In Thailand, a sales contract is one of the most fundamental legal instruments governing the transfer of ownership of goods, property, or services. Whether you are purchasing real estate, vehicles, or commercial assets, the sales contract defines the rights and obligations of both parties — the buyer and the seller. However, not all contracts are created equal, and each type of sale requires a different approach to review and due diligence. Understanding the types of sales contract review in Thailand is essential to avoid legal risks, ensure compliance with Thai law, and safeguard your financial interests.
A contract review is a detailed examination of the contract’s terms, clauses, and legal implications. It ensures that the agreement accurately reflects the parties’ intentions, complies with Thai law, and protects the buyer’s and seller’s interests. In Thailand, contract reviews are commonly performed by licensed attorneys familiar with Thai civil and commercial law, foreign investment regulations, and real estate laws.
1. Real Estate Sales Contract Review
One of the most common and significant types of sales contract review in Thailand involves real estate transactions. Purchasing land, a condominium, or a villa in Thailand requires a detailed examination of the sale and purchase agreement (SPA) to confirm that all terms are fair, enforceable, and compliant with Thai property laws.
Key Aspects of Review:
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Verification of Seller’s Ownership: Lawyers review the title deed (Chanote) and confirm that the seller is the legal owner with the right to sell the property.
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Property Details: The contract should specify the exact location, land size, and property boundaries consistent with the title deed.
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Payment Terms: The schedule of payments, deposit requirements, and conditions for the final transfer must be clear and legally binding.
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Transfer Conditions: The buyer must understand when and how ownership is transferred at the Land Office, and who bears the transfer fees and taxes.
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Defect Liability and Warranties: The contract should outline remedies if defects are found after transfer.
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Foreign Ownership Compliance: For foreign buyers, the review ensures compliance with Thai property laws, such as the Condominium Act or land lease regulations.
A lawyer’s review helps identify hidden risks, such as encumbrances, pending litigation, or clauses that unfairly favor the seller — ensuring the transaction proceeds smoothly and lawfully.
2. Off-Plan Property Sales Contract Review
Buying off-plan properties — developments still under construction — is increasingly popular in Thailand, especially in areas like Bangkok, Phuket, and Pattaya. However, these transactions carry specific risks related to construction delays, developer insolvency, or project non-completion. Reviewing the sales contract in these cases is absolutely critical.
Key Aspects of Review:
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Developer’s Credentials: The contract review includes verifying the developer’s licenses, track record, and legal standing.
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Construction and Completion Terms: The lawyer checks timelines, penalties for delays, and guarantees that the developer will deliver the property as described.
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Payment Structure: Most off-plan contracts involve installment payments; the review ensures payments are tied to verified construction milestones.
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Refund and Termination Clauses: Buyers should be aware of refund rights if the project is canceled or not completed.
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Building Permits and Environmental Compliance: Legal advisors verify that the project complies with Thai building regulations.
A professional review protects the buyer from losing money on incomplete or fraudulent developments and ensures compliance with Thai consumer protection laws.
3. Business or Commercial Sales Contract Review
When buying or selling a business, shares, or commercial assets in Thailand, a sales contract review becomes even more complex. Such transactions often involve not just physical assets but also intellectual property, employees, debts, and regulatory approvals.
Key Aspects of Review:
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Corporate Documents: Lawyers verify the business registration, Articles of Association, and shareholder structure.
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Asset vs. Share Purchase: The review determines whether the deal is an asset sale (buying the business’s assets) or a share sale (acquiring company ownership).
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Liabilities and Debts: A due diligence process ensures the buyer is aware of any outstanding obligations, tax liabilities, or ongoing litigation.
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Warranties and Indemnities: The contract should protect the buyer against hidden defects or misrepresentations by the seller.
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Regulatory Compliance: Depending on the industry, certain transactions may require approval from Thai government agencies or compliance with foreign business laws.
