GRAND CHAMB ER

DE CISION

AS TO THE ADMISSIBILITY O F

A pplications n os. 71916/01 , 71917/01 and 10260/02 by Wol f- Ulrich von MALTZAN and Others , Margarete von ZITZEWITZ and O thers , and MAN FERROSTAAL and ALFRED TÖPFER STIFTUNG against Germany

The European Court of Human Rights, sitting on 2 March 200 5 as a Grand Chamb e r composed of

M r L. Wildhaber , P r e sident , Mr C.L. Rozakis , Mr J.-P. Costa , Mr G. Ress , Mr L. Caflisch , Mr K. Jungwiert , Mr J. Casadevall , Mr B. Zupančič ,

Mr J. Hedigan , Mr M. Pellonpää , M rs H.S. Greve , M r A.B. Baka , Mr R. Maruste , Mr K. Traja ,

M rs E. Steiner ,

Mrs E. Fura- Sandströ m

Mrs A. G yulumyan , ju d ges ,

and M r E. Fribergh , Deputy Registrar ,

Having regard to the above -mentioned applications lodged on 3, 17 and 18 May 2001 respe ctive ly ,

Having regard to the d e cision of 11 March 2004 by which the Chamber of th e Third S ection, to which the applications had initi ally been assigned , relinquished jurisdiction in favour of the Grand Chamb er ( A rticle 30 of the Conv ention),

Having regard to the observations s ubmitted by the respondent Government and th e observations in reply submitted by the applicants ,

Having regard to the parties ' oral observations at the hearing on 22 Se ptemb er 2004 ,

Having deliberated on 22 S eptemb er 2004 and 2 March 2005 , delivers the following decision :

THE FACTS

1 . The re are seventy-one applicants ( see detailed list a ppend ed ). Sixty-nine of them are natural persons , of whom sixty-eight are German na tionals and one a Swedish national . Two of them, the Alfred Töpf er F oundation and a company , Man Ferrostaal, are legal entities incorporated under German law .

A t the hearing on 22 September 2004 , in respect of the first application forty-five applicants were represented b y M r T. Gertner , a lawyer . O ne of these applicants was also represented by M r S. von Raumer , a lawyer . Two other applicants were represented by Mr von Raumer, one of whom was also represented by M r M. Nette sheim, a profess o r. In respect of the second and third applications, the twenty -four applicants were represented by M r C. Lenz and Mr W. Peukert , lawyers .

The respondent Government were represented by M r K. Stoltenberg, their A gent, and by M rs A. Wittling - V ogel, Deputy A gent, a ssis ted by M r J. Frowein and Mr R. Motsch, pr ofess ors , as counsel , and by M r H. - J. Rodenbach and W. Marx , as a dvisers .

A. The circumstances of the case

2 . The facts of the case, as submitted by the parties , m ay be summarised as follows .

1. Background to the case

3 . The applications concern one of the major issues to arise after the reunification of Germany : compensation for those whose property was expropriated either between 1945 and 1949 in the Soviet Occupied Zone of Germany following the land reform ( Bodenreform ) or after 1949 i n the German Democratic Republic (GDR ).

4 . During the negoti ations between the Governments of the Federal Re publi c of Germany ( FRG ) and the GDR ( a fter the first democratic elections, held there on 18 March 1 990) and the four former occupying powers (France, the United Kingdom, the United States and the Soviet Union ), the two German Governments issued a Joint Declaration on 15 June 1990 on the R esolution of O utstanding P roperty Issues ( Gemeinsame Erklärung der Bundesrepublik Deutschland und der Deutschen Demokratischen Republik zur Regelung offener Vermögensfragen / Gemeinsame Erklärung – see paragraph 38 below ) , which lays down the fundamental principles ( Eckwerte ) relati ng to property issues .

5 . These principles were subsequently implemented by the legislature, first in the Resolution of Outstanding Property Issues Act/Property Act

( Gesetz über die Regelung offener Vermögensfragen / Vermögensgesetz ) of 2 3 S eptemb er 1990 ( see paragraph s 41 -46 below ) and secondly in the Act governing i ndemnification pursuant to the Resolution of Outstanding Property Issues Act and S tate c ompensation for e xpropriatio ns carried out on the basis of the laws or other powers of the o ccupying force /Indemnification and Compensation Act ( Gesetz über die Entschädigung nach dem Gesetz zur Regelung offener Vermögensfragen und über staatliche Ausgleichsleistungen für Enteignungen auf besatzungsrechtlicher oder besatzungshoheitlicher Grundlage/ Entschädigungs–und Ausgleichsleistungsgesetz – “ the EALG ” ) of 27 S eptemb er 1994, which itself comprises two Acts ( see paragraphs 47-55 below ).

6 . With regard to r e habi litation, the legislature enacted the Victims of Illegal Prosecutions on “ Accession ” Territory (Rehabilitation and Compensation) Act / Criminal Re habilitation Act ( Gesetz über die Rehabilitierung und Entschädigung von Opfern rechtsstaatswidriger Strafverfolgungsmassnahmen im Be itrittsgebiet / Strafrechtliches Rehabilitierungsgesetz – see paragraph s 57-58 below ) of 29 Octob e r 1992 and the Annulment of Unlawful Administrative Decisions on “Accession” Territory (Derivative Rights) Act / Ad ministrative Rehabilitation Act ( Gesetz über die Aufhebung rechtsstaatswidriger Verwaltungsentscheidungen im Beitrittsgebiet und die dara n anknüpfenden Folgeansprüche / Verwaltungsrechtliche s Rehabilitierungsgese tz – see paragraph s 59-60 below ) of 23 June 1994.

2 . The applicants ' position

7 . Sixty-five applicants are natural persons who are the heirs of the owners of land or buildings that were expropriated un der the land reform implemented in the Soviet Occupied Z one of Germany between 1945 and 1949 .

The two legal entities among the applicants also owned land that was e xpropriated during that period .

A fter the re unification of Germany they unsuccessfully applied to the relevant authority for restitution of their land and/ or buildings .

8 . Three of these applicants also applied to t he administrative authoritie s under the Administrative Re habilitation Act for the rehabilitation of the ir ascendants .

One of them applied to the Dessau Administrative Court ( Verwaltungsgericht ), which gave judg ment on 22 March 2001 dismissing the application.

In a decision of 16 May 2002 the Federal Administrative Court ( Bundesverwaltungsgericht ) refus ed to entertain an appeal on points of law

( Revision ) by the applicant , referring to its two leading judgments of 21 February 2002 on the subject ( see paragraph 34 below ). In a de cision of 12 August 2002 the Federal C onstitution al Court ( Bundesverfassungsgericht ) also refus ed to entertain the applicant ' s appeal .

9 . Five applicants , including one of the sixty-five claimants mentioned in paragraph 7 above, are natural persons who are the heirs of owners of land or buildings that were expropriated after 1949 pursuant to a dec ision of the GDR authorities .

A fter German reunification they applied for r estitution of their land and/ or buildings. The relevant authorities re jecte d the application s o n the grounds laid down in the Property Act, namely that the third parties who had acquired the property in the meantime had done so in good faith or that r estitution was impossible in practice .

10 . Twenty-one of the applicants applied to the Federal Constitutional Court arguing t hat the Indem nification and Compensation Act was incompatible with the Basic Law ( Grundgesetz ).

In a leading judgment of 22 No vemb er 2000 the Federal C onstitution al Court dismissed their applic ation ( see paragraph s 23-32 below ).

3 . The leading judgments of the Federal C onstitution al Court on the land reform

11 . The Federal Constitutional Court delivered four leading jud gments on the land reform . They concern , in particul ar , the constitutionality of the various statutes governing property or re habilitation issues enacted by the legi slature after German re unification ( for d e tail s of the provisions of these statutes , see paragra p h s 41 -60 below ).

( a ) The Federal Constitutional C ourt ' s judgment of 23 Ap ril 1991

12 . In the first leading judgment on the land reform, delivered on 23 April 1991 , the Federal Constitutional Court held that the exclusion of any right to restitution for persons whose property had been expropriated between 1945 and 1949 did not infringe the Basic Law .

13 . The Constitutional Cour t found that the expropriations i n question, although carried out by the German authorities, had been ordered by the Soviet occupying authorities and had consequently been based on the sovereign power of the occupying forces . The FRG Government ' s power to conclude the Unification Treaty and include in it the amendments to the Basic Law necessitated by un ification flowed from its constitution al obligation to attain German unity . The manner in which those amendments had been made violated nei ther formal nor substantive law .

14 . T he C onstitution al Court held that the rule in question did not violate any of the complainants ' cons titution al rights as they were no longer in a legal position that could have been affected by it .

15 . The expropriations had been considered legitimate by the Soviet and GDR authorities . The FRG could not be held responsible for measures taken at a time when the Basic Law had not even been in force . Under the law then in force in the zones occup ied by the Western A llied Powers the c omplainants had also lost their standing to contest the confiscat ion of their property . Under that law confiscation measures effected by a foreign State were to be considered valid if carried out within that State ' s sover eign powers .

