Update on the issue of Land Redistribution

We have just received an update on the issue of land redistribution without compensation. Here it is:

SUMMARY

These are the five kinds of property the new Expropriation Bill says could be subject to expropriation without compensation.

1. Farms with labour tenants - or perhaps just portions of such farms

Expropriation without compensation may be appropriate where “the land is occupied or used by a labour tenant”, the draft law says.

Labour tenants are defined as people who live or have the right to live on a farm, or in some cases those who had parents or grandparents who worked on a farm in return for living there. They also include some people who had the right to cropping or grazing.

The draft bill makes provision for partial expropriation, which could be used to expropriate only sections of farms, but also has a mechanism where those affected by partial expropriation can ask for the full property to be taken instead.

2. Abandoned Property

Zero compensation could be fair “where the owner of the land has abandoned the land”, the draft law holds.

It does not specifically refer to hijacked buildings in central business districts, but legal experts have previously speculated that such buildings would be easy targets for expropriation without compensation.

3. Property owned by the likes of Eskom and Transnet

Not paying compensation could be just “where the land is owned by a state-owned corporation or other state-owned entity”, the Expropriation Bill says.

The more than 700 state entities in South Africa include many with extensive landholdings surrounding various facilities - including such urban gems as Eskom’s Megawatt Park headquarters north of Johannesburg.

4. Land held for speculation

It may be equitable to pay nil compensation “where the land is held for purely speculative purposes”, the draft reads.

It does not specify how to differentiate between land snapped up for future development and land bought with the idea of flipping it for a profit.

5. Land into which the state has already invested more than its value

Expropriation without compensation could be done when the market value of the land is less than the value of “direct state investment or subsidy” spent either to buy it, or on capital improvements made.

There has been speculation that failed land reform projects, where the government has heavily subsidised community farming projects, could be subject to expropriation and re-redistribution.

Feel free to contact Pam Golding Properties Gansbaai for more information.