Factory Land in Thailand for Foreign Manufacturers 2026: Why You Are Not Limited to a 30-Year Lease, the 50-Year Industrial Lease, BOI and IEAT Ownership and the Registration Trap

Key takeaways

• Foreigners cannot own land in Thailand, but a foreign manufacturer has four lawful routes to a factory site: a long-term commercial-industrial lease, BOI land ownership, IEAT industrial estate ownership, and a right of superficies.
• A factory lease is not limited to 30 years. Under the Hire of Immovable Property for Commerce and Industry Act B.E. 2542 (1999), a qualifying lease may exceed 30 years up to 50, and on expiry the parties may agree a new term of up to 50 years.
• The test has two layers, both of which must be met: the land must be in an area zoned commercial or industrial under town planning law, or inside an IEAT industrial estate (either); and the business must be a commercial activity with investment of at least THB 20 million, an industry eligible for investment promotion, or an activity announced as beneficial to the economy and society (either).
• Foreign lessees of more than 100 rai face a higher bar: a narrower list of business types, investment of at least THB 100 million excluding rent, funds remitted from abroad, and the approval of the Director-General of the Department of Lands.
• A leasehold under the Act has three features an ordinary lease lacks: it can be mortgaged, it passes on death, and it can be sublet or assigned unless the contract says otherwise.
• It must be in writing and registered, or it is void. An ordinary lease of more than three years that is not registered is merely unenforceable beyond three years; a lease under the Act that is not registered never existed.
• The IEAT route has a time trap: if the foreign operator ceases business, the land must be disposed of to IEAT or a transferee within three years.
• The Treaty of Amity does not help Americans here. It covers business operations under the Foreign Business Act and expressly excludes land; a US company takes the same four routes as everyone else.
• 2026: the Department of Lands has been evaluating the 1999 Act and consulting on possible reform, but no amendment bill has been tabled.

The sentence a foreign manufacturer hears most often when looking for a site in Thailand is: "Foreigners can't buy land, you can only lease, and only for 30 years."

The first half is right. The second half is wrong for industrial land.

Section 540 of the Civil and Commercial Code does cap a lease of immovable property at 30 years, and that rule governs residential and general leases. But Thailand has a separate statute written for commercial and industrial use: the Hire of Immovable Property for Commerce and Industry Act B.E. 2542 (1999), in force since 19 May 1999 and administered by the Department of Lands.

Under that Act, a qualifying commercial or industrial lease may exceed 30 years up to 50, and on expiry the parties may agree a further term of up to 50 years.

For a manufacturer planning long-term capacity, that is a different order of magnitude.

This guide sets out the four lawful routes to a factory site, the conditions and limits of each, and the points where things most often go wrong in practice.

1. The rule: foreigners may not own land

The Land Code prohibits foreigners from acquiring ownership of land. It is not a quota; it is a prohibition by status.

Readers from the United States should note one point at the outset. The US-Thai Treaty of Amity lets US nationals and US-majority companies hold a majority of a Thai business in most sectors, but it operates under the Foreign Business Act, not the Land Code, and land is one of its express exceptions. On land, an American company is in exactly the same position as a German, Japanese or Taiwanese one. The treaty's scope, and the BOI and FBL routes it sits beside, are compared in our guide to setting up a company in Thailand for foreign investors .

Thai law does, however, separate buildings from land. A foreigner cannot own the land but can own the building on it, and that distinction is the foundation of the whole system.

The four lawful routes to a factory site are therefore:

Each is explained in turn.

2. The 1999 Act: 50 years plus 50

This section is the core of the guide.

Term

Under the Act, the lease term may exceed 30 years but may not exceed 50.

On expiry, the parties may agree to renew, but the new term may not exceed 50 years from the date of renewal.

Note the contrast with residential "30+30+30" arrangements. Pre-signed renewal clauses for residential leases have been struck down by the Supreme Court, because the 30-year cap in section 540 of the Civil and Commercial Code is mandatory. The 50 years for commercial and industrial leases is a term expressly allowed by a special statute, and renewal is expressly provided for in it; the legal basis is entirely different.

What a residential buyer actually holds under a 30-year lease, why the "90-year" villa and condo products fail, and what passes to the heirs, is in Buying Property in Thailand as a Foreigner 2026: The 49% Condo Quota, the 30-Year Lease Ceiling, the Nominee Trap and What Your Heirs Can Keep .

