Civil society organisations will be in the Western Cape High Court next week to challenge the legality of the Expropriation Act. The sanctity of the Constitution and the future of private property rights in South Africa are at stake.

Background

Monday’s court appearance is the culmination of a protracted and contentious fight over expropriation without compensation (EWC), a policy directive formally adopted by the African National Congress (ANC) at its policy conference in Johannesburg in December 2017.

An avowedly socialist organisation, the ANC has always been ambivalent about private property rights. It has long argued that existing restitution processes are not enough to correct historical injustices relating to land.

While South Africa does indeed have a history of depriving black South Africans of private property rights, the solution to this is to strengthen, rather than weaken, the existing property rights framework already enshrined in the Constitution.

While most countries have powers of expropriation (to build dams or highways, for example), it is commonly accepted that citizens whose property is expropriated by the state should be appropriately compensated at a market-related price.

However, ostensibly in the name of redress, the ANC now seeks to use expropriation legislation to empower the state to confiscate land for “nil” compensation.

To achieve EWC, the ANC initially set its sights on amending the Constitution – the same Constitution that it helped to negotiate in the mid-1990s – which guarantees private property rights for all South Africans.

Thus, the ANC attempted to amend section 25 of the Constitution in 2021 through the Eighteenth Amendment Bill. Amendments to the Bill of Rights require a two-thirds majority in Parliament to pass. Thankfully, the ANC could not convince the more-radical-than-thou Economic Freedom Fighters (EFF) to support the amendment, which was ultimately defeated in Parliament.

However, when the constitutional amendment failed, President Cyril Ramaphosa openly proclaimed that the government would seek to introduce EWC through ordinary legislation, thus inverting the supremacy of the Constitution. And so, the Expropriation Act of 2024 was passed in Parliament, replacing the old Expropriation Act of 1975.

The president signed the Expropriation Act into law in January 2025. Soon thereafter, in February, my organisation, the Free Market Foundation (FMF), convened an urgent civil society roundtable meeting to form a united front against this assault on private property rights. Several organisations, including the FMF, publicly committed to taking legal action against the Act.

The Case

Applications have been brought by civil society organisations AfriForum and IRR Legal against the Expropriation Act in the Western Cape High Court. The respondents include the President of the Republic of South Africa, the Minister of Public Works and Infrastructure, the Speaker of the National Assembly, the Chairperson of the National Council of Provinces, and the EFF.

The FMF, through its Rule of Law Project, has been admitted as an amicus curia (friend of the court) and the matter has been set down for next week. We will be ably represented in court by Advocates Mark Oppenheimer and Kessler Perumalsamy.

On Monday, the same High Court will also hear another case brought by the Democratic Alliance (DA), which has various procedural and substantive objections to the Act. The DA’s application will be dealt with separately by the court (albeit in a joint hearing with the AfriForum and IRR Legal case).

Both AfriForum and IRR Legal seek to have section 12(3) of the Act declared inconsistent with the Constitution and invalid. As an amicus, the Rule of Law Project must make novel arguments that help to inform the court’s deliberations and must not repeat the arguments made by other applicants.

In our heads of argument, we contend that section 12(3) of the Expropriation Act is unconstitutional, serves no rational purpose, and is inconsistent with customary international law. What follows is a basic outline of our submission to the court.

The Act is Unconstitutional

The Rule of Law Project raises concerns about the constitutionality of section 12(3) of the Act, which empowers government authorities to expropriate property for "nil compensation" in an open-ended set of circumstances.

This, we argue, is in direct contradiction to section 25(2) of the Constitution, which stipulates that the state may only take property:

• •for a public purpose or in the public interest, and
• •subject to compensation, the amount of which must be agreed or decided by a court, and the time and manner of payment must also be fixed.

The words “compensation”, “amount”, and “payment” all mean that there should be some form of compensation in the event of expropriation by the state.

As we argue in our papers, zero is not a form of compensation:

“That is the antithesis of compensation. To take without any money exchanged is confiscation and not expropriation.”

Reading section 25 in its entirety – including the reference to market value in section 25(3)(c) – reaffirms the principle that compensation is required. The courts must give meaning to every word in the Constitution and cannot simply ignore the words “compensation”, “amount”, and “payment”, we say.

We also delve into the historical context behind the drafting of the property rights clause of the Constitution and note that all parties in the constitutional negotiations – including the ANC – intentionally rejected the notion of expropriation without compensation.

Irrational

A law must have a rational connection to a proper purpose, but section 12(3) of the Act does not pass this test.

Even if one accepts that “nil compensation” could somehow be a form of “just and equitable” compensation, the government has not explained why a special section is needed for it.

Sections 12(1) and 12(2) of the Act already provide guidance on how to calculate just and equitable compensation by balancing various factors. However, section 12(3) simply states that the outcome of that balancing exercise can be zero.

As we argue in our papers:

“If the objective of section 12 generally is to provide a mechanism for determining what is just and equitable compensation, then why is it necessary for section 12(3) to place an amount – indeed, any amount – on what is just and equitable?”

If the ordinary process can already produce a low or zero figure, why create a separate rule that specifically authorises “nil”, we ask? The government has not been clear on this.

International Law Requires Compensation

South Africa’s Constitution requires courts to consider international law when interpreting rights.

Since the South African government is a signatory to various bilateral investment treaties (BITs) and other international agreements, it would have an obligation to compensate foreigners who own property in South Africa, where that property is the subject of an expropriation under section 12(3) of the Act.

However, if the state relies on the same section to expropriate the property of a South African, it would not be required to pay compensation. We warn that this would produce an unfair double standard between South Africans and foreigners:

“[Interpreting] section 25 of the Constitution to permit nil compensation produces absurd and discriminatory results because it would create two parallel legal regimes, which afford greater remedies to foreign persons and entities than South Africans, and it would interpret the guarantees of section 25 (2) and (3) as essentially purposeless and in conflict with ostensibly competing constitutional interests.”

Instead, we urge the court to adhere to section 39(1)(b) of the Constitution, which requires that section 25 be interpreted in a manner consistent with customary international law.

“The position at international law is clear: compensation is required for every expropriation,” we conclude.

Into the Arena

South Africans should pay attention to what happens in the High Court this week. It is sure to be an epic legal battle. Not only property owners, but anyone who believes in constitutionalism and the rule of law should care about the outcome.

More importantly, you should support those organisations who are taking the fight to the government in defence of your most basic of freedoms: your right to keep what is yours.

Ansara is CEO of the Free Market Foundation.