Constitutional land reform: Upholding property rights in South Africa - Ayanda Zulu

Key topics:

• FMF rejects Expropriation Act, defends private property rights.

• Act allows “nil compensation,” undermining owners’ legal protection.

• FMF proposes rights-based, constitutionally sound land reform alternatives.

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By Ayanda Sakhile Zulu*

On 6 August the Free Market Foundation (FMF), in line with its broader Liberty First policy initiative (www.LibertyFirst.co.za), released a new report titled Constitutional Land Reform: Alternatives to Confiscation and Land Retribution. This report rejects the Expropriation Act in its entirety and sets out a comprehensive blueprint for a land reform programme that upholds the Constitution and safeguards private property rights.

As the FMF has previously argued, the Expropriation Act, which was signed into law by President Cyril Ramaphosa in January 2025 and has since been embraced uncritically by several mainstream commentators as a necessary mechanism for land reform, is a dangerous piece of legislation that fails to meet global constitutional standards and opens the door to confiscation rather than expropriation.

In the first instance, expropriation is a legal concept that refers to the coercive acquisition of property by the state for a narrowly defined public purpose such as the building of a bridge, for instance. There is nothing inherently wrong with expropriation, and what distinguishes it from confiscation is that it protects property owners from state abuse by guaranteeing both market-value compensation and solatium (an additional payment for inconvenience and/or loss).

This principle rests on the understanding that the property owner is not a perpetrator, but a victim of a government that, without any fault on their part, has decided to initiate expropriation. Even in cases where expropriation arises from historical injustice - say, land unjustly acquired through the 1913 Natives Land Act - compensation remains necessary if the current owner purchased the property in good faith and had no part in the original dispossession. Section 25 of the Constitution exists precisely to balance the imperative of justice with the protection of private property rights.

The problem with the Expropriation Act is that it departs from this established approach and veers into a constitutional grey area that severely undermines private property rights. Its legal fiction of “nil compensation,” which has been defended by some as a legitimate legal concept, not only does away with the principle of market-value compensation but also opens the door for the state to offer payments that fall significantly below fair value. 

A key reason for this shift lies in the African National Congress’s (ANC) broader attitude toward property owners in South Africa, which is not neutral but overtly antagonistic. It often portrays property owners as obstacles to its grand vision of “transformation,” rather than as individuals whose ownership is rooted in good faith and legal purchase. Within its narrow ideological outlook, terms like “land thieves” and “apartheid beneficiaries” have come to dominate, and they have created the impression that property owners are in possession of stolen property and should, therefore, consider themselves fortunate to receive anything in return.

It is against this backdrop that the so-called “narrow circumstances” under which expropriation is permitted by the Act deserve closer scrutiny. When property owners are no longer regarded as victims but rather perpetrators, any resistance to parting with property - no matter how reasonable or legally grounded - is likely to be dismissed as an attempt to obstruct "transformation". This will effectively chill legitimate contestation and place the burden of proof on the owner to justify their right to retain what is lawfully theirs.

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Another area of serious concern is the removal of solatium, which is a provision that was included in the now defunct 1975 Expropriation Act. As alluded to earlier, solatium refers to an additional payment made to acknowledge that the property was taken without the owner's consent. Its removal means that not only is market-related compensation under threat, but so too is even the most minimal gesture of justice or consolation for the inconvenience and loss that expropriation inevitably brings. What remains, in effect, is a bare-knuckle approach to property acquisition by the state.

The FMF’s new report is acutely aware of the risks posed by the Expropriation Act, and it is for this reason that it proposes a range of rights-based alternatives that are rooted in the Constitution’s dual mandate of advancing justice while upholding the protection of private property rights. 

Among its key proposals are the transfer of extensive tracts of state-owned land to lawful occupants, the overhaul and streamlining of the country’s restitution process, and the recognition of secure private ownership over communal land. Considered together, these proposals present a viable and constitutionally sound path forward that avoids the pitfalls of confiscation and instead anchors land reform in justice and lawfulness. In stark contrast to the ANC’s decades-long pattern of corruption and hollow, divisive sloganeering, this approach offers a principled and pragmatic framework for real progress.

The centrality of private property rights, which are under direct threat in this case, cannot be overstated. They are not merely an extension of individual freedom but are, as highlighted in the Fraser Institute’s Economic Freedom of the World annual report, a defining feature of stable, prosperous societies with high standards of living.

The Expropriation Act poses a direct and serious threat and must, therefore, be challenged vigorously. If left unchecked, it could set the country on a path well-trodden by failed states that chose populist expediency over constitutional principle.

*Ayanda Sakhile Zulu holds a BSocSci in Political Studies from the University of Pretoria and is an intern at the Free Market Foundation.