A usufruct in Thailand grants a person the right to use and benefit from someone else’s property for a specific period. This legal concept is valuable for foreigners and investors looking to utilize real estate without owning the land outright.
1. Legal Definition and Scope
A usufruct is governed by the Thai Civil and Commercial Code (Sections 1417–1428). It allows the usufructuary to possess, use, and derive income from the property while preserving its value. However, ownership remains with the grantor (landowner).
2. Duration and Registration
- Term Limit: Typically up to 30 years or the lifetime of the usufructuary. It cannot be transferred by inheritance.
- Registration: A usufruct must be registered at the local Land Office to be legally valid. The registration fee is usually minimal, based on the property value.
3. Rights and Responsibilities of the Usufructuary
- Rights:
- Full usage rights, including leasing the property to others.
- Profits from the property, such as rental income.
- Responsibilities:
- Maintain the property’s condition.
- Pay taxes and cover maintenance costs.
- Cannot alter the property’s fundamental nature without the owner’s consent.
4. Benefits of a Usufruct Agreement
- For Foreigners: Enables long-term property use without ownership restrictions.
- For Landowners: Retains ownership while allowing someone else to manage and benefit from the property, often useful for family arrangements.
5. Termination of a Usufruct
- Natural Expiration: Upon the agreed term or death of the usufructuary.
- Abuse or Neglect: If the usufructuary causes damage or misuses the property, the owner can seek legal termination.
6. Practical Considerations
- Legal Counsel: Essential to ensure a well-drafted contract that protects both parties.
- Clear Agreements: Define maintenance obligations and permissible uses to avoid disputes.
Conclusion:
Usufructs provide a practical solution for property usage in Thailand, especially for foreigners. Understanding the rights, responsibilities, and legal framework ensures both parties benefit from this flexible arrangement.
