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Phuket

Phuket making waves as jet-skis get legal

Legacy Phuket Gazette

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Phuket making waves as jet-skis get legal | The Thaiger



PHUKET: The issue of jet-ski insurance, a topic that never seems to be off the back-burner, resurfaced earlier this month at the Honorary Consuls’ regular four-monthly meeting.

British Honorary Consul Martin Carpenter asked the Marine Department chief if he could provide clear information warning tourists of the potential quagmire they face should they get into problems while renting a jet-ski.

As a result of that request, Phuripat Theerakulpisut, Director of the local Marine Department office, promulgated copies of the current insurance policies held by jet-ski renters. (Click here to see a jet-ski rental agreement and insurance policy, and read a summary of them at the bottom of this report.)

There are now two companies currently selling jet-ski rental insurance polices to jet-ski operators: The Thai United Insurance Co Ltd (TUI), and Sri Ayudhya General Insurance Public Co Ltd (SAGI).

This was not always the case. Reported in the Phuket Gazette newspaper in April 2011, was the near collapse, a mere two years after its launch, of the only jet-ski policy brokered by Ayudhya Insurance PCL. The threatened collapse was caused by the constant high claims submitted by jet-ski operators for damage by tourists to their rented machines.

The history of jet-skis in Phuket dates back to the last century and includes a number of tourist deaths and serious injuries, including injuries sustained by tourists in recurring altercations with rental operators.

In February 1998, it was reported there were about 250 machines operating here, of which only 22 were registered.

In March 2000, routinely faced with a barrage of complaints, the Provincial Office implemented a “jet-ski management program” covering the five beaches of Kata, Karon, Patong, Kamala and Bangtao. The following month Provincial officers and officials from across the island gathered and decided that tough action against the jet-ski operators was the way forward.

At that time, Marine officers examined and registered 219 jet-skis. That figure was capped by the Phuket Provincial Office for seven years, with no more rental jet skis to be stationed on the island until March 2004.

Even then, laws were in place to regulate jet-skis. The Public Health and Safety Act 1992 barred jet-ski operators from several practices, such as riding in swimming zones and using jet-skis for commercial purposes, which might be construed to include the rental business. The Public Health and Safety Act also enforces the mandatory wearing of life-vests.

The provision against using jet-skis for commercial purposes has always been ignored.

An even older and more specific act is the 1913 Navigation act. This requires all vessels, including jet-skis, to be registered with the Harbor Department. Furthermore, a person driving a jet-ski must hold at least a Helmsman Level 2 license, a qualification that requires two years’ documented proof of experience aboard a Thai-flagged ship, which would effectively preclude tourists from ever riding a jet ski.

The license provision in the Navigation Act has, likewise, always been ignored.

By July of last year, with complaints from tourists increasing and foreign officials becoming more vocal about jet-ski scams, not to mention a “turf war” threatening to erupt on Bang Tao Beach in January this year, Phuket Governor Tri Augkaradacha stepped in to enforce provincial policy on the operators.

He instigated zoning of six beaches where jet-ski operators ply their trade: Kata, Karon, Patong, Kamala, Bang Tao and a new addition at Koh Naka. The zones separated swimmers from jet-skis and were marked with buoys placed by the local authorities.

Within the last few years more jet-skis have started to appear on the beaches. A recent investigation counted an additional 67 of them.

The current number of registered jet-skis on Patong Beach is 170; Kamala, 26; Kata-Karon, 38; Bang Tao, 40; and Koh Naka, 12.

The number of unregistered jet-skis doing business at these beaches is not publicly known.

To control the growth of the hazardous machines, the Marine Department says it will not register more than the 286 already in operation. The department also insists, publicly, that those operators must follow the regulations or risk losing their franchise.

In summary, to continue his business, an operator must in theory ensure that his jet-ski is covered by adequate insurance and registered with the Marine Department.

Once registered, those jet-skis must display an orange sticker identifying its number, the owner and its working location.

In the case of a jet-ski damaged beyond repair, the jet-ski owner(s) must apply to have the unserviceable machine struck from the register. Only after that can they apply to register and operate a replacement machine. This will be granted at the discretion of the Marine Department, if approved by the local jet-ski “club”, on which all operators must be a member.

Foreigners are not allowed to operate a jet-ski rental business and are this ineligible to join a “club”.

Two weeks ago, Mr Phuripat confirmed that 286 jet-skis were the limit and that no more can be registered.

“Actually 281 jet-skis have been registered; five were not presented to us for registration. If the owners attempt to rent them out, they will be caught,” he asserted.

“Jet-skis can still be registered with the Marine Department, but not for renting to the public. If caught, they risk a fine of up to 10,000 baht,” he added.

Speaking specifically about the Bang Tao jet-ski operators, Mr Phuripat said that the local dispute between local operators and a new foreign-owned concern had been resolved and the illegal foreign-owned jet skis were no longer operating.

