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What to expect from the controversial, revised Expropriation Bill

Its far-reaching implications must be carefully scrutinised.
Image: Shutterstock

The controversial Expropriation Bill has been extensively opposed since its introduction in 2015. In consequence, it has been subject to various amendments culminating in the Expropriation Bill, 2020 (the bill).

The Bill has received the Chief Legal Advisor’s stamp of approval from a Constitutional perspective and was published in the Government Gazette on 9 October 2020. It will now be subject to Parliament’s process of consideration, debate and public consultation before it may be enacted into law by the President.

‘Nil’ compensation for expropriation

The most controversial feature in the Bill is that it entitles the State to expropriate property without compensating the owner.

Initially, Parliament reasoned that in order to allow for expropriation without compensation, section 25 of the Constitution should be amended to explicitly allow for this. However, as this proposed amendment is yet to be finalised, the Bill is drafted in accordance with the section as it currently stands.

Read: South Africa takes a step closer to land expropriation

Section 25 stipulates that compensation for expropriation must be just and equitable having regard to all relevant circumstances. Accordingly, if property is expropriated by the State for ‘nil’ compensation it must be just and equitable to do so in the circumstances.

The circumstances are dealt with in clause 12(3) of the Bill:

  • Where private land is abandoned or used merely as a market investment, and not for development and income generation;
  • If it is state land and not being used by a state entity in line with its core mandate;
  • Where the market value of the land is equal to or less than the present value of direct state investment or subsidy in the acquisition and improvement of the land; and
  • When the nature or condition of the property poses a health, safety or physical risk to persons or other property.

The introduction of clause 12(3) in the Bill is in line with Parliament’s objective to provide clarity and certainty on the land rights of South African citizens. However, the listed circumstances, and the fact that the list is infinite, does little to quell the anxieties of investors and property owners in South Africa.

Some relief can be found in the fact that our Courts can be called upon to determine whether the price of the compensation for the expropriation is just and equitable if the expropriating authority and expropriated owner cannot agree upon the price for compensation.

Definition of property

A further red flag is in the Bill’s failure to provide a comprehensive definition of what property may be expropriated. As it stands, the definition expressly states that it is not only limited to land. Precisely what property may be expropriated is left to a wide interpretation and may include intellectual property and movable property. To contextualise this, on the face of it the State would be entitled to expropriate farm land, along with all the livestock, equipment, vehicles and intellectual property required for its operations.

In light of the rising tensions with respect to land restitution in South Africa, the need for coherent expropriation legislation is becoming increasingly more vital. However, the far-reaching implications of the Bill dictate that it must be carefully scrutinised before being enacted into law. Whether the Bill will withstand this scrutiny, by both Parliament and the public, is still to be seen.

Marikah Calo is an associate at Cox Yeats, specialising in corporate and construction law.

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All that the ANC/EFF are doing is introducing it piecemeal in true political fashion.

They are introducing this bill now to appease those opposed to it by this specific bill being less controversial than initially expected.

People will foolishly think that this is the end of it.

An amendment to the constitution requires a far greater parliamentary majority in favour of the change than a standard law such as this one.

The amendment that the ANC/EFF want to the constitution is for the constitution to say that the Expropriation Act i.e. this bill that will be in law at the time of the constitution amendment will define what can be expropriated and how it will be done.

i.e. they are shifting the weight of expropriation away fromt he constitution where they will find it harder to pass so that they can then amend this act again once the constitutional change has been made.

So to simplify, the steps are as follows:

1) Pass the Expropriation Bill into law
a) This will quieten down the volume of opposition because this bill seems to be a compromise of sorts.

2) Change the constitution to move the definition of what may be expropriated and how from the constitution and into the expropriation act.
a) This will be easier to pass in parliament with the ANC/EFF and some other black parties in favour because the definition of expropriation will seem to be fine based on point 1.
b) It will move the large majority required to get the ANC/EFF vision of expropriation legalised to the small majority for the Expropriation Act to be changed.

3) Change the Expropriation Bill to have the ANC/EFF vision of rapacious, looting utopia
a) Far smaller majority required
b) Less opposition by this time
c) The end game under the guise of communism and reparation

You heard it here first folks!

Unfortunately, the majority of our main stream media is either captured or bought.

Does not matter how they try and sugarcoat it. It is what it is and it is called LANDGRAB!!!!!

They have had a constitutional mandate to expropriate land with compensation for 26 years now. Why did they not do it?

They have no intention. It is a tool to get votes and enrich the political elite.

Had noting to do with the lack of money either as the “without compensation” bit can be construed to imply.

If money was the issue and the intention was to give land to the poor. WHY DID THEY NOT GIVE AWAY THE MILLIONS OF HECTARS AF STATELAND??? They are doing it now as an eye blind.

Landgrab is Landgrab. They will pay for it. They just think the whole world is as stupid as they are. Real amateurish con job.

The world is not stupid. Countries like the US and China are waiting in the wings.

Once they ANC/EFF has completely destroyed the country and there is no economy to speak of, the only thing that they will have to trade with is land.

At that point, the land will be bought up for commercial rights such as mining, large-scale farming, and fracking and the ANC/EFF will have regressed back into slavery of their own accord.

I wonder how they will find their Chinese masters.

Rubb*sh

C-3PO perhaps you could enlighten us with your version?

Land grab as you say. Correct me if I am wrong but as I understand the EWC bill etc one of the key changes from, as you say, the expropriation law that exists for public good, is to expropriate for private ownership. Like the minerals grab from farmers. Their farms will be taken and then allocated to “deserving” black farmers, probably ANC cadres, one and all.

The ANC won’t touch the big corporates who will also stay quiet as they make their planes. Look at Mondi’ Cyril (Shanduka) is their BEE “partner” (read protector) and they are disinvesting from SA day by day. Their land is safe – the CR ANC will target the individual land owner who has a productive farm; until the ANC takes it!

Yaa. Hey this lot is just corrupt to the core.

What does not help is many of the things cant be ventilated as MW might be closed down or something if they don’t “moderate” the anti BEE stuff.

The whole lot is just a stinking mess.

Mt take on this? I may be wrong but I do believe that the Gov knows it is wrong and unworkable apart from being unconstitutional but it is a vote catcher so is kept on the back burner and stirred a bit each time elections are looming.

Immoral legalised theft !!!

Expect more international skepticism to investing in SA.

They will take/forcefully buy land, it will become a desert and then they’ll sell it to china

What makes blk settlers believe they have more rights than wht settlers?

A good starting point will be to take away and sell to Private productive owners the unproductive land sitting on government (all levels) and SOE balance sheets.

Immediate : cash
Immediate : rates & taxes
Very soon : employed people
Soon : income tax from productive owners

Imagine just in Post Office, Telkom and councils the amount of unproductive land

The bill in its current shape has been greatly watered down. The court is the final decider.

Given South Africa’s problems with corruption and wasteful expenditure, it remains to see how immune to corruption and cadre exploitation this will all be. This is probably why investors and others are sitting this one out, for now.

I wonder if all the aspirant landowners know that there is no limit to how many times a piece of land can be expropriated?

End of comments.

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