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What is a right of superficies - Legal Thai land contracts

High quality right of superficies contract (Thai/English) drafted by lawyers online

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The right of Superficies (sections 1410 to 1416 of the Thailand Civil and Commercial Code) is a transferable and inheritable interest in land giving for a specified term the right to own or acquire buildings construction in, on or above the land owned by another. Foreign and a Thai nationals can obtain the right of superficies by agreement with the owner of the land. The right of superficies as a real right is created by a registered Thai land contract granting a person (the superficiary) the right to use another man's land and to erect structures upon it for a specific period of time. Generally it runs simultaneously with a 30-year land lease.

The right of superficies may be created either for a period of time (similar to a lease for up to 30-years) or for life of the owner of the land or the life of superficiary or superficarius (the person granted the right of superficies). If created for a period of time the right of superficies may be renewed, similar to lease. The agreement granting the right of superficies usually drafted in combination with a land lease, each allowing separate clauses for long term protection in a real estate investment by the hirer and developer of a building upon another person's land.

The right of superficies is not complete (valid) unless registered on the land title deed at the local land office. The agreement granting the right of superficies must be in Thai script and will be noted on the backside of the land title deed. Registration takes place at the local land office and a registration fee of 1.1 % is charged based on the value/ consideration for the superficies. If the right of superficies is granted without further consideration (as part of a long term land lease construction) the land office will charge a minimal amount for registration.

The right of superficies (registered on the land title deed) is a 'real right' which means that it is attached to the land rather than the person. The Right of Superficies is a transferable right, including transferable by inheritance (unless restricted in the agreement granting the right of superficies). It is a strong additional right in any long term land lease construction combined with ownership over the building by the lessee or hirer.

The main benefit of a superficies lies in the fact that it allows certain clauses that are under a lease merely personal or contractual rights (rights attached to a person instead of a right attached to a property). The other main benefit of a superficies is that is offers greater and additional protection to the land lease which among others lies in the possible succession separate from the land lease. It could happen under Thai law that certain rights under the land lease agreement are lost or not enforceable (or the whole lease is terminated) but the rights under the right of superficies agreement remain in full force. It's important to distinguish rights which are attached to a person and rights which are attached to a property. Certain rights under a superficies are attached to the property, where the same rights under a lease are in principle only binding between the parties (succession clause). Back to order a contract granting the right of superficies.

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Superficies in the Thailand Civil and Commercial Code:

SUPERFICIES

Section 1410. The owner of a piece of land may create a right of superficies in favour of another person by giving him the right to own, upon or under the land, buildings, structures or plantations.

Section 1411. Unless otherwise provided in the act creating it, the right of superficies is transferable and transmissible by way of inheritance.

Section 1412. A right of superficies may be created either for a period of time or for life of the owner of the land or the superficiary.

If it is created for a period of time, the provisions of Section 1403 paragraph 3 shall apply mutatis mutandis

Section 1413. If no period of time has been fixed, the right of superficies may be terminated at any time by any partner giving reasonable notice to the other. But when rent is to be paid, either one year's previous notice must be given or rent for one year paid.

Section 1414. If the superficiary fails to comply with essential conditions specified in the act creating superficies or, when rent is to be paid, he fails to pay it for two consecutive years, his right of superficies may be terminated.

Section 1415. The right of superficies is not extinguished by destruction of the buildings, structures or plantations even if caused by force majeure.

Section 1416. When the right of superficies is extinguished, the superficiary may take away his buildings, structures or plantations, provided he restores the land to its former condition.

If instead of permitting the removal of the buildings, structures or plantations, the owner of the land notifies his intention to buy the at a market value, the superficiary may not refuse the offer except on reasonable ground.

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