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Unification and Property Issues (June 15, 1990)

The regulation of property issues was among the most important topics in the negotiations between the Federal Republic of Germany and the German Democratic Republic in the summer of 1990. The principle “restitution before compensation” was settled upon, as was the controversial regulation declaring that the expropriations carried out during the Soviet occupation would not be reversed. This declaration and the Law on the Regulation of Open Property Issues of September 23, 1990, were incorporated into the Unification Treaty.

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Joint Declaration of the Governments of the Federal Republic of Germany and the German Democratic Republic on the Settlement of Open Property Questions, June 15, 1990

The division of Germany, the related migration from East to West, and the different legal systems in the two German states have led to numerous problems involving property rights; these problems affect many citizens of the GDR and the FRG.

In resolving existing property issues, both governments base their views on the assumption that it is possible to balance the various interests in a socially responsible manner. Legal certainty and legal clarity, as well as the right to property, are the principles guiding the governments of the GDR and the FRG in resolving the property issues facing them. Only in this way can peace under the law be permanently assured in a future Germany.

Both German governments agree on the following basic premises:

1. Expropriations on the basis of occupation law or occupational jurisdiction (1945 to 1949) cannot be reversed. The governments of the Soviet Union and the GDR see no possibility of revising measures taken at that time. The government of the FRG acknowledges this in view of historical developments. It is of the opinion that the right to make a final decision on possible state compensation must be reserved for a future all-German parliament.

2. Trusteeship administration [Treuhandverwaltungen] and similar measures limiting the use of real estate, businesses, and other property must be rescinded. With this, citizens whose property was taken into state administration as a result of flight [from the GDR] or for other reasons will regain control of their property.

3. In principle, confiscated real estate will be returned to the former owners or their heirs, taking account of the cases listed in a) and b):

a) The restitution of property rights to real estate and buildings whose use or function was changed – particularly when they were dedicated to public use, integrated into complex housing and development projects, employed for commercial purposes, or included in a new commercial unit – is not possible on account of the very nature of the matter. In such cases, compensation will be paid to the extent that it has not already been made under regulations applying to citizens of the GDR.
b) Provided that a citizen of the GDR has properly obtained ownership rights or usage rights to a property that is to be transferred back, a socially responsible settlement is to be made with the former owner through the exchange of property of comparable worth or through monetary compensation. This also applies to property sold to third parties by state trustees. Details remain to be clarified.
c) Insofar as former owners or their heirs have a claim to restitution, compensation may be chosen instead. The issue of compensation for changes in value will be dealt with separately.

The question of compensation for additions and improvements will be regulated separately.

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