The Battle for "Public Property"

In the GDR the single party, the SED, its mass organisations and the state bloc parties had piled up major assets. In June 1990 the GDR parliament set up an independent commission to investigate these assets; but former party officials managed to secrete away billions by founding companies, making generous loans to party members, giving donations to party-related institutions and using their contacts abroad.

At the beginning of March 1990, on the instigation of the Central Round Table, the GDR government set up the Institute for Trustee Administration of Public Property (Treuhand Agency). At the same time, the whole extent of the GDR's economic bankruptcy became clear. From June 1990 the Treuhand Agency focused on privatising the state-owned GDR enterprises, over ten thousand in number. By October not even two hundred had been sold, for reasons like the need for major restructuring, heavy debt, unresolved ownership issues and rapid collapse of markets.

There were heated debates on settling questions of ownership. In the end, for property expropriated by the communist regime since 1949 the principle of restitution rather than compensation was applied in all but a few cases.

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