Foreign Land Ownership Laws in Thailand

Thai law states that foreigners cannot own land, they can own buildings only. If a foreigner wishes to acquire land he has 2 tried and tested options:

1. Set up a Thai limited company including Thai shareholders and purchase the land through the company. The foreign director(s) cannot own more than 49% of the shares. However, the foreign director(s) hold all the power because the company is structured so that the Thai shareholders (nominees) enter into legal power of attorney with the foreign director(s). The foreign director(s) is the only officer who can commit or bind the company in any contractual dealings. The directors shares are also preference shares and hold 10 times the voting rights of the nominal shares, giving the directors 90% of the voting power. The company owns the freehold of the land and the investor(s) is free to build on the land, sell or lease property and transfer their rights to next of kin.
2. An alternative to setting up a Thai limited company is for the foreigner to purchase a 30 year lease for the land. Options to renew the lease for 2 further periods of 30 years can be built into the contract. The contract can also include a fixed option to purchase the freehold once foreign ownership laws are revised.