Pension Rights and Prospects Transfer Act (AAÜG)
The Pension Rights and Prospects Transfer Act (AAÜG) is a German federal law that emerged in the context of German reunification, and is officially titled the Act for the Transfer of Rights and Prospects from Supplementary and Special Pension Systems of the former GDR into the Statutory Pension Insurance System of the Federal Republic of Germany. The Act governs the transfer and valuation of pension rights and prospects acquired before October 3, 1990 in the German Democratic Republic (GDR), and provides the legal basis for their recognition and continuation within the all-German social security system.
Purpose and Objectives of the Pension Rights and Prospects Transfer Act
The AAÜG serves the purpose of social- and insurance-law integration of pension claims acquired in the GDR, especially from the so-called supplementary and special pension systems. These systems granted certain groups of employees—such as scientists, doctors, engineers, or artists—above-average benefits exceeding those of the general pension insurance.
With the AAÜG, the framework was established to include these claims in the pension law of the Federal Republic of Germany after reunification, while also compensating for differences with the then-existing West German pension law and avoiding excessive benefits.
Legal Basis and Evolution of the Law
The AAÜG was promulgated on July 25, 1991, in the Federal Law Gazette (BGBl. I p. 1606) and went into effect retroactively as of January 1, 1992. The legal basis is Article 30 of the Unification Treaty, which mandates the alignment of pension rights. Since then, the law has been amended several times to accommodate judicial and factual developments.
Structure of the Act and Key Regulatory Areas
The core objective of the AAÜG is to continue the rights and pension prospects acquired in the GDR, as a rule, only up to a maximum limit (so-called ceiling) and in accordance with statutory pension insurance provisions.
The Act particularly addresses the following core areas:
- Scope and Transfer of Rights (§§ 1-2 AAÜG):
The law defines the groups of insured persons entitled to claims and sets out the rules regarding transferrable pension prospects and claims excluded from the transfer.
- Valuation Principles and Calculation (§§ 3-5 AAÜG):
Guidelines for the valuation of periods as well as for determining the relevant incomes and associated pension points to calculate entitlements.
- Transfer Modalities and Transitional Provisions (§§ 6-8 AAÜG):
Adjustments and special provisions to protect acquired rights and address special groups of cases, e.g., supplementary pensions for surviving dependents.
- Final and Transitional Provisions (§§ 9-15 AAÜG):
Regulations on existing payments, reimbursement claims, and protection of entitlements for certain pre-existing claims.
Scope and Groups Covered
The Pension Rights and Prospects Transfer Act essentially refers to supplementary and special pension systems as they existed in the GDR. These include, among others, the following systems:
- Supplementary pension systems for technical professionals
- Civil servant pensions of the GDR (including senior state officials)
- Doctors’ pension systems
- Systems for scientists and university lecturers
- Special pension system for members of the healthcare sector, the People’s Police, and other groups
Pension rights and prospects acquired under the general GDR social insurance are not subject to the AAÜG, as these were already transferred into the statutory pension insurance.
Exceptions
Certain groups were expressly excluded from the transfer, in particular persons with pension schemes that would have been incompatible with federal German law, and cases of excessive pension benefits.
Legal Effects and Impact on Those Affected
The Pension Rights and Prospects Transfer Act did not take over all GDR pension entitlements unchanged; instead, there was a revaluation and adaptation to West German pension law. The transfer generally took place according to the following system:
- Consideration of prospects accrued in the GDR
- Determination of a notional creditable income based on the applicable tables and transfer values
- Credit of the corresponding earnings points in the West German pension system
- Limitation of transferred pension benefits through statutory maximum limits (so-called capping limit)
Effects on Pension Amounts and Acquired Rights
- In many cases, the recalculation resulted in lower pension entitlements compared to the benefits promised in the GDR.
- However, broad protection of previously granted pensions and payments up to reunification was introduced, provided these were based exclusively on the transferred rights.
Case Law on the AAÜG
The interpretation and implementation of the Pension Rights and Prospects Transfer Act have been and remain the subject of numerous rulings by Germany’s highest courts, particularly the Federal Social Court and the Federal Constitutional Court. Central points of contention include:
- The issue of the constitutionality of the capping of pensions under the AAÜG
- The methodological determination of the notional earnings
- The equal treatment of comparable occupational groups under the old and new pension systems
- Individual issues regarding competing vested rights and transitional entitlements
The Federal Constitutional Court has, in several decisions, confirmed the basic permissibility of the new regulations, but emphasized that confidence-building transitional arrangements and a minimum level of protection are necessary.
Amendments and Current Relevance
The AAÜG has been repeatedly revised and modified in the course of harmonizing German social law, particularly for clarification in individual cases and adaptation to case law. Meanwhile, nearly all pension prospects have been transferred, yet the Act remains relevant due to recalculations, applications for reopening, and ongoing pension recipients.
Assessment in the Context of German Social History
The Pension Rights and Prospects Transfer Act is a central element of Germany’s social unity. It enabled an orderly legal transition of old-age pension entitlements while ensuring overall societal balance and long-term financial viability of the pension system.
Literature and further information:
- Text of the Act: AAÜG in the Federal Law Gazette
- BSG, judgments on the AAÜG
- Federal Constitutional Court, decisions on pension law in the new federal states
Note: This article provides comprehensive information about the Pension Rights and Prospects Transfer Act (AAÜG) and covers all relevant legal aspects within the framework of a legal encyclopedia.
