Government can now take these properties without compensation

Concerns have been raised that South Africa’s new Expropriation Bill could result in certain groups being unfairly targeted and having their land taken without compensation. However, experts explained that this is not the case.

President Cyril Rampahosa recently signed the Expropriation Bill into law in South Africa, drawing widespread fears from people who fear this could lead to the government targeting one group by confiscating their property.

Donald Trump was among this group and has threatened to stop funding for South Africans until this new Bill is investigated.

However, despite these concerns, the University of Western Cape’s Professor Ruth Hall explained on Newzroom Afrika that this law is, in fact, not new at all.

This law was decided on during the Constitution’s 1995 negotiations and confirmed in the 1996 Constitution. Before this new Act was signed into law, expropriation in South Africa was done in terms of the 1975 Expropriation Act.

“It does not empower the state to force people off the land as an immediate action,” Hall said.

“It is not a law that allows for confiscation. Donald Trump is incorrect about that. Confiscation is where the state simply takes your property away. Expropriation, which is this law, has always been law in South Africa.”

According to Hall, this is not unique to South Africa. Countries worldwide, including the United States, have similar laws in place.

“Expropriation is a process through which states worldwide assert their right of eminent domain and acquire property for public purposes or in the public interest.”

“The United States does it. Britain does it. France does it. Countries around the world with different political frameworks do it.”

Hall explained that, essentially, expropriation allows the state, through a specified process over a protracted period with notices and explanations, to appeal to the court to take certain property.

This is not only limited to land, but it can also include any property. It is also not only limited to property owned by individuals, as it includes companies and even public entities.

“It always has had this power, but the way in which and the purpose for which it can be done has changed,” Hall said.

Where the 1975 Act restricted expropriation to reasons related to “public purpose”, it now also includes expropriation for “public interest”.

Public purpose is where the government acquires property for public functions, such as Transnet or housing.

Public interest, on the other hand, as defined in the Constitution, “includes the nation’s commitment to land reform, and to reforms to bring about equitable access to all South Africa’s natural resources.”

Part of this entails addressing historical injustices and making reparations towards people or communities who lost their land as a result of racially discriminatory land after 1913.

“The law that has been signed now echoes exactly that terminology from the Constitution. ‘Public interest’ is the nation’s commitment to dealing with property in a manner that addresses historical wrongs.”

This is the specific part of the legislation that has been the subject of a lot of scrutiny, as certain groups of people may be afraid it could be used to target them unfairly and deprive them of their property.

Hall clarified that although there are certain properties which are more likely to be confiscated than others, this law is not aimed at any specific group of people.

“There isn’t any Target in this property Clause it doesn’t say which types of property and nor should it. It’s not about who, it’s about which properties.”

Which properties can be taken without compensation

The other aspect that makes this act so controversial is the possibility that the state may take land without compensation.

Section 25 of the Constitution and the new Act stipulate that the compensation for expropriated property must be “just and equitable”.

The compensation must reflect an equitable balance between the public interest and the interests of those affected, which includes the owner of the property.

There are five important criteria in this regard:

• the current use of the property;
• the history of the acquisition and use of the property;
• the market value of the property;
• the extent of direct state investment and subsidy in the acquisition and beneficial capital improvement of the property; and
• the purpose of the expropriation.

Hall explained that there may be cases where, looking at all of those factors, it would be just and equitable to give no compensation at all.

The Act gives four examples of such cases, but all of these are likely to be rare and probably will not affect property that is currently in use or being lived on, she said.

This could happen when the land is not being used, and the owner’s primary goal is not to develop or generate income from it but rather to benefit from an increase in its market value.

It also includes abandoned property and property for which there are incredibly high levels of debt owed to municipalities.

The Act specifies that where the market value of the land is equivalent to, or less than, the present value of direct state investment or subsidy in the acquisition and beneficial capital improvement of the land, it may be equitable to expropriate the land without compensation.

“Here, the classic example is the one of abandoned inner-city buildings where the owners have absconded and they owe millions in rates to the municipality.”

“There are also cases where a state entity is holding property and not using it for its intended purpose, which is a major problem,” Hall said.