‘The way things are at the moment is that the current agreement between the Provincial Office and the jet-ski operators is for two years and will end next July,” said Mr Phuripat.

“Nearer the time we will have meeting with the Provincial Office to see the results. If the project is not successful, it can be canceled. However, all jet-ski operators have agreed to follow the regulations.”

Looking to the future, Mr Phuripat said it depended on the Phuket Governor to continue the measures and to improve them. Certainly there will be no more jet-skis without discussions with the Provincial Office.

Insurance policy details

Jet skis are required by the Marine Department to have “first class” insurance cover. Currently many rental operators are going for two policies. One to cover the mandatory requirement to insure riders and passengers, and a second covering damage to property while also providing a “reserve” should medical bills out-strip the limit of the first policy.

The TUI policy covers the jet-ski driver and one passenger for personal injury or death, and limited medical costs. Each contract will not pay more than 300,000 baht per jet-ski annually.

Death or permanent disability of rider or passenger: 100,000 baht.

Medical costs of rider or passenger: up to 15,000 baht per person.

SAGI’s insurance policy covers the same range of risks at a lower payout, but also includes third party liability and damage, including damage to the jet-ski. The contract will not pay more than a total of 200,000 baht per policy.< — Atchaa Khamlo



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Bangkok

Top Five things to consider if you’re buying a condo in Thailand

Tanutam Thawan

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Top Five things to consider if you’re buying a condo in Thailand | The Thaiger

Not quite a Top Ten but some good straight-talking about buying condominiums in Thailand from Desmond Hughes from Hughes Krupica

One of the most commonly read or spoken summary of foreign ownership of property in Thailand is along the lines of

“Foreigners can buy a foreign freehold condominium in their name”.

At this sentence, many foreign investors switch off, and assume that the rest of the detail provided by the author may be legal mumbo jumbo or a thinly veiled attempt to win their business.

In fact, there is quite a lot you should know about Thai condominiums, before you start property hunting. As my clients don’t generally spend their time reading legal journals and legislation unless they have to, I have set out a mixture of legal and practical matters below without much distinction:

1. Only 49% of the Registrable Area of a condominium can be sold to foreigners.

In Bangkok, this is not likely to have any impact on you. Most of the buyers and owners of condominiums in Bangkok are Thai nationals. Even in condominiums popular with foreigners, it is an uncommon phenomena that foreigners would ever outnumber Thais as owners in a building. You might ask why the rule even exists, but there is a fear and protectionism in many Asian countries, not just Thailand, to try and keep foreigners ‘controlled’ through numbers and perecentages.

In other places – Phuket; Pattaya; Koh Samui; Chiang Mai and Hua Hin particularly you should apply caution to ensuring that the correct ‘quota’ of foreign units is available to be sold to you on a freehold basis.

2. Banks often advertise they will give finance, even potentially to foreigners, but in the end – don’t

I speak from personal experience and from that of my clients. For my first condo investment in Bangkok, I had to take out a loan with HSBC which was then taken over by a Thai bank. My loan had to be in foreign currency, because in order to buy a foreign freehold condominium – you have to send foreign currency into Thailand from overseas to generate ‘foreign exchange transaction forms’ to register the title to a foreigner at the land office. This means a lot of hoops for a bank to jump through simply to provide a mortgage. Foreigners are also viewed as flight risks by Thai banks and they do not wish to spend their time chasing foreign assets. This all means that a very high percentage of the foreign buyer market is cash based, which is good for the stability of that part of the condo market.

If you are tempted to try and take out finance applications to banks, be aware that the banks are looking for you to have some business in Thailand; perhaps to be married to a Thai national who preferable from the bank’s perspective will have some degree of wealth for self-support; and that you have other assets in Thailand with a history of using and paying off credit such as credit cards.

3. There is an oversupply of condominiums in Bangkok at the moment and rental yields are traditionally low in terms of % compared to more expensive Asian neighbors – Hong Kong and Singapore, and further afield

A condo in a prime rentable area at a high investment price can remain rentable due to its extremely useful location and amenities. If such condo has a 24 hour supermarket in the basement of the retail area and dozens of restaurants, as a condo building I am thinking of does have such amenities, then it will remain rentable for some time if the property is maintained. However, another condo at the end of the same ‘Soi’ and post building and delivery could remain unrented after many months and even if the rent is cut to 50% of the market price. Don’t just take my word for the state of the market for condo rentals in Bangkok, ask the agents.

In addition to this, the authorities are taking a closer eye at tax declarations and ‘cracking down’ on undeclared taxes – not just personal income tax, but the ‘business tax’ of 12.5% for renting units out. This all adds to the costs of investing and renting in a condo, and you must calculate this into your budget and forecasts to avoid living in fantasy land about dream returns.

