The proposal seeks to allow fraccing to take place at depths greater than 3000m, with a six-person expert panel to be set up to consider shallower fracs.
The laws also only apply to shale oil and tight gas operation in water protection and spring healing zones, allowing a re-start of the industry in the Lower Saxony region where it was once concentrated.
Senior German officials have indicated that the proposal is an environmental protection measure and that it is unrelated to energy security issues caused by the conflict in Ukraine.
German federal environment agency president Maria Krautzberger told The Guardian that it was important to set out a framework for fraccing, as the current moratorium is on a voluntary basis and doesn't actually expressly forbid companies from the practice.
Krautzberger said her organisation was on the side of environmentalists and that the development of shale gas fraccing in Germany was unlikely.
The tight gas industry made up about 3% of German gas production before the moratorium, with the country estimated to have shale gas reserves of 2.3 trillion cubic metres.
Environmental groups have expressed outrage at the proposed laws, pointing out that half of the experts proposed for the panel belong to institutions which were party to the Hanover Declaration, which called for increased exploration of shale gas in Germany as a way of strengthening energy security.
Pro-industry groups have touted the proposal as a measure to help Germany pursue a transition away from coal, oil and nuclear energy to renewables, a process referred to as energiewende, saying that the small-scale fraccing proposed would not challenge the pursuit.
A plenary vote on the laws is expected in May. If it is passed, the panel should be set up in 2018, with fraccing following in 2019.