In the world of real estate, commission is the lifeblood of an estate agent’s income. But what happens if an agent closes a deal while their Fidelity Fund Certificate (FFC) is expired or invalid? A recent High Court case has once again highlighted a critical point: without a valid FFC, an estate agent may have no legal right to commission.

At VDM Attorneys, we regularly advise both agents and sellers on commission disputes. Here’s what the law says about Fidelity Fund Certificates, and why keeping them valid is non-negotiable.

What Is a Fidelity Fund Certificate?

The Property Practitioners Act 22 of 2019 (previously under the Estate Agency Affairs Act) requires all property practitioners - including estate agents, rental agents, and agencies - to hold a valid FFC issued annually by the Property Practitioners Regulatory Authority (PPRA).

This certificate proves that the agent is registered, compliant, and entitled to handle trust money and earn commission.

The Legal Position: No FFC, No Commission

South African courts have consistently held that:

• If an estate agent acts without a valid FFC, they cannot legally claim commission.
• The requirement is strict: even if the agent did all the work, introduced the buyer, or concluded the sale, without a valid FFC at the time of the transaction, their claim collapses.
• This rule protects the public by ensuring only registered, compliant agents may trade.

The Lek Case: A Recent Example

In Lek v Estate Agents Board (2025), an estate agent attempted to claim a share of commission despite a gap in the validity of their FFC.

• The court examined whether the agent held a valid FFC during the time they were actively involved in the transaction.
• It turned out there was a period where their FFC had lapsed.
• The court confirmed the long-standing rule: an agent cannot recover commission if they were unlicensed during the relevant period.

This meant that despite having participated in the deal, the agent’s claim failed because of the administrative lapse.

Practical Risks for Estate Agents

1. Commission Forfeiture – You may lose your entire commission, even after months of work.
2. Reputational Harm – Acting without an FFC can undermine trust with sellers, buyers, and colleagues.
3. Regulatory Sanctions – The PPRA can take disciplinary action for practising without a certificate.

Tips for Agents to Stay Compliant

• Renew Early: Apply for your FFC renewal well before expiry (typically by October for the following year).
• Keep Records: Always keep copies of your current certificate available for clients.
• Agency Compliance: If you’re part of an agency, make sure the agency itself also holds a valid FFC - both the firm and the individual need certificates.
• Check Co-Agents: If you’re working with another agent, confirm their FFC status before splitting commission.

Conclusion: Protect Your Commission with Compliance

The lesson is clear: No valid FFC, no commission. South African law does not bend on this point. Agents who let their FFCs lapse risk losing not only their income but also their professional standing.

At VDM Attorneys, we help estate agents resolve commission disputes, draft clear mandates, and protect their rights under the Property Practitioners Act.

👉 If you’re facing a commission dispute - or need guidance on compliance - speak to our team today. Protect your livelihood with the right legal advice.