April 29, 2011

Using Thailand’s Escrow Act in Property Development Transactions

T-AB: Thai-American Business, Journal of the American Chamber of Commerce in Thailand

In certain jurisdictions, an escrow account system is required in order to protect the interests of the purchasers of properties. In an escrow arrangement, the buyer and the seller mutually agree to appoint a third party escrow agent, who will hold the seller’s documents and assets on the one hand, and, on the other, the buyer’s deposit or the whole purchase price. This involves a tri-party written agreement known as an escrow agreement. The escrow agent has a duty to ensure that the parties fulfill their obligations under both the purchase contract and the escrow agreement. The escrow agent is also responsible for the safekeeping of any money, assets, or documents deposited by the parties, for handing over funds, and/or arranging the transfer of ownership of or rights to the assets when required.

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