National Land Agency BPN - Republic of Indonesia (1995):
International Workshop on the Implementation of Rural Land Consolidation

10.3.4 Recreation of the private ownership organization in the new Federal Länder

Following the peaceful revolution of the fall of 1989 and German reunification, the new German Länder have different tasks regarding land organization to take care of than their counterparts in western Germany. Here, the conditions for land development and for the restructuring of the formerly socialist form of agriculture had to be created in the first place through reinstatement of private property.

After World War II, private ownership of land and soil was eliminated by the communists in the area of agriculture too.

Through a so-called Land Reform, all holdings over 100 hectares were confiscated and converted into "people's ownership" instead.

That was followed by forced collectivization and industrialization of agriculture.

As a consequence, an Agricultural Producers' Cooperative farmed an average of around 4,000 hectares when the GDR fell apart in 1989. In comparison, a full-time farm in West Germany managed around 35 hectares.

Fig. 17: Satellite photo - Agricultural land use on both sides of the former internal German border

The resulting conditions are shown in a satellite photo of both sides of the then inner-German border.

In the East, giant farm areas, in the West, small-scale structure.

In the course of German unification, collective farming was abolished. Private property in agriculture and the forest industry was reinstated, as well as farming based on private property. The agricultural and forestry property confiscated during land reform will, on the basis of German unification, not be handed back to their former owners. However, the former owners will receive government compensation payments. The areas are being privatized through sale and leasing. Privatization includes a total of 2.1 million hectares of agricultural area and 750,000 hectares of forestry areas.

The areas being farmed by Agricultural Producers' Cooperatives due to forced collectivization were returned to their former owners or their heirs.

The entire agriculture and forestry industry was restructured along market economy principles. The approximately 5,000 large farms having an average area size of 4,000 hectares were converted into 25,000 new agricultural holdings with an average farm size of nearly 200 hectares.

Compared to other sectors of the economy, the agricultural sector of the former GDR has made the most progress and been most successfully redirected.

10.3.4.1 Aims of land regulation in the agrarian sector

The major aim of the Agriculture Adjustment Act is to create efficient and competitive farming operations. But this aim cannot be achieved solely by restoring a private ownership system, for it would just re-establish the situation which existed before compulsory collectivization. In terms of both ownership and economic policy, this would be nonsensical, because ownership structure is completely fragmented. In addition, the original plots, including their former access routes, are no longer identifiable because of the large-scale farming. Almost all the boundary stones have been removed. In addition, ownership changes were rarely recorded in public registers. So the task today is the same work on adjustment and reorganization of property ownership which has been the result of over 40 years of land consolidation activities in former West Germany.

For this purpose, the Agriculture Adjustment Act, as an instrument for land regulation, has provided the so-called processes for land reorganization as a special instrument to accompany the radical change process in agriculture. They are really designed to eliminate the consequences of the land utilization right for agricultural producers' co-operatives which was introduced with compulsory collectivization and which displaced completely the property rights of the land owners.

The processes for land reorganization are an essential accompaniment to the restructuring of the agrarian sector in the eastern Länder of Germany. To establish the reorganization of ownership in villages and village fields, about 10,000 procedures relating to about 250,000 hectares are meanwhile being processed by the newly formed land reorganization authorities and the private agencies which have been commissioned. Their range of action includes:

• appropriate organization and uniting of rural property, so that property owners can do as they wish with their land following over 40 year. of anti-ownership policies (self-management, leasing, sale);
• provisional cultivation agreements between the new farming enterprises (these include both the former cooperatives, converted to conform to a market economy, and the newly established or re-established farms) to solve conflicts until ownership status has been finally reorganized;
• support for privatization of formerly state-owned agricultural and forest property;
• adjustment of the road, path and waterway network to present needs;
• surveying and marking of properties, so that a reliable record in public registers can again be ensured and properties are identifiable on site and
• ecological improvement of field areas through landscaping programs.

I wish to show you an example of soil organization measures to restructure agriculture in eastern Germany:

Fig. 18: Procedure for land reorganization under the Agricultural Adjustment Act
(This figure is only inlcuded in the hardcopy of this document.)

Map 1: Land use of Agricultural Producers' Cooperative
Map 2: Land use today after reorganization

Fig. 19: Procedure for land reorganization under the Agricultural Adjustment Act

Map 1: Property structure before reorganization

Map 2: Property structure after reorganization

The first figure (Fig. 18 - map 1) shows how management by Agricultural Producers' Cooperatives took place during the days of the former East Germany. This form of management displaced private property, which still existed formally (Fig. 19 - map 1) but had no value anymore to owners during the period of Communism.

Through a reorganization, management was reorganized (Fig. 19 - map 2). A large new farm leasing the areas from the private owners now has developed from the Agricultural Producers' Cooperative (farm in yellow). In addition, a former member of the producers' cooperative has once again set up a farm (brown). This resulted in conflicts: therefore, farming was regulated by the soil organization authority.

Ownership was reorganized, too (Fig. 19 - map 2). This put the owners at an advantage, since they can now more easily lease their areas.

All parties are now satisfied. Both agricultural holdings now have secure leasing arrangements; this is the prerequisite for eligibility for state subsidies.

The landowners can now profit from their ownership, receiving a decent return through the rent charged.