Using a company to buy and own land

[Attila]

I have just been in a conversation between an accountant and a guy who wants to buy land. This guy plans to build a 10 - 20 bungalow village, so he wants to use a company to buy the land etc etc.

The accountant confirmed that a company can be set up and buy the land for the development project the guy has in mind, but then he rolled his eyes and and said but please bring your own nominees

In the discussion which followed it became obvious that you not only need to have Thai nominees running your company (well, officially ) but that they are also checking the bank accounts of these nominees, and a poor Isaan farmer or bar girl will not suffice. It needs to be a Thai with some money. It must appear plausible that the Thai can afford to come up with the capital for his shares.

Is there anyone who bought some land recently using a company, and can comment?

[grant]

I have purchased land in the past year using a company, but the Thai shareholders are not maids, drivers, gardeners, etc. but legitimate professionals. To my knowledge they were not contacted and I had no problems. Expert legal advise was obtained in advance.

[dozer]

I understood it to be like this: the thing that makes the shareholders not nominees is that they have a real interest in the business, ie. irrevocable dividends which must be paid out to them. In other words why should they want to be shareholders in your company?? -- to get dividends, which as long as there is this reason they are not nominees. I knew a company setting these up and they would go down to the land office with a stack of documentation about a meter tall. The shareholders could borrow the money but the paper trail had to match up on everything.

[Attila]

I understood it to be like this: the thing that makes the shareholders not nominees is that they have a real interest in the business, ie. irrevocable dividends which must be paid out to them. In other words why should they want to be shareholders in your company?? -- to get dividends, which as long as there is this reason they are not nominees. I knew a company setting these up and they would go down to the land office with a stack of documentation about a meter tall. The shareholders could borrow the money but the paper trail had to match up on everything.

Yes, that seems to be it. There must be evidence that they can afford to pay for the shares with their own money, and that they really know what's going on, what "their" company is doing.

[jazzman]

Expert legal advise was obtained in advance.

I would be careful about making statements like that - there appears to be so many bad lawyers around that you will be pestered for the recommendation