constitutes an interference with the internal legislation of the exporting country.103 He recognized (writing in 1902) that the duties were being used more and more, but attributed this to economic, not at all to juristic, causes. 104 "La compatibilité des droits compensateurs avec la clause n'étant pas soutenable, il faut s'étonner que ce système fasse encore tant de progrès. Seule la politique economique en est cause." States wish to do away with bounties, but cannot do so on account of lack of unanimity. Countervailing duties work toward this end. In effecting this object, many states have had too little regard for the juristic side and the legal questions involved. 105 Kaufmann, on the other hand, cites a long list of opinions sustaining the legality and justice of the duties.106 He himself takes the view that the most-favored-nation clause does not forbid countervailing duties, but forbids only a fixed countervailing duty determined upon the basis of the highest export bounty paid, which would be manifestly unfair to other bounty-payers who pay less.107 If political economy is as M. Visser points out the cause, and if a legitimate object, the doing away with commercial inequalities, is to be attained, surely the most-favored-nation clause ought not be invoked to forbid these countervailing duties for the clause 103 Visser, op. cit., 174–176. 104 "# * la pratique est douteuse. Les États ne diffèrent pas seulement entre eux en ce qui concerne la compatibilité des droits avec la clause dont nous traitons, mais aussi la manière d'agir des différents États se modifie dans un court espace de temps dans l'un ou l'autre sens. On ne peut donc certainement pas parler d'une reconnaissance générals. Nous n'hésitons pas à soutenir l'incompatibilité de ces droits avec la clause (Visser, op. cit., 172.) 105 Visser, op. cit., 176–177. 107 " Entsprechende Gegenmassnahmen gegen Praemien sind keine Verletzung vertragsmaessig gewaehrter Meistbeguenstigung und sind eventuell Pflicht mit Ruecksicht auf meistbeguenstigte dritte Staaten." (Kaufmann, op. cit., 338.) "Der materiellen Auffassung der Meistbeguenstigungsclausel entsprach daher bei verschiedener Hoehe der fremden Praemien nicht ein einziger gleichmaessiger Ausgleichzoll, sondern verschieden hohe Ausgleichzoelle je nach der verschiedenen Hoehe der fremden Praemien." (Ibid, 280.) On the policy of the United States, compare Ibid, 274-280. On the policy of England, Ibid, 280-302. Mr. Herod considers the duties both equitable and legal. Herod, op. cit., 121. owes its existence, if not its origin, to practical economic necessities; it has been a most potent instrument in the struggle for commercial equality, and the highest value set upon it by friends and enemies alike has been its power to level artificial inequalities and maintain commercial equilibrium. International law has not yet become so established that it may be cited as either affirming or denying the right in question; whatever appears the more practical and equitable interpretation will become the law. At present, economic interests, the equities involved, and the tendency of international opinion (witness the Brussels Sugar Convention) certainly favor the attitude assumed by the United States and Great Britain. Mr. Herod (Chapters VI-X) considers in detail many cases, from which he draws conclusions which we may conveniently group and consider as a body of quasi-rules, for most-favored-nation treatment. Omitting the discussion, we would cite as among the more important of these, the following: 1. The general form of the most-favored-nation clause, or the more limited form specifying "no other or higher duties" requires that duties on imports and exports shall be uniform and collected without any unfair discrimination against the products of the contracting state. (pp. 57-8.) 2. The equality of duties applies to the time at which they are levied as well as to their amount. (p. 60.) 3. Silence on the part of the legislature under its sovereign powers, to regulate commerce, implies that that branch of commerce on which no expression is given is to be free. (pp. 62-3.) 4. It does not concern one state that the articles of commerce of another are taxed or free of duty, provided that the enforcement of the legislation governing their taxation in no way discriminates against its own articles of commerce. (pp. 63-4.) 5. A state will not be acquitted of a charge of unfair and unequal discrimination if it extends a gratuitous favor to the products of a particular geographical district which may or may not contain organized states, and refuses it to nations which are entitled to the same treatment under the most-favored-nation clause. (p. 70.) 6. A regulation which relieves the importer of goods of a country from any charge on the transaction necessary to bring the goods to the seller must be extended upon equal terms to the importers of the goods of those nations which enjoy the privileges of the most-favored-nation. (p. 77.) 7. Where a tonnage tax is national in character, and a favor is extended by one nation to the vessels of another. the same favor upon terms of reciprocity should be readily granted to the vessels of all other nations enjoying the privileges of most-favored-nation treatment. (p. 82.) 