The SEC has prepared draft regulations to allow companies with expertise in real estate investment and management to seek SEC approval to become a Real Estate Investment Trust (REIT) manager and issue and allocate units in the REIT.

According to a news release on the SEC's website, the proposed REIT regulations would be more relaxed and flexible than the current ones governing property funds (Type 1).  Issuance and allocation of units in the REIT would be more market-driven, and the REIT would be allowed to invest in real estate overseas, participate in property development and apply for loans.

Supervision of REITs by the SEC would be similar to that for listed companies.  For instance, an acquisition or disposition of key assets and related-person transactions would need approval of (i) the trustee who holds the title to the trust property and is responsible for the trust management, or (ii) resolution of the REIT unit holders.

The consultation papers on the regulation of REIT unit issuances and offerings along with seven associated rules can be found on the SEC's website.  For more background on Thai securities laws, click here.