where a Thai national whose spouse is an alien, after marriage, has already purchased or possessed the land and informed or submitted a false document declaring the married status of a Thai national as single or had not been married to an alien to the official prior to the date the letter of Ministry of Interior, most urgent no. MOI 0710/wor 792 dated 23 March 1999 was issued, or has already purchased or possessed the condominium unit after marriage and informed or submitted a false document declaring the married status of a Thai national as single or had not been married to an alien prior to the date the letter of the Department of Lands no. MOI 0710/wor 34167 dated 6 October 2000 was issued, such alien spouse, whether legitimate or illegitimate, and a Thai national shall together give a joint written confirmation, which later to be filed in the case-list (or dealing package), to the competent official that the money which that Thai national will expend on the purchase of the land or the condominium unit is wholly the separate property of that Thai national and not the community property or jointly acquired property. If an alien spouse is being abroad and not be able to come to give a joint written confirmation to the competent official, in this instance, the application shall be considered in accordance with the case that a spouse of a Thai national who intends to purchase land or a condominium unit is being aboard, then an applicant shall consign the statement, after completion, to the competent land official for filing in the case-list.

Now this is quite important, as many of our members have asked what to do if they did not sign this paper, or as the above states, if they have bought the land before the March 1999 issued ministerial order. It states clearly that the couple still can file this statement and that the competent land official will update the case file on that particular piece of property accordingly.

 

 

QUOTE

3.2 In the case where a Thai national who has an alien spouse, whether legitimate or illegitimate, applies for permission to accept a gift of land during marriage or cohabitation as husband and wife. If the inquiry reveals that the acceptance of the gift is made with the intention that the land will become the separate property or personal property of the donee without resulting in the alien having co-ownership in the land, the competent official will proceed with the registration of rights and juristic act.

Another important one. This rule clearly states that the Thai partner can accept land (or assumingly the funds to acquire that land) as a gift, and that the competent land official will proceed with the registration if the land will become the separate personal property of the Thai partner. Which would only need to same statement to be signed...

 

[Khun_Kong]

Let's start applying this law immediately!

 

How about all of the farangs who "bought" a house in the wife's name, only to be scammed by her leaving and taking the property, turn themselves in for violating this "law". He's never going to see the land himself anyway. Might as well strip it from the thieving cunt and her family.

 

 

[ThaiHome]

That only makes the point the wife is not a nominee since obviously the husband has no actual control on the property.

 

By the way, that is what a nominee is, a person who owns something in name only and does not actually control it. The control is exerted by means of another contract (often undisclosed) in which the nominee is prevented from executing his titular duties. This is most often done by having undated letters of resignation.

 

TH

 

[cavanami]

Waaaaaaay too much legal eagle...I would hope that LOS can make it simple...a Thai can own land in country X, then a citizen of country can own land in LOS...simple and easy!

[Gadfly]

that is what a nominee is, a person who owns something in name only and does not actually control it.

 

Applying this definition, a Thai is a nominee when he rents land to a foreigner. When land is rented to a foreigner, that foreigner exercise control over that land even though the land is in the name of the Thai landlord.

 

This specific situation fits your definition exactly. And yet Thai law permits foreigners to rent land. There is an obvious problem with your definition of the term "nominee" - it applies to situations that are indisputably legal in Thailand.

 

There is an even more fundamental problem with the very concept of "nominee" in Thai law. You won't find a definition of the word "nominee" in any provision of Thai law relevant to land. If you claim otherwise, tell us all where in the Thai Land Code the term "nominee" is defined.

 

Even better, tell us all where the term "nominee" is even used in the Thai Land Code. You can't do either because the term is neither defined nor used in the Thai Land Code.

 

This exact same issue came up when the appointed National Legislative Assembly (NLA) tried to make the Foreign Business Act (FBA) more restrictive. Foreign ownership has always been defined in in the FBA (and the prior Alien Business Law) in terms of ownership of shares without any reference to control whatsoever. The definition of an "alien" company was absolutley clear on this point.

 

And Thai law allows shares to have different voting rights. For the past 35 years tens of thousands of companies have been set up where foreigners were allowed to exercise control over those companies even though they operated in areas restricted by the FBA. They did so through superior voting rights.

 

In an act that would have divested tens of thousands of foreign companies of their holdings in Thailand (including many brand name companies that employ tens of thousands of Thais), the NLA sought to change the definition of an alien company to mean "control". If a foreigner controlled the company, the Thai was a nominee and the arrangement was illegal.

