Institute for War and Peace Reporting | Giving Voice, Driving Change
Romania Pays Price for Seized Property
Romania will have to pay 900,000 euro in compensation if it refuses to hand over a property seized by the communist authorities more than five decades ago.
The European Court of Human Rights, ECHR, ruled last week that the Bucharest government must hand back a house in the capital which was seized from local resident Calin Popescu Nasta in 1950, and pay him more than 16,000 euro in damages and costs.
If it fails to do so, Popescu Nasta must be paid 900,000 euro in lieu of his property - and the government will have only three months to come up with the money, the court ruled.
This is the most severe verdict ever handed down by the ECHR against Romania, which has already been forced to pay out more than two million euro in twelve cases heard over the past two years.
The government is planning to challenge the majority of these rulings, despite Prime Minister Adrian Nastase's declaration that it fully intends to hand certain properties back to their former owners.
"Some decisions are questionable, because they set the value of a house depending on its location, without taking wear and tear into consideration," said a source in the justice ministry.
Popescu Nasta effectively won his house back in 1993, but the Bucharest appeals court decision was overturned by the supreme court a year later. When a new government took power in 1997, he appealed once more, but was told that the property could not be returned, as it had since become an art museum.
He then approached the ECHR. The case, which ended on January 7, has worrying implications for the Romanian authorities, which may be forced to confront the country's communist past if they want a future in the European Union and NATO. Romania was invited to join the alliance at its Prague Summit in November 2002.
Bucharest drew up legislation to ease the process of returning seized property some years ago, but consistently failed to enact it until early 2001. Until then, only land restitution had been tackled since the fall of the communist regime in 1989, with around 50 hectares of farmland and 10 hectares of forest being returned to their former owners.
However, critics say the government is endangering its reform process and even the country's international reputation with its hesitant attitude towards property restitution.
"After years of indecision in tackling this problem, the government has no clear idea - and few resources - to implement a workable property restitution process," political analyst Ovidiu Nahoi told IWPR. "How do officials expect to attract foreign investment without this?"
The 2001 law made it possible for factories, banks, houses and other assets to be returned to their rightful owners or otherwise financially compensated. However, the authorities did not publicise the legislation until it came under pressure from abroad.
After lobbying by several organisations - especially representatives of the Jewish community in the United States, many of whose members lost their homes under the communists - Bucharest extended the deadline for property restitution requests until March 14, 2003.
So far, around 128,000 claims have been made but less than 12 per cent have been processed.
Lucia Negoita of the government's property restitution authority told IWPR that it is often difficult to prove ownership after such a long period of time. "Only half of those who have applied are entitled to payment, as many have not been able to verify their claim to certain properties," she said, adding that the authorities expect the final bill for restitution and compensation to be around 3.5 billion US dollars.
It is still not clear how the cash-strapped Bucharest authorities intend to pay for this. Last month, the government issued a statement implying that the owners of confiscated properties should be reimbursed with shares in various state-owned companies earmarked for privatisation.
However, this has not been welcomed by former owners. "We will not accept it because we want our properties back, or proper compensation for our losses," said Maria Teodoru, president of the Association of Former Owners Forcibly Dispossessed by Communists.
"The Romanian government must pay the former owners for their lost possessions without delay."
Marian Chiriac is a Bucharest-based journalist
As coronavirus sweeps the globe, IWPR’s network of local reporters, activists and analysts are examining the economic, social and political impact of this era-defining pandemic.
- Europe & Eurasia
- Latin America
- Middle East & North Africa
- Focus Pages
- Training & Resources
- Print Publications
- IWPR Spotlight