Grantees Welcome Options Provided By New Right In Immovable Property

Thai law provides a variety of ways for owners to grant others (“grantees”) the right to use immovable property, with leases perhaps the most common.  Other methods include superficies (allowing the grantee to own buildings and other structures upon an owner’s land), usufructs (allowing the grantee posses, use and enjoy the benefits of an owner’s land), and habitation (allowing the grantee to inhabit an owner’s building without paying rent).

Downsides to these rights, from the grantee’s perspective at least, are that they are not easily transferable to third parties or available as collateral for a loan without first obtaining the consent of the underlying owner.  Addressing these concerns, however, is a new type of right known as a “Sap-Ing-Sith”.  Holders of a Sap-Ing-Sith are entitled to use the underlying property as they would under a lease, but are also permitted to transfer the right to a third party or use it as collateral without first having to obtain the consent of the owner of the underlying property.

Only land covered by a Chanote (title deed), buildings constructed on Chanote land, and condominium units can be subject to a Sap-Ing-Sith.   The Sap-Ing-Sith is created in writing by the underlying owner and grantee for a period of up to 30 years and must be registered with the land office, which will in turn issue a Sap-Ing-Sith certificate.

The Sap-Ing-Sith is covered in a new draft act passed by the Thai National Legislative Assembly in early February 2019 and is pending royal endorsement to be followed by publication in the Government Gazette.   It will be expected to come into effect 180 days following publication.