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Berlin on the way to corporate law: coalition comes to an agreement!
The black-red coalition in Berlin agrees on a socialization framework law to enable state intervention in the event of undesirable developments.
Berlin on the way to corporate law: coalition comes to an agreement!
Something is happening in the political landscape in Berlin, and this particularly appeals to tenants. Today, the leaders of the black-red coalition, consisting of the CDU and SPD, agreed on key points for a long-awaited socialization framework law. This law is intended to define the legal framework for possible associations. CDU parliamentary group leader Dirk Stettner and SPD parliamentary group leader Raed Saleh announced this agreement on Sunday, signaling a step towards more control over large real estate groups. But what does that mean exactly?
The aim of the new law is clear: it should enable the state to intervene in undesirable developments in areas such as housing and energy without having to resort to expropriation directly. Instead, the law relies on a regulatory effect. As Stettner emphasized, the measures should be targeted and proportionate. A draft bill is expected to be introduced in the House of Representatives by the end of the year and could come into force at the earliest two years after its promulgation in order to address possible legal concerns, according to Tagesspiegel.
Socialization and referendum
The background for this debate is a referendum from 2021, in which 58% of Berliners voted in favor of socializing large housing companies. However, the “Expropriate Deutsche Wohnen & Co.” initiative, which called for this step, is dissatisfied with the current development. They criticize the planned framework law as inadequate and as a distraction from the original goal, as RBB24 reports. Governing Mayor Kai Wegner (CDU) has also categorically ruled out the corporatization of large housing groups.
The initiative is planning another legislative push to enforce its demands. A report on the constitutionality of the law has been announced, but is still pending. Finance Senator Stefan Evers announced that this report could soon be commissioned. Here his administration depends on feedback from other Senate administrations in order to make rapid progress.
Insight into the details
The planned socialization framework law will affect both housing stock and other areas of general interest such as water, energy and health care. It remains to be seen whether the law actually includes all the necessary regulations. A commission of experts has already determined that socialization is legally possible under certain circumstances. It will also be important to determine appropriate compensation, which every company that may be incorporated must take into account. It remains unclear how this can be reconciled with the market value of the properties, which is complicated by different opinions among experts, as Haufe explains.
It remains to be seen whether the black-red coalition can ultimately prevail and seriously take tenants' concerns into account. The course of the debates and the upcoming steps are being followed with excitement for many Berliners, because ultimately it is about their apartments and living conditions.