Superficies in Thailand is a legal right granted to an individual (referred to as a superficiary) that allows them to own buildings or structures on land they do not own. This right is particularly significant in Thailand, where foreigners are prohibited from owning land directly but may seek alternative arrangements, such as superficies, to gain rights to structures they build.

1. What Is Superficies?

Superficies, governed under the Civil and Commercial Code of Thailand, allows a person to legally separate ownership of land and structures. The superficiary holds the right to possess and use the land for a fixed period, while the landowner retains ownership of the land itself. The right can be established through an agreement between the landowner and the superficiary, offering legal protection for those who wish to invest in building or developing property without owning the land outright.

For example, a foreigner may obtain the right to build a house on a Thai national’s land through a superficies agreement, while the Thai individual retains ownership of the land beneath the structure.

2. Establishing Superficies in Thailand

Superficies can be created in the following ways:

• Contractual Agreement: The right is established through a contractual agreement between the landowner and the superficiary. The agreement outlines the duration, scope, and specific rights granted to the superficiary.
• Registration with the Land Department: To ensure the right is enforceable, superficies must be registered with the Land Department. If not registered, it is only valid between the two parties but not enforceable against third parties (e.g., future landowners).
• Duration: Superficies can be granted for a fixed period of time (up to 30 years) or for the lifetime of the superficiary. It can be renewed, but such renewals must be clearly outlined in the contract and re-registered.

3. Key Rights and Responsibilities of the Superficiary

Once established, the superficiary holds several rights and obligations:

a) Ownership of Structures

The superficiary has full ownership over any buildings, houses, or structures they erect on the land. They can sell or transfer ownership of the structure, though the landowner retains ownership of the land itself. This distinction is particularly important for foreigners, who cannot own land in Thailand but may fully own the structure built on it.

b) Transferability

Superficies can be transferred or inherited. In the case of the superficiary’s death, their heirs may inherit the right, provided the superficies agreement allows for it. However, the rights do not outlast the agreed-upon duration or the lifetime of the superficiary.

c) Right to Use and Rent

The superficiary has the legal right to use the land and the structure as they wish, including renting out the structure to third parties. However, these activities must comply with the original agreement and any local laws governing the use of the land.

4. Termination of Superficies

Superficies may be terminated under the following circumstances:

• Expiration of Term: If the agreement has a fixed term, superficies ends when that term expires. The superficiary must vacate the land or negotiate a new agreement.
• Death of the Superficiary: If superficies is granted for the lifetime of the superficiary, it ends upon their death, unless the agreement specifies otherwise.
• Mutual Agreement: Both parties can agree to terminate the superficies before the agreed-upon term expires.
• Breach of Contract: If either party violates the terms of the agreement, it may lead to termination.

5. Benefits of Superficies for Foreigners

Superficies is a popular option for foreigners who wish to invest in property development in Thailand but are restricted by Thai laws prohibiting land ownership. By acquiring the right of superficies, foreigners can gain long-term security over a property they build, while still complying with legal restrictions.

The right of superficies provides:

• Security of Tenure: The superficiary has legal protection and can enjoy the land and structure for the agreed period.
• Full Ownership of Structures: The superficiary can fully own the building or structure, despite not owning the land itself.
• Flexibility: The superficiary can sell, lease, or transfer their rights, providing flexibility in managing the property.

6. Comparison to Leasehold

While superficially similar to leasehold, superficies offers more legal security and rights to the superficiary, particularly regarding ownership of the structure. In a leasehold agreement, the lessee does not own the structure, and their rights are limited to occupying the property for a specific time. In contrast, superficies grants full ownership of the structure, independent of the land.

• Leasehold: The lessee gains only the right to occupy and use the property for a certain period, and upon expiration of the lease, both the land and any buildings revert to the landowner unless otherwise agreed.
• Superficies: The superficiary owns the building outright, even though they only have rights to use the land beneath it. This provides more stability and ownership control, especially for property developers and foreign investors.

Conclusion

Superficies in Thailand offers a legally recognized way for individuals, particularly foreigners, to gain control over property development without owning land. It provides the superficiary with full rights over the structures they build and protects their long-term interests through registration with the Land Department. Whether for residential or commercial purposes, superficies offers a flexible and secure alternative for property investment in Thailand. Proper legal advice and careful drafting of the superficies agreement are essential to ensure that both the superficiary and the landowner’s rights are protected.