In a bid to encourage Foreign Direct Investment and to reinvigorate Thailand’s Property Industry, the Finance Ministry is considering amending the laws governing land leases. The proposed amendments and changes according to Finance Minister Apisak Tantivorawong, would aim to increase leasehold terms up to 50 years and grant transfer rights.
Currently according to Thai Property Law:
– Foreigners are only allowed ownership of freehold condominium units (Provided foreign quota of 49% is available)
– Foreign Nationals cannot own land in Thailand; however they may take leases for up to a maximum of 30 Years (For Residential Purposes)**According to the Lease of Immovable Property for Commercial and Industrial Purposes Act BE 2542 (1999) maximum leases of 50 Years are granted for industrial and commercial purposes.
This is an interesting legal development, as traditionally land ownership by foreigners has been perceived as a hot button topic in Thailand. The reasons for denying foreigners the right to own land can be described as a mixture of both economic protectionism and local social convention.
While condominium, apartment and villa developers have for years developed a series of exotic strategies to overcome this ownership hurdle. It is important to note, that these strategies sit in the grey-area of the Thai Legal System.
Therefore this proposed re-evaluation of leasehold rights has been well received by the Thai real estate industry. While still restricting outright ownership of land, these proposed changes would be the first step in relaxing the currently rigid property ownership framework for foreign national/entities!
Source: Bangkok Post, 25 March 2017
