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Auction Alliance seeks ConCourt approval

Johannesburg – The Constitutional Court will on Monday hear an application by Auction Alliance for confirmation of an order relating to sections of the Estate Agency Affairs Act and the Financial Intelligence Centre Act.

This was after the Western Cape High Court in Cape Town declared section 32A of the EAAA and section 45B of the FICA unconstitutional and invalid.

The sections permitted any inspections without warrants, other than routine or random inspections aimed at ensuring regulatory compliance.

The Estate Agency Board, which is the primary regulator under the EAAA, suspected Auction Alliance of breaching the acts.

Inspectors from the board and the financial intelligence centre tried to use the search powers contained in the two acts to conduct a search of Auction Alliance’s business premises.

Auction Alliance refused to let the inspectors enter.

It argued that the provisions were invalid because they authorised “targeted” searches without a warrant.

The high court upheld Auction Alliance’s challenges to both statutory provisions and declared them unconstitutional and invalid.

The declaration had immediate effect in relation to section 32A of the EAAA, but the high court suspended its declaration of invalidity regarding section 45B of the FICA for 18 months to give the legislature an opportunity to amend it.

In the interim, the high court ordered that words be read into section 45B to allow a magistrate or judge to grant a warrant upon application.

The high court rejected the board’s counter-application, in which the board had asked the high court to grant a warrant for the search of Auction Alliance’s premises.

Auction Alliance wants the Constitutional Court to confirm the high court’s order of constitutional invalidity.

However, it will oppose the suspension of the order of invalidity in relation to section 45B of the FICA, and also argued that, if a suspension was granted, the court should reject the high court’s interim reading-in.

The board conceded that both statutory provisions were unconstitutional, but it took issue with the distinction the high court drew between “targeted” and “non-targeted” searches.

It supported the suspension of the order of invalidity, but asked that, in the interim, it be empowered to conduct searches in terms of the Criminal Procedure Act.

The board would also ask the court to allow warrantless “targeted” inspections where the subject of the search was an institution licensed to conduct business within one of the FICA’s regulated industries.
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