Phuket Post :: Article :: LEGAL SENSE

Registration of Land and Property Transfers

It is important for Buyers and Sellers alike to understand that in a property deal the transaction has not necessarily completed if only the purchase price has been paid and the Buyer has moved into their new home. The legal transfer of the property will sometimes still need to be concluded and a considerable amount of forward planning prior to acquisition will be required to ensure that transfer takes place as agreed between the Buyer and Seller. It is worth noting that in some instances, a Buyer or Seller may be in breach of contract in failing to effect the registration of the transfer of the property on the agreed date unless the contract expressly allows a legitimate delay.

Villa Transfer

The land (whether freehold or leasehold) and the building erected upon it are subject to separate and distinct procedures and requirements in connection with the registration process. In order to register the transfer of a building, all of the relevant documentation must be prepared and lodged with the land office and a public notice must be posted for a period of thirty days prior to the completion of the registration of the transfer of the Building to the Buyer. This notice period provides the public with an opportunity to object to the transfer.

Lease Registration

The registration of a land lease also requires a 30 day notice period from the time that the application is submitted to the Land Office to the time that the leasehold interest in the land is registered to the Buyer.

Transfer of Land

Unlike the transfer of a building and the granting of a lease, the transfer of land does not require a 30 day notice period prior to registration. A transfer can take place in a day.

Synchronised payment and transfer date

The parties are likely to be under considerable pressure in the event that the purchase price is payable upon the date of the transfer. Often the Agreement between the parties will provide for sanctions against a party who cannot complete the registration of transfer on the agreed transfer date. Under such circumstances, the Buyer will not be willing to release the purchase price to the Seller until legal transfer has taken place and the Seller will not want to transfer title until they have received the Purchase price. A convenient way of avoiding the need for either party to succumb to unnecessary risk is for the Buyer to place the Purchase Price with a third party Escrow Agent subject to an Escrow Agreement on the condition that the purchase price will be released as soon as the transfer has taken place. An Escrow arrangement works to the benefit of both the Buyer and Seller (Please note that there is no specific law of Escrow in Thailand, however the principles of Escrow can be employed through private contract).

Documentation required to effect registration

Ordinarily, both the Buyer and the Seller must attend the relevant land office to effect the transfer. In instances where a building and/or lease are to be registered this means two trips to the land office. In order to avoid this, Buyer and Seller may provide a Power of Attorney to their lawyers allowing the lawyer to register the transfer on their behalf.

In circumstances where the Buyer is acquiring the property through an offshore company, certified copies of the corporate documents of the offshore company must be provided to the land office, with a certified Thai translation, together with minutes of the offshore company resolving to acquire the lease / building.

Desmond Hughes (Partner) and Christian Glanville (Associate)
Belmont Limcharoen
desmond@belmontlimcharoen.com
www.belmontlimcharoen.com