1. Oct. 2005 BVVG - Bodenverwertungs- und -verwaltungs GmbH

2. BVVG Realignment of Land

3. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 20053 Historical Background Land reform 1945-1949 Land reform 1945-1949 Collectivisation after 1949 Collectivisation after 1949 Privatisation after reunification Privatisation after reunification

4. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 20054 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

5. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 20055 Privatization of Agricultural and Forestry Land

6. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 20056 Situation in the Agricultural Sector in 1989 4.500 Collective Farms 4.500 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

7. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 20057 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

8. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 20058 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

9. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 20059 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

10. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200510 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)

11. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200511 Structure of BVVG NL NL NL 8 NL 8 Management central services Berlin: Head office 231 employees 717 Employees Operational Level clients Branches

12. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200512 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

13. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200513 Competency through management of… > 1.700.000 ha Arable/pasture/forestry > 1.700.000 ha Arable/pasture/forestry 515 State farms 515 State farms 4,6 Mio parcels 4,6 Mio parcels 30.000 active purchase applications 30.000 active purchase applications 75.000 sales contracts 75.000 sales contracts 400.000 client data 400.000 client data

14. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200514 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 1992 - 1996 1992 - 1996 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 1996 - 2010 1996 - 2010 Sale of land within the fully developed land market Sale of land within the fully developed land market beginning 2005 beginning 2005

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

16. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200516 Control and Supervision of the Privatisation Process is realised on the following Levels Legal Regulations Supervising through Shareholder Internal Regulations Ebenen

17. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200517 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

18. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200518 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

19. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200519 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

20. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200520 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

21. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200521 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

22. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200522 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

23. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200523 Balance of BVVG 1992 - 2004 sold sold 297.000 ha agricultural land 297.000 ha agricultural land 434.000 ha forstry land 434.000 ha forstry land 42.000 ha building land 42.000 ha building land leased out leased out 706.000 ha agricultural land 706.000 ha agricultural land transferred to Federal states without charge: 30.000 ha transferred to Federal states without charge: 30.000 ha Restituted 1.400.000 ha Restituted 1.400.000 ha transferred to the federal budget transferred to the federal budget ca. 2,3 Milliarden Euro ca. 2,3 Milliarden Euro

24. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200524 Thank you for your attention Thank you for your attention

25. Bodenverwertungs- und -verwaltungs GmbH BVVG Bodenverwertungs- und -verwaltungs GmbH Oct. 200525 Homepage of BVVG: http:// www.bvvg.de Michael Rebholz BVVG Personal Assistent of CEO of BVVG Schönhauser Allee 120 D-10437 Berlin fon: +49-(0)30-4432-1007 fax: +49-(0)30-4432-1200 mail: rebholz.michael@bvvg.de For further Contact: BVVG German Agriforest Privatization Agency