3. You won’t have any say in how the condominium is managed

Unless you buy up over half of the voting rights attached to units in the entire building, you will be a minority voice on issues like the raising of the common area fees; use of the ‘sinking fund’ – the fund to make capital repairs, changes to the rules and regulations and general maintenance decisions, even of some significance. Don’t imagine standing up at an co-owners meeting voicing your opinions and somehow making headway in ‘changing’ the direction of the management of a building. The way in which a building is managed boils down to how the developer has structured ownership, whether the developer retains many units and a large % of the voting rights or not, and whether the developer plans to self-manage or outsource management of the asset to a reputable or not-so-reputable management company.

If you don’t check the management plan then I can reference lots of analogous situations where you would take more care – if you buy a car, you should think if there are any decent repair centres nearby and at a reasonable price – Ferraris in Phuket aren’t currently easy to maintain, I would imagine, as a non-Ferrari owner and observer of the state and condition of the roads in that Province. You also wouldn’t, I hope, buy a smart phone without knowing you could have the phone service, fixed and various parts replaced on reasonably short notice. As a property is a far higher value of investment, a lot of investigation into the management plan is necessary.

4. Don’t Believe the Hype – It’s a Sequel

False Media, we don’t need it do we? If you see a glossy marketing brochure and are told that the developer ‘has to deliver on its promises by law’ – be wary. To take one example, I bought a condo under which a ‘private wine cellar area with personal secure wine bottle storage space’ would be provided to every buyer. Amazingly, without any shame at all, the famous developer constructed an unchilled cheap wooden cabinet with glass doors, no locks next to 4 sofa chairs in the open space corridor between a swimming pool and the gym. If you wanted to fry an egg on the ‘wine cabinet’ then that was highly likely to have been possible.

These kind of things are not all ‘horror stories’ – I actually got a decent condo notwithstanding the missing items. However, you will often have to compromise when in more highly regulated and supervised jurisdictions, you would not. Compromise is a very common work in Thai society and it applies to business and consumer purchases too.

5. Set up your ownership for easy re-sale

If you are buying a condo as a ‘foreigner’ and paying cash, then you can buy your condo through a foreign company, and sell the company later. This is only worth doing if the cost of setting up and maintaining the foreign company is reasonable and the company you set up is ‘saleable’ and attractive to others. You should not carry out this kind of structuring to ‘avoid tax’. However, you can set up this kind of structure, pay tax on the purchase, and subsequently deal with your company as you see fit, provided a buyer is willing to buy it. If such a company receives rental income, then even if it is foreign it is till liable to taxes as the use of the ‘immoveable property’ for generating revenue isn’t deemed to be ‘outside’ of Thailand, and that applies even if the company tries to contract for and receive the rent outside of Thailand.

Desmond Hughes has operated and owned 2 law firms in Asia in 14 years spanning Thailand; Vietnam; Indonesia with clients in all of Asia and other markets investing inwards into the region with his existing firm Hughes Krupica possessing a large market shares in its fields of expertise. 

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Phuket

Motorbike driver smashes through glass window after accelerator malfunctions

Tanutam Thawan

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Motorbike driver smashes through glass window after accelerator malfunctions | The Thaiger

A female motorbike driver has sustained injuries after her motorbike’s hand grip malfunctioned and she collided with a glass wall. Chalong Police were notified of the incident at an air conditioning shop at 6pm yesterday on Chao Fa West Road in Chalong.

Police and emergency responders arrived and found the shattered glass wall and a damaged motorbike. The injured 40 year old Naowarat Jankarn had already been taken to Chalong Hospital. She sustained injuries from cuts from the broken glass. Pools of blood were found on the floor.

Ms Naowarat told police that she had parked her motorbike in front of the shop since Wednesday . The motorbike was undrivable because the hand grip accelerator was malfunctioning.

Yesterday she started the motorbike, claiming she had forgotten about the broken accelerator.

Motorbike driver smashes through glass window after accelerator malfunctions | News by The Thaiger Motorbike driver smashes through glass window after accelerator malfunctions | News by The Thaiger Motorbike driver smashes through glass window after accelerator malfunctions | News by The Thaiger Motorbike driver smashes through glass window after accelerator malfunctions | News by The Thaiger Motorbike driver smashes through glass window after accelerator malfunctions | News by The Thaiger

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Phuket

Police hunting for driver who threatened others with a gun on Phuket road – VIDEO

Tanutam Thawan

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Police hunting for driver who threatened others with a gun on Phuket road – VIDEO | The Thaiger

PHOTO: Tiw Tiw

The Thalang Police are hunting for the driver who was threatening other motorists on Thepkrasattri Road by waving a gun around out of the driver’s window of his red sedan in Thalang this morning.

A Facebook user ‘Tiw Tiw’ has posted the video with a message reading “where are the police, please follow him. The incident happened this morning in Thalang.”

The video shows a car switching from one lane to another.  The driver shows a gun in his car window and then appears to throw it out (at least he used his indicator).

The Thalang Police are investigating the incident and want to find the car driver for questioning.

 

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