State wants to prevent land speculation with law
The Thuringian state government has introduced a law to curb the extreme price increases on the agricultural land market. The draft of the Agricultural Structure Act, which has now been approved by the cabinet, is intended to achieve more control and transparency in the sale of agricultural land, said Agriculture Minister Susanna Karawanskij (Left Party) on Tuesday in Erfurt. In addition, a price brake, among other things, should prevent a strong concentration of agricultural land in the hands of investors from outside the sector.
Farmland in the hands of farmers
The Red-Red-Greens want to use the law to preserve the regionally anchored agricultural structure in the hands of local farms and relieve farmers of cost pressure, said the Minister. Prices for agricultural land in Thuringia had tripled in some cases in recent years. It was becoming increasingly difficult for local farms and young farmers in particular to buy agricultural land.
The draft law stipulates that purchase and lease agreements on the agricultural land market must be notified or approved for one hectare or more. Fines of between 10,000 euros and one million euros could be imposed for violations, the Minister explained.
Control of the sale of company shares
For the first time, a notification and approval requirement will also be introduced for so-called share deals - i.e. the acquisition of shares in agricultural businesses with agricultural land. If companies acquire more than 50 percent of the shares in agricultural businesses based in Thuringia, these must be reported in future in the same way as a direct land purchase. Approval of share deals will be mandatory from an acquisition share of 90 percent. In order to curb further price explosions for arable land, the current limit of 50 percent above the market price could also be reduced to 20 percent above the market price in regions with particularly high land prices.
Up to now, non-notified lease agreements have not been subject to sanctions - the notification of the purchase of shares in agricultural businesses is not regulated at all. According to the figures, almost half of the land in Thuringia is agricultural land.
The opposition reacted with criticism to the planned reform of agricultural and forestry land law. "State intervention or even the imposition of fines always harbors the risk of standing on feet of clay in legal terms," explained Marcus Malsch, agricultural policy spokesman for the CDU parliamentary group. The AfD parliamentary group also sees many question marks. Both parliamentary groups referred to an expert opinion by the farmers' association, which considered an early draft of the law to be largely unconstitutional.
The introduction of the Agricultural Structure Act by the Thuringian state government also includes a notification and approval requirement for share deals in agricultural businesses with agricultural land. This is intended to prevent non-farmers from acquiring a significant portion of agricultural land through share acquisitions.
The Thuringian government's efforts to control the agricultural land market extend beyond land purchases, as the new law aims to curb land speculation through share acquisitions as well.
Source: www.dpa.com