8. A nation enjoying the privileges of most-favored-nation treatment in matters of commerce can justly claim upon terms of reciprocity, rates as low as those extended under like conditions to any other nation. This applies to railroad rates, telegraph, telephone, post, bills of lading, etc. (pp. 102-5.) 9. A tax upon a bounty product, equal to the unnatural advantages which it enjoys, is justifiable. (p. 121.) 10. The general clause of the most-favored-nation does not comprehend special engagements of reciprocity. (p. 112.) 11. In questions of considerations the sum of the concessions on one side must be taken as the consideration for the total of the favors obtained from the other party. (p. 113.) 12. Where a state has by a special treaty of reciprocity granted favors in matters of commerce and navigation, it should in justice grant to every other power with which it has treaty relations an opportunity by negotiation to arrive at what would be a fair equivalent for the favors extended by the special treaty. (p. 113.) 13. When there is withheld from a nation or its citizens any privilege, favor, or immunity to which, by operation of the clause, it or they are entitled, a claim for damages, if actual damages have been suffered, is not barred by the statute of limitations, on the theory that "where a treaty is made between two independent powers, its stipulations cannot be deferred, modified, or impaired by the action of one party without the assent of the other. If the parties, by their joint act, have established no barrier in point of time to the preservation of any treaty made by them, then neither country can interpose such limit." (p. 33-4.) If the discrimination has taken the form of an actual money tax or loss of property, the claim for restitution will rightly carry with it interest upon the amount unjustly levied when such tax has been paid under protest. 14. Where the constitution or practice of a state gives equal weight to laws and treaties and makes that which is of latest date repeal others. the courts, following the constitutional rules, are obliged to sustain a law, even though it operates to deny rights guaranteed by a treaty concluded previous to the passing of the law. This does not, however, according to the law of nations, weaken the treaty obligations of a nation, and a state remains in honor bound to carry out the stipulations of its treaties. A breach in treaty obligations renders a state committing it liable in international law and in equity to the injured party. (pp. 34-5.) We may add to this: 15. As between two treaties which two different nations have with a third, and which are in conflict, that of older date prevails.108 STANLEY K. HORNBECK. [The remainder of this article, which will appear in the October JOURNAL, will deal especially with the most-favored-nation relations of the United States and Germany, arguments for an against the use of the clause, and suggestions for improvement.] 108 Hall: International Law, 342; Bluntschli: Le droit international codifié. 3d ed., 414. Mr. Herod also suggests but this can not be looked upon as an expression of practice that it seems only fair that a nation which through the policy of free trade imposes no duties on exports, should be entitled by favored-nation treatment to all the benefits of a treaty of reciprocity founded solely upon mutual conditions in exchange of articles of commerce, for she has not only conceded the equivalents, but has done so in advance of such nations as have bought the favor. (Op. cit., 118.) 1 THE INTERNATIONAL OPIUM COMMISSION 1 Part 1 The International Opium Commission proposed by the United States and accepted by Austria-Hungary, China, France, Germany, Great Britain, Italy, Japan, The Netherlands, Persia, Portugal, Russia, and Siam convened at Shanghai on the 1st of last February, completed its study of the opium problem throughout the world, and based on that study, issued nine unanimous declarations. The Commission adjourned on February 27th. The Commission's work is interesting from several points of view. It was the first step towards the solution of the opium problem by international action. It was the second Commission of its kind to meet since the formulation of the Hague rules of 1899 as to the function of such Commissions. Its organization, its rules of procedure, the spirit in which it attacked its problem, avoided a majority and minority report, and declared unanimously, establish a precedent for the guidance of all future Commissions of Inquiry. The world at large, and even many of those who have agitated the opium question in the past, have regarded the problem as one that concerned Great Britain and China alone. The work of the Commission demonstrated beyond a doubt that it is a problem of almost world-wide extent, and that the United States has a large and increasing interest in it. Before dealing with the Commission and its deliberations, it will be well to glance as rapidly as possible at the opium question as it appeared between the issue of the Report of Her late Britannic Majesty's Royal Opium Commission in 1895, and the beginning of the new movement against opium which resulted in the calling of the International Commission. To take the United States first: 1 The various treaties and statutes mentioned herein appear in the SUPPLEMENT, pp. 253-276. |