We can help you through the formalities of acquiring properties or businesses in Koh Samui.
Company set up
Concerning the way to purchase Thai "Land" there is two options :
You basically register a lease under the Thai law for 30 years on the land title deed.
The "Land" can be purchased by a foreigner as leasehold. The land lord will lease the land to the purchaser for a period of 30 years with an option to extend, for a further two 30 year periods to give effectively a 90 year lease. To be noted that only the first 30 years can be registered at the land office. Good leasehold contract should include a clause which stipulate that if the land law in the Kingdom of Thailand changes, making a freehold option available, the title may be converted from leasehold to freehold at the leaseholders request.
It is needed in order to buy land freehold to create a Thai Limited company who will own the Land Title deed and you as a Manging director you control the shareholding.
Under Thai law a foreigner may not own the freehold to land, however, a freehold title for a building which sits on the land can be purchased. The foreigner can create Thai company limited (Co.,Ltd) where they can own 49% of the shares, the other 51% must be owned by genuine Thai investor with a a ratio of two Thai for one foreigner, often the Thai don’t have the same amount of voting rights, foreign investors then control the company. That done the property can be placed under the control of that company and therefore controlled by the foreign director.
In any case you must comply and satisfy Thai laws. This is why you must in any case seek the advise of a Lawyer who will clearly explains you all your available options before any decisions. If you don’t have any contact please feel free to ask us a list of recommended lawyer.
Note:Thai Government may check the funding into the 51% of the Thai shareholder make sure it is clear where did your shareholder got the funding, you may as a foreigner in accordance with your lawyer and Thai law loan the money to the 51% under a "Loan agreement" making clear how could your shareholder did invest in the capital of the company, the common capital for a limited company is 2,000,000 Bath therefore your shareholder may justify of 1,020,000 Bath though that loan
The use of nominee Thai shareholders is prohibited under the Foreign Business Act (1999).
What are the title Deeds in Thailand ?
Chanot or Nor Sor 4
The Thai word ’chanote’ means title or title deed
The official classification for this land title is N. S. 4 J. The chanote document ranks highest of all land title documents. It gives proof of freehold (not only possession) of a certain plot of land. Every person who is registered on this document has a legal title on the land (ownership, but also other titles, e.g. mortgage, can apply).
The chanote document is issued in Thai language.
How does a Chanot land title look’s like :
This document usually is issued on a single page of paper with content on both sides.
The symbol of the Thai Nation on top of the front-side, is imprinted in red color.
All these documents show the word ’chanote’ in the headline, and, in addition in newer documents, the official classification, N. S. 4 J., appears on the top, right hand side. The front-side includes name and address of the landlord,
The land size (in rai, ngan and tarang-wah),
A map of the land (north-oriented) with all boundary-markers and its numbers, plot-numbers, and the scale of the map.
The original scale of the map is often 1:1,000; however, the map in the document might be displayed in another given scale.
The back side side of the page includes chronologically all legal changes, such as. the name of the new landlord when the land was sold, a person or bank granting a mortgage, a lease-holder (if the owner leased out his land for 30 years), or usufruct ray for life.
Nor Sor 3 Gor or Nor Sor 3 Kor
The N. S. 3 K. document is a high-ranking land title-deed. It is a document for the right of the possession and use of a certain land for a certain person, and includes the right to be sold, leased, and can be used as mortgage collateral. In a strict sense, it is not a true title-deed, rather a land exploration testimony, but you can deal with it in almost the same way as a chanote document. It is also possible to apply at the land office for an upgrade to a chanote document.
The N. S. 3 K. document is issued in Thai language. It looks like a chanote document and consists of a single sheet of paper. The symbol of the Thai Nation, centrically on top of the front-side, is imprinted in green color. The headline reads as ’nung-seu rub-rong gahn-tum-pra-yoht’ and means ’Document for having obtained a title’ or simply’ title’. It does not contain the word chanote. The official classification (N. S. 3 K.) appears on the top, right hand side. The front-side includes name and address of the land¬lord, the land size (in rai, ngan and tarang-wah), a map of the land (north-oriented) with all boundary-markers and plot-numbers, and the scale of the map. The original scale of the map is 1:5,000; how¬ever, the map displayed in the document might be reproduced in a larger scale, e.g. 1:1,250. The reverse side of the document includes chronologically all legal changes.
Land with this title was surveyed decades ago by an old method which was not as precise as a modern method (GPS-based) nowadays in use. The geographic position is often determined by aerial survey photography. One should expect to get a roughly defined boundary (of a few meters) of a certain plot, rather than a precise one, especially when border poles cannot be found.
Nor Sor 3
The land with Nor Sor 3 title Deed as not been measured by the Land office of Koh Samui, boundaries are not exact and may be more or less 5% different. This title can be upgraded to the Nor Sor 3 Gor , and then to the Chanot
To be noted that only the Chanot and the Nor Sor 3 Gor can be mortgaged by the bank