Buying a Condominium Unit
Foreign Currency Remittance Requirement

To qualify for foreign ownership under the Thailand Condominium Act, a foreign purchaser of a condominium unit must generally remit the full purchase price into Thailand in foreign currency. This requirement does not apply where the purchaser qualifies under one of the alternative grounds set out in Section 19 of the Condominium Act, for example as a lawful resident in Thailand.

Important.
Foreign purchasers registering ownership under Section 19 of the Condominium Act should ensure that the purchase funds are remitted into Thailand in foreign currency and that the receiving bank issues the appropriate supporting documentation. This documentation will be required by the Land Office when registering the transfer of ownership.

The purchase price should normally be transferred from abroad in foreign currency and converted into Thai baht by the receiving bank in Thailand. The receiving bank will issue documentary evidence of the foreign currency remittance, usually in the form of a Foreign Exchange Transaction (FET) Form or other acceptable bank documentation, depending on the amount transferred and the applicable banking regulations.

The bank documentation should normally include:

  • The amount transferred in foreign currency.
  • The amount converted into Thai baht.
  • The name of the sender.
  • The name of the recipient.
  • The purpose of the transfer (for example: purchase of Condominium Unit 101, ABC Condominium).

A non-resident foreigner purchasing a condominium unit in Thailand must be able to provide the Land Office with the bank-issued FET Form or other acceptable bank documentation confirming the remittance of foreign currency into Thailand. The document must show the foreign purchaser's name as either the sender or the recipient of the transferred funds in order to qualify for foreign ownership registration under the Condominium Act.

Foreign Exchange Transaction (FET) Form

The Foreign Exchange Transaction (FET) Form, previously known as the Thor Tor 3 Form, is issued by the receiving bank in Thailand for foreign currency transactions with a value equivalent to USD 50,000 or more. The transaction is also reported to the Bank of Thailand in accordance with the applicable foreign exchange reporting requirements.

For remittances below the reporting threshold, the receiving bank will normally issue a bank confirmation letter, credit advice or other supporting bank documentation instead of an FET Form. Provided the document contains the relevant remittance details, it is generally accepted by the Land Office as evidence that the purchase funds were transferred into Thailand in foreign currency and converted into Thai baht.

Remittance of Sale Proceeds out of Thailand

When a foreign owner sells a condominium unit and wishes to transfer the sale proceeds abroad, the receiving bank will normally require supporting documentation. Depending on the circumstances, this may include the original FET Form or other acceptable bank documentation evidencing the original foreign currency remittance, together with the Land Office transfer documents and the relevant tax receipt.

These documents help demonstrate that the purchase funds were originally remitted into Thailand in foreign currency and may facilitate the transfer of the sale proceeds overseas, subject to the applicable foreign exchange regulations and the bank's requirements.

Practical Notes

The purchase funds do not necessarily have to be transferred directly from the purchaser's overseas bank account to the seller. In practice, the purchase price may first be remitted into the purchaser's foreign currency account or Thai bank account, provided the receiving bank can issue the appropriate documentary evidence linking the foreign currency remittance to the purchaser.

In the case of a new condominium purchased directly from a developer, the purchase price is often paid in instalments to the developer's account. The developer will normally advise the purchaser on the required foreign currency remittance procedure and the supporting documentation needed for registration of foreign ownership at the Land Office.

Because individual banks may have different documentary requirements, foreign purchasers should confirm the required remittance procedure with the receiving bank before transferring the purchase funds.

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article source: foreign exchange form (tor tor 3)