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The organisation AfriForum will be mulling over its options after the Supreme Court of Appeal dismissed its application in the ongoing matter regarding the "gratuitous display" of the apartheid flag.
The organization had appealed an earlier ruling declaring the display of the old South African flag as "hate speech" even if displayed in private.
Afriforum's Ernst van Zyl said freedom of expression has "become watered down in this country."
He said their position in the matter did not mean that Afriforum "displays the flag or that we will not strongly oppose genuine hate speech."
"We are entering very chaotic and dangerous waters when the law can be wielded to attempt to protect people from feelings of offence alone," he said.
In the initial ruling, the High Court found "that any gratuitous display of the old flag, aside from being racist and discriminatory, demonstrates a clear intention to be hurtful; to be harmful and to incite harm; and to promote and propagate hatred against black people, in contravention of s 10(1) of the Equality Act."
"Such a display constitutes hate speech and is 'divisive, retrogressive and destructive of our nascent non-racial democracy, the constitutional values of human dignity and equality and the building of a society united in its diversity."
Meanwhile, the Nelson Mandela Foundation welcomed the judgment as one of the respondents, saying the court had agreed with its argument that any gratuitous display of the old flag impaired nation-building and legitimises white supremacy.
The Nelson Mandela Foundation said the judgment is a win for everybody in South Africa who's committed to protecting the dignity of all people .. the challenge of nation-building .. and healing the deep wounds the nation carries from its past.
