SA’s first major test of expropriation without compensation is set to be decided under outdated legislation due to President Cyril Ramaphosa’s failure to bring the 2024 Expropriation Act into force.
According to Adv Tembeka Ngcukaitobi, the delay leaves courts applying the 1975 Expropriation Act rather than the new law, which is intended to shift the focus from market-value compensation to what is considered “just and equitable”.
Ngcukaitobi says until the 2024 Act is fully proclaimed cases such as Driefontein in Gauteng, a 34ha property seized by the City of Ekurhuleni in 2019 without compensation for a government housing project, cannot set binding precedent under the new legal framework.
Driefontein’s owner, Business Venture Investments 900, was offered zero compensation despite independent valuations placing the land’s market value at R30m-R64m — hence the looming high-stakes legal showdown.
Ramaphosa signed the bill into law in January but has not yet proclaimed the act as it is facing legal challenge and requires a formal proclamation to come into effect. Ngcukaitobi said the fact that the Driefontein case will have to be decided under the old law means it will not have much precedent value.
If and when enacted the 2024 legislation will allow the courts to weigh factors such as the history of land acquisition, state investment, rehabilitation costs and the purpose of expropriation, even permitting “nil” compensation where costs exceed market value.
Ngcukaitobi describes this as a major shift in the country’s land reform approach. “The 2024 act changes the law to align with the constitution, which means there is no longer an entitlement to market-related compensation. Property owners have strong procedural protections but cannot insist on market-based compensation. Justice and equity [will be] the main drivers of expropriation decisions.”
The Driefontein dispute has dragged on for six years and mediation has now been scheduled for October, with an 18-day trial set for February 2026. According to nonprofit business lobby group Sakeliga, Business Venture Investments 900 has been pursuing compensation through the courts since 2019, arguing that the expropriation has caused it substantial financial losses, including legal costs and missed development opportunities.
Risks to property values, investor confidence
Business groups such as Sakeliga have warned that prolonged uncertainty over expropriation law risks depressing property values and undermining investor confidence. But in legal papers the city said it believes “nil compensation is just and equitable” in the Driefontein case, and that the interests of the landless poor outweigh the owner’s claims to market value. It argues that the property was not in active use at the time of seizure and therefore caused no financial loss to the owner.
The case was originally announced by then Ekurhuleni mayor Mzwandile Masina as a test case for the limits of section 25 of the constitution, which deals with land reform and expropriation. Masina, now a member of the ANC’s national executive committee and chair of parliament’s trade & industry committee, has defended expropriation without compensation in recent public statements as a tool to address inequality.
Supporters of the new law, including the ANC, have argued that it gives the state powers to speed up land reform in line with section 25 of the constitution. But critics, including Sakeliga and several opposition parties, argue that it weakens property rights and opens the door to arbitrary seizures.
Sakeliga has said that the Driefontein case illustrates how state entities may use the 2024 act to seize land while leaving owners to carry the burden of lengthy and costly litigation. The group has vowed to support the owner’s case and to mount broader legal challenges to the act later this year.
SA’s first big expropriation without compensation test — the Driefontein case — will be decided under outdated 1975 law because the new 2024 Expropriation Act hasn’t been proclaimed. That means the outcome won’t set binding precedent for future land reform cases. The delay risks weakening property rights, damaging investor confidence and fuelling legal uncertainty at a time when SA’s coalition politics and global credibility are under pressure.
The case comes at a delicate time for SA’s coalition government, where differences over land reform remain a source of friction. The ANC pushed through the 2024 Expropriation Act despite opposition from its coalition partners, the DA, FF+ and IFP, which have warned of economic fallout.
“Politically, one should expect severe strain on the current coalition government and also within political parties in the coalition or aspiring to be in future local and national coalitions. Moreover, foreign political scrutiny will escalate sharply, causing a crisis of legitimacy in the international arena,” Sakeliga said.
Property rights remain a politically charged issue in SA. Previous high-profile disputes have included the government’s failed attempt in 2020 to amend section 25 of the constitution explicitly to allow expropriation without compensation, as well as local battles over land occupations and farm expropriations in provinces such as Mpumalanga and Limpopo.
Sakeliga said the Driefontein case will be closely watched because it involves urban land in a major metro and could set a precedent for both housing projects and commercial development. The organisation warned that if the court upheld Ekurhuleni’s stance, valuations of similar properties could fall, undermining collateral values and affecting financial markets. Uncertainty over property rights would have “wide-ranging and deeply harmful effects” on investment and land development, it said.
Update: September 21 2025
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