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Selling your farm? Proposed new regulation of farm sales

Selling your farm? Proposed new regulation of farm sales

Regulation of Agricultural Land Holdings Bill, 2017, was recently published for comment.

This Bill once enacted would apply in respect of all agricultural land, and to all transactions whereby agricultural land is acquired or disposed of.    

Any provision in any agreement entered into after the commencement of the Bill to acquire or dispose of agricultural land will be void in so far as it purports to exclude, or to limit, any provision of the Bill once enacted. Any acquisition of land in any manner which is inconsistent with or contrary to the provisions of the Bill would be unlawful and a court may make an order for the forfeiture of such land to the State.

Some of the requirements that will have to be met in terms of this proposed legislation are:

  • No foreigner (which includes a juristic person in which a natural foreign person or a foreign juristic person holds a controlling interest) may buy agricultural land:
  • A foreigner may however enter into a long lease of such land for a period of not less than 30 years and not more than 50 years;
  • If a foreigner sells agricultural land the land must first be offered to the Minister who has a right of first refusal.

The proposed legislation also has significant implications for resident owners of agricultural land. Within 12 months from the commencement of the Act a resident owner of private agricultural land is required to:

  • Notify the Commission of his or her ownership, details about the owner's gender and race and the size and use of the land;  and
  • Identify the portion of such agricultural land which constitutes redistribution agricultural land in terms of the provisions of this Act and notify the Commission thereof.

A failure to provide the required notification will be an offence in terms of the Bill.

Comments may be submitted on the Bill by 16 April 2017.

Here is a link to the Bill: www.gov.za/documents/regulation-agricultural-land-holdings-bill-draft-17-mar-2017

Contact one of our conveyancing directors, Adri Ludorf, Tracey Watson-Gill , or Nicholas Mitchell , or Senior Associate Bardine Hall  for all your Property Law requirements.

image: Courtesy of cyberagent.co.za