The decision by the Museum of Fine Arts Bern comes after a year-long investigation into the origins of the art work it received from a German collector Cornelius Gurlitt in 2014.
A Swiss museum will give up almost 40 works of art after a years-long investigation concluded they were either stolen by the Nazis or came from a doubtful origin.
But the Museum of Fine Arts Bern said on Friday almost 1,100 other works from the same trove would be retained despite their provenance remaining unproven.
German-Austrian collector Cornelius Gurlitt died in 2014 and left more than 1,600 works to the museum, including paintings by Pierre-Auguste Renoir, Paul Cezanne, Max Beckmann, Eugene Delacroix and Edvard Munch.
Gurlitt's father was one of four art dealers tasked by the Nazis with selling art stolen from Jews or confiscated as "degenerate".
The museum accepted the collection in November 2014 but renounced the rights to all artworks that once belonged to Jewish owners dispossessed by the Nazis, following an agreement with Germany.
The institution launched a years-long study that labelled the works with a traffic-light system where looted works were labelled "red".
Stolen works of art
It said on Friday it had already given up nine works stolen by the fascist regime, which Germany had since returned to their owners.
It also refused to accept 29 works "of uncertain origin but with doubtful signs and/or circumstances, even if proof of Nazi dispossession is lacking".
Five of those works have already been returned to Germany, two are subject to restitution applications and 22 remain in the museum for further research on their provenance.
Almost 1,100 other works of doubtful origin will remain with the museum despite the institution saying that their "provenance from 1933 to 1945 has not been unambiguously clarified; gaps in the ownership history remain".
In deciding to retain the art, it concluded: "There are no implications of looted art and/or conspicuous circumstances."
Gurlitt's collection was only discovered in 2012 after customs officials entered properties in the southern German city of Munich and Salzburg, Austria.