Questions?
We reply within 24 hours, free of charge.
This is a typical situation assembled from practice. It does not describe a real matter: details are changed.
As a rule, a foreigner cannot own land in Thailand: Land Code section 86 reserves that right to Thai nationals unless a treaty says otherwise, and no treaty does, not even with the United States. Buying through a Thai company with nominee shareholders is a criminal offense, not a workaround. When a developer pointed a client toward exactly that setup, our lawyers showed him three lawful routes instead: a registered 30-year lease with superficies over the house, a usufruct on a genuine Thai owner's land, and, for much larger investments, a permit under Land Code section 96 bis. He chose the lease with superficies, and here is why.
The situation
An American retiree living in Phuket on a long-term visa found a plot in Rawai with a chanote, the strongest Thai land title, and wanted to build a retirement home on it. The developer managing the project offered a Thai company instead: two Thai shareholders the developer would supply holding 51%, the buyer holding 49% and the director's seat, with the buyer funding the purchase. The developer added that this was "normal for Americans" under the Treaty of Amity. Before paying a deposit, the buyer asked us how safe that was.
A note for US citizens: the Treaty of Amity doesn't cover land
A Treaty of Amity certificate is a route for business activities, not for land. The treaty does not grant land ownership rights: Land Code section 86 still blocks foreign land ownership regardless of nationality, and no treaty, including with the United States, grants that right today. A Treaty of Amity certificate can support a genuine business, but it does not turn a nominee land company into a lawful one.
Why the nominee company didn't work
A company where Thai shareholders hold shares on paper while a foreigner supplies the money and the decisions is a nominee structure, and it breaches section 36 of the Foreign Business Act for both sides: up to three years in prison, a fine of THB 100,000 to 1,000,000, or both. Directors can be held personally liable (section 41), the Land Department can order a forced sale of the land under Land Code section 111, and the company can be wound up.
The developer's plan likely would not have survived incorporation. Under DBD Order 2/2569, in force since 1 August 2026, incorporating a company with a foreign shareholder holding under 50%, or a Thai-owned company with a foreign authorised director, requires an Investment Explanation Letter, three months of bank statements for each Thai shareholder showing matching withdrawals, and a statement for the company's receiving account. The proposed funding arrangement would raise questions under DBD's source-of-funds checks. Separately, since 15 May 2026 the Department of Lands checks a buyer's source of funds once cash payment reaches THB 2 million or the appraised value reaches THB 5 million, and Phuket is a priority province for that check. We cover what the same checks mean for buyers who already hold land through a company in villas on nominee companies.
We do not set up structures like this, so we moved straight to the lawful options.
Three lawful routes
| Route | What it gives you | Who it suits | What to weigh |
|---|---|---|---|
| Registered lease plus superficies | Right to use the land for up to 30 years (CCC s. 540) and right to own a house on that land for up to 30 years or for life (CCC ss. 1410–1416) | Buyers building a home for themselves, with no family tie to the landowner | Both rights are registered at the Land Department; renewal needs a fresh agreement, since the Supreme Court does not uphold a pre-agreed "30+30+30" extension |
| Usufruct on a Thai owner's land | Right to use the land and take income from it for life or up to 30 years (CCC s. 1417 and following), recorded on the chanote | Families where a Thai spouse holds the land | The land genuinely belongs to the spouse, and the usufruct ends when its holder dies. If the spouse pays with the foreign partner's money, the Land Department may ask about the source of funds |
| Section 96 bis permit | Freehold title to up to 1 rai of residential land | Buyers investing at least THB 40 million in approved assets | Needs the Interior Minister's approval and is rarely used in practice; how long the investment must be held is set by ministerial regulation, which we check case by case |
The first route is an ordinary way to buy a villa or a house plot in Phuket: the right is registered at the Land Department, and the land itself stays with the Thai owner. A condominium unit within the 49% foreign quota under Condominium Act section 19 is also a lawful route to outright ownership; the quota is calculated by floor area, not by the number of units, and it does not apply to land. BOI promotion and a Foreign Business Licence exist for running a business, not for a private home.
What we chose and why
A usufruct did not fit: it works through a Thai spouse or another genuine Thai owner willing to grant it, and the buyer had neither. Investing THB 40 million for a section 96 bis permit was far more capital than he wanted to commit for a retirement home. The landowner, a Thai national unconnected to the developer's scheme, was willing to lease the plot long-term, so the buyer chose a registered lease with superficies, the same structure we cover in leasehold villa.
- We checked the chanote at the Land Office for mortgages, encumbrances, disputes and seizure.
- We confirmed the owner genuinely held the land and would lease it on market terms, with no loan, buy-back option or side agreement. Authorities judge these structures on substance, not on the contract's label: a lease really financed by the foreign tenant, with the Thai owner holding title only on paper, raises the same nominee flag.
- Our team prepared a bilingual 30-year lease and a separate superficies contract, naming heirs and successors directly, since sources disagree on whether a lease passes to heirs by default. We explain why a "30+30+30" clause does not guarantee extra years in the 30-year lease ruling.
- The buyer paid through the bank and kept the records for a possible source-of-funds question.
- We registered the lease and superficies at the Land Department. Local practice for registering these rights to a foreigner is not settled in our sources, so we confirm the procedure with the office before filing.
If your situation is similar
As a rule, a foreigner will not get outright title to land, but building a house and living in it lawfully is possible. The right route depends on family, the size of the investment and how long you plan to stay, not on what a developer calls "normal." No one can promise how a future check turns out or that a lease will renew after 30 years, which is why how the rights are drafted and registered now matters.
If you already have a draft lease or a developer's proposal, send it to us. Our review is free and takes up to 48 hours: our lawyers flag the clauses that could become risks and the questions to put to the seller. If a developer or agent proposes a Thai company with nominee shareholders, write to us before the deposit, and we will look at the proposal. We agree and fix the cost of consultation and registration support before work starts: [price].
Every lawful route to land is covered in land in Phuket for foreigners. If you already bought through a company, see the typical situation moving off a nominee structure.