16 . Furthermore, unless it was caused by its own organs , the FR G was not bound fully to compensate damage resulting from the Second World War . In respect of compensation payments for such damage, the FR G had a wide margin of appreciation and could take into account other expenditure and budgetary requirements .

17 . The C onstitution al Court also found that there had not been a violation of the right to equal treatment . It relied o n evidence given by the Federal Minister for Foreign Affairs , M r Klaus Kinkel, and other high -ranking official s , showing , in the court ' s opinion , that the Soviet Union had agreed to German unification on condition that the legality of the confiscations b e tween 1945 and 1949 would not be called into question, which meant that restitution was effectively ruled out. It had also been the object of t he GDR to ensure in the U nification Treaty that social peace was maintained on its territory after un ification. T he FRG had therefore had to accept that condition in order not to block t he process of un ification . T he rule whereby property owners whose property had been confiscated between 1945 and 1949 were treated differently from those whose property had been confiscated later was, in the circumstances, sufficiently justified.

18 . The C onstitution al Court added :

“In respect of the expropriations without compensation [between 1949 and 1990] , which do not fall within the scope of no. 1, fourth sentence, of the Joint Declaration [see paragraph 38 below] , the legislature has elected to compensate the former owners on the basis of the principle of restitution of the expropriated property . This may be relevant for the amount of compensation payable in lieu of restitution. If the legislature opts for that solution it cannot exclude all reparation for the expropriations carried out pursuant to the Occupation laws or the powers of the occupying authorities [between 1945 and 1949].

...

The applicants ' complaint that the rule laid down in no. 1, fourth sentence, of the Joint Declaration infringes their fundamental rights in so far as the reference to mere compensation excludes the full reparation required by the Constitution is unfounded. As has already been stated, the rules do not specify any criteria relating to the amount of compensation. There is no principle in the Basic Law requiring full reparation for the expropriations in issue in the present case.

In calculating the compensation the legislature is also entitled , within the scope of the margin of appreciation available to it in all cases, to take account of its financial means having regard to the other duties incumbent on the State. The principles for compensating war damage apply here mutatis mutandis ... Accordingly, the legislature can take account of all the damage to be compensated, which include s other heads of damage besides those affect ing property. In assessing the damage affecting property regard must be had to other assets – relating, for example, to life, health, freedom and occupational prospects – that were also affected d uring the period in question ... Besides that, the legislature is entitled to take account of additional tasks arising from the reconstruction activities in the new Länder . In assessing the State ' s economic and financial situation and the various tasks incumbent on it, the legislature has a particularly w ide margin of appreciation... Faced with the disastrous economic situation in the new Länder which , as is already apparent , will require several hundred billion in subsidies to redress, there is no constitutional obligation at the outset to provide reparation to the same value as restitution . However, the legislature does have to take account of Article 3 § 1 of the Basic Law [ principle of equality ] in determining the global rules relating to compensation .

In these circumstances, the fact that part of the property concerned belongs to the public authorities does not allow the applicants to draw any conclusions to their advantage. The economic bankruptcy brought about by the poor management of the former German Democratic Republic ' s economy, which does not engage the responsibility of the Federal Republic of Germany, is not cancelled out by the existence of these assets . Nor does the fact that their property happens to be still available allow the former owners to demand preferential treatment regarding the amount of compensation compared to other persons who were expropriated or to victims of unjust measures who have suffered damage of a different kind. This also applies to those who are able to reacquire their former property.

...

(b) The Federal Co nstitution al Court ' s judgment of 18 April 1996

19 . In the second leading judgment on the land reform the Federal C onstitution al Court dismissed the appeal by the appellants who had argued that the Soviet Union had not specified any con ditions regarding the non -res titution of property confiscated between 1945 and 1949 during the negoti ations concerning German unif ication.

20 . The C onstitution al Court , confirming its first leading judgment on the land reform , held that the FRG had had a wide margin of appreciation during the negotiations concerning German reu nification . Accordingly, in so far as the Constit ution al Court had power to examine the issue, the FRG Government had not acted contrary to their obligations by considering ,

having regard to the position adopted by the Soviet Union and the GDR on the expropriations under the land reform , that the expropriations carried out between 1945 and 1949 were no longer reversible .

( c ) The Federal C onstitution al Co urt ' s judgment of 22 November 2000

21 . On 29 June 1995 some of the applicants applied to the Federal C onstitution al Court for a ruling on the is sue of the divergence in value between reparation in the form of restitution of the property and reparation in the form of indemnification or compensation. The y submitted that some of the provisions of the Indemnification and Compensation Act were incompatible with the Basic Law in that they generally prescrib ed amounts that were less than the current market value of the expropriated property o r property that was to be returned in accordance with the Property Act .

22 . On 28 March 2000 the Federal C onstitution al Court held a hearing during which it heard evidence from the claimants and the F R G Government and all the Government s of the Länder situated in the former GDR .

23 . On 2 2 November 2000 the First Division ( Senat ) of the Federal C onstitution al Court , composed of eight ju d ges, delivered the third leading judgment on the land reform . It point ed out at the outset that it was not required to examine the constitutionality of reparation for injustices committed by another State from the standpoint of the protection of the right of property guaranteed by Article 14 of the Basic Law. The provisions of the Indemnification and Compensation Act had not infringed the applicants ' property right since neither the J oint D eclaration of the two German States nor the initial version of section 9 of the Property Act had created concrete rights protected by Article 14 of the Basic Law for persons whose property had been expropriated by the GDR and by the Soviet occupying force.

Accordingly, the sole issue which fell to be examined by the Constitutional Court was the constitutionality of the Indemnification and Compensation Act in the light of the principle s of social justice and the rule of law (Article 20 §§ 1 and 3 of the Basic Law) and that of the prohibition of arbitrariness ( Article 3 § 1 of the Basic Law). It stated that, in accordance with the “ social justice ” principle , the State community had a duty to apportion the burden s borne by certain groups of persons by means of a statute, which alone would establish concrete rights to indemnification or compensation for the victims. In setting up that system , the legislature had a very wide margin of appreciation regarding both the nature and scope of the reparation awarded. The legislature could thus determine the amount of the

indemnification or compensation according to the financial means at its disposal and could take into account its other expenditure and charges.

24 . The Constitutional Court then examined the various provisions of the Indemn ification and Compensation Act .

(i) The Indemnification Act

25 . The Constitutional Court found, unanimously, that sections 1 (terms and conditions of payment of indemnification ) and 3(1) (basis for calculati ng indemnification ) of this Act were compatible with the Basic Law.

There were indeed objective reasons for treating persons who were entitled to restitution differently from those entitled to indemnification. The aim of restitution was to set up new property structures in the Länder of the former GDR, whereas in calculating indemnification payments the State could take account of the financial means available to it and of the other funds committed for recons truction measures. As reunification had been carried out very quickly, leading to a very substantial increase in property prices, reimbursement of the current market value of the property would not have been financially feasible. Furthermore, even persons whose property had been returned had not always received the full value, given the condition of the property . T hose who had only had a right of usufruct over their property under GDR law had also suffered substantial financial loss. Similarly, the decision to make the payment s at a later date was acceptable as a compromise between the interests of the State and those of the persons concerned .

26 . The Constitutional Court then held, by four votes to four – section 15(4) , third sentence, of the Federal Constitutional Court Act ( Bundesverfassungsgerichtsgesetz ) provides that where an equal number of votes are cast no breach of the Basic Law can be established – that section 7(1) of this Act (progressive reduction of rights to indemnification according to the value of the property) was also compatible with the Basic Law .

27 . Four judges found that the provision did not infringe the principle forbidding arbitrariness because the legislature was not obliged to have regard to the real value of the property in determining the amount of indemnification. It also had to situate the indemnification in the context of the other compensatory or rehabilitative measures taken and the other priority expenditure associated with German reunification, such as the creation of infrastructure in the areas of communication, information and education , and reducing unemployment in the former GDR. Furthermore, account also had to be taken of the fact that many people had suffered other injustices in the GDR, such as interference with their freedom, health or occupational prospects , which could not be indemnified in the same way. The State could support those people only through state measures designed to give them the same chances and the same living conditions as those existing in the rest of Germany .

28 . The other f our j udges gave a dissenting opinion . In their view, the amount of indemnification had to reflect the real value of the expropriated property, which was no longer the case if it was less than fifty per cent of the value of the property.

Thus , on grounds of providing social protection for the poorest people , the reduction percentages were still acceptable for rights to indemnification of less than DEM 90,000, and for rights to indemnification of more than DEM 500,000. However, they were not acceptable regarding rights to indemnification ranging between DEM 90,000 and DEM 500,000 , where there were no objective reasons for reducing the indemnification so substantially . This concerned above all individual houses or small buildings . For the sake of social solidarity, that category of persons should be awarded an appreciable amount of indemn i fi cation and no less than fifty per cent of their rights. The financial reasons relied on did not justify such a drastic reduction in the amount of indemnification . Furthermore, the legislature could have provided for alternative solutions, such as the attribution of substitut e land on favourable conditions .

( ii ) The Compensation Act

30 . The Constitutional Court went on to hold that the fact that the nature and amount of compensation were governed by the same terms and conditions as under the Property Act did not infringe the Basic Law either.

