REALWorld Law

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

There is no restriction on granting a mortgage over real estate to foreign lenders but the registration approval is at the sole discretion of the registrar. The registrar can refuse the registration of a mortgage over real estate on the grounds that he believes that the borrower is a nominee of the foreign lenders. Evidence such as loan agreements and a money transfer certificate must be presented to the registrar in order to clarify the nominee issue.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

There is a mortgage registration fee payable at the Land Office on the registration date at the rate of 1 percent of the total mortgage amount, provided that the total fee may not exceed THB 200,000. Stamp duty may also apply in certain cases, ie if the parties wish the mortgage agreement to be an evidence of the loan or overdraft facility, such mortgage agreement shall affix stamp duty at the rate of 0.5 percent of the mortgage amount but shall not exceed THB 10,000.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

No. There is no such restriction in Thailand but the board of the directors of the company must give approval before a corporate entity can give valid security over its real estate assets.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

No.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

Yes, as specified by law. The Thai Civil and Commercial Code provides for preferential rights which can be generally divided into the following three categories:

• General preferential rights
• Preferential rights in movable assets, and
• Preferential rights in immovable assets

For each category, existing secured debt may be postponed to newly created debt according to a certain hierarchy. The law in this area is complex and specific advice should be sought.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

Yes, generally the foreign law will be respected.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

The holder of the unperfected security will not have a preference right over the secured property and they will be deemed normal creditors in relation to unsecured assets of the debtor.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

No.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

In order to enforce the provisions of the mortgage contract the mortgagee must notify the mortgagor in writing of the mortgagor's duty to perform his obligation within a reasonable time (such reasonable time shall not be less than 60 days from the date of the receipt of the notice) to be fixed in the notice. If the mortgagor fails to comply with the notice, the mortgagee may enter an action in court for a judgment ordering seizure of the mortgaged property and sale by public auction. In addition to this remedy, the mortgagee is entitled to foreclose on the mortgage subject to certain conditions; provided that if the mortgagor is not the debtor, the creditor shall notify the mortgagee in writing within 15 days commencing from the date of the notice to the debtor or else the mortgagee shall be relieved from the obligation to pay interest, indemnity or any ancillary arising from such debt from the subsequence of 15 days. The provisions of the Civil and Commercial Code also provide for the various rights and duties of the parties to such an agreement.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

Arrangements can be negotiated between the parties, unless otherwise prohibited by the law.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

No.

Last modified 19 Jul 2023

Is the concept of a trust or a split between legal ownership and beneficial ownership recognized?

Creditors are paid in the order in which security has been perfected, including cases in which a creditor holds the same security interest over the same real estate asset. The enforcement shall be in respective orders of date and time which the creditor's right thereof has been legally registered.

Last modified 19 Jul 2023