Leasing Land for Commerce and Industry in Thailand by Foreigners

In general, a foreigner is allowed to lease land in Thailand for not exceeding 30 years with an option of renewal, but it must not exceed 30 years from the date of renewal. (Read here for more information about 30 year land lease in Thailand by foreigners.)

However, according to the Government policy under the Hire of Immovable Property for Commerce and Industry Act B.E. 2542 allows a foreigner who intends to lease land for commercial or industrial purposes is eligible to lease land for a maximum period of 50 years. A foreigner can choose either from leasing land not exceeding 100 Rai or more than 100 Rai (1Rai=4Ngan=1,600 Sq. m.).

Leasing land not exceeding 100 Rai, the rules and conditions are as follows:

  • The period of leasehold shall exceed 30 years but not exceed 50 years. Both parties may make an agreement to renew the contract but it shall not exceed 50 years from the commencing day of the renewal agreement.
  • The lease agreement must be made in writing and registered by the competent Land Officer at the Land Department.
  • The Lessor must hold the ownership of the land.
  • The right of lease can be used as security for performance of obligation by mortgage.
  • The right and duty of the lease are descended upon the heir and the lessee can sublease or transfer his/her right of lease to a third party unless otherwise agreed by both parties.
  • The registered lease of land by the competent Land Officer shall be located in either area of the followings:

–        The area specified by Town and Country Planning Regulations as for commercial or industrial purposes.

–        The Industrial Estate Zone provided by the Industrial Estate of Thailand Regulations.

  • Before the lease registration procedure, either of the following characteristics of a commerce or industry must be met:

–        For commerce, the investment value must be at least 20 Million Baht.

–        For industry, that can be granted a certificate of investment promotion by Investment Promotion Act.

–        For commerce or industry which benefits the economic and social of the country as declared by the Minister of Ministry of Interior and granted by the cabinet.

  • The type of commerce or industry which a foreigner can register for land lease must be followed with the characteristics of business permitted to foreigners under the Foreign Business Act.

Leasing land more than 100 Rai, besides the above mentioned rules, either of the following rules must also be provided:

  • Such operating commerce or industry shall increase value of exportation or support employment in the country.
  • Such operation shall never be operated in the Kingdom, unless otherwise inadequate.
  • Such operation shall incorporate modern of the production process or technology development.
  • Such operation shall highly benefit to the economic and social in the country as declared by the Minister of Ministry of Interior and granted by the cabinet.
  • In the case, a foreigner is a lessee, sub-lessee, or a transferee of lease, an investment value in an operation of such commerce or industry must be at least 100 Million Baht included the rental price. The total amount of money shall be brought as a foreign exchange into the Kingdom or withdrawn from the Foreign Currency deposit account or withdrawn from the non-resident Thai account.

Contact ThaiLawyers for assistance in leasing land in Thailand.