Water rights are an essential commodity in the agricultural sector and a commodity with limited availability. Accordingly, the transfer of existing water rights is a critical aspect for many farmers as it affects their ability to expand and further develop their farms. Many farmers also carry the perception that in practise the transfer of water rights is only possible to persons that meet the minimum requirements for black economic empowerment, particularly as regards ownership and management.
In the recent appeal court case of Makhanya v Goede Wellington Boerdery (Pty) Ltd, the court confirmed that the transfer of water rights is indeed possible, that an equal consideration of various factors must take place in the consideration of any application for the transfer of water rights, and that no single factor may be afforded preference or carry a heavier weight than any other factor in such consideration. The judgement therewith confirms that, although empowerment is an important factor in the consideration of licenses, it is not the sole factor to be considered and that a balance must be struck between all relevant factors as prescribed by the National Water Act in the consideration of any application.