Ownership of Land in Thailand by a Thai Married to a Foreigner
There has been much debate in recent weeks as to the validity of land ownership rights of Thai nationals who are married to foreigners. The controversy stems from claims that any Thai nationals who are married to foreigners will be under scrutiny by the authorities at the Land Department. This is due to the fact their right to the ownership of their own home may be void if they are deemed as a nominee to their foreign spouse. This would be shown to be the case if the Thai national cannot prove they have sufficient funds within their control for the purchase.
History of Ownership Laws for Foreign Spouses
To give some context to this notion, when a Thai spouse purchases property in Thailand, the couple must give a joint written statement to the Land Department stating that the money for the purchase is the “separate property” or the “personal property” of the Thai national, as defined in the Thai Civil and Commercial Code. This, in essence, means that the foreign spouse would have no future rights or claims to this property. This regulation, in fact, has been in place since 1999 where a Letter of Declaration was issued by the Ministry of the Interior and is, therefore, not entirely a revelation. Many foreigners here who are married to Thai nationals are quite aware of this requirement.
Normally, all property acquired by a husband and a wife after marriage is considered “marital property” or “community property” and would generally be shared equally between the husband and wife in the event of death or divorce. Gifts to one spouse, however, are deemed as the spouse’s “separate property.” Again, it is well known here that the purchase of a property is regarded as the “separate property” or the “personal property” of the Thai spouse. This is not that unusual given the case that foreigners, except under certain conditions, cannot own land in Thailand.
Issue in Contention
So with this being the case, the question remains. Since it is considered a gift to the Thai spouse, it would appear difficult for the authorities to claim that the money used for the purchase of the property was given to the Thai spouse as a nominee. It seems impractical for any land official to determine whether such funds was indeed given as either a gift or deceitfully in order to own property.
Exceptions to Property Ownership by Foreign Nationals
The rule providing for full ownership of land by the Thai spouse applies to all Thai spouses of foreigners, even if the marriage occurred in another country or if the marriage is common-law.
The rule, however, applies only to land and there are several exceptions to this rule:
- Foreigners can own the buildings and physical structures on the land. This means that if a Thai and a foreign spouse are buying land with a house, the couple could work with a lawyer to give the foreigner rights to the house;
- Foreigners can own up to 49% of freehold rights to condominiums provided that several requirements are met; and
- A foreigner can own interest in land by using a number of registered instruments such as leases, superficies, or usufructs as appropriate.
Legal Rationale to this Law
Once again, the rationale for this rule ensuring that Thai spouses own 100% of the land exists because foreigners cannot generally own land in Thailand.There is a degree of xenophobia in Thailand when it comes to land ownership rights. This aspect is not in contention here as it is not uncommon in developing nations such as Thailand to be protective of their rights to land. The question, however, lies in the basic nationalistic right of a Thai citizen to own property in their own country despite who they may wish to marry.
As marriage is supposed to be a union of two persons, it is impractical to suggest that one spouse cannot cause benefit to the other as it may appear as if they are acting as a nominee.Indeed, the law in Thailand, in both the Civil and Commercial Code and the Land Code, allows and recognizes the concept of gifts to a spouse. Any notion which repudiates such right can only be found in exceptional circumstances such as, for example, undue enrichment cases. However, the mandatory requirement of signing the declaration letter at the Land Office stating that the property will belong in full to the Thai national would make such cases difficult to prove in any event. It would appear that at the end of the day, the Thai national will still own the land. As significant steps by the authorities have already been taken to ensure that this is the case, it would appear that the spirit of the Thai Land Code has not been circumvented in any way at all if a Thai married to a foreigner should wish to buy a property with funds gifted by their spouse.
Jennifer Erickson is an American Attorney working in the Bangkok office of Siam Legal International. Siam Legal publishes a Legal Guide to Thailand Real Estate
which can be downloaded from their website.