Form and registration

A lease under the Act must be made in writing and registered with the competent official, or it is void.

This is a condition of validity, not of enforceability. An unregistered lease is void from the outset, not "valid but unenforceable against third parties".

Note also that the lessor must be the owner of the property. A lessee cannot grant a lease under the Act in its own name.

Where the leased area exceeds 100 rai, the approval of the Director-General of the Department of Lands is also required under the procedure prescribed by ministerial regulation (section 5 of the Act).

Three special legal effects

This is the most important difference from an ordinary lease, and the most often overlooked.

A leasehold under the Act has the following features that an ordinary lease lacks:

• It can be mortgaged. The Act applies the provisions on mortgage of immovable property to the leasehold. The leasehold itself can therefore be security for finance, which for a manufacturer raising bank funding for a plant is a real financial tool.
• It passes on death. An ordinary lease in principle ends with the lessee's death; a leasehold under the Act passes with the estate. For a site held through an individual or a family company, that difference matters.
• It can be sublet. Unless the contract provides otherwise, the lessee may sublet or assign the leasehold in whole or in part; an ordinary lease requires the lessor's consent. That gives real flexibility for subletting within an estate or for intra-group reorganisation.

Note too that changes to the registered lease, subleases, security over the leasehold, assignments and transfers on death must themselves be in writing and registered, or they cannot be asserted against third parties (section 8 of the Act).

Supplementary application

Where the Act is silent, the lease provisions of the Civil and Commercial Code apply.

3. Qualifying conditions: the two-layer test of location and business

Not every commercial or industrial lease qualifies. Under the ministerial regulation issued under the Act, the conditions come in two layers, both of which must be met.

Layer one: location of the land (either)

• In an area designated for commercial or industrial use under town planning law
• Within an industrial estate under the Industrial Estate Authority of Thailand (IEAT) legislation

Layer two: type of business (either)

• A commercial activity with investment of at least THB 20 million
• An industrial activity eligible for promotion under the Investment Promotion Act (in other words, a BOI-eligible category)
• A commercial or industrial activity announced as beneficial to the national economy and society

Note that this is a cumulative structure, location plus business, not a menu of alternatives. Many online summaries list the two layers as if any one condition sufficed; that is a common error.

The higher bar for foreign lessees

Where a foreigner leases more than 100 rai, the conditions tighten markedly: the business must be of a type that raises export value, increases domestic employment, introduces advanced processes or technology, or is of high benefit to the economy and society; investment must be at least THB 100 million, excluding the rent itself; and the funds must come from foreign currency remitted from abroad or drawn from a foreign currency deposit account.

For most mid-sized plants (within 100 rai) the relevant conditions are the two layers above; a large estate-scale investment should build the THB 100 million threshold and the proof of source of funds into the plan early.

The recommended order of checks: confirm the town-planning zoning of the target land first, then whether it is inside an IEAT estate, then match the business type. All three can be verified before signing, and they decide whether the 50-year term is available.

4. The EEC's 50 years

Besides the 1999 Act, the Eastern Economic Corridor (EEC) Act also allows lease terms of up to 50 years for qualifying property.

If the site is in the EEC (Chachoengsao, Chonburi and Rayong provinces), assess both the EEC Act and the 1999 Act; the conditions and procedures differ.

5. BOI and IEAT: the two routes to ownership

BOI land ownership

Under the Investment Promotion Act, a foreigner granted BOI promotion may own land, to the extent the BOI considers appropriate, for the purpose of carrying on the promoted business. The BOI application and its conditions are covered in the complete guide to establishing a business in Thailand .

This is ownership rather than a leasehold, but it is tied to the promoted business: the purpose is limited to operating that business, not general property investment.

IEAT industrial estate ownership

Under the Industrial Estate Authority of Thailand Act B.E. 2522 (1979), a foreign operator in an industrial estate may own land within the estate to the extent the IEAT board considers appropriate.

The IEAT three-year disposal trap

Build this into the exit plan.

Under the Act, if the foreign operator ceases business, the land must be disposed of to IEAT or to any transferee within three years.

That means that once you decide to leave Thailand or close the plant, the land cannot be held indefinitely waiting for a good price; there is a fixed deadline. Three years is not generous in the rhythm of industrial property transactions, especially in a weak market.

Plan the exit when you plan the entry; this provision sets the time pressure on disposal of the asset.

