Since 8 July 2022, the annotation of the bail bond in the land register has no longer been possible. Corresponding requests will be rejected by the land registry court with reference to the new legal situation. Existing annotations will be automatically deleted in the future. The bail bond will therefore disappear completely.

Previous legal situation

Up to now, in the case of mortgages serving as cover for “classic” covered bonds (i.d. Pfandbriefe) and covered bank bonds (i.d. fundierte Bankschuldverschreibungen) under the Mortgage Bank Act (HypBG), the Covered Bond Act (PfandBG) and the Act on Covered Bank Bonds (FBSchVG), the bail bond was recorded in the land register.

New legal situation since 8 July 2022

Now, in the course of its amendments to the bank lending directives, the EU has eliminated the bail bond. In implementation of the directive, both the Mortgage Bank Act (HypBG) and the Act on Covered Bank Bonds (FBSchVG) expired on 7 July 2022.  

The annotation of the bail bond thus lacks the legal basis since 8 July 2022. Applications to the land register with additional requests for the recording of the bail bond have therefore been rejected by the land register court since 8 July 2022. 
If a trust letter of the bank still includes the annotation of a bail bond, this item is to be deleted because the trustee can no longer fulfill this obligation in purely factual terms.

Existing annotations of a bail bond shall be deleted in the future

Existing annotations of a bail bond in the land register are to be automatically deleted by order of the Federal Minister of Justice after the expiry of 12 months after the entry into force of this Federal Act. Dispositions of liens with a noted bail bond, in particular their deletion, do not require the participation of the government commissioner or trustee. Likewise, their notification may be omitted.

Summary

New annotation of a bail bond are no longer possible since 8 July 2022 and corresponding requests are rejected by the land register court with reference to the new legal situation. Existing annotations will be deleted automatically within 12 month.  In the future, the note of a bail bond in the land register will therefore disappear completely.