Last week, on the 2nd of October, the PPRA sent a Practice Note and a draft exemption application to its database of property practitioners. Unfortunately both documents are riddled with apparent typing errors and other legal oversights and we are therefore clarifying the essence thereof for our business partners:
The Practice Note:
- applies to all transactions facilitated by estate agents (and other property practitioners) with one exception: It does not apply in the case if the sale of residential property;
- states that the mandatory Disclosure Form – which the Property Practitioners Act prescribes must accompany a mandate and must be presented to a prospective purchaser or tenant of a property – does not efficiently deal with defects found in non-residential and rental properties and that therefore, practitioners are advised to develop their own Disclosure Form that is particular to the type of property dealt with;
- implies that such adapted Disclosure Form remains mandatory; and
- in order to implement the use of such adapted Disclosure Form, a property practitioner must first submit an exemption application to the PPRA. The pre-printed grounds for exemption and the date in this form that the PPRA provided in their email of 2 October, are unfortunately incorrect. We therefore suggest that you use the Exemption Application form that is on the PPRA’s website and:
- On page 2 thereof, where the reason for the exemption must be indicated, include wording that states: (i) the sector in which you operate; (ii) that, in reliance on the PPRA Practice Note dated 28 September 2023, you apply for exemption from section 67 and regulation 36 of the PPA in order to make use of an amended Disclosure Form in transactions that you facilitate; (iii) that the amended Disclosure Form will not be used in transactions for the sale of residential property.
- It appears that the exemption application must be accompanied by your Fidelity Fund Certificate and Identity document or, if making application on behalf of an entity, the entity’s Fidelity Fund Certificate and a resolution authorizing the applicant to act on behalf of the entity in making the application.
Do not hesitate to contact us at info@stbb.co.za should you have any questions.