Condominium in Thailand, foreign ownership
Usufruct and responsiblities for expenses of the condo and voting rights in the meetings
Whether a condo apartment in Thailand is foreign owned within the foreign ownership quota of the condominium or Thai owned, a foreigner may be given the right of usufruct over an apartment unit registered under the Thailand Condominium Act. Usufruct under Thai property law means that during the term of the usufruct the person granted the right of usufruct is entitled to the use, management and enjoyment of the condominium apartment and the owner gives up these rights for the term of the usufruct.
Common expenses of the condo
By the right of usufruct the usufructuary will obtain a major part of the rights associated with ownership but also the responsibilities. This means that when a condominium is burdened with a right of usufruct the usufructuary becomes responsible for the payment of management and maintenance fees to the condominium juristic person. Not the owner of the condominium will be required to pay, but the usufructuary as the user and manager of the condo becomes responsible for payment of these fees to the condominium juristic person. However, at the end of the term of the usufruct the usufructuary is allowed to claim refund of any payments which are not considered part of the normal condo fees or common expenses.
Condominium expenses under a special assessment
Fees that are for example paid under a special resolution to upgrade the condominium or expenses that are used for major repairs of the building are under Thai usufruct law the responsibility of the bare owner of the condominium and not the usufructuary.
Special assessments are uncommon but can be substantial when major repairs are needed and there is a shortfall in the reserve fund. This requirement can be found in section 1424 of the Thailand Civil and Commercial Code.
Section 1424: the usufructuary is bound to keep the substance of the property unaltered, and is responsible for ordinary maintenance and pretty repairs. If important repairs or measures are necessary for the preservation of the property, the usufructuary must forthwith inform the owner thereof and permit them to be carried out. In case of default by the owner, the usufructuary may have the work carried out at the owner's expense', and
Section 1425: all extraordinary expense must be borne by the owner, but in order to meet these or expenses coming under the foregoing section he may realize part of the property unless the usufructuary is willing to advance the necessary funds without charging interest.
Usufruct and voting rights associated with ownership
Contrary to a lessee, who obtains possession of a condo in Thailand but NOT the right of management and voting rights in the meetings associated with ownership, a usufructuary will obtain the voting rights in the condominium unit owners meetings unless the parties have agreed differently in the usufruct contract. The bare owner will otherwise lose his voting rights in the meetings to the usufructuary.
- Learn more about legal aspects of owning a condominium in Thailand
- Learn more about usufruct between husband and wife
- Learn more about leasehold condominium