The same was true of the taking into account of amounts received in compensation, including interest, under the Equalisation of Burdens (War Losses) Act ( Lastenausgleichsgesetz – see paragraph 50 below).

32 . The Constitutional Court added that the programme for the acquisition of certain land ( Flächenerwerbsprogramm – see paragraph 54 below ) did not infringe either the principle of the rule of law or the rule forbidding arbitrariness as the legislature was pursuing two objectives: (i) to enable those whose agricultural or forestry land had been expropriated to redevelop it on preferential conditions, and (ii) to set up a support programme for agriculture and the water and forest industries in the Länder of the former GDR .

(d) The Federal Co nstitution al Court ' s judgment of 4 July 2003

33 . In its fourth leading judgment on the land reform the Federal Con stitution al Court held that the exclusion of the right to administrative r e habilitation coupled with r estitution of property for those whose property had been expropriated between 1945 and 1949 ( section 1 § 1 , third sentence , of the Ad ministrative Rehabilitation Act taken in conjunction with section 1 ( 8 ) of the Property Act – see paragraph s 59 and 43 below ) did not infringe the Basic Law .

34 . In its judgment the C onstitution al Court referred to the two leading judgme nt s the F ederal A dministrative Court had given on 21 February 2002 , in which it had ruled in the following terms :

“ 2. By virtue of the reference to section 1 ( 8 ) of the Property Act , the Administrative Re habilitation Act is inapplicable to exprop riations carried out under the O ccupation laws or the powers of the occupying authorities ( 1(8)( a ) ). That also concerns the expropriat ing mea sures referred to in section 1 ( 1 ) , first sentence , of the Administrative Rehabi litation Act . Section 1 ( 1 ) , third sentence, of that Act is not confined to merely reiterating that the cases referred to in section 1 ( 8 ) of the Property Act are also among t he meas ures referred to in section 1 ( 1 ) , second sentence , which do not fall within the scope of the Administrative Re habilitation Act . This reference was not necessary . Rather, the s ection specifies that , save in the cases referred to below (under 2.2), the expropriations carried out under the O ccupation laws or the powers of the occupying authorities cannot in any circumstances be annulled ; in that connection it is of little importance by which of the two Acts they would be governed if the cl ause did not exist ... .

2.1. Th is interpr e tation is confirmed by the drafting history of the Administrative Re habilitation Act . I n respect of section 1 ( 1 ) , t hird sen tence , the Government made the following submissions :

' [ Under that provision ] two categories of e xpropriation are excluded from the scope of the Property Act and the A d ministrative Re habilitation Act: expropriations without compensation in the industrial domain that were effected for the benefit of the Länder of the Soviet Occupied Zone and expropriations carried out under the so-called democratic land reform . That choice was due to the decisive a ttitude of the Soviet Union , which maintained that , in accordance with public international law, the expropriations carried out under its occupation were not a matter within the discretion of the two German States and should remain un touch ed ( unangetastet ). That also had to be respected in th e context of the A dministrative Re habilitation Act . '

The idea behind the Act is therefore that both categories of expropriation have to be regarded as unfair pers e cution and should therefore confer the right to r e habilitation under the terms of the new Act if the exclusion clause had not been inserted. The legislature decided to award compensation for any illegal interference with property under the Occupation under the Compensation Act , regardless of whether the measures i n question had been persecutory . In the light of those conside rations, no different conclusion ca n be drawn in the present case.

2.2 The applicant cannot rely on section 1 ( 7 ) of the Property Act to which section 1 ( 8 )( a) of that Act taken in conjunction with section 1 ( 1 ) , third sentence , of the A dministrative Rehabilitation Act refers . Admittedly , that provision also allows restitution of property confiscated under the O ccup ation laws or other po wers of the occupying authorities , but it requires the ex propriation decision to have been annulled under other provision s. No other provision can be found in the A dministrative Re habilitation Act , however, precisely because of the exclusion clause. If in the present case an annulment [ of the expropriating measure ] is not possible, the reference contained in section 1 ( 1 ) , third sentenc e, can o nly be to the unlimited exclusion clause, that is, section 1 ( 8 ) ( a), first sentence , of the Property Act . Accordingly, reh abilitation under the A dministrative Rehabilitation Act in respect of the categories of expropriation concerned in the present case is expressly exclud ed under the provisions of that Act . I t follows that the applicant cannot seek an annulment of the expropriati o n order concerning his father ' s property . ”

36 . The Con stit ution al Court also compared the applicant ' s position with that of the heirs of persons who had been convicted in criminal proceedings and could apply for re habilitation under the Criminal Re habilitation Act and claim restitution of the property in question if the r e habilitation also concerned it . The applicant could not apply for reha bilitation of that kind because his father ' s property had been confiscated without there having been a criminal conviction ; his administrative re habilitation fell foul of the exclusion clause in section 1 ( 1 ) , third sentence, of the A dministrative Re habilitation Act.

The C onstitution al Court held that the differen ce in treatment applied to t he applicant was justified because there were objective reasons for it . A criminal conviction was a far greater and more serious interference with a person ' s sphere of freed om than a measure in the form of an administrative decision . This was evidenced by , among other things, the assortment of possible penalties available to the criminal courts ranging from a prison sentence and other interferences with the victim ' s freedom to capital punishment , and including pecuniary penaltie s . As a general rule , a person who had incurred a cr iminal penalty was in greater ne ed of r ehabilitation than someone who had merely been expropriat ed, a measure which mainly affected his or her property . The German authorities could not therefore be found to have acted unco nst itution al ly in considering that, unlike administrative expropriations , a criminal conviction was such a serious interference that it justified the rest itution of confiscated property via reha bilitation proceedings .

37 . The Co nstitution al Court held that the interpretation of section 1 ( 1 ) , third sentence , of the A dministrative Rehabilitation Act and its application to the instant case did not fall foul of the prin ciple s of the rule of law and social justice provi ded for in Article 20 §§ 1 and 3 of the Basic Law . It reiterated on that point that the heirs of victims of expropriations carried out under the Occupation laws o r other powers of the occupying authorities were not wholly deprived of the right to compensation for the in justice suffered, but were entitled to compensation under the Act governing State c ompensation for e xpropriations carried out on the basis of the laws or other powers of the occupying force / Co mpensation Act ( Gesetz über staatliche Ausgleichsleistungen für Enteignungen auf besatzungsrechtlicher oder besatzungshoheitlicher Grundlage ) which it had found to be compatible with the Basic Law in its judgment of 22 November 2000.

B. Relevant domestic law and practice

1. The Joint D e claration of the FRG and the GDR on the Resolution of Outstanding P roperty I ssues

38 . The relevant passages of this Joint D e claration read as follows :

“The division of Germany , the resulting po pulation movement from East to West and the divergent legal systems in the two German S tates have given rise to numerous property - law problems which affect man y citizens in the German Democratic Republic and the Federal Republic of Germany.

In resolving the property issues ahead , the two Governments agree that vario us interests are to be balanced in a socially compatible manner. Legal certainty and legal clarity as well as the right of ownership are principles by which the Governments of the German Democratic Re public and the Federal Republic of Germany shall be guided in resolving the property issues ahead . Only in this way can enduring legal pea ce ( Rechtsfriede n ) be guaranteed in a future Germany .

The two German Governments agree on th e following fundamental values ( Eckwerte ) :

1. The expropriations carried out on the basis of the O ccupation legislation or the other powers of the occupying authorities [ between 1945 and 1949] can no longer be revoked ( die Enteignungen auf besatzungsrechtlicher bzw. be s atzungshoheitlicher Grundlage sind nicht mehr rückgängig zu machen ) . The Governments of the Soviet Union and the German Democratic Republic see no means of revising th e measures tak en at that time . The Government of the Federal Republic of Germany takes not e of this in view of historical developments. It is of the opinion that a final decision on any state compensation ( etwaige staatliche Ausgleichsleistungen ) must re main a matter for a future all-German parliament .

...

3. E xpropriat e d real estate is in principle to be returned to the fo r mer owners or their heirs, havi ng regard to the type of case specified in sub - paragraphs (a) and (b) below.

( a) It is not possible to restore rights of ownership over la nd and buildings whose use or purpose has been altered, in particular by being dedicat ed to public purposes, used for housing developments, for commercial purposes or incorporated into new business units.

Co mpensation will be paid in these cases, in so far as it has not alrea dy been made pursuant to the laws and regulations applicable to citizens of the German Democratic Republic .

( b) In so far as citizens of the German De mocrati c Rep ublic have in good faith acquired ownership or rights of user in rem ( ding l iche Nutzungsrechte ) over real estate , socially acceptable indemnification ( sozialverträglicher Ausgleich ) is to be made to the former owners by substituting real estate ( Grundstücke ) of a compa rable value or by paying compensation .

The same applies, mutatis mutandis , for real estate the ownership of whi ch was transferred to third parties by the state trustees. The details still need to be settled .

( c) Former owners or their heirs who are entitled to restitution of their property can choose to receive compensation in lieu of restitution.

...

