REAL ESTATE
Thailand’s Land Code
By Thailand Property Report
Mar 5, 2006, 02:41

The Thai government has made changes to the country’s land code that will have an impact on real estate development, says law firm Johnston Stokes & Masters (JSM).

The firm says Cabinet has approved the repeal of certain provisions in the Land Code in order to avoid the duplication of laws, which means that business operators who wish to engage in land allocation will no longer be required to apply for both a real estate business licence under the Land Code and a land allocation licence under the Land Allocation Act.

To date, although the Land Allocation Act already covers the business of land allocation in Thailand, business operators who wish to engage in land allocation are required not only to apply for a land allocation licence under the Land Allocation Act but also to apply for a real estate business licence under the Land Code.

In a Cabinet meeting held late last year, the Cabinet approved in principle a draft act amending the Land Code. The aim of the amendment is to repeal certain provisions in relation to the real estate business in the Land Code which are not necessary at present, including: to repeal the definition of ‘real estate business’ in Section 1; to repeal Sections 101 and 102, which concern the application and procedure to operate a real estate business; and to repeal part of Sections 111 and 112, which relate to the punishment of persons who violate the provisions relating to a real estate business.

The rationale behind the amendment is that to date an operator who carries out the business of land allocation is subject to both the Land Code and the Land Allocation Act B.E. 2543; i.e. the operator is required to apply for a licence under both regulations. Applying for each licence takes time and money, therefore this unnecessarily increases the burden on the operator´s side and can delay the operator in commencing its business.

In addition, as the Land Allocation Act already covers the business of land allocation and is consistent with the town planning policy, this causes a duplication of laws. Accordingly, in order to be consistent with the current economic situation, the revocation of the provisions relating to the real estate business in the Land Code is necessary.

“Due to the property boom in Thailand, the Thai Government has attempted to eliminate any obstruction which business operators may encounter in carrying out their business in Thailand,” says JSM. ”One of the measures is to avoid the duplication of laws i.e. Land Code and Land Allocation Act. Consequently, upon the enforcement of the aforesaid Act, business operators who wish to engage in the business of land allocation will be required to apply only for the land allocation licence under the Land Allocation Act.”

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