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29 July - 5 August 2014
Issue 576
41618
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Foreigners to be banned from SA land ownership
| A new bill set to be fast-tracked through parliament within a few months will no longer allow foreigners to buy property or land in South Africa. However, South Africans with foreign spouses might equally be affected by sertan sanderson Foreign investors to SA are facing a new set of drastic regulations, as the government has announced a new expropriation bill, which would limit foreigners’ access to land in South Africa to leasing periods of 30 years only. Under the Regulations of Land Holdings Bill, foreigners would not be allowed to own any land at all, and it is uncertain whether they would be allowed to renew the proposed leases. While current foreign landowners would be exempted from the bill (as roughly seven percent of land in South Africa is owned by non-South African nationals) the announcement of the new regulation may still come as a shock to many South African nationals, who might be hoping to buy houses in Mzansi together with their foreign national spouses. The government is hoping to rush the new bill through government in November and have it applied within five years. Though lacking the required two-third majority to push the law through parliament, the ruling ANC is likely to gain widespread support from the Economic Freedom Fighters (EFF) on this occasion, as the two parties may work closer together in the future – especially on issues pertaining to land reform and redistribution.
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EFF had caused outrage recently when they had accused Sir Richard Branson, founder of Virgin, of stealing land when acquiring a hotel and vineyard estate in the Franschoek valley in the Western Cape. The EFF, who occupy ten percent of all parliamentary seats, run on a party-political programme which calls for land expropriation without any compensation, invoking a Zimbabwe-style leadership, where various bans on land ownership have sent the economy into ruins over the past twenty years. The repercussions of a ban on foreigners acquiring land in South Africa would likely be equally unsupportable for SA’s economy.
With a favourable exchange rate of the rand to foreign currencies, pleasant climate conditions and a welcoming property market, South Africa has been attracting more and more buyers from abroad year after year. But Gugile Nkwinti, the Minister of Rural Development and Land Reform, said that the proposed bill allowing only locals to purchase land would be a fair way of ensuring that the property market stays favourable to the purchasing power of local buyers. He also assured existing landowners from abroad that the new regulations would not infringe on their current property rights or
lead to the expropriation of their existing properties, adding that such practices would be arbitrary and unconstitutional. However, especially in the case of SA nationals married to foreigners, the constitutional legalities of the proposed bill will likely be challenged, under the premise that any South African has a right to build and sustain a family, including the provision of a home, as he or she may desire to. With a track record of suggesting other bills, which have been criticised for leading to irrational approaches to the ongoing
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