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February 2022

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How the new Property Practitioners Act will impact property developers

Accreditation and compliance already dominate the operations of South Africa’s property developers – such as ensuring that the necessary certifications are obtained and that the property to be developed follows all the necessary zoning laws. Now, for some property developers, the Property Practitioners Act (PPA) will usher in a new era of additional compliance and certification requirements.
 

Wilco du Toit, associate, Barnard Incorporated Attorneys

Wilco du Toit, associate, Barnard Incorporated Attorneys

From 1 February 2022, the Property Practitioners Act repeals the Estate Agents Affairs Act and casts a wider candidate net that now includes property developers – including their directors, members, or trustees, who act as a facilitator on behalf of another in the sale and letting of immovable property for profit or gain.

The many property developers who will fall under the definition of a “property practitioner” defined in the Act will, among other legislation and provisions, need to ensure compliance with Chapter 8 of the PPA.

Fidelity Fund Certificate

Sections 47 and 48 of the Act compels property practitioners (including its directors, members or trustees, and its employees who act as property practitioners) to obtain and hold a valid Fidelity Fund Certificate. No property practitioner can act as a property practitioner unless a valid Fidelity Fund Certificate is held by that person.

Anybody that fails to obtain a valid Fidelity Fund Certificate may be required to repay any amounts received in respect of any property transaction.

Source: BIZCommunity
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