Domestic / cross cultural issues - Thai / Foreigner concerns

Land purchase through Thai spouse forbidden: Land Dept

By Suttisan, Created on: 28/05/2009, Last updated on: 02/10/2016

» -- Land purchase through Thai spouse forbidden: Land Dept The director general of the Land Department has reiterated that foreigners using Thai nominees to buy land anywhere in the country will have their land title deeds revoked if caught – even if the nominee in question is a lawfully wedded...

• Krumm commented : Ian, A Thai lawyer told me that one of his foreign clients recently set up a company 100% owned by Thai nominees and then tried to use it to buy land. The Land Dept officer quizzed the company's managing director who went to do the transfer about the nature of the company's business and why it wanted to buy a residential property immediately after incorporation and before starting any business or setting up an office. Since the nominee MD couldn't answer the questions the land officer refused the transfer on the grounds that it was probably on behalf of a foreigner, even though the company had no foreign shareholders, directors or employees. If they want to get tough on Thai registered or unregistered spouses they do the same and refuse any transfer which is suspected to be on a behalf of a foreigner and put the burden of proof on the purchaser. There is already a procedure for checking up on assets and income of Thai shareholders of suspected nominee shareholders. That could be extended to cover Thai women married to foreigners or suspected to be buying on behalf of foreigners. For example, a 22 year old with an Isaan accent coming into a Land Office in Phuket to transfer a million dollar home with an infinity pool would be a dead ringer for an investigation. If she has no income or assets apart from the purchase price recently arrived in her bank account, then it doesn't matter how many layers of transactions the money has been laundered through, the transfer could be refused. For me the "Letter of Confirmation" gets the Land Dept where it wants to be over this. There is certainly a legal justification for investigating suspicious purchases by Thai women who fail to disclose a foreign other half through the "Letter of Confirmation". However, going after those who have declared themselves and signed the form which guarantees the property remains Thai owned would really be madness and would also be highly questionable on constitutional grounds. It was due to the 1997 constitution that Thai women married to foreigners were given the right to buy land in the first place. So it would be retrogressive. Interestingly the Land Code has never specifically denied Thai women married to foreigners the right to buy land. That injustice was inflicted via ministerial regulations.

• Krumm commented : Charlie, An interesting but somewhat confusing and not totally correct reply from the Phuket land officer. This is the first time I have seen the suggestion that using funds from a joint account is OK but from the Thai spouse's own account is not OK. It would seem that signing the agreement where the foreign spouse waives all rights the the land should suffice wherever the funds come from. The joint account concept seems to be worse for what the Land Dept hopes to achieve because it makes it easier argue that it was indeed joint property, bearing in mind that, under the Civil and Commercial Code and legal agreement between a husband and wife can be voided. The Land officer is quoted as saying that the only way a foreigner can own property is "through the 40% condominium rule". As far as I know this is 49% not 40%, although it was 40% for the first few years of the Condominium Acts life. In addition it is simply not true to say that foreigners can only own land this way, even though the exceptions are limited in nature. Foreigners can own land through BOI privileges and by bringing in B40 million and investing it in approved investments (excluding the property).

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