Frequently Asked Questions
What is the significance of the Pension Rights and Prospects Transfer Act (AAÜG) for the transfer of pension prospects from the GDR to the West German pension system?
The Pension Rights and Prospects Transfer Act (AAÜG) governs the legal transfer of pension prospects and entitlements acquired in the GDR into the pension law of the Federal Republic after reunification. The law defines which prospects and entitlements are eligible for transfer and how they are assessed in accordance with West German statutory pension insurance. It specifies, in particular, how various pension schemes, special pension systems, and company supplementary pension schemes from the GDR are treated, including those for specific professional groups (e.g. doctors, engineers, public sector employees, etc.). The AAÜG lays down detailed rules regarding the extent to which GDR-specific provisions are either recognized or curtailed (e.g., through ceilings, qualifying periods, or grounds for exclusion). It also regulates how periods and pension points acquired in the accession area are recalculated, with special tables and sections (§§ 2, 5, and 6 AAÜG) being particularly relevant. It is also central in defining the legal consequences when records are missing or inadequate, providing for evidentiary relief. Overall, the AAÜG ensures a uniform, legally certain transfer of claims acquired in the accession area and subjects these to West German law, while also taking historical interests in security into account.
How are periods in special pension systems determined and recognized under the AAÜG?
For the determination and recognition of periods spent in special pension systems of the GDR (e.g., supplementary pension systems for the healthcare sector, technical, or scientific fields), the AAÜG provides special procedural regulations. Those entitled are, as a rule, persons who belonged to a relevant pension system as of June 30, 1990, or whose entitlements are based on being potential applicants as of that date. Recognition generally requires proof of membership in the pension system by submitting appropriate evidence (e.g., employment contracts, certificates) or—if such records are missing—by means of a sworn affidavit. The transfer typically applies only to professional activities and periods explicitly privileged by the law. The AAÜG defines exclusion criteria for certain groups, meaning that periods resulting from criminal convictions, political functions, or work with security organs may be excluded (§ 6 (2) AAÜG). The transfer is limited both in substance and in time: Not all rights acquired in the GDR system are recognized (in particular special rules such as the possibility of earlier pension eligibility); rather, an adjustment to West German law is made.
How are earnings and earnings points for periods in the East calculated under the AAÜG?
The AAÜG regulates that, for transferring periods completed in the accession area (former GDR), a valuation procedure according to § 5 AAÜG applies. The employment income earned in the GDR is converted taking into account the relevant comparative earnings for the corresponding activity in the Federal Republic. The conversion is typically carried out using tabular values setting average earnings for non-insured employment in special pension systems. Earnings points are determined on the basis of the annual incomes, with special rules applying where applicable for ceilings (so-called ‘capping’ of earnings) and specific situations (e.g., part-time work). Values are adjusted according to the contribution assessment ceilings then in force or federal legal provisions. There is also the possibility to submit actual proof (e.g., pay slips), or, if records are missing, to establish credible earnings, whereby the lower table value applies. The total of the recognized earnings points then flows into the total calculation of the statutory pension under the Social Code VI.
What grounds for exclusion exist for the transfer of pension periods under the AAÜG?
The AAÜG contains, in § 6 (2) and § 8 (2), various grounds for exclusion and restrictions to avoid so-called ‘overprivileging.’ Accordingly, certain periods and entitlements are not transferred into West German pension law. Exclusion applies in particular for employment or benefits related to an unjust regime, such as periods with specific security services (Ministry for State Security, intelligence services, combat groups), politically motivated positions in the party or state leadership, as well as periods unjustly acquired as a result of criminal convictions or disciplinary measures. Pension claims based on privileges not recognized as legitimate under the Basic Law or social law in the Federal Republic are likewise excluded. Those affected by such exclusion receive only retroactive insurance in the statutory pension insurance for the relevant periods, without supplementary privileges.
What requirements apply for proving claims and prospects if records are incomplete?
Due to the often incomplete record situation after the dissolution of GDR institutions, § 8 of the AAÜG provides for special evidentiary relief. Eligible claimants must first submit all evidence available to them, such as employment contracts, certificates, or attestations. If such documents cannot be produced, a sworn declaration indicating all available details will suffice. The German pension insurance scheme must then, as a rule, conduct a plausibility check and, if necessary, an official investigation. However, this evidentiary relief is restricted: patent false statements, contradictions, or lack of indicative evidence will not lead to a successful claim. Ultimately, the key factor remains the substantiation by objective facts and the applicant’s duty to cooperate. The pension insurance fund may collect additional information or commission expert opinions to clarify the claim.
What are the tax and social insurance consequences of the transfer under the AAÜG?
With the transfer of pension entitlements under the AAÜG, the affected pension benefits become fully benefits from the statutory pension insurance under SGB VI. Therefore, the transferred pensions are generally subject to income tax according to the Income Tax Act and are subject to the general requirements for social security contributions (e.g., contributions to health and long-term care insurance for pensioners). The tax treatment is based on the start date of each respective pension payment (key-date rule for pension taxation). Supplements from additionally recognized periods are generally treated as regular partial entitlements. Any benefits paid under the AAÜG must be included as income from previous services (§ 22 No. 1 Sentence 3 EStG) and may increase the taxable portion of the pension. Double entitlements from parallel pension schemes (e.g., supplementary occupational pension under GDR law and statutory pension) are excluded; in such cases, an offsetting takes place. The legal classification is always based on West German law, regardless of the original legal basis under GDR law.
