Tax & Legal News Flash | Issue 35
On 9 January 2018, the Thai Cabinet approved, in principle, the Bill on Sub-Ing-Sithi (the “Bill”), which governs a new type of real property right called ‘Sub-Ing-Sithi’ proposed by the Ministry of Finance in order to create an alternative legal right to use real property in a new form in addition to the ownership and leasehold rights which could create investors’ confidence to invest in Thailand and to facilitate their use of real property right.
Under the leasehold right, there are some limitations under the applicable laws (i.e. the Civil and Commercial Code (“CCC”) in case of general lease, and the Act on the Lease of Immovable Property for Commercial and Industrial Purposes (“Act”)) which could hinder the maximum utilization on real property from an economic aspect.
For example, the lessee’s right under the CCC is exclusive to each lessee. Therefore, the lease would be terminated upon the lessee’s death and may not be freely transferrable. In addition, such leasehold right under the CCC could not be used as a business collateral, while the Act is applicable to the lease for the commercial or industrial purpose only.
|Grantor of Sub-Ing-Sithi
|Registration of Sub-Ing-Sithi||
|Legal rights of Grantee of Sub-Ing-Sithi (without having to obtain consent of the grantor of Sub-Ing-Sithi)
|Duty of Grantee of Sub-Ing-Sithi||
The Bill will proceed with further necessary steps before becoming an enforceable law.
We welcome any opportunity to discuss the relevance of the above matter upon request.
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