9 . In so far as property has been seized in connection with criminal proceedings in violation of the rule of law, the GDR will create the statutory basis required to co rrect such seizures in proceedings that conform with the principles of justice ( justizförmiges Verfahren ) . ”

2. The German U nific ation Treaty

Article 3

Entr y into force of the Basic Law

“ Provided that there is no provision in this Treaty to the contrary, when the accession takes effect the Basic Law of the Federal Republic of Germany.... shall enter into force, together with the amendments contained in Article 4, in the La ̈ nder of Brandenburg, Mecklenburg-West Pomerania, Saxony, Saxony-Anhalt and Thuringia, and the part of Berlin to which it has not applied hitherto.”

Article 4

Amendments to the Ba sic Law

as a resul t of accession

“T he Basic Law of the Federal Republic of G ermany shall be amended as follows :

1. ...

4. The present wording of A rticle 135 ( a ) shall become paragraph 1 of that Article . The followi ng paragraph shall be inserted after that paragraph :

( 2) Paragraph 1 shall apply mutatis mutandis to liabilities of the German Democratic Republic or its controlling authorities and liabilities incurred by the Federation..... in connection with the transfer of assets of the German Democratic Republic to the Federation... a nd to liabilities resulting from measures taken by the German Democratic Republic or its controlling authorities. ”

5. The following new A rticle 143 s hall be inserted in to th e Basic Law :

(1) The law in the territory referred to in Art icle 3 of the U nification Treaty may only derogate from the provisions of the present Basic Law for as long as it takes, as a result of the differing conditions in the two countries, to fully adapt to the c onstitution al order but by 31 De cemb er 1992 at the latest . D e rogations shall not infringe A rticle 19 , paragraph 2 , and shall be compatible wi th the principles enshrined in A rticle 79 , paragraph 3 .

(2) D e rogations from sections II, VIII, VIII ( a ) , IX, X and XI shall be permissible until 31 December 1995 at the latest .

(3) I rrespective of paragraphs 1 and 2, A rticle 41 of the U nification Treaty and its implementing provision s shall also remain in force to the extent that they provide that the interference with property in the territory referred to in A rticle 3 of th at Treaty shall not be reversed . ”

Article 17

Re habilitation

“T he Contracting P arties reiterate their intention to create a statutory basis for the re habilitation of victims of a political pro secution or a judicial de cision c ontrary to the rule of law and the Constitution. The r ehabilitation of these victims of the unjust regime of the Socialis t Unity Party of the GDR ( Sozialistische Einheitspartei Deutschlands – “the SED ” ) must be accompanied by adequate compensatory measures . ”

Article 41

Settlement of property issues

“( 1) The Joint De claration on t he resolution of outstanding property issues made on 15 June 199 0 by the Government of the Federal Republic of Germany and the Government of the German Democratic Republic (A nnex III) shall be a constituent part of this Treaty .

(2) ...

(3) As to the rest , the Federal Republic of Germany shall not enact legal rules that co nflict with point 1 of the above-mentioned Joint Declara tion. ”

40 . The fundamental principles regarding property issues set out in the Joint De claration were subsequently implemented by the legislature , first in the Property Act of 29 S eptember 1990 and then in the Indemnification and C omp ensation Act of 27 S eptemb er 1994.

3 . The Resolution of Outstanding Property Issues Act / Property Act

41 . On 29 Sep temb er 1990 the Property Act of 23 S eptemb er 1990 came into force . That Act was also to be part of the U nifica tion Treaty , which provided that the Property Act would continue to exist in Germany after re unification of the two German States on 3 October 1990 . Th e aim of the Act was t o resolve disputes over p roperty situated in th e former GDR in a socially acceptable way in order to achieve enduring legal order in Germany .

42 . Section 1 ( 7 ) provides :

“ Th is Act applies mutatis mutandis to the restitution of property in connection with the annulment , under other provisions ( nach anderen Vorschriften ) , of unlawful de cisions in the sphere of criminal law, criminal administrative law and administrative law . ”

43 . The relevant part of section 1 ( 8 ) provides :

“ This Act does not apply ... to

a) Expropriations of property carried out under the O ccupation law s or the other powers of the occupying authorities; the rights provided for in sub-sections 6 and 7 of this section shall remain intact ( bleiben unberührt ) ;

... ”

44 . The Property Act provides that persons whose property was unlawfully expropriated at the time of the GDR are in principle entitled to restitution of their property unless it is impossible to retur n it in practice or it has been purchased in good faith ( section 4 ( 2 ) of the Act ). In such cases the former owners have a right to indemnification under the Act governing i ndemnification pursuant to the Resolution of Outstanding Property Issues Act / Indemnification Act of 27 September 1994 ( Gesetz über die Entschädigung nach dem Gesetz zur Regelung offener Vermögensfragen / Entschädigun gsgesetz ).

45 . In the initial versions of the Property Act (1990, 1994 and 1997), section 9 provided :

“if restitution is impossible because the property has been acquired in good faith by thir d parties, indemnification can be effected by the transfer of land if possible of comparable value ( durch Übereignung von Grundstücken mit möglichst vergleichbarem Wert ). If this is impossible , indemnifi cation shall be made in accordance with the provisions of the Indemnification Act.”

46 . That section was repealed by a law of 15 September 2000 .

4 . The Act governing indemnification pursuant to the R esolution of 0u tstanding P roperty I ssues Act and S tate compensation for expropriatio ns carried out on the basis of the laws or sovereign ty of the occupying force / Indemnification and Compensation Act

47 . The I ndemni fication and Co mpensation Act ( EALG ) of 27 September 1994 itself com prises two Acts , namely :

(i) the Act governing indemnification pursuant to the Act governing i ndemnification pursuant to the Resolution of Outstanding Property Issues Act / Indemnification Act ( Gesetz über die Entschädigung nach dem Gesetz zur Regelung offener Vermögensfragen / Entschädigungsgesetz ), which governs the terms and conditions for indemnifying persons whose property was expropriated in the GDR after 1949 where the property cannot be returned or the person entitled prefer s to receive indemnification ;

(ii) the Act governing S tate compensation for expropriations carried out on the basis of the l aw s or other powers of the occupying force / Compensation Act ( Gesetz über staatliche Ausgleichsleistungen für Enteignungen auf besatzungsrechtlicher oder besatzungshoheitlicher Grundlage ), which governs the term s and conditions for compensating persons whose property was expropriated between 1945 and 1949 in the Soviet Occupied Zone .

(a) The Indemnification Act

48 . Section 3 ( 1 ) of the Indemnification Act provides that the basis for calculati ng the amount of indemnification is the unit value of the property prior to any damage ( the reference date is generally 1935) multiplied by a statutorily prescribed factor .

49 . Section 7 ( 1 ) of the Act provides that if the basis of calculation (after deduction of long-term obligations and payments received) exceeds DEM 10,000 the amount of indemnification shall be reduced by a certain percentage, which increases progressively according to the unit value established at the outset. Thus the percentage is 30% if the rights to compensation are between DEM 10,000 and DEM 20,000, 80% if the rights to compensation are between DEM 100,000 and DEM 500,000 and 95% if the rights to compensation exceed DEM 3,000,000 .

50 . Section 8 of the Act provides that from the amount thus reduced must be deducted any amounts, including interest, received by way of compensation under the Equalisation of Burdens (War Losses) Act ( Lastenausgleichsgesetz ), which dealt with repa ration for damage or loss incurred as a result of expulsions or destruction of property dating from the Second World War and the post-war period in the Soviet Occupied Zone of Germany .

51 . Section 1(1) of the Act provides that indemnification shall be made in the form of state-is sued transferable bonds , to be redeemed by five annual instalments bearing interest of 6% per annum and commencing in 2004 .

(b) The Compensation Act

52 . The Compensation Act does not provide for a different basis of calculation, but refers to the corresponding provisions of the Indemnification Act .

53 . It has the following additional provisions, however :

54 . Section 3 of the Act provides for the possibility of acquiring certain agricultural or forestry land on preferential conditions ( Flächenerwerbsprogramm ).

Persons eligible for compensation are, in order of priority, the former and new “developers” ( Wieder- und Neueinrichter ), that is, either local farmers who have redeveloped their former farms and persons eligible under the Indemnification Act or the Compensation Act or, alternatively, persons who have never been farmers but now wish to run an agricultural holding and were in residence on 3 October 1990 .

Next come the former owners of farms or forest land who have not been assigned to the first category. Former owners of forest land cannot acquire agricultural holdings, whereas former owners of agricultural holdings can acquire forest land .

55 . Section 5(2) provides that movable property must be returned to the former owners, thereby creating an exception to the principle that property expropriated in the former Soviet Occupied Zone in Germany cannot be returned. However, cultural property intended for public exhibition must be made available to the public or for research free of charge for a period of twenty years.

5. The Reh abilitation Acts

56 . The legislature enacted two laws governing rehabilitation: the Criminal Re habilitation Act of 29 O ctob er 1992 and the A dministrative Rehabilitation Act of 23 June 1994 .

( a ) The R eh abilitation and I ndemnification of V ictims of I llegal P rosecut ions on “ A ccession” T erritory ( Beitrittsgebiet ) Act / Criminal Re habilitation Act

57 . The Criminal Re habilitation Act of 29 O ctob er 1992 pr ovides for the re habilitation of victims of unlawful de cisions or measures .

