When is a property broker's commission owed in Thailand? CCC Sections 845-848 explained

When does a Phangan seller or buyer actually owe a broker's commission? Under CCC Sections 845-848, the starting rule is that commission is earned only when the broker's work leads to a concluded contract. Everything else, such as the rate, exclusivity and what happens after the mandate ends, comes from the brokerage agreement. For who may legally act as a broker, see foreign real estate agent restrictions.

The four core rules

• Section 845 — success-based. A person who agrees to pay a broker for indicating an opportunity to conclude a contract, or for procuring one, is liable to pay only if the contract is concluded in consequence of that indication or procurement. If the contract is subject to a condition precedent, the commission cannot be claimed until the condition is fulfilled. Expenses are reimbursable only if so agreed, even if no contract results.
• Section 846 — implied remuneration. Commission is deemed impliedly agreed if the work entrusted to the broker would, in the circumstances, only be expected for payment. If no amount is fixed, the usual remuneration is deemed agreed.
• Section 847 — no double-dealing. A broker is not entitled to remuneration or expenses if, contrary to the engagement, they also acted for the third party or accepted a promise of payment from that party inconsistent with acting in good faith.
• Section 848 — limited liability. A broker is not personally liable for performance of the contract they brokered, unless they did not tell one party the other party's name.

What this means in practice

• Commission is tied to the deal, not the viewing. A broker who only showed a villa is not automatically owed a fee. They need to be the cause of the contract. One law-firm guide describes this as being the "effective cause" and says commission is typically earned on signing the sale and purchase agreement or lease. Check how your agreement defines the trigger: signing the SPA, paying the deposit or transfer at the Land Office.
• Conditions matter. If your purchase is conditional, for example on obtaining a permit, Section 845 delays the claim until the condition is met. Say so in the agreement; see the sale and purchase agreement guide.
• Who pays is a matter of agreement. The same law firm states the owner usually pays, and on Phangan the seller commonly pays the agent. See the step-by-step buying guide before assuming a buyer pays nothing.
• There is no statutory rate. The same source describes market practice of roughly three to five percent of the price for residential sales, with other property varying. Treat it as a market range and negotiate it.
• Exclusive vs non-exclusive. An exclusive mandate restricts the owner from using other brokers or selling directly during the exclusivity period. A non-exclusive one lets several brokers work and pays only the successful introducer.
• Tail periods. Agreements often protect the broker if a previously introduced buyer signs shortly after the mandate expires. Read how long and which buyers it covers.

Conflicts of interest

Section 847 is the basis for questioning a broker who took money from both sides without disclosure. Ask any agent in writing whether they represent you, the other party or both, and whether they receive any payment from the developer or the other party. Agents also carry anti-money-laundering duties; see the AMLO checks guide.

Checklist before signing a brokerage agreement

• Commission rate, in baht or percent, and what it is calculated on (price, net of fees, or per-rai).
• The event that earns it, and whether conditions defer it.
• Exclusivity period, termination rights and tail period.
• Which buyers count as introduced by the broker.
• Expenses, only if you intend to reimburse them, per Section 845.
• A written agreement. Practitioners strongly recommend it, and it is far easier to prove than oral terms.

If an agent asks for payment before any contract exists, that is outside the Section 845 default and should be treated with caution. Have a Thai lawyer review any non-standard fee or an exclusivity clause before you sign, and for an agent acting under your authority see agency and power of attorney liability.