Page 81 - Introduction to Investment Laws in Thailand

Section 545. If the rent rightfully sublets the property
rent, the sub-rent is directly liable to the letter. In such case a
payment of rent made in advance by the sub-rent to the rent who
sublets cannot be set up against the letter. The provision does not
prevent the letter from exercising his rights against the rent.
By section 540 above, the maximum term period of the land or
property rental agreement is 30 years. In case the rent period is more than
three years, there must be the registration of the rent agreement with the
department of land. Additional requirements are that if the lease
agreement is classified under the Rent of Property for Commercial and
Industries Act BE 2542, the rent can be more than 30 years but not exceed
50 years. The parties to the lease can extend upon the consent of both
parties of the lease agreement. Similarly, the parties to the lease can extend
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upon the approval from both parties of the lease agreement.

3.4 Right over a Property with Land Trust Scheme

The concept of land trust allows landowners to maintain their ownership
over their property and rent the property to developers in exchange for the
rental fees. The developers can use the land trust for their financial and
commercial purposes. The concepts of the land trust have been embedded
into Thai law by the issuance of the "Right Over Property Act BE 2562
(2019).

The "Right Over Property Act BE 2562 (2019) section 4 stipulates that
the landowner who aims to establish the land trust may apply to the
department of land to develop and register a land trust. The land trust will
bide the landowners and land users (renter) over land use. After the
approval of the land trust, the holder of the land trust (renter) may seek
mortgage loans from the bank by using the land trust as the collateral for
the mortgage. However, the land trust has a maximum period of 30 years.
The land trust can be transferable or be the collateral for any financial

89 Ibid

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