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The Bundestag lifted the requirement to wear a mask in most places, despite a record number of coronavirus infections. The move has been criticized by the opposition Christian Democratic Union.
FDP Justice Minister Marco Buschmann reached a compromise with SPD Health Minister Karl Lauterbach over COVID restrictions
Germany's parliament approved a new law on Friday that lifted most restrictions to contain the coronavirus.
The new Infection Protection Act was a "difficult compromise," Health Minister Karl Lauterbach said.
Mask-wearing will remain obligatory on public transport, hospitals and care homes but not in shops, restaurants and schools.
The new rules were a compromise between Lauterbach's Social Democrats (SPD) and the business-focused Free Democratic Party (FDP), part of SPD Chancellor Olaf Scholz's governing coalition.
Without the new law, all previous COVID-19 restrictions would have expired on Saturday.
"We can't continue to shield the whole country to protect a small group of those unwilling to be vaccinated," Lauterbach said.
The opposition Christian Democratic Union (CDU) criticized the bill, saying it was a sign that the federal government no longer wants to take responsibility to fight COVID-19.
Germany's 16 states have the power to impose restrictions if they identify hotspots where both infections and hospitalizations peak.
Germany has recorded its highest rate of COVID-19 infections since the start of the pandemic.
The country's benchmark infection rate, measuring infections per 100,000 people over the last week, hit a pandemic high of 1,585.4 on Tuesday.
Germany's disease control agency reported 297,841 new cases on Friday. The Robert Koch Institute said there had been a further 226 COVID-related deaths, taking the toll since the start of the pandemic to 126,646.
Lauterbach stressed, "The pandemic is unfortunately not over yet. We need further protective measures."
The German parliament has been debating a vaccine mandate, but a final decision to make vaccinations compulsory for all adults in Germany wasn't expected for weeks.
Opponents of this measure have suggested mandatory vaccination only for people over 50, while others reject the idea altogether.
lo/wd (dpa, epd, KNA)