Usufruct

In Thai language it is called “Sidhi-kep-kin” and it provides temporary
ownership rights. This right is for the use and enjoyment of the profits and
advantages of something belonging to another as long as the property is not
damaged or altered in any way. The person who enters into a contractual
agreement with the owner for this right is called the “usufructuary.”
A usufruct may be created either for a period of time (not exceeding 30
years) or for the life of the usufructuary. The usufructuary is responsible for
the expenses for the management of the property, paying taxes and duties,
and be responsible for interests payable on debts charged to it. If required
by the owner, the usufructuary is bound to insure the property against loss
for the benefit of the owner. He must pay the insurance premiums for the
duration of his usufruct. You are registered on the title deed. The land can
never be sold or transferred by the owner of the land until the servitude is
terminated. A usufruct interest expires upon the death of the holder of the
usufruct and therefore cannot be inherited.

An interesting feature of usufruct is that the usufructuary can enter into
a 30-year lease with a third party. So if the usufructuary signed a 30-year
lease contract before his death, the lessee (tenant) will maintain the rights
of the lease until its expiration. Supreme Court ruling 2297/1998 states that
the lessor (landlord) does not have to be the owner of the property.
Therefore the usufructuary can rent out the land. Although in the event of
death of the usufructuary with the lease term, only the usufruct will be
terminated but not also the lease.

Moreover, the usufructuary could transfer the right of using the land to his
child. However, it remains to be seen if the Land Department officials would
allow a transfer of the rights to the land. There is no annual tax levied on the
property compared with 12.5 percent of the assessed or market rate rental
value in the case of a registered lease.