German art collector Cornelius Gurlitt has come to an agreement on the future of the 1,406 works found in his apartment.

The collection was seized by police in 2012.

The 81-year-old Gurlitt says he will co-operate with authorities – to determine which of the paintings were stolen by the Nazis during the war and enable their return.

Any works which go undisputed will be returned to him within a year.

The rare art treasure trove includes pieces by Picasso and Matisse and is estimated to be worth $1.35 billion.

More than 1,400 works were seized from Gurlitt’s apartment in Munich two years ago – during a routine tax investigation.

Another 60 pieces were discovered in his house near Salzburg, Austria, earlier this year.

Experts say many of the works were previously thought to have been lost or destroyed.