BERLIN (AFP).- A German panel ruled Thursday against the heirs of Jewish collectors seeking to recover a trove of precious medieval church artifacts, saying its sale in 1935 was not made under Nazi duress.

The dispute centres on the Guelph Treasure or "Welfenschatz" of gold, silver and gem-studded relics believed to be worth hundreds of millions of euros (dollars) in total.

The more than 40 pieces, the largest publicly owned collection of German ecclesiastical art, are kept in a Berlin museum of the Prussian Cultural Heritage Foundation.

The case comes at a sensitive time after news last year of a vast stash of long-lost art found in a Munich flat sparked complaints of German foot-dragging on returning Nazi loot.

The state-backed Limbach Commission found that the former Jewish owners did not sell the Welfenschatz treasure under duress and received a fair market price from the state of Prussia.

The mediation panel on Nazi-era art claims said it was "aware of the severe situation of the art dealers and their persecution in the Nazi era".

But it added that it saw no evidence of "a persecution-induced forced sale" and that the price was normal "on the art market after the world economic crisis" following the 1929 stock market crash.

The panel -- whose rulings are non-binding but seen to carry moral weight -- said "it can therefore not recommend the return of the Welfenschatz to the heirs of the four art dealers and any other former co-owners".

State Culture Minister Monika Gruetters said that, although the German government often favours restitution, in this case she "hopes that the Jewish heirs will accept the recommendation of the commission".

Lawyers for the claimants said "the decision causes us consternation and is incomprehensible for us and our clients as well as for those at home and abroad who know the details of the history of the Guelph Treasure."

Gem-studded crucifixes
Under Adolf Hitler's reign, the Nazis confiscated what they deemed "degenerate art" and stole, or bought under duress for a pittance, art from persecuted Jewish collectors.

The Limbach Commission, with a former state president, a top court judge and historian among its eight members, in mid-January heard the dispute on the Welfenschatz claim launched in 2008.

A lawyer for the claimants had argued that all the art dealers and their relatives eventually "lost their personal and professional existence in Germany due to racial persecution".

The German panel however argued that in 1935 all sides had voluntarily consented to the deal for the treasure, which was then being held out of the Nazis' reach in Amsterdam.

The syndicate of Frankfurt art dealers had in 1929 bought the collection of then 82 pieces for 7.5 million Reichsmark. It included gem-studded crucifixes and other ornate Christian artifacts, some dating back to the 11th century.

The group of dealers then saw its value drop sharply amid the Great Depression and sold off about half of the pieces, mostly in the United States, for a total of 2.7 million RM.

The dealers, Zacharias Hackenbroch, Isaac Rosenbaum, Seamy Rosenbaum and Julius Falk Goldschmidt, sold the remaining objects for 4.25 million RM to Prussia, which was then led by Hermann Goering, the Gestapo secret police founder and air force chief.

The heritage foundation now holding the treasure welcomed the panel's "carefully considered recommendation", saying it was in line with its own "years of intensive provenance research" into the collection.

It said it had in the past handled more than 50 claims for restitution and always reached "fair and just solutions with legitimate claimants", returning over 350 works of art and more than 1,000 books.

"In all previous restitution cases, the Prussian Cultural Heritage Foundation has been able to agree on a solution with claimants, but not in this case," it said.



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