With Henry II deposed, in July 976 Otto II issued far-reaching edicts on the reorganization of the southern German duchies. Otto II reduced the size of Duchy of Bavaria by almost a third. From the excised Bavarian territory, Otto II established the Duchy of Carinthia in southern Germany. By depriving Bavaria of the March of Verona, Otto II considerably reduced the influence of the Bavarian dukes in northern Italy and in general Imperial policy regarding Italy. Otto II gave the newly diminished Duchy of Bavaria to his relative Otto, the Duke of Swabia, and appointed Henry III, son of the former Bavarian Duke Berthold, as Duke of Carinthia. These appointments continued his policy of appointing individuals who had no political links to Otto the Great, including those who had even rebelled against him.