Oct BVVG - Bodenverwertungs- und -verwaltungs GmbH

BVVG Realignment of Land

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Historical Background Land reform Land reform Collectivisation after 1949 Collectivisation after 1949 Privatisation after reunification Privatisation after reunification

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Starting Position Property of church: 0,2 Mio ha Total Area: 10,8 Mio ha Privately owned land 5,1 Mio ha Publicly owned land 5,5 Mio ha Total Area: 13,4 Mio parcels Property of church: 0,15 Mio parcels Publicly owned land 4,5 Mio parcels Privately owned land 8,7 Mio parcels

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Privatization of Agricultural and Forestry Land

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Situation in the Agricultural Sector in Collective Farms Collective Farms 515 State Farms 515 State Farms 2,2 Mio ha of agricultural land in state ownership (35%) 2,2 Mio ha of agricultural land in state ownership (35%) 2,0 Mio ha of forestry land (90%) in state ownership 2,0 Mio ha of forestry land (90%) in state ownership

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Turning publicly owned land into private property Foundation of the German Trust Agency (Treuhandanstalt) January 1990 Foundation of the German Trust Agency (Treuhandanstalt) January 1990 Objective: Privatization of state owned property Objective: Privatization of state owned property Foundation of BVVG - July 1992 Foundation of BVVG - July 1992 Goal 1: Privatization of state owned agricultural and forestry land Goal 1: Privatization of state owned agricultural and forestry land Goal 2: Restitution Goal 2: Restitution Supervision of BVVG through Ministry of Finance Supervision of BVVG through Ministry of Finance in cooperation with the Ministry of Consumer protection, Food and Agriculture in cooperation with the Ministry of Consumer protection, Food and Agriculture

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Basic Concept of the BVVG Uniform Privatisation in all New Federal States of Germany Uniform Privatisation in all New Federal States of Germany Independent Privatisation - as a limited company - comparatively minor influence of day to day politics Independent Privatisation - as a limited company - comparatively minor influence of day to day politics Transparent Privatisation and Administration - Approaches and Results publicly available Transparent Privatisation and Administration - Approaches and Results publicly available Turnover-oriented Privatisation - surpluses of revenues are being transferred directly to the Ministry of Finance Turnover-oriented Privatisation - surpluses of revenues are being transferred directly to the Ministry of Finance Socially responsible for a balanced development of the rural areas in co-operation with the agrarian administrations and elected bodies Socially responsible for a balanced development of the rural areas in co-operation with the agrarian administrations and elected bodies

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct The BVVG: An Organization of the Federal Republic of Germany An Organization of the Federal Republic of Germany Sole shareholder is the Ministry of Finance (BMF) Sole shareholder is the Ministry of Finance (BMF) is supervised by the Ministry of Finance in cooperation with the Ministry of Consumer protection, Food and Agriculture (and Forestry) is supervised by the Ministry of Finance in cooperation with the Ministry of Consumer protection, Food and Agriculture (and Forestry) Fulfills a legal mandate Fulfills a legal mandate Privatization and Restitution of formerly publicly owned agricultural and forestry land Privatization and Restitution of formerly publicly owned agricultural and forestry land

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct BVVG - Service provider for the Ministry of Finance Revenues from sale and lease Administrative costs of BVVG and minimun profit Federal Ministry of Finance Costs for parcels(dues, pay out, redevelopment)

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Structure of BVVG NL NL NL 8 NL 8 Management central services Berlin: Head office 231 employees 717 Employees Operational Level clients Branches

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Our Core Competencies.... Transformation of ownership relations in rural areas by... Transformation of ownership relations in rural areas by... Sale of agricultural and forestry land as well as land for housing area and industry Sale of agricultural and forestry land as well as land for housing area and industry lease of agricultural land, of fishery and hunting rights lease of agricultural land, of fishery and hunting rights Management of abridgment of buildings and redevelopment of contaminated sites Management of abridgment of buildings and redevelopment of contaminated sites Realization of restitution and handing back land to municipalities Realization of restitution and handing back land to municipalities

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Competency through management of… > ha Arable/pasture/forestry > ha Arable/pasture/forestry 515 State farms 515 State farms 4,6 Mio parcels 4,6 Mio parcels active purchase applications active purchase applications sales contracts sales contracts client data client data