 

Sound familiar?

 

The problem was and is that Thai law doesn't say this. It never has.

 

The NLA responded by saying they were merely trying to enforce the FBA against foreigners who were violating the FBA. But that response was easy to rebut: if these foreigners are already violating the FBA, why do you need to change the law?

 

If these arrangement aren't legal under exisiting law, why does the law need to be changed. Simply enforce the exisiting law if these arrangements are really illegal.

 

There are serious problems with making this sort of changes to Thai law. Not only does it represent a taking of property, but it scares off investors.

 

Moreover, "control" is not a simple concept. If I am bank, and lets make this a foreign bank to make it more interesting, when I lend money to a Thai (or anyone else for that matter), there will be terms in the loan agreement that prohibit the borrower from doing various things. For example, the borrower will be prohibited from transferring all of his assets without receiving fair consideration in return.

 

In a joint venture agreement, there will be restrictions (control) imposed on the local partner. He cannot, for example, transfer all of the company's assets to his cousin. Is Thai law now going to say that this sort of restriction is illegal?

 

More sober minded Thai leaders saw this problem, and we can thank them for preventing this change to the FBA. Actually, this is not just a matter that concerns foreigners. All Thais can and should thank them for preventing what would have been a disaster for Thailand.

 

The Director-General's interpretration of Thai law, at least as quoted in the Phuket Gazette, would be equally disastrous for Thais and Thailand. Indeed, Thais would fare wose than foreigners.

[ThaiHome]

Your first paragraph is so wrong I'm not even sure how to start.

 

I also see that you did not address my post where a Phuket Land Dept official responded to the issue of a Thai wife directly purchasing land nor did you address the following post that quoted the translations of the actual land dept regulations.

 

You keep going on and on about defining â??nomineeâ? under Thai law. Does US law define a bank robber? Does it say it is illegal to be a â??bank robberâ? No, it says it is illegal to go into a bank and take money by coercion or force. In the law, the term â??bank robberâ? is never used; nevertheless, everyone knows what a â??bank robberâ? is. Thai law does not define â??nomineeâ?Â, it does not say it is illegal to be a â??nomineeâ?Â. What Thai law does is say what a Thai person must do to show evidence of their source of capital when registering a company where a non-Thai person holds significant, but less then a majority shares, but acts as authorized director. Not being able to do this might cause a Thai person to be called a â??nomineeâ? and the company to be possibly considered illegal.

 

The rest of your post was the same old rant about proposed changes to the FBA (that were never enacted) that you have been doing for years now. During those years you have been ranting, foreign companies have continued to invest in Thailand and have continued to make lots of money. Just like today, where there are Thai wives buying and registering land without the Thai wife having to show the money did not come from the husband.

 

TH

 

[Gadfly]

Your first paragraph is so wrong I'm not even sure how to start.

 

In other words, you are unable to respond. I simply took your own definition of a nominee and applied it to a common situation that we all know is perfectly legal in Thailand. When you do this, it becomes perfectly obvious that your definition simply does not work.

 

There is no rant here. And you shouldn't take it personally because it has nothing to do with you. All of these regulations and pronouncements about ending illegal nominee ownership of property by foreigners suffer from a very fundamental problem.

 

The concept of nominee ownership of land doesn't exist under Thai law. There are two ways to demonstrate this.

 

First, Thai land law never once refers to nominee land holding. You cannot find a definition of the term "nominee". I see your excuse about why you cannot point to a defintion, but don't agree with it.

 

But there is another more fundamental problem: if Thai land law really outlaws nominee ownership of land, you should at least bea able identify a specific provision of the Thai Land Code that refers to nominees, right?

 

Using your bank robbery example, you can certainly point to laws in the U.S. that make bank robbery illegal. You can that in Thailand as well.

 

Now, try this same exercise with illegal nominee ownership of land. You won't be able to do so. Why? Because Thai law does not even recognize the concept of nominee ownership.

 

Second, nominee ownership only exists where there is a recognized distinction between beneficial and real ownership. Thai law doesn't recognize this distinction (outside of very recent changes to Thai securities law (which occurred in the last two years).

 

When officials here get incensed over foreign control of land and businesses, and promulgate regulations to address this "problem", they start complaining about illegal nominee ownership, but skirt over the fact that Thai law doesn't even recognize the concept of a nominee.