The Expropriation Bill has been passed -but concerns remain
30 May 2016
The National Assembly has passed the Expropriation Bill and should the President assent to it, South Africa will have a newExpropriation Act.
The new Expropriation Act has been a long time coming, the quest having begun in 2008, with the previous versions lapsing in Parliament over concerns with their constitutionality. In many respects, this version is perhaps the best thus far. That is not to suggest that the newExpropriation Bill is without fault.
To begin with, at provincial level, there were allegations of insufficient public participation in the legislative process. Various media reports revealed how, for example, in the Eastern Cape, the public was only made aware of the scheduled public hearings three days before they began. The Free State reportedly saw last minute venue changes, different from those initially advertised, which created confusion. It is doubtful whether the provinces managed to solicit a sufficient degree of public participation, which therefore casts doubt over the legitimacy of the National Council of Province’s final mandate.
The courts have made it abundantly clear that the legislature has a duty to involve the public in the legislative process. The Constitutional Court, in the seminal case Doctors for Life International v The Speaker of the National Assembly and Others, makes it clear that good laws are made, and citizenship is enhanced, when legislators are required to invite and attend to public input. The same case made it clear that Parliament would have failed its constitutional duty if either the National Assembly or the National Council of Provinces (NCOP) did not adequately facilitate public participation.
When considering the substantive provisions of the Bill, the definition of expropriation is, perhaps, the most concerning. The Bill defines expropriation as “the acquisition of property”. The definition is problematic because the notion of custodianship, as introduced in the Agri South Africa v Minister for Minerals and Energy and Others (AgriSA) decision, held that mineral resources are not acquired by the State but are held in custodianship for all South Africans, thus requiring no compensation despite the complete deprivation of ownership entitlements. The AgriSA decision was careful to restrict the concept of custodianship to the particular facts on hand - a point that the Bill misses. In fact, the very notion of State “custodianship” over non-natural resources does not find much support in academic and legal circles.
The Bill provides for expropriation for a “public purpose” and in the “public interest”. The concept of “public purpose” is well established in law and includes expropriation for public purposes, such as the building of roads or dams. However, the concept of the “public interest” is vague and the definition included in the Bill simply quotes the Constitution verbatim to the effect that “public interest” “includes the nation’s commitment to land reform, and to reforms to bring about equitable access to all South Africa’s natural resources…”.
It is insufficient for the Bill to simply quote the Constitution verbatim. The role of legislation is to flesh out the Constitution - by giving clarity to its provisions. Merely repeating what has already been stated fails to lend greater understanding to the existing constitutional provision and renders the Bill’s provisions vague. This vagueness creates uncertainty and may lead to irregularities - and possible challenges in the Constitutional Court.
In addition, the Bill’s definition of “property” - “property means Property as contemplated in Section 25 of the Constitution” - is so broad that it could encompass virtually any form of property, including indigenous knowledge and other forms of intellectual property.
The Expropriation Bill also appears to allow third-party transfers - in that it allows the expropriation of property for private individuals. As we have previously commented, in the absence of an express provision in the Bill limiting third-party transfers for purely economic development, the Bill may very well encourage malfeasance or abuse of authority. Outside of land reform (which the Constitution already makes an imperative requirement), third-party transfers for purely economic development reasons create room for irregularities and abuse.
It must be said though, that this Bill, compared to previous versions, provides better protection to property owners in that it makes it mandatory for the State to first attempt to acquire property through agreement. Only where there is no agreement, may the State proceed to expropriate the property. While market value is but one of the factors that must be taken into consideration in calculating the compensation amount, it must still be a just and equitable amount, which also factors in the owner’s interest. However, in line with section 25(b) of the Constitution, it is the Courts and not the State, that have the final say with regard to the compensation amount. This is a great improvement on the 2008 Bill which, in effect, attempted to circumvent the role of the Courts in determining compensation for expropriated property.
That South Africa requires a new expropriation process, one aligned with the Constitution, is a given. Nonetheless, this expropriation process needs to reflect the delicate balance that requires the protection of property rights while making allowance for land reform, as reflected by the property clause in the Constitution. The Bill is still far too vague, particularly with regard to its definitions of expropriation, property and the public interest, and also because of the provision for expropriation on behalf of third parties.
It might be advisable for the President to send the Bill back to the National Assembly for its constitutionality to be assessed, before he signs it into law.
By Phephelaphi Dube, Director, Centre for Constitutional Rights, 30 May 2016