58 . Section 3 ( 1 ) provides that the annulment of an unlawful decision in criminal proceedings give s rise to right s under this Act . Section 3 ( 1 ) provides, inter alia , that if a measure co nfiscati ng property is set aside, the property must be returned in acco r dance with the Property Act.

( b ) The A nnulment of U nlawful A dmin istrative D ecisions on “ A ccession ” T erritory ( Derivative R ights ) Act / A dministrative Rehabilitation Act

59 . Section 1 ( 1 ) of the Administrative Re habilitation Act of 23 June 1994 is worded as follows :

“ A sovereign measure taken by a German authority ( Verwaltungsentscheidung ) in an individual case on the territory referred to in A rticle 3 of the U nification Treaty between 8 May 1945 and 2 October 1990 that has caused physical damage, infringed a pecuniary right ... shall be revoked on request if it is absolutely ( schlechthin ) incompatible with the principles of a State based on the rule of law and has lasting direct, unrea sonable and intolerable effects . This Act shall not apply to administrative decisions in tax cases or to me a sures falling within the scope of the Property Act or the Act governing indemnification pursuant to the Property Act ( Gesetz über die Entschädigung nach dem Gesetz zur Regelung offener Vermögensfragen / Entschädigungsgesetz ). Nor shall it a pply to the categories of cases referred to in section 1( 8 ) of the Property Act ( D ies gilt auch für die in § 1 Abs . 8 des Vermögensgesetzes erwähnten Fallgruppen ) .”

60 . Section 7 ( 1 ) of the Act provides that where property is confiscated as a result of a mea sure described in section 1 restitution of the property or indemnification for its confiscation is governed , among other things, by the Property Act .

COMPLAINTS

61 . The applicants submitted that the Property Act of 23 S eptemb er 1990 , the Indemnification and C ompensation Act (EALG) of 27 S eptemb er 1994 and the leading judgment of the Federal C onstitution al Court of 22 N ovemb er 2000 had infringed the property rights guaranteed by A rticle 1 of Protocol No. 1 which they had had at the time of German r e unification. In their submission, the amount of compensation or indemnification they had received was far less than the real value of the property that had been unlawfully expropri ated .

62 . They also considered that they had been discriminat ed against within the meaning of Artic le 14 of the Convention taken in conjunction with A rticle 1 of Protocol No. 1 because, unlike other categories of people , they had been unable to claim a right to restitution of their property.

63 . The applicants also complained of the Administrative Re habilitation Act of 23 June 1994 and the d e cision s of the Federal A dministrative Court and the Federal C onstitution al Court of 16 May and 12 August 2002 respectively. They relied on Ar ticle 1 of Protocol No. 1 , taken alone , and A rticle 14 of the Convention taken in conjunction with A rticle 1 of Protocol No. 1 and A rticle 8 of the Convention.

64 . Lastly, the applicants who had lodged an application with the Federal Co nstitution al Court submitted that the length of the procee dings before it had exceeded the reasonable time provided for in Ar ticle 6 § 1 of the Convention.

THE LAW

65 . The applicants submitted that the Property Act of 23 S eptemb er 1990 , the Indemnification and Compensation Act ( E ALG) of 27 S eptemb er 1994 and the leading judgment of the Federal Con stitution al Court of 22 N ovemb er 2000 had infringed the ir property right guaranteed by Ar ticle 1 of Protocol No. 1, which provides :

“ Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties. ”

The applicants also complained of the Administrative Re habilitation Act of 23 June 1994 a nd of the de cisions of the Federal Adm inistrative Court an d the Federal C onstit ution al Court of 16 May and 12 August 2002 respectively .

( a) The Govern ment

66 . A s their main submission , the Government raised an objection on the ground that the applications were incompatib le ratione materiae with the Convention.

67 . They referred to the C our t ' s case-law , argu ing that Germany had not inte r fer ed with the applicants ' property rights protected by A rticle 1 of Protocol No. 1.

T he applicants – who had lost their property between 1945 and 1949 or between 1949 and 1990 – had not had property rights under the le gislation in force on 3 O ctob er 1990 , when the Convention came into force in the new Länder in Germany . Regarding the issue of the compatibility of those expropriations with public international law , the Court was not competent to examine the circumstances of the expropriation s or the continuing effects produced by them up to the present date , as it had stated in the case of Prince Hans- Adam II of Liechtenstein v. Germany ([GC], no. 42527/98, ECHR 2001-VIII). Nor had the applicants had property rights or a legitimate expectation of obtaining compensation or indemni ficat ion of a particular amount based on the Joint Declar ation by the FRG and the GDR or the leading judgments of the Federal C onstitution al Court on the land reform .

The G overnment a dded that the applicants could not derive a legitimate expectation from the debates in the Federal P arl iam ent ( Bundestag ) either , for it was in the nature of a democratic re gime to discuss the various systems of compensation under consideration .

68 . Regarding the expropriations carried out between 1945 and 1949, the Government pointed out that whatever the p osition of the Soviet Union might have been at the time , i t was indisputable that during the ne go t iations concerning German r e unification the freely elected Parl ia ment of the GDR had insisted on preserving the outcome of the land reform implemented between 1945 and 1949.

With regard to the legal entitie s among the applicants , the Government pointed out that although it was true that they had not received any compensation, this was not the case for the shareholders .

As regards re habilitation, the legislature had intended to make a clear distinction between administrative and criminal re habilitation , the latter concerning victi ms of criminal convictions , which were inherently more serious than administrative de cisions . Similarly, the wording of section 1 ( 1 ) , t hird sentence , of the Administrative Re habilitation Act of 23 June 1994 , taken in conjunction with section 1 ( 8 ) of the Property Act , clearly in dicated that the legislature had intended to prevent the clause in the Joint D e claration excluding restitution being circumvented by the Ad ministrative Re habilitation Act .

69 . With regard to the exprop riations carried out between 1949 and 1990, the Government submitted that although the Joint De cla ration had stated that property would, in principle, be returned or, failing that, the owners indemnified, those princip l es had su bsequently been implemented in the Property Act of 23 S eptemb er 1990 and the Indemnification and Com pensation Act of 27 S eptemb er 1994. The applicants did not have rights or a legitimate expectation going beyond the framework f ixed by that legislation .

( b) The applicant s

70 . The applicants submitted that the expropriations that had taken place betwe e n 1945 and 1949 o r between 1949 and 1990 breached public international law ( particularly A rticle 46 of the Hagu e Regulations on the Laws and Customs of War) and the law of the FRG , and that what was involved were actually “crimes against humanity” . They referred to the Court ' s reasoning in the case of Loizidou v . Tur key ( merits) ( judgment of 18 December 1996 , Re ports of Judgments and De cisions 1996-VI) asserting that the expropriations had amounted to a continuing violation of their property rights . Moreover, the FRG had never acknowledged the expropriations on a political or legal level , as all the politicians of the FRG had constantly reaffirmed .

71 . The applicants contended that at the time of German re unification they had had property rights for the purposes of A rticle 1 of Protocol No. 1 o r at least a legitimate expectation of obtaining res titution of their property or adequate c ompensation or indemni fication . In their submission, this was clear from the terms of the Joint Declaration and the first leading judgment of the Federal C onstitution al Cour t on the land reform . By refusing them any possibility of restituti on o r adequate reparation after re unification, the FRG had expropriat ed them a second time in breach of their property rights guaranteed by A rticle 1 of Protocol No. 1.

72 . With regard to the expropriations carried out between 1945 and 1949 , the applicants submitted that it had been established that during the negotiations regarding German reunification the Soviet Union had never laid down conditions regarding the non- restitution of the property and still less the amount of compensation payable .

Furthermore, the ex propriations had in reality amounted to political perse cutions of a criminal nature and the applicants had been eligible for criminal rehabilitation coupled with restitution of their property in accordance with point 9 of the Joint Declaration taken in conjunction with A rticle 17 of the U nification Treaty. Under section 1 ( 7 ) of the Property Act they had at least been eligible for administrative re habilitation coupled with restitution of their property.

By denying them any possibility of re habilitation coupled with restitution of their property, the FRG had also infringed A rticle 1 of Protocol No. 1. Lastly , the legal entitie s among the applicants pointed out that they did not have a right to restitution or compensation.

73 . With regard to the expropriations carried out between 1949 and 1990, the applicants submitted that the Joint D e clarat io n had established the principle that the property would be returned or, failin g that, land of an equivalent value allocated or indemnification paid . The subsequent repeal of section 9 of the Property Act had d irectly interfered with their property rights .

2. The C our t ' s assessment

( a ) Re capitulation of the relevant princ iples

( a) Deprivation of ownership or of another right in rem is in principle an instantaneous act and does not produce a continuing situation of “deprivation of a right” (see Malhous v. the Czech Republic (dec.) [GC], no. 33071/96, ECHR 2000 -XII, with further references).

