Finances - No decision on environmental damage caused by former GDR companies
A funding dispute between the federal government and the states of Saxony and Thuringia regarding the costs of cleaning up environmental damage caused by former GDR state-owned companies remains unresolved at the Federal Constitutional Court. The highest German court rejected applications by the two federal states as inadmissible, according to information provided on Wednesday. They had not sufficiently demonstrated their right to file an application and had also not shown any constitutional obligation on the part of the Federal Republic of Germany to (proportionately) bear future costs for the remediation of contaminated sites. The Second Senate in Karlsruhe ruled that such an obligation had not been demonstrated either with regard to the Basic Law or unwritten constitutional principles. (Ref. 2 BvG 1/19 and 2 BvG 1/21)
The background to this are agreements made in the course of reunification. Former state-owned companies in the GDR were transferred to the federally-owned Treuhandanstalt and privatized by the latter. In many cases, the Treuhand agreed indemnities with investors for environmental damage caused by these companies.
In 1992, the federal government and the East German states concluded an agreement regulating the financing of the environmental legacy. According to the press release, this agreement provides, among other things, for a distribution of the indemnification costs for environmental contamination between the Treuhand (60 or 75 percent) and the respective state (40 or 25 percent). As a result of practical difficulties in implementation, some states concluded general contracts with the Treuhand.
In Saxony and Thuringia, the two states want to renegotiate because the renovation costs exceeded the estimated budget. On the federal side, the Federal Ministry of Finance and the Federal Agency for Real Estate are now responsible. According to further information from the court, they reject renegotiations.
Statement from the court Decision
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- Despite the ongoing dispute, Thuringia and Saxony argue that the Federal Republic of Germany should share the financial burden of cleaning up environmental damage caused by former GDR companies.
- The environmental legacy in Saxony and Thuringia is a significant issue, as the costs of cleaning up contaminated sites have exceeded initial budget estimates.
- The Federal Constitutional Court in Karlsruhe has rejected the states' applications, stating that they did not adequately demonstrate their right to file an application or prove a constitutional obligation on the part of the Federal Republic of Germany.
- Historical agreements between the federal government and the former East German states, such as the 1992 agreement on financing the environmental legacy, have set out a distribution of costs for environmental contamination.
- In this agreement, the Treuhandanstalt, a federally-owned entity, was responsible for 60 or 75% of the indemnification costs, while the respective state shouldered 40 or 25%.
- The case highlights the complexity of managing environmental damage and financial responsibilities across different levels of government in Germany, involving federal states and the Federal Republic of Germany.
- The Federal Ministry of Finance and the Federal Agency for Real Estate, now responsible for the federal side in this dispute, have rejected the states' request for renegotiations on the funding agreement.
Source: www.stern.de