6. Registration: two limits, two effects

The registration rules are easy to confuse. In summary:

The gap is enormous: the first is "valid but defective", the second is "never existed".

So if the 50-year term is the aim, registration is not an administrative recommendation but a condition of the right coming into existence.

7. What else a plant needs before it can operate

Securing the land right is only the first step. Before operations begin you also need:

• A factory licence (Ror Ngor 4): under the Factory Act, factories of specified sizes and types need a licence before they operate.
• Building and use permits: construction and use of the plant must comply with building control law.
• Environmental impact assessment (EIA): projects of specified types and sizes must complete an EIA first. The EIA timeline is often the critical path of the whole project and should be reserved early in the schedule.
• IEAT permits: a plant in an industrial estate must also meet IEAT's rules and procedures.

A practical note: the sequence and interdependence of these permits drive the overall timeline. Without an EIA there is no building permit; without a building permit there is no plant. Confirm before signing the land contract that the target site can obtain each permit, rather than discovering after signing that the location does not qualify. If the site comes with an existing company, the land title type and the permits are also items in the due diligence before buying a Thai company .

8. 2026: the Department of Lands is reviewing the Act

On the public information available as at September 2026, the Department of Lands has been evaluating the operation of the 1999 Act and has consulted business associations, the bar and the property industry on the direction of possible reform, across eight topics including the content of the right, the lease term and the area rules.

The evaluation covers registration statistics since 1999, application volumes, the size of leased areas, and the Act's actual effect in promoting investment, commerce and industry, and whether the current law still meets economic needs.

Note that no amendment bill has yet been tabled. Whether the law will be amended, and in what direction, is undecided.

Practical advice: plan on the current law, and do not build conditions around a reform that does not exist. For longer projects, the contract can include a mechanism for adjusting to a change in the law.

9. Five practical recommendations

• Confirm the town-planning zoning and IEAT boundary before signing. These two facts decide whether the 50-year term is available, and both can be verified before signing.
• Confirm that the lessor is the owner. Under the 1999 Act the lessor must own the property. If the other party is a lessee rather than the owner, the Act cannot apply.
• Make registration a closing condition. Because an unregistered lease is void, completion of registration should be a condition of payment or closing, not something handled after signing.
• Assess mortgaging the leasehold. If the plant needs external finance, the ability to mortgage the leasehold is a planning tool to raise with the bank from the start.
• Plan the exit at entry. Especially on the IEAT route, the three-year disposal deadline belongs in the investment decision.

Frequently asked questions (FAQ)

Can a foreigner really only lease factory land in Thailand for 30 years?

No. The 30-year cap in section 540 of the Civil and Commercial Code applies to residential and general leases, but Thailand has the Hire of Immovable Property for Commerce and Industry Act B.E. 2542 (1999), in force since 19 May 1999 and administered by the Department of Lands. Under it, a qualifying commercial or industrial lease may exceed 30 years up to 50, and on expiry the parties may agree a new term of up to 50 years. The conditions are a two-layer test: the land must be in an area zoned commercial or industrial under town planning law, or inside an IEAT industrial estate (either); and the business must be a commercial activity with investment of at least THB 20 million, an industry eligible for investment promotion, or an activity announced as beneficial to the economy and society (either).

How does a 50-year lease differ from an ordinary lease?

Besides the term, a leasehold under the 1999 Act has three features an ordinary lease lacks: it can be mortgaged (the Act applies the rules on mortgage of immovable property, so the leasehold itself can be security for finance); it passes on death (an ordinary lease in principle ends with the lessee's death); and, unless the contract provides otherwise, it can be sublet (an ordinary lease needs the lessor's consent). The formal requirement is also different: a lease under the Act must be in writing and registered or it is void, whereas an ordinary lease of more than three years that is not registered is merely unenforceable for the excess, a lighter consequence.

What are the lawful ways for a foreign manufacturer to obtain a factory site?

Four. First, a long-term commercial-industrial lease under the 1999 Act (up to 50 years, renewable), the widest and most flexible route. Second, BOI land ownership: a promoted investor may own land, to the extent the BOI considers appropriate, for the purpose of the promoted business; this is ownership, but tied to that business. Third, IEAT industrial estate ownership: a foreign operator in an estate may own land in it with the IEAT board's approval. Fourth, superficies: a real right to own buildings on another's land, which needs the landowner's cooperation and is harder to obtain in practice. If the site is in the EEC, the Eastern Economic Corridor Act's 50-year lease should also be assessed. The Treaty of Amity does not add a fifth route for Americans; it excludes land.

