The Civil and Commercial Code recognizes all kinds of leases. It is more of an issue of whether the lease is enforceable, rather than the form of the lease. In general, a lease of immovable property is not enforceable by a cause of action unless some written evidence signed by the party liable exists. If the lease is for a term of more than three years, it is enforceable only for three years unless it is made in writing and registered at the relevant governmental authority.
Last modified 19 Jul 2023
The duration of the term depends on commercial considerations. The Civil and Commercial Code only requires registrations of a lease if the lease term is more than three years. It should be noted that the maximum term for a lease is 30 years, with an option to renew for another term of 30 years.
Last modified 19 Jul 2023
Yes. The Lease of Immovable Property for Commercial and Industrial Activities Act B.E. 2542 applies to leases of commercial and industrial immoveable property. Under this Act, the lease term for a lease of land for commercial and industrial activities can exceed 30 years but must not exceed 50 years, subject to certain requirements.
The key requirements are as follows:
The lease term may exceed 30 years but not exceed 50 years. Upon the expiration of the lease term, the parties may make an agreement to renew the lease, but the new term is not to exceed 50 years from the date that the parties agreed on the renewal.
The land must be located in one of the following areas:
Note that the type of commercial or industrial activities for which a foreigner can apply for registration must be one which a foreigner can undertake under the Foreign Business Act.
The lease of land for commercial and industrial activities with an area more than 100 rai (one rai is 160,000 square meters) must comply with one of the following additional requirements:
Last modified 19 Jul 2023
In general, under the relevant laws, after expiration of a commercial lease, the tenant will not have a right to continue to occupy the relevant real estate. However, if the tenant continues occupying the relevant real estate with no objection from the landlord, it shall be deemed that the lease is extended with no definite period. This matter is a contractual issue and subject to the agreement between the contracting parties.
Last modified 19 Jul 2023
Contractual protections are generally used. The agreement should include a provision that provides that after expiration of a lease term or if the lessee is in breach of material terms of the lease contract, the landlord can enter into or occupy the relevant real estate. In the absence of such a provision, the landlord will bear the risk of being challenged and accused by the tenant of trespassing.
Last modified 19 Jul 2023
This issue is a contractual matter. It depends on negotiation between the parties to the contract.
Last modified 19 Jul 2023
Yes, in certain cases, such as eminent domain, where the leased property may be expropriated by the relevant government authority. If the property is taken, the lease may be terminated as the landlord no longer has any property to be leased. If a property is expropriated, the compensation will be paid to the owner of the leased property (eg if the leased property is land, compensation will be paid to the landowner; if the leased property is a building, compensation will be paid to the owner of the building).
Last modified 19 Jul 2023
In general practice, a landlord often asks a tenant to provide a security deposit or a letter of guarantee. The security deposit or guarantee will normally be returned to the tenant when the lease term expires.
Last modified 19 Jul 2023
Restrictions can be imposed by relevant provisions in the lease, as well as by relevant laws (ie the Condominium Act and the Civil and Commercial Code). For example, under the Civil and Commercial Code, any use of the leased property that is unlawful or contrary to public order or the good morals of the people of Thailand is prohibited.
Last modified 19 Jul 2023
This matter is solely a contractual arrangement between the parties.
Last modified 19 Jul 2023
This matter is solely a contractual arrangement between the parties.
Last modified 19 Jul 2023
This matter is solely a contractual arrangement between the parties. Both fixed and variable rent are commonly used in Thailand.
Last modified 19 Jul 2023
This matter is solely dictated by the contractual arrangement between the parties and commercial considerations. Economic situations often dictate changes and variations in rent amounts.
Last modified 19 Jul 2023
No. VAT is charged on goods and services only.
Last modified 19 Jul 2023
In general commercial practice in Thailand, a ‘rent premium fee’ is often payable by the tenant.
Last modified 19 Jul 2023
This arrangement depends on the type of lease and negotiated terms. For example, for a condominium unit, an owner is required to pay a common fee for the use of common property. However, this burden can be shifted to the tenant by way of contract.
Last modified 19 Jul 2023
Under the Civil and Commercial Code, it is the tenant’s duty to undertake ordinary maintenances and petty repairs. This matter is, however, agreeable upon by contractual arrangement between the parties.
Last modified 19 Jul 2023
This is a contractual arrangement between the parties. Parties often allocate this responsibility so that:
Last modified 19 Jul 2023
This is a contractual arrangement between the parties to the contract. The normal events causing damage which are insured against are fire, flooding and other force majeure events. An all-risks insurance policy is generally used to mitigate against these risks.
Last modified 19 Jul 2023
What is the usual length of each type of commercial lease?
The duration of the term depends on commercial considerations. The Civil and Commercial Code only requires registrations of a lease if the lease term is more than three years. It should be noted that the maximum term for a lease is 30 years, with an option to renew for another term of 30 years.
Last modified 19 Jul 2023