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Govt moots ban on farm buyers

Oct 14 2010 06:34 Troye Lund

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Cape Town - A ban on foreigners buying productive land in South Africa and additional property taxes for “absentee landlords” form part of a detailed government proposal to create a new land tenure system, aimed at improving land reform.
 
According to the “final draft” of the long-awaited green paper on rural development and land reform, limiting land ownership rights for foreigners who don’t have permanent residency would be entirely constitutional.
 
It would also be in line with measures other developed and developing countries have put in place.
 
The discussion paper also suggests that, in certain cases, the same moratorium on acquiring land could be extended to “South Africans who do not qualify for redress under the national land reform policies”.
 
Fin24.com has obtained a copy of the 129-page document, which explains that: “The problem with foreign land ownership is not the sale or purchase of land by non-citizens per se but the use of the land.”
 
This view, argues the paper, shifts the debate to the realm of the “effectiveness of measures designed to assuage the ill-effects of foreign land ownership”.
 
These ill-effects, according to the green paper, include rising land values, distortion of the land market, perpetuation of segregation as well as the legacy of fragmentation that was initially created by apartheid land planning.
 
The green paper proposes that a “viable mechanism for the future” is for foreigners to be limited to medium- and long-term leases of all productive land.
 
It adds that: “Regulation, in this view, should include measures such as additional property taxation on non-residents or absentee landlords”.
 
The document, which will be released for public comment once approved by cabinet, concedes that government has no statistical information on exactly what land foreigners currently occupy.
 
But it dismisses official figures which show that foreign natural persons own only 0.55% of farms by number of properties, 0.15% by value, and 0.07% by area.

These figures also show that when it comes to “agricultural holdings” (generally residential smallholdings around some large towns), they own 1.79% by number of properties, 1.75% by value, and 1.98% by area.
 
“The concern is that these figures may not reveal the full extent of foreign ownership,” the paper states. There is a concern that foreigners own a great deal of land through their stakes in corporate entities.
 
It is for this reason that the document proposes compulsory disclosure of nationality, race, gender and other information.
 
It also calls for a land management commission (LMC) to oversee a new, three-tier land reform system and to enforce legislation that will be necessary to implement it.
 
It is proposed that the LMC be given prosecuting powers to safeguard against issues like fronting which should, the document recommends, carry the sanction of asset forfeiture.

 - Fin24.com
land reform
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