(b) Article 1 of Protocol No. 1 does not guarantee the right to acquire property (see Van der Mussele v. Belgium , judgment of 23 November 1983, Series A no. 70, p. 23, § 48, and Slivenko and Others v. Latvia (dec.) [GC], no. 48321/99, § 121, ECHR 2002-II).

( c) An applicant can allege a violation of Article 1 of Protocol No. 1 only in so far as the impugned decisions related to his “possessions” within the meaning of this provision. “Possessions” can be either “existing possessions” or assets, including claims, in respect of which the applicant can argue that he or she has at least a “legitimate expectation” of obtaining effective enjoyment of a property right. By way of contrast, the hope of recognition of a property right which it has been impossible to exercise effectively cannot be considered a “possession” within the meaning of Article 1 of Protocol No. 1, nor can a conditional claim which lapses as a result of the non-fulfilment of the condition (see Prince Hans-Adam II of Liechtenstein v. Germany [GC], no. 42527/98, §§ 82 and 83, ECHR 2001-VIII , and Gratzinger and Gratzingerova v. the Czech Republic (dec.) [GC], no. 39794/98, § 69, ECHR 2002-VII).

( d) Article 1 of Protocol No. 1 cannot be interpreted as imposing any general obligation on the Contracting States to return property which was transferred to them before they ratified the Convention. Nor does Article 1 of Protocol No. 1 impose any restrictions on the Contracting States ' freedom to determine the scope of property restitution and to choose the conditions under which they agree to restore property rights of former owners (see Jantner v. Slovakia , no. 39050/97, § 34, 4 March 2003) .

In particular, the Contracting States enjoy a wide margin of appreciation with regard to the exclusion of certain categories of former owners from such entitlement. Where categories of owners are excluded in this way, their claims for restitution cannot provide the basis for a “legitimate expectation” attracting the protection of Article 1 of Protocol No. 1 (see, among other authorities, Gratzinger and Gratzingerova , cited above, §§ 70-74).

On the other hand, once a Contracting State , having ratified the Convention including Protocol No. 1, enacts legislation providing for the full or partial restoration of property confiscated under a previous regime, such legislation may be regarded as generating a new property right protected by Article 1 of Protocol No. 1 for persons satisfying the requirements for entitlement. The same may apply in respect of arrangements for restitution or compensation established under pre-ratification legislation, if such legislation remained in force after the Contracting State ' s ratification of Protocol No. 1 (see Broniowski v. Poland [GC], 31443/96, § 125, ECHR 2004 -V ).

( b ) Application of the relevant principles to the pr esent case

( i ) General c onsid erations

76 . A s occurred in the other c entral and e astern European States , the transition from a communist regime to a democratic market-economy system in the new Länder raised many issues relating to property rights in Germany . The Joint De claration by the FRG and the GDR of 15 June 1990 on outstanding property issues , to which the GDR a dhered after the first democratic e lections of its p arl ia ment a nd which became an integral part of the U nification Treaty, laid down the f undamental princip l es in that connection .

Those principles were subsequently implemented by the legislature in the Property Act of 2 9 S eptemb er 1990 and in the Indemnification and C ompensation Act of 27 S eptemb er 1994 . With regard to re habilitation, the legislature enacted the Criminal Re habilitation Act of 29 O ctob er 1992 and the A dministrative Rehabilitation Act of 23 June 1994 .

In its four leading judgments of 23 April 1991 , 18 April 1996 , 22 N ovemb er 2000 and 4 July 2003 on the land reform the Federal Constitutional Court found that th at legislation was compatible with the Basic Law .

determine the arrangements whereby they agree to pay indemnification or compensation to the persons concerned ( see , mutatis mutandis , Kopecký , cited above , § § 37 and 38).

( ii ) As to whether the applicants had “ possession s” within th e meaning of A r ticle 1 of Protocol No. 1

79 . The present case clearly does not concern “ existing possessions ” of t he applicants . Most of them are the heirs of persons whose property was expropriated a long time ago and have thus no t been in a position to exercise their ownership rights over the property concerned for more than half a century in most cases .

(a) between 1945 and 1949 , at the instigation of the Soviet occupying forces in Germany . That occupation of Germany was not an “ ordinary ” war-time occupation , but an occupation sui generis , follow ing a war and an unconditional capitulation , which conferred powers of “sovereignty” on the occupying forces. That special re gime was generally recognised by the international community; and

(b) after 1949 in the GDR, which was a separate State , distinct from the FRG, and widely recognised by the international community towards the end of its existence .

The expropriations attributable to the GDR were carried out in respect of its own nat ionals and are not therefore governed by international law .

84 . I t remains for the Court to examine whether the applicants had a “ legitimate expectation ” of realising a current and enforceable claim , by obtaining the re stitution of their property or compensation ( for the 1945-1949 expropriations ) o r indemnification ( for the post- 1949 expropriations ) of a particular amount commensurate with the real value of their possessions.

( α ) The expropriations carried out between 1945 and 1949 in the Soviet occupied zone in Germany

85 . With regard to restitution , the Court notes that the Joint D e claration by the FRG and the GDR of 15 June 1990 ( see paragraph 38 ab ove ) indi cates that “the e xpropriations carried out by the occupying authorities [between 1945 and 1949] can no longer be revoked . ” Subsequently the Federal Co nstitution al Court, in its first leading judgment , of 23 April 1991 , on the land reform ( see paragraph s 12-18 above ) , confirmed that that exclusion of any right to restitution did not breach the Basic Law .

86 . Accordingly , the applicants do not appear to have any legal basis on which to ground a legitimate expectation of securing the restitution of their property. The Court also refers in this connec ti on to the Commission ' s reasoning in the case of Mayer and Others (above-cited de cision), which concerned the exclusion of any restitution in respect of expropriations carried out between 1945 and 1949.

89 . It was not until later that the Com pensation Act , which is part of the Indemnification and Com pensation Act of 27 Se ptemb er 1994 ( see paragraph s 52-55 above ) , dealt with t he detai ls of the compensation payable to the former owners of the land and buildings in question.

In its third leading judgment , of 22 November 2000 , on the land reform ( see paragraph s 23-32 above ), the Federal Co nstitution a l Court held that that Act did not breach the Basic Law .

90 . The applicants submitted that they had a legitimate expectation of receiving far higher compensation , commensurate with the real value of their possessions. They referred, in particular, to the first leading judgment of the Federal C onstitution al Court , of 23 Ap ril 1991 , on the land reform . In that judgment the Co nstitution al Court held that “ If it [the legislature] opts for that solution [for the 1949-1990 expropriations] it cannot rule out a ll reparation for the expropriations carried out pursuant to the Occupation laws or the powers of the occupying authorities [1945 - 1949 expropriations ].” It added that “ the rules [stated in the Joint Declaration] do not specify an y criteria relating to the amount of compensation. There is no principle in the Basic Law requiring full reparation for the expropriations in issue in the present case ... . There is no constitutional obligation at the outset to provide repar ation to the same value as restitution . However, the legislature does have to take account of Article 3 § 1 of the Basic Law [ principle of equality ] in determining the global rules relating to compensation ” .

92 . Neither the wording of the Joint Decl aration nor the content of the Federal C onstitution al Court ' s judgment of 23 Ap ril 1991 support the contention that the applicants had a legitimate expectation going beyond the framework established by that Act and based on a current and enforceable claim which the y could expect to succeed ( see Jantner , cited above , § 29).

93 . I n the judgment in question the Federal C ons titution al Court stressed , on the contrary, the wide margin of appr e ciation available to the legislature in determining a comprehensive solution regarding the consequences of German re unification. In calculating the i ndemni fication and compensation payable to the heirs of the former owners , the legislature was entitled to have regard to it s financial means in the light of the total damage to be made good .

I t could also take account of the interference with assets other than the right of property, such as life , health or freedom , and the tasks related to rebuilding the country .

Similarly, in its judgment of 22 N ovemb er 2000 the Federal C onstitution al Court , when examining the constitutionality of the Indemnification and Compensation Act in the light of the principle s of social justice a nd the rule of law, reiterated that the state community had an obligation to apportion the burden borne by certain groups of persons by

means of a statute w hich alone would establish concrete rights to indemnification or compensation . It also pointed out that , i n setting up that system , the legislature had a very wide margin of appreciation regarding both the nature and scope of the reparation awarded.

94 . Lastly , the claims of the legal entities among the applicants clearly fall outside the provisions of the Indemnification and C ompensation Act as they are not entitled to any compensation under that Act . In its judgment of 2 2 N ovemb er 2000 the Federal Constitutional Court held that the exclusion of legal entitie s did not breach the Basic Law ( see p aragraph 29 above ) . In that connection the Court notes that the shareholders of the legal entitie s in question did have a right to compensation under the Indemnification and C ompensation Act.

95 . With regard to re habilitation coupled with restitution , the Court notes that the legislature passed two laws in this connection: the Criminal Re habilitation Act of 29 October 1992 ( see paragraph s 57- 5 8 above ) and the A dministrative Rehabilitation Act of 23 June 1994 ( see paragraph s 59- 6 0 above ) .

