Extraterritoriality Extraterritoriality is the state of being exempted from the jurisdiction of local law , usually as the result of diplomatic negotiations . Extraterritoriality can also be applied to physical places , such as foreign embassies , military base s of foreign countries , or offices of the United Nations . The three most common cases recognized today internationally relate to the persons and belongings of foreign heads of state , the persons and belongings of ambassadors and other diplomats , and ships in foreign waters . Extraterritoriality is often extended to friendly or allied militaries , particularly for the purposes of allowing that military to simply pass through one ' s territory . It is distinguished from personal jurisdiction in the sense that extraterritoriality operates to the prejudice of local jurisdiction . Historical cases . 14th Century . During the thirteenth and fourteenth centuries , the Italian sea republics of Genoa and Venice managed to wrestle extraterritoriality for their quarters ( Pera and Galata ) in the Byzantine capital , Constantinople . They even battled among themselves for further control of the weakened empire . East Asia . Perhaps the most well - known cases of historical extraterritoriality concerned European nationals in 19th century China , Japan and Siam under the unequal treaties . China . Extraterritoriality was imposed upon China in the Treaty of Nanking , resulting from the First Opium War . Shanghai in particular became a major center of foreign activity , as it contained two extraterritorial zones , the " International Settlement " and the " French Concession " . Chinese and non - treaty nationals in these settlements were subject to Chinese law but , until 1927 , were tried by a hybrid Mixed Court which had a Chinese judge and foreign assessor sitting on it . Foreign Nationals of treaty powers were tried by consular courts . Great Britain established the British Supreme Court for China and Japan in Shanghai in 1865 and America the United States Court for China in the early 20th Century . Extraterritorial rights were not limited to Western nations ; Japan and China granted each other reciprocal extraterritorial rights when both opened to trade . Later , in 1895 , under the Treaty of Shimonoseki China gave up its extraterritorial rights in Japan and Japan obtained further rights in China . Japan later claimed extraterritorial privileges elsewhere in Asia . Extraterritoriality in China for non - diplomatic personnel ended at various times in the twentieth century . Germany and Austria - Hungary lost their rights in China in 1917 after China joined the allies in World War I ; the Soviet Union gave up its rights in China in 1924 ; the United States and United Kingdom gave up their rights in 1943 ; Italy and Japan gave up their rights by virtue of being at war with China in World War II ; and Portugal was the last country to give up its rights , in 1946 . Japan . Japan recognized extraterritoriality in the treaties concluded with the United States , the United Kingdom , France , Netherlands , and Russia in 1858 , in connection with the concept of the " most favoured nation " . Most countries exercised extraterritorial jurisdiction through consular courts . Britain established the British Court for Japan in 1879 . Japan succeeded in reforming its unequal status with Britain through the Anglo - Japanese Treaty of Commerce and Navigation signed on 16 July 1894 in London . Similar treaties were signed with other extraterritorial powers at the same time . These treaties all came into effect in 1899 . Siam . Siam signed a treaty granting extraterritorial rights to Britain in 1855 during the reign of King Rama IV . Unequal treaties were later signed with 13 other European powers , as well as Japan . After the absolute monarchy was overthrown in 1932 , the constitutional government promulgated a set of legal codes , setting the stage for new treaties signed between 1937 and 1938 which canceled extraterritorial rights . American Indian Nations . In American Indian contact with Euro - American s , extraterritoriality once denoted the same idea that beyond given points / lines — e . g . , the Indian Southern Boundary in colonial times — Indian tribes were beyond white jurisdiction and non - Indians were not to trespass or occupy any lands . With the establishment of reservations , extraterritoriality soon lost this meaning or became a moot designation . Royal Births . There are a few examples of extraterritorial agreements concerning the birth of royals : In January 1943 the maternity ward of Ottawa Civic Hospital in which Princess Margriet of the Netherlands was born was temporarily declared to be extraterritorial by the Canadian government . Making the maternity ward outside of the Canadian domain caused it to be unaffiliated with any jurisdiction and technically international territory . This was done to ensure that the newborn Princess would derive her citizenship from her mother only , thus making her solely Dutch . Similarly in 1945 , the birth of Alexander , Crown Prince of Yugoslavia happened in Suite 212 of Claridge ' s Hotel in London , England , United Kingdom , which was temporarily ceded as Yugoslavian territory . Irish Treaty Ports . It is sometimes thought that the Treaty Ports in Ireland were examples of extraterritoriality . They were sovereign bases created by the United Kingdom in 1922 , did not enjoy extraterritoriality from the Irish Free State . They were instead pieces of sovereign territory retained by the United Kingdom , until they were finally ceded to the Free State ' s successor , the Republic of Ireland , in 1938 .