Can foreigners even now individual land or a condominium unit outside of the international possession quota with a Thai limited company in Thailand? In new restrictions issued by the Thai governing administration (starting off in May well 2006) this circumvention of the law by foreigners is no longer disregarded by the Thai governing administration.
Thai law permits the obtain of land or condominium by a partly international owned Thai company so long as the highest international shareholding does not exceed 49%. Foreigners are below Thai law as a minority shareholder authorized to control a Thai company that owns immovable house and for that reason you could argue that foreigners can have a form of freehold possession or control more than house that would usually be limited for international possession (land or a condominium unit outside of the international possession quota).
Even though house possession by a partly international owned Thai company is a this kind of not unlawful below Thai law the Thai governing administration is limiting and discouraging the misuse by foreigners of Thai companies to circumvent house possession limitations in Thailand. The Thai governing administration has issued suggestions and regulation that should be utilized by the community land workplaces when they are working with a partly international owned company.
Ahead of the land place of work suggestions issued by the Land Section and Ministry of Inside starting off in May well 2006 it has been widespread practice for foreigners to individual house via Thai limited companies. Currently this is much fewer widespread and foreigners who want to form a company for house possession will usually have to circumvent the land place of work restrictions and have the shares in the company only registered in their identify soon after the house is registered to the ‘holding’ company (this to protect against investigations into the Thai company and shareholders by the Land Section when registering the house). Less than the recent land place of work suggestions, when a partly international owned company is registering house (land), the Thai shareholders in the company should be investigated by the land place of work formal right before registration and transfer to the company is authorized (i.e. is it a serious company or established up to circumvent the law and are the Thai shareholders in the company serious shareholders or acting as nominees on behalf of a foreigner).
Current partly international owned (up to 49%) Thai house holding companies are usually disregarded by the Thai governing administration but the key negatives the foreigner should be informed of are:
1. The objective of a company may well not be to circumvent international house possession limitations in Thailand. This would be an unlawful objective, creating the entire lawful established up and registration into the firm’s identify void below the Civil and Professional Code and unlawful below the Land Code Act. The company should have a business objective and be in operation as a standard company and file annually stability sheets and suitable accounting (i.e. the company can below Thai law not be a ‘special objective company’ or ‘land holding company’ for the foreigner)
two. Foreigners are not authorized to use Thai nominee shareholders in the company. In accordance to the recent suggestions ‘real shareholders’ are about defined as Thais with sufficient revenue and believable money heritage and position, have an employment heritage and they should be in a position to evidence this at the Land Section (investigation into the company and Thai shareholders only usually takes location at the land place of work when registering the house or transferring the house).
three. Every time registering lawful acts (e.g. advertising the immovable house) at the Land Section the land place of work formal should investigate the Thai shareholders when it appears to be a partly international owned company, even if the foreigner is eradicated from the up-to-date shareholder list but appears on the Memorandum of affiliation this investigation is below the most recent restrictions expected.
Foreigners who make a decision to go the company route with further house possession in mind (land, land and residence or condominium) must be encouraged by a Thai lawyer with encounters in business and house law. Too typically foreigners who established up companies to individual house are not appropriately encouraged and stop up with complications at the Land Section when registering the house for the reason that of mistakes made by an inexperienced lawyer.
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