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct The Road towards Privatisation in East Germany I. Phase Short/Long Term Lease II. Phase Subsidised Sale Law of compensation III. Phase Sale at Market Value Stabilisation of emerging farms Stabilisation of emerging farms Basis for future sales Basis for future sales Consolidation of the newly developed agrarian structure Consolidation of the newly developed agrarian structure Development of forestry structure in private hands Development of forestry structure in private hands Sale of land within the fully developed land market Sale of land within the fully developed land market beginning 2005 beginning 2005

BVVG Bodenverwertungs- und -verwaltungs GmbH The Privatization process The Privatization process Basis and Mechanisms for Internal and External Supervision, Control and Monitoring

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Control and Supervision of the Privatisation Process is realised on the following Levels Legal Regulations Supervising through Shareholder Internal Regulations Ebenen

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct BVVG as capital company underlies the regulations of the commercial code and other corresponding Laws clear rules for the built up of the accounting system clear rules for the built up of the accounting system controlling of the estate, finance and results through accounting firm controlling of the estate, finance and results through accounting firm Obligation to publish annual balance sheet Obligation to publish annual balance sheet Transparency Transparency Gesetzliche Regelungen

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Steuerung und Kontrolle durch den Gesellschafter bzw. den Bund responsible Ministry (Shareholder) Budget, goal-agreements, monthly meetings, clear distribution of competencies responsible Ministry (Shareholder) Budget, goal-agreements, monthly meetings, clear distribution of competencies Parliament / German Federal Court of Auditors Parliament / German Federal Court of Auditors hearings, Petitions via responsible Ministries, finance control hearings, Petitions via responsible Ministries, finance control Clients Clients initiate revision through complaints, law suits initiate revision through complaints, law suits Interest groups and associations inquiries, which get checked by responsible governmental bodies Interest groups and associations inquiries, which get checked by responsible governmental bodies

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Clear supervision Clear supervision Guidelines, support Guidelines, support Four eyes principle Four eyes principle Sales and lease procedure has to be checked by second employee Rotation of staff Rotation of staff change of assignments, Dept., clients Technical guidance and control through Departments at headquarters Technical guidance and control through Departments at headquarters Formulation of binding Privatization rules Formulation of binding Privatization rules Interne Mechanismen

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Auditing and Reporting Auditing and Reporting periodical analysis and reporting to management of organizational units, managing directors, Supervisory board and shareholder periodical analysis and reporting to management of organizational units, managing directors, Supervisory board and shareholder Checking Contracts acceding a certain price volume or ha volume Checking Contracts acceding a certain price volume or ha volume affirmation of managing director and responsible department necessary affirmation of managing director and responsible department necessary Internal Revision Internal Revision independent board for control of internal regulations and cross checking of single cases independent board for control of internal regulations and cross checking of single cases InterneMechanismen Interne Mechanismen

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Relevance of the East German Experience for other Eastern European and Central Asian Countries Ownership structure and Agricultural structure in the starting situation are similar Ownership structure and Agricultural structure in the starting situation are similar The transformation process should be oriented at the European norms´. Transformation differs from country to country The transformation process should be oriented at the European norms´. Transformation differs from country to countrybut: the problems that need to be solved are comparable ! The privatisation process has not ended yet The privatisation process has not ended yet A sound land policy and a consistent legal frame are necessary for a successful privatisation process A sound land policy and a consistent legal frame are necessary for a successful privatisation process

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Contribution of BVVG... Consulting in Land reform issues Consulting in Land reform issues Accompanying the privatization process for agricultural and forestry land Accompanying the privatization process for agricultural and forestry land Development of the land market through laws, regulations valuation schemes Development of the land market through laws, regulations valuation schemes Forming and optimizing the state land management Forming and optimizing the state land management

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Balance of BVVG sold sold ha agricultural land ha agricultural land ha forstry land ha forstry land ha building land ha building land leased out leased out ha agricultural land ha agricultural land transferred to Federal states without charge: ha transferred to Federal states without charge: ha Restituted ha Restituted ha transferred to the federal budget transferred to the federal budget ca. 2,3 Milliarden Euro ca. 2,3 Milliarden Euro

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Thank you for your attention Thank you for your attention

Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct Homepage of BVVG: Michael Rebholz BVVG Personal Assistent of CEO of BVVG Schönhauser Allee 120 D Berlin fon: +49-(0) fax: +49-(0) mail: For further Contact: BVVG German Agriforest Privatization Agency