New policy could see foreigners lose land

2015-02-08 15:00

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Multinational companies operating in South Africa are keeping mum on the governing party’s plan to ban foreign ownership of land, which was unveiled after its national executive committee met last month.

The decision has placed the ownership of expensive title deeds in doubt – among them those held by British telecoms group Vodafone, which owns 65% and 60.9% in Vodacom Group and Vodacom, respectively.

These companies together own five title deeds, according to deeds office records, purchased for a collective R38.4?million.

The sprawling Vodaworld complex in Midrand alone accounted for about R32.4?million of this total, and has almost certainly appreciated in value since it was purchased 14 years ago.

But Vodacom spokesperson Richard Boorman did not want to speculate on the implications of the ANC’s decision on its foreign parent.

“We’d need to look at it in more detail and get clarity on the proposal before making any kind of comment,” Boorman said.

ANC secretary-general Gwede Mantashe told reporters the party’s highest nonconference decision-making body had resolved to cap land ownership at a maximum of 12?000 hectares or two farms for individuals or companies, while foreign nationals would be barred from owning land.

“They will, however, be able to access land through leaseholds,” Mantashe said.

One of the largest corporate holders of title deeds is German car maker Daimler, which has numerous subsidiaries in the country, among them Mercedes-Benz SA, Koppieview Prop and Atlantis Foundries.

Koppieview appears to hold most of the subsidiaries’ title deeds, including for vehicle showrooms throughout the country and two farms bought for a collective R15.2?million.

“All South African property owned by any of these companies is owned by the locally registered companies,” said Mercedes-Benz SA’s Jeanette Clark.

“The title deeds are therefore owned by the local companies and are not in foreign ownership.”

The registration of the companies locally has foreign businesspeople scratching their heads about what constitutes a local or foreign company.

Matthias Boddenberg, chief executive of the Southern African-German Chamber of Commerce and Industry, said: “There are a number of ‘German’ companies that own the property or hold the title deeds they are using for plants and production facilities. Almost all of them are legal entities in South Africa.

“Most of them are registered companies as (Pty) Ltd or Ltd. It would have to be clarified whether they would be considered ‘South African’ or ‘German’.”

Clark said Mercedes-Benz SA would study any official decisions made by government at the appropriate time. That could be a long time coming – the department of rural development and land reform does not have firm data on land ownership.

Department spokesperson Linda Page said: “The department is in the process of conducting the second land audit, which will give us accurate statistics of who owns what in terms of land in the country. Currently, the information we have is contained in the land audit booklet on our website.”

This booklet indicates that, in 2010, 18% of land was owned by the state and 79% was in private hands. The rest was unaccounted for. The audit could not identify foreign ownership because the department’s system did not provide for that analysis.

But at least two of the country’s top 10 luxury game lodges – as ranked by SA Tourism – have some form of foreign ownership.

There is the 23?000ha Phinda Private Game Reserve in northern KwaZulu-Natal owned by &Beyond, a company under the control of major shareholders Capricorn and the Getty family trusts.

Capricorn is owned by the Enthoven family, known for its holdings in fast food company Nando’s, vintner Spier and insurer Hollard. The family’s trusts were established for scions of the US oil dynasty.

Kevin Pretorius, & Beyond’s regional director for South Africa, said the policy still needed to be legislated through Parliament. “We trust the inherent complexities of such a policy, and the negative impact on our economy thereof, will be understood before any legislation is affected,” he said.

Richard Branson’s ownership of the 13?500ha Ulusaba Private Game Reserve, which borders the Kruger National Park in Mpumalanga, is also no secret.

Two years ago, Indian industrial billionaire Analjit Singh bought three wine estates in Franschhoek, which have been converted into five-star hotel and boutique winery Dassenberg Estates.

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