Part 1: Business overview and Thai legal framework

Chapter 1 The property development business from a legal perspective

Legal issues Property development involves dozens of laws, covering land, condominiums, land allotment, building control, the environment, tax, consumer protection and labour, through to foreign investment and the capital market. The project cycle divides into five stages: land acquisition, pre-construction preparation, construction, handover and transfer, and after-sales. Each stage has different risk points. The project type determines which main laws apply, so housing estates, condos, villas, condotels and mixed-use projects each carry different obligations.

What the developer must do Decide the project type jointly among management, legal counsel and the finance team before buying the land. Prepare a permit checklist and a timeline that track every authority. Define the Legal Manager's responsibilities clearly at each stage, and identify the work that needs an external law firm, such as litigation, cross-border matters or a second opinion.

Key risks Common problems include defective land title, undisclosed encumbrances, zoning changes after the land is bought, launching sales before permits are in place, disputes with contractors, and defect claims after transfer. Laws may change during the life of a project, so the plan must be reviewed regularly. A single missing permit can halt the entire project.

Chapter 2 Core legal framework for the Thai real estate business

Legal issues This chapter is a legal map of the main laws: the Civil and Commercial Code on property, the Land Code, the Condominium Act, the Land Allotment Act, the Building Control Act, the Town Planning Act, environmental law including EIA, the Foreign Business Act, investment promotion law and the Revenue Code. The key principle is that foreigners may hold land only under narrow exceptions, while condominium units are subject to a ceiling on foreign ownership based on the proportion of floor area.

What the developer must do Check which laws apply to the project before investing, maintain a register of the laws applicable to the project, and verify the current version with the official authority every time. On tax, include SBT of 3.3% for juristic persons selling real estate, CIT at the standard rate of 20% and the transfer fee in the budget from the feasibility stage, and check temporary measures transaction by transaction.

Key risks Citing section numbers or rates from outdated documents can throw the plan off course. Many laws have ministerial regulations and subordinate notifications that change often, such as EIA thresholds, zoning, fees and the conditions of investment promotion. A lawyer should confirm any point that affects a decision.

Chapter 3 Corporate structure and basic documents

Legal issues The legal entity structure affects liability, borrowing, sales, tax and exit. Property development companies usually use a limited company or a public company, and commonly set up a separate SPV for each project to isolate risk, keep separate accounts and make it easier for banks to assess. A group with several projects may use a holding company with subsidiaries. The articles of association are a registered document that binds every shareholder, whereas a shareholders agreement is a private contract that binds only the parties to it.

What the developer must do Define the SPV's objects, a capital level suited to the project, and the authorised directors. Obtain board or shareholder resolutions as required by the articles and the law for significant transactions such as buying land, borrowing, mortgages and joint ventures. Prepare a corporate authorisation matrix that separates the requester from the approver, require dual approval for large items, and review it every year.

Key risks A transaction lacking signing authority or complete resolutions may have its binding effect challenged. Transactions between group companies, such as management fees, loans and shared services, must be reasonable on an arm's-length basis and supported by documents. Terms in a shareholders agreement (SHA) that are not reflected in the articles may be hard to enforce against the company or new shareholders.