96 . The applicants submitted that the e xpropriations in question were in reality acts of criminal political pers e cutio n and that they had rights to criminal r e habilitation coupled with restitution of their property unde r point 9 of the Joint De claration taken in conjunction with Article 17 of the U nification Treaty ( see paragraphs 38 - 39 above ). They declare d , above all, that under section 1 (7) of the Property Act ( see paragrap h 42 above ) , they were at least eligible for administrative r e habilitation coupled with restitution of the property of which they had been deprived by the exclusion clause inserted into section 1 ( 1 ), third sentence of the A dministrative Rehabilitation Act ( see paragraph 59 above ).

97 . On the first point the Court reiterates that while the Joint De claration and the U nification Treaty established the fundamental principles, these were subsequently implemented by the legislature in the various statutes which determin ed the concrete rights on which the applicants may rely . By enacting two different statutes concerning re habilitation , the legislature intended to make a distinction between victim s of administrative d ecisions and victims of criminal convictions, which are inherently more serious. In its fourth leading judgment, of 4 July 2003 , on the land reform ( see p aragraph s 33-37 above ), the Federal Co nstitution al Court held that a criminal conviction was such a serious interference with a person ' s freedom that , unlike administrative expropriations , it justified rest itution of the confiscated property via the reha bilitation pro ceedings . In the instant case

the expropriations between 1945 and 1949 were carried out exclusively on the basis of administrative decisions .

98 . Accordingly, the applicants ' claims clearly do not fall within the provisions of the Criminal Re habilitation Act and the Court does not see anything arbitrary or unfair in the distinction made by the German authorities between victims of administrative decisions and victims of criminal convictions.

99 . On the second point the Court reiterates that the Joint De claration states that “ the expropriations carried out by the occupying authorities [ between 1945 and 1949] can no longer be revoked” . A rticle 41 of the U nification Treaty provides that “the Federal Republic of Germany shall not enact legal rules that co nflict with point 1 of the above-mentioned Joint Declara tion ” ( see paragraph 39 above ).

The Court also points out that it is clear from section 1 ( 1 ), third sentence , of the A dministrative Rehabilitation Act , taken in conjunction with section 1 ( 8 ) of the Property A ct , that the Administrative Rehabil itation Act does not allow restitution of property confiscated between 1945 and 1949.

100 . In their leading judgments of 21 February 2002 and 4 July 2003 , the Federal A dministrative Court and the Federal Con stitution al Court confirmed the exclusion of any right to restitution , notwithstanding the terms of section 1 ( 7 ) of the Property Act . The Federal C onstitution al Court reiterated that the main intention of the legislature in inserting the third sentence in section 1 ( 1 ) of the Administrative Re habilitation Act had been to prevent the exclusion of the right to restitution , as pr ovided for in section 1 ( 8 ) of the Property Act ( and deriving from the exclusion clause in point 1 of the Joint De claration) , from being circumvented by means of the Administrative Re habilitation Act . It added that in respect of the expropriations carried out during that period , the applicants were entitled to compensation under the Indemnification and Co mpensation Act.

102 . Accordingly, it cannot be claimed that the applicants had a legitimate expectation of being entitled to administrative re habilitation coupled with restitution of their property .

β ) The expropriations carried out in the GDR after 1949

103 . The Cour t note s that the Joint De claration establishes the principle that confiscated property must be returned unless this is impossible o r t hird parties have acquired it in good faith . In the latter case , according to the Joint Declaration, “ socially acceptable indemnification is to be made to the

former owner by substituting real estate of a comparable value or by paying indemnification ” . Those principles were subsequently implemented in the Property Act of 29 S eptemb er 1990 ( see paragraph s 41-45 above ) and in the I ndemnification Act, which is part of the Indemnification and Compensation Act of 27 S eptemb er 1994 . In its third leading judgment , of 22 N ovemb er 2000 , on the land reform, the Federal C onstitution al Co urt held that those statutes did not breach the Basic Law .

104 . The applicants submitted that they had had a legitimate expectation of obtaining either restitution of their property or land of an equivalent va lue or much higher indemnification commensurate with the real value of the property . They referred to the Joint De claration and to the initial version of section 9 of the Property Act ( see paragraph 45 above ) , which provided fo r the allocation of land of an e quivalent value , and to the first leading judgment of the Federal Const itution al Court of 23 Ap ril 1991 on the land reform . In that judgment the Con stitution al Court held that “ i n respect of the expropriations without indemnification [between 1949 and 1990] , which do n ot fall within the scope of no. 1, fourth sentence, of the Joint Declaration , the legislature has chosen to compensate the former owners on the basis of the principle of restitution of the expropriated item. This may be relevant for the amount of indemnification payable in lieu of restitution ” .

105 . The Court is of the opinion that the applicants ' rights regarding the conditions for recover y of their property were clearly established by the Property Act . Where those conditions were not fulfilled, because restitution was impossible in practice or third parties had acquired the property in good faith , t he applicants ' claims clearly fa ll outside the scope of the Property Act.

106 . The same is true of the applicants ' rights regarding the amount of indemnification that they could legitimately expect to receive, which we re clearly established by the Indemnification and Co mpensation Act of 27 S eptemb er 1994 .

107 . Neither the terms of the Joint De claration nor the content of the Federal Constitutional Court ' s judgment of 23 April 1 991 support the contention that t he applicants had a legitimate expectation going beyond the framework laid down by those statutes and based on a current and enforceable claim that the y could expect to succeed ( see Jantner , cited above , § 29).

108 . Both point 3 ( b) of the Joint De claration and the initial ver sion of section 9 of the Property Act provide d for the allocati on of land of an equivalent value or the payment of indemnification as alternatives to restitution . Similarly, in its judgment of 23 April 1991 the Federal

Cons titution al Court merely indicated that the principle of restitution established in respect of the expropriations c arried out between 1949 and 1990 might be relevant for the amount of indemnification payable .

109 . Moreover , as the Court has stated above ( see paragrap h 9 3 ) , in its judgments of 23 Ap ril 1991 and 22 N ovemb er 2000 the Federal C onstitut ion al Court stressed the wide marg in of appr e ciation av ailable to the legislature in determining an overall solution regarding the consequences of German re unification. Furthermore, it explicitly reiterated that neither the Joint De claration nor the initial v ersion of section 9 of the Property Act had created concrete rights protected by Article 14 [right of property] of the Basic Law for persons whose property had been expropriated by the GDR .

( iii ) Conclusion

In the instant case, by choosing to make good injustices o r damage resulting from act s committed at the instigation of a foreign occupying force or by another sovereign State , the German legislature had to make certain choices in the light of the public interest . In that connection, by enacting legislation governing issues of property and re habilitation after German re unification, i t had regard , among other things, to the co ncepts of “ socially acceptable balance between conflicting interests ” , “ legal certainty and clarity ” , “right of ownership” and “ legal peac e ” contained in the Joint De claration. Si milarly, in examining the compatibility of th at legislation w ith the Basic Law, the Fe deral C onstitution al Court referred to the principles of “ social justice and the rule of law ” and that of the “prohibition of arbitrariness” .

113 . The Cour t concludes that the applicant s have not shown that they had claim s that were sufficiently established to be enforceable, and they theref ore cannot argue that they had “possession s ” within the meaning of Article 1 of Protocol No. 1. Consequently, nei ther the statutes in question nor the judgments or deci sions of the Federal C onstitution al Court amounted to an interference with the peaceful enjoyment of their possessions , and the facts of the case do not fall within the ambit of A rticle 1 of Protocol No. 1.

114 . I t follows that the complaint s under Article 1 of Protocol No. 1 are incompatible ratione materiae with the provisions of the Convention, withi n the meaning of A rticle 35 § 3, and must be rejected in accordance with A rticle 35 § 4.

115 . The applicants also claimed to be the victims of discrimination in breach of A rticle 14 of the Convention taken in conjunction with Ar ticle 1 of Protocol No. 1 because , unlike other categories of persons, they were unable to claim a right to restitution of the property that had been unlawfully expropriated and had received only a negligible amount of compensation o r indemnification .

A rticle 14 of the Convention reads as follows :

“The enjoyment of the rights and freedoms set forth in [the] Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status.”

In particular, the applicants who are the heirs of persons whose property was expropriated between 1945 and 1949 consider ed that they had been discriminated against compared with persons whose property was expropriated between 1949 and 1990 and who were able to recover their property under the Property Act . They also maintain ed that they had been discriminated against compared with persons who were eligible for criminal re habilitation coupled with restitution of their property.

The applicants who are the heirs of persons who se property was expropriated between 1949 and 1990 and were unable to recover their property submitted that t hey had been discriminated against compared with those in such a position who had been able to recover their property .

116 . According to the Court ' s settled case-law , A rticle 14 of the Convention complements the other substantive provisions of the Convention and its Protocols. It has no independent existence since it has effect sol ely in relation to the “ enjoyment of the rights and freedoms” safeguarded by those provisions. Although the application of Article 14 does not presuppose a breach of those provisions - and to this extent it is autonomous - there can be no room for its application unless the facts at issue fall within the ambit of one or more of the latter ( see Prince Hans-Adam II of Liechtenstein , cited above , § 91 , and Gratzinger and Gratzingerova , cited above , § 76 ).