Are there extra conditions for a foreigner leasing a large area?

Yes; the threshold is 100 rai. A lease of more than 100 rai requires the approval of the Director-General of the Department of Lands under the procedure in the ministerial regulation, and a foreign lessee must meet stricter business criteria (raising export value, increasing domestic employment, introducing advanced processes or technology, or high economic and social benefit), invest at least THB 100 million excluding rent, and fund it with foreign currency remitted from abroad or drawn from a foreign currency deposit account. Most mid-sized plants are within 100 rai and unaffected; a large estate-scale investment should plan for the threshold and the proof of funds early.

What should I watch when owning land through IEAT?

Above all the three-year disposal deadline. Under the Industrial Estate Authority of Thailand Act B.E. 2522 (1979), a foreign operator in an estate may own land in it with the IEAT board's approval, but if the operator ceases business the land must be disposed of to IEAT or a transferee within three years. Once you decide to leave Thailand or close the plant, you cannot hold the land indefinitely for a better price; there is a fixed deadline, and three years is not generous in industrial property, especially in a weak market. Plan the exit when you plan the entry and put this provision into the investment decision.

What happens if the lease is not registered?

It depends which law applies, and the difference is large. A commercial-industrial lease under the 1999 Act that is not registered is void: not defective, but non-existent, so if the 50-year term is the aim, registration is a condition of the right rather than an administrative step. An ordinary lease of more than three years that is not registered is, under section 538 of the Civil and Commercial Code, unenforceable for the excess. Changes to the registered lease, subleases, security over the leasehold, assignments and transfers on death must also be registered to be asserted against third parties. In practice, make completion of registration a condition of payment or closing, and confirm that the lessor actually owns the property, since otherwise the 1999 Act cannot apply.

Has Thailand's commercial-industrial lease law changed in 2026?

Not yet, but a review is under way. On the public information available, the Department of Lands has been evaluating the 1999 Act's operation since it took effect and has consulted business associations, the bar and the property industry on the direction of possible reform, across eight topics including the content of the right, the lease term and the area rules. No amendment bill has been tabled and neither the fact nor the direction of any amendment is settled. Plan on the current law and do not build around a reform that does not exist, but a long-term contract can include a mechanism for adjusting to a change in the law.

"Foreigners can't buy land, and can only lease for 30 years" circulates widely among foreign investors, but it confuses two different regimes.

Residential and general leases are indeed capped at 30 years, and pre-signed renewals have been struck down by the Supreme Court. Commercial and industrial use has its own statute: 50 years is an express statutory term, renewal is an express statutory mechanism, and the leasehold can be mortgaged, inherited and sublet.

The difference is not a technique. It is whether, before signing, you confirmed that the land meets the Act's conditions and whether you registered. Both happen before signing, and both can be verified.

How Louis Group can help

Louis Group has offices in Taipei and Bangkok, with Thai-qualified lawyers working alongside Taiwanese colleagues in English. We help foreign manufacturers with factory sites in Thailand: zoning and title checks on the target land, lease structuring and the choice of governing statute, lease registration, comparison and application for the BOI and IEAT routes, financing on the security of the leasehold, factory licence and EIA scheduling, and advance planning of the exit and disposal. If your current factory lease in Thailand runs for 30 years, reassess whether the 1999 Act applies before the next renewal or expansion.

Author: Dr. Yvonne Wei (Arisa Pailinsiri) , Senior Partner, Louis Group Bangkok.

*This article is general legal information, not advice on a specific case. Qualifying conditions, registration procedures and the authorities' interpretations vary with the facts and may change with the law. Take advice from a Thai-qualified lawyer and rely on the latest rules of the Department of Lands, the IEAT, the BOI and the other authorities.*

Related reading

• The Complete Guide to Establishing Your Business in Thailand
• Setting Up a Company in Thailand 2026 for Foreign Investors: The 49% Rule, Nominee Shareholder Risk, Capital and Work Permit Ratios, BOI and the New DBD Checks
• Buying a Company in Thailand 2026: Share Deal vs Asset Deal, the 49% Rule, Licence Succession, Merger Control and a 12-Point Due Diligence Checklist for Foreign Buyers