Agri South Africa v Minister for Minerals and Energy

Agri South Africa (Agri SA), representing commercial farmers, challenged the constitutionality of the Mineral and Petroleum Resources Development Act 28 of 2002 (MPRDA), arguing that it expropriated pre‑existing mineral rights without compensation. The challenge was based on the experience of Sebenza (Pty) Ltd, which had purchased and registered coal mineral rights under the Minerals Act 50 of 1991. When the MPRDA came into force on 1 May 2004, Sebenza’s rights became ‘unused old order rights’, valid for one year and convertible into new rights upon application. Due to financial and internal difficulties, Sebenza did not apply for conversion and its rights lapsed. Sebenza and Agri SA claimed that the extinguishing of these rights amounted to expropriation under section 25 of the Constitution. The High Court upheld this claim, but the Supreme Court of Appeal overturned it, holding that no expropriation had occurred. Agri SA then appealed to the Constitutional Court.

Leave to appeal was granted but the appeal was dismissed. The decision of the Supreme Court of Appeal was upheld. No expropriation occurred and no compensation was payable. The Minister’s application for leave to cross‑appeal was dismissed.

This case is a leading authority on the distinction between deprivation and expropriation under section 25 of the Constitution. It confirms that the MPRDA’s transfer of mineral resources into state custodianship does not constitute expropriation. The judgment affirms the constitutionality of South Africa’s post‑apartheid mineral law regime and clarifies that transformative regulatory reform, even if it extinguishes existing rights, does not necessarily trigger compensation.