117 . Having regard to the finding that A rticle 1 of Protocol No. 1 is inapplicable, the Court holds that Articl e 14 of the Convention cannot be taken into account in the present case.

118 . I t follows that the complaint s under A rticle 1 of Protocol No. 1 , taken in conjunction with Ar ticle 14 , are also incompatible ratione materiae with the provisions of the Convention, within the meaning of A rticle 35 § 3, a nd must be rejected in accordance with A rticle 35 § 4.

119 . One of the applicants, who is the heir of a person whose property was expropriated between 1945 and 1949, claimed that the Adm inistrative Rehabilitation Act of 23 June 1994 and the de cisions of the Federal A dministrative Court and the Federal Consti t ut ion al Court of 16 May and 12 August 2002 respectively had also infringed A rticle 14 of the Convention taken in conjunction with A rticle 8. That provision is worded as follows:

“1. Everyone has the right to respect for his private and family life, his home and his correspondence.

2. There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others . ”

120 . The Court must first rule on the applicabilit y of A rticle 8 to the present case, having regard to the non-autonomous nature of Article 14.

121 . The applicant submitted that the A dministrative Rehabilitation Act fell within the scope of Ar ticle 8 and, inter alia , that the State had positive obligations in that regard . Relying on that Article, he contended that he was entitled to administrative r e habilitation coupled with restitution of his property.

122 . The Cour t notes at the outset , as it has already done regarding Article 1 of Protocol No. 1 (see paragraphs 8 1-82 above), that since the FRG is not responsible for acts committed between 1945 and 1949 at the instigation of a foreign occupying for ce, the Court does not h ave jurisdiction ratione temporis to examine the circumstances of the expropriations and whether there was a breach of Art icle 8.

With regard to the A dministrative Rehabilitation Act , which was passed after German re unification , and to the de cisions of the Federal A dministrative Court and th e relevant ones of the Fed eral C onstitution al Court , the Court considers that th is complaint does not raise a n issue distinct from the one raised under A rticle 1 of Protocol No. 1.

123 . The Cour t therefore concludes that Art icle 8 of the Convention is inapplicable, which means that A rticle 14 d oes not come into play in the present case.

124 . I t follows that the complaints under Article 14 of the C onvention taken in conjunction with A rticle 8 are also incompatible ratione materiae with the provisions of the Convention, wi thin the meaning of Ar ticle 35 § 3, and must be rejected in accordance with A rticle 35 § 4.

125 . T he twenty-one applicant s who had applied to the Federal Constitutional Court complained that the length of the proceedings before that court had exceeded the reasonable time required by Article 6 § 1 of the Convention , which provides:

“In the determination of his civil rights and obligations ..., everyone is entitled to a ... hearing within a reasonable time by [a] ... tribunal...”

126 . The Co ur t notes that the applicants app lied directly to the Federal Con stitution al Court for a ruling on the constitution a lity of the Indemnification and Co mpensation Act .

127 . The period to be considered began on 29 June 1995 , when the applicants lodged their application , and ended on 22 N ovemb er 2000 , when the Federal C onstitution al Court delivered its judgment . It therefore lasted nearly five years and five months .

128 . The Court reiterates that the “reasonableness” of the length of proceedings must be assessed in the light of the circumstances of the case and with reference to the following criteria established by its case-law : the complexity of the case, the conduct of the parties and of the relevant authorities and what was at stake for the parties in the dispute ( see Süssmann v . Germany , judgment of 1 6 S eptemb er 1996, Re ports 1996-IV, p. 1172, § 48 ; Gast and Popp v . Germany , n o. 29357/95, § 64, ECHR 2000-II ; and Frydlender v . France [GC], n o. 30979/96, § 43, ECHR 2000-VII).

129 . The Govern ment maintained that the case was of considerabl e complex ity , particularly as the application had been directly lodged against a statute. The Federal Cons titution al Court had thus been the first and only judicial body to examine the case and had had to analyse in detail all the different types of situation that could arise under the Indemnification and C ompensation Act in the light of the Basic Law . It could not be criticised for grouping together applications that had been pending since 1995. Lastly, the Government submitted that since the payments in question had not been due before 2004 under the Indemnification and C ompens ation Act , there had been no need to give priority to the matter .

130 . The applicants replied that , having regard to the i mportance of the issues in question , the Federal C ons titution al Court should have given a de cision speed ily, as it had done in its first leading judgment , of 23 Ap ril 1991 , on the land reform . As these issues affected hundreds of thousands of victims, many of whom were ver y elderly people, the C onstitution al Court should even have given priority to the applications .

( see Süssmann , cited above , p. 1174, §§ 55-56 ; Gast and Popp , cited above , § 75; and Goretzki v . Germany , ( d e c .), n o. 52447/02, 24 January 2002 ).

134 . Moreover, this case was one of many applications to the Federal C onstitution al Court following German re unifi cation ( see Süssmann , cited above , p. 1174, § 60).

135 . Lastly, the undeniable importance of what was at stake in the proceedings in question for the applicants, many of who m are very elderly, is also a factor to be taken into consid e ration. However, since the payments of indemnification and compensation in question were not in any event scheduled to be made before 2004, the stakes were not so important as to impose on the court concerned a duty to deal with t his case as a matter of very great urgency, as is true of certain types of litigation ( see Süssmann , cited above , p. 1175, § 61 in fine ; Gast and Popp , cited above , § 80 ; and Gore tzki , cited above ).

136 . In the light of all the circumstances of the case , and particularly the exceptional c ontext of German reunification , the Court finds that the “ reasonable time ” prescribed by Article 6 § 1 was not exceeded and that there has therefore no t been an appearance of a violation o f that provision on this point.

137 . I t follows that thi s complaint must be rejected as manifestly ill-founded in accordance with A rticle 35 §§ 3 and 4 of the Convention.

For these reasons , the Cour t , by a majority ,

D e clare s the applications inadmissible.

Erik Fribergh Luzius Wildhaber              Deputy Registrar Pr e sident

A PPE N DI X

Application no. 71916/01

von MALTZAN and Others v . Germany

List of applicants

The vast majority of the applicants complained of e xpropriat ions carried out between 1945 and 1949. Th e three applicants wh o complained of post- 1949 expropriat ions are indicated below .

Wolf-Ulrich von MALTZAN

Peter RUESS

Christoph von SCHLIPPENBACH

Jörg von LÜDINGHAUSEN

Christoph and Natascha von WINTERFELD

Sophie HESSE

Wolfgang HUPERTZ

Hanno von WULFFEN

Winfried von SCHUTZBAR-MILCHLING

Marion NEUMANN

Jürgen GRAUE

Hannelore WAGNER-HEPP

Jaspar von MALTZAHN

Horst FIKENTSCHER

Rosemarie von EINSIEDEL

Horst APFEL

Irmgard KNOPF

A fter 1949

Gerhard HEEREN

Ralph MAENNICKE

Johann-Detloff HESSE

Marie-Louise von ROSEN

Swedish national

Gudrun Freiin von SOBECK

Ingeborg VONHOFF-STREHLE

Manfred von MALTZAHN

Horst GROSS

Anita REISS

A fter 1949

Maria von MALTZAHN

Ursula GROSS-NILGES

Franz HEUER

Fritz HÃœLSSE

Rolf MARTIN

Dietrich von WERTHERN-WIEHE

Günter STANG

Bernhard von PLESSEN

Krafft von RIGAL

Jürgen QUAST

Anneliese GRONAU

Gottfried STRIEGLER

Irmgard STURM

Ruth BARTHEL

Before and after 1949

Hans-Wolfgang von BYERN

Sabine POMMEREHNE

Dr. Hermann KOEBE

Manfred LORENZ

Dr. Reginald HANSEN

Christoph von ZEHMEN

Hans von REICHE

Applications nos. 71917/01 and 10260/02

Von ZITZEWITZ and Others , and MAN FERROSTAAL and ALFRED TÖPFER STIFTUNG v . Germany

List of applicants

The vast majority of applicants complained of expropriat ions carried out between 1945 and 1949. Th e two applicants who complained of post- 1949 expropriat ions are indicated below .

A. Natural persons

N ames

Margarete von ZITZEWITZ                     after 1949

Werner KLAUSSER                           after 1949

Dora BAUMGARTEN

Ingeborg KRETZMANN

Hans KATHE

Wolfgang KATHE

Hans-Jochen WINTERFELDT

Sabine FRANKE née WINTERFELDT

Ute WINTERFELDT

Hubertus von HEYDEN

Friedrich-Wilhelm SCHAEPER

Elard SCHAEPER

Elisabeth-Charlotte WIERSDORFF

Iris WIERSDORFF

Hans-Hennig WIERSDORFF

Freia WIERSDORFF

Swantje JÖRDENING née WIERSDORFF

Gebhard von DAVIER

Otto von BOYNEBURGK

Dr. med. Joachim vom DAHL

Dr. med. Dieter vom DAHL

Erika LAUTERBACH née vom DAHL

B. Legal entities

N ames

The Alfred Toepfer-Stiftung Foundation F.V.S.

Deutsche Ind ustrie-Anlagen Gesellschaft G mbH , which subsequently bec ame Man Ferrostaal