A thorough commercial contract review ensures the transaction structure is legally sound and reduces the risk of post-sale disputes or financial losses.
4. Vehicle and Movable Property Sales Contract Review
In Thailand, the sale of vehicles, machinery, or other movable property also requires a proper sales contract, particularly for high-value transactions. Reviewing these contracts ensures that ownership transfer is valid and that the buyer receives legal title free of encumbrances.
Key Aspects of Review:
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Proof of Ownership: The seller must provide documentation showing clear title to the vehicle or machinery.
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Condition of Goods: Clauses should specify inspection rights and warranties for defects.
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Delivery Terms: The time and place of delivery, and who bears the risk of loss during transport, must be clear.
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Payment Terms: Lawyers check for clauses on deposits, installment payments, and conditions for refund or replacement.
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Registration Transfer: For vehicles, ownership must be registered with the Department of Land Transport.
Though simpler than property or business transactions, these contracts still require review to avoid fraud, defective goods, or unclear delivery terms.
5. Franchise and Licensing Sales Contract Review
Thailand’s growing franchise sector — especially in food, retail, and services — often involves sales contracts for franchise rights or licensing agreements. Reviewing these contracts ensures that the terms are fair, transparent, and compliant with Thai intellectual property and commercial law.
Key Aspects of Review:
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Franchise Fees and Royalties: The contract must clearly define initial and ongoing fees.
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Use of Trademarks and Branding: A lawyer ensures that intellectual property rights are properly licensed.
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Operational Obligations: The franchisor’s training, support, and performance expectations should be detailed.
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Territorial Rights: The agreement should specify the geographical area in which the franchisee may operate.
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Termination Clauses: These determine how and when the contract may be ended and what rights remain with each party.
A professional review ensures that franchise buyers understand their obligations and avoid exploitative terms that could jeopardize their investment.
6. Sales Contract Review for Foreign Buyers
Foreign individuals and entities investing in Thailand face unique legal challenges due to restrictions on land ownership, foreign business participation, and exchange control laws. A contract review tailored to foreign buyers ensures compliance with the Foreign Business Act B.E. 2542 (1999) and other relevant legislation.
Key Aspects of Review:
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Ownership Restrictions: Ensuring the contract structure complies with Thai law — for example, using long-term leases, condominiums, or Thai companies within legal limits.
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Currency and Payment Regulations: Compliance with the Bank of Thailand’s foreign exchange rules for property purchases.
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Tax Implications: Legal advisors review withholding tax, transfer fees, and stamp duty obligations.
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Dispute Resolution Clauses: The review ensures that disputes can be resolved fairly, whether through Thai courts or arbitration.
Without legal review, foreign investors risk entering into contracts that violate Thai law and may later be deemed void or unenforceable.
7. Preliminary and Reservation Agreement Review
Before signing a formal sale and purchase agreement, many transactions in Thailand involve preliminary contracts, such as reservation agreements, letters of intent, or deposit agreements. These documents, though often short, can carry binding legal effects.
Key Aspects of Review:
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Refund Terms: Clarifying whether the deposit is refundable if the transaction does not proceed.
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Time Limits: Ensuring the contract sets clear deadlines for signing the main agreement.
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Binding Clauses: Determining whether the preliminary agreement creates enforceable obligations.
A lawyer’s review of even these early-stage documents helps prevent misunderstandings and protects the buyer’s deposits.
Conclusion
In Thailand, every sales contract — whether for land, property, business, or other assets — carries unique legal requirements and potential risks. A sales contract review ensures that all terms are legally valid, transparent, and aligned with both Thai law and the buyer’s intentions. By engaging a qualified Thai lawyer to review the contract before signing, buyers and investors can safeguard their rights, avoid costly mistakes, and proceed with confidence.
In short, contract review is not an expense — it’s an investment in legal security. Whether you’re buying property, investing in a business, or entering a franchise, having your contract professionally reviewed is the smartest way to ensure your deal in Thailand is safe, fair, and enforceable.