Dobrindt plans federal investment protection law to curb Berlin socialisation plans

Federal bill aimed at Berlin plans

Federal Interior Minister Alexander Dobrindt (CSU) has announced a new investment protection law, the Investitionsschutzgesetz, that would set high hurdles for socialisation (Vergesellschaftung) of large housing stocks. He made the announcement in an interview with Bild, which first reported the plan. The Interior Ministry then confirmed details of the bill to the German Press Agency (dpa). The federal government had already agreed in principle on such a bill, but its exact legal design is still open.

“We will make clear in an investment protection law that arbitrary left-wing socialisation fetish is incompatible with the Basic Law.”

Three conditions for socialisation

Dobrindt's plan rests on three central requirements. First, compensation would be possible only at market value (Verkehrswert), which would have to be determined by an appraisal report. Second, compensation would have to be paid directly in cash. Third, socialisation would be allowed only if its necessity is expressly proven, and a state government would first have to exhaust all other means, such as investment in housing construction or subsidies for it. According to the Bild report cited by WELT, this would make the Berlin plan unaffordable.

Berlin plan and cost estimates

The bill responds to a possible red-green-red coalition of Linke, Grüne and SPD in Berlin, whose exploratory paper was published on Saturday, 24 October. Berlin voters already backed such socialisation in a 2021 referendum, according to watson, and the paper targets private housing companies with more than 10,000 flats. Under the plan, those firms could keep a basic stock of 10,000 flats, while cooperatives, non-profit firms and flats built since 2021 or still under construction would be excluded. WELT reports that about 160,000 flats from five property companies would move into state ownership, and the parties also agreed on 100,000 new flats and a rent cap for state-owned property. The parties plan up to 16 billion euros in compensation, a figure RP Online says is likely below market value. Per a Bild report cited by WELT, experts estimate that socialisation at market value would cost 50 to 60 billion euros in taxpayer money, a sum Berlin could not raise.

Criticism from Giffey and the SPD

Former Berlin mayor Franziska Giffey (SPD), who is still economy senator, criticised the plans on Instagram for the third time since the paper was published. This time she objected to planned state-level voting rights for everyone living in Berlin for at least five years, regardless of citizenship.

“In my view, that contradicts the constitutive principles of our country.”

She argued that state voting rights should remain reserved for German citizens, and that anyone who wants to vote must speak German and affirm the free democratic basic order. Otherwise, she warned, the change would pose a "risk to the stability of our democracy". Giffey also linked the debate to social protests in France, which have involved massive unrest, and described the images from there as shocking.

Orkan Özdemir, deputy chair of the SPD parliamentary group in the Berlin House of Representatives, called the comparison "highly problematic" and said it suggested the people protesting in France were not French. He pointed to the large share of Black citizens resulting from France's colonial history.

“Not being white does not automatically mean being a migrant.”

Özdemir also recalled guidelines that Berlin's Senate under Giffey presented to the House of Representatives in 2022.