ABSTRACT

Privatization in east Germany started with the establishment of a government agency which was made responsible for privatization and restructuring of public property. This ‘Treuhandanstalt’ had already been founded in the former German Democratic Republic and was afterwards reorganized by a law of June 1990, which came into effect at the same time as the treaty on the monetary, economic and social union between the Federal Republic of Germany and the German Democratic Republic.1 During its active life (1 July 1990 until 31 December 1994), Treuhandanstalt sold 15,102 key-sector enterprises to private investors.2 These transactions typically were sales of large, former public enterprises, which were bought by large, private enterprises. Fifty-five per cent of the private buyers had more than five hundred employees, only 10.3 per cent of the private buyers had fewer than a hundred employees.3