Title: 2025 Reformation Act: A New Hope for South Africa?

“Law is a powerful tool for social ordering”, writes Katharina Pistor in The Code of Capital. In her work, she argues that law not only creates wealth but also generates inequality, in a system shaped by people, and enforced by the government. As a result, legal systems themselves can become the root cause of social and economic injustice. Nowhere is this more evident than in the Republic of South Africa, where apartheid was only formally dismantled in the early 1990s. The country’s history is marked by centuries of land dispossession and expropriation laws, and this legacy continues to shape the present. As of 2022, the World Bank identified South Africa as one of the most unequal countries in the world, with around 10% of the population controlling 80% of its wealth. 

The genesis of land expropriation acts

The dispossession of land through the 1913 Natives Land Act was apartheid’s original sin. First of a series of laws that enabled the South African government to enforce systematic oppression, this Act limited black people’s capacity to ownership, by restricting them from buying or occupying land. Subsequently, as the government began the mass relocation of black people to poor homelands and to poorly planned and serviced townships, a cycle of endless exploitation was created, ensuring a durable position of inequality and social fragility for the country.

 Eventually, Expropriation Act was signed in 1975, which provided a legal framework for the expropriation of property for public and certain other purposes, and placed an obligation on the state to pay owners it wanted to take land from, under the principle of “willing seller, willing buyer”, reflecting the priorities and legal standards of the apartheid regime. The Act started feeling outdated when the new Constitution was adopted in 1994, as it faced widespread criticism for its failure to align with it for many reasons. The first reason for this discontent was linked to compensation being based on market value, conflicting with Section 25 of the 1996 Constitution, which required “just and equitable” compensation that considers factors like historical disadvantage and land reform needs. 

This made land redistribution financially impractical for the state, slowing efforts to provide a framework for transformative land reform. Moreover, the Act did not feature nil compensation, which is the possibility for the state to expropriate land without paying any monetary compensation to the owner, under specific circumstances, which slowed down efforts even more. Furthermore, the lack of court oversight and the attribution of wide powers to the ministry, could not guarantee a fair procedure to the citizens. 

The new Expropriation Act 2025

As a result, the Minister of Public Works and Infrastructure, Patricia de Lille, stated in September 2022 that “it is our responsibility to correct this historic injustice” and, indeed, South African President Cyril Ramaphose signed a new Expropriation Bill into law on 23 January 2025, which aimed to replace the old Expropriation Act 1975. Although highly contested by the opposition party out of fear that it would establish property rights and foreign investment, the reality seems to be that the Bill seeks to align South Africa’s expropriation framework with constitutional principles of equity, justice, and public interest. 

This new law brings a lot to the table. First of all, the act adds that expropriation can be made not only for a public purpose, but also in the public interest, including land reform and redress. Second of all, procedures entailing land expropriation will be more structured and transparent and will improve safeguards against misuse. This means that the courts will retain crucial oversight in accordance with constitutional standards and negotiation and mediation before expropriation has been emphasised, ensuring in this way a just and equitable framework, balancing public interest with property rights. In addition, compensation won’t just be based strictly on market value anymore, but it will also need to be just and equitable, coherently with constitutional principles. Moreover, one of the most controversial aspects of the Bill is the provision allowing for nil compensation in certain circumstances. This means that, if an expropriation of a property meets the constitutional requirement of being just and equitable, the compensation could legally be zero. 

Who does this law not sit right with? 

Nonetheless, opposition’s parties are not so pleased with this new act, even expressing the will to challenge its constitutionality and questioning its legitimacy, with the Democratic Alliance claiming to “have reservations about the procedure and aspects of the Bill”. AgriSA, an agricultural union representing farmers since 1904, is also fearing the Bill, claiming that it facilitates the expropriation of land with nil compensation under specified conditions in the public interests. “The signing of the Expropriation Bill poses a risk to private property rights which is the primary basis on which South Africa agriculture is structured” says Johann Kotzé, AgriSA CEO. The organisation has taken part in the parliamentary processes that contributed to forming the basis for the recently signed legislation, during which AgriSA addressed a letter to the President, questioning the constitutionality of the bill. In addition, it was requested to conduct an assessment of a policy of land expropriation without compensation to find out its macroeconomic impact. 

The legacy of land dispossession continues to shape the lives of millions of South Africans and remains a major barrier to the country’s economic development. It stands as one of the most significant challenges to addressing inequality and bridging the country’s deep socio-economic divides. While the 2025 Expropriation Act has been highly debated, it can be said that it marks a historical and legal turning point in South Africa’s long-delayed land reform process. “Law is a powerful tool for social ordering”, so perhaps, through this legislation one might glimpse President Ramaphosa’s attempt to use law to reshape South African society.