Short answer: Yes, a Thai company can legally own property in Thailand, and foreigners may hold up to 49% of the shares in such a company. However, using a Thai company solely as a vehicle for a foreigner to own land is considered illegal under Thai law.
Yes, a Thai company can legally own property in Thailand, and foreigners may hold up to 49% of the shares in such a company. However, using a Thai company solely as a vehicle for a foreigner to own land is considered illegal under Thai law.
Legal Framework
Under Thai law, land ownership is restricted to Thai nationals and Thai majority-owned companies. A company is considered Thai if at least 51% of its shares are held by Thai nationals. While foreigners can own up to 49% of the shares, the company must operate as a legitimate business entity, not merely as a proxy for foreign land ownership. The use of nominee shareholders—Thai nationals holding shares on behalf of foreigners—is illegal. If authorities determine that a company is being used to circumvent foreign ownership restrictions, they may order the sale of the property and impose penalties on the involved parties.Risks and Considerations
- Legal Compliance: The company must engage in genuine business activities and comply with all corporate regulations, including annual audits and tax filings.
- Ownership Control: Even with 49% ownership, a foreigner may have limited control over the company's decisions, depending on the share structure and voting rights.
- Government Scrutiny: Thai authorities have increased scrutiny on companies suspected of being set up solely for foreign property ownership, leading to potential legal complications.
Alternative Legal Options
If you’re a foreigner interested in property ownership in Thailand, consider these legal alternatives:- Condominium Ownership: Foreigners can legally own up to 49% of the total area of a condominium project.
- Leasehold Agreements: Long-term leases (up to 30 years with possible renewals) offer legal usage rights without land ownership.
- Usufruct or Superficies Rights: These grant rights to use or build on land owned by a Thai national.