INTERNATIONAL COURT OF JUSTICE

REPORTS OF JUDGMENTS,
ADVISORY OPINIONS AND ORDERS

CASE CONCERNING
RIGHTS OF NATIONALS OF
THE UNITED STATES OF AMERICA

IN MOROCCO
(FRANCE v. UNITED STATES OF AMERICA)

JUDGMENT OF AUGUST 27th, 1952

1952

COUR INTERNATIONALE DE JUSTICE

RECUEIL DES ARRETS,
AVIS CONSULTATIFS ET ORDONNANCES

AFFAIRE RELATIVE AUX DROITS
DES RESSORTISSANTS
DES ETATS-UNIS D’AMERIQUE

AU MAROC
(FRANCE c. ÉTATS-UNIS D'AMÉRIQUE)

ARRÊT DU 27 AOÛT 1952
This Judgment should be cited as follows:

“Case concerning rights of nationals of the United States
of America in Morocco, Judgment of August 27th, 1952:
I.C.J. Reports 1952, p. 176."

Le présent arrét doit étre cité comme suit :

« Affaire relative aux droits des ressortissants des Etats-Unis
d'Amérique au Maroc, Arrêt du 27 août 1952:
C.I. J. Recueil 1952, p. 176.”

Sales number 9 3
Ne de vente:

AUGUST 27th, 1952

JUDGMENT

CASE CONCERNING RIGHTS OF NATIONALS
OF THE UNITED STATES OF AMERICA
IN MOROCCO

(FRANCE v. UNITED STATES OF AMERICA)

AFFAIRE RELATIVE AUX DROITS DES
RESSORTISSANTS DES ÉTATS-UNIS D’AMERIQUE
AU MAROC

(FRANCE c. ÉTATS-UNIS D’AMERIQUE)

27 AOÛT 1952

ARRÊT
176

INTERNATIONAL COURT OF JUSTICE

1952
August 27th
General List : YEAR 1952

No. Il

August 27th, 1952

CASE CONCERNING
RIGHTS OF NATIONALS OF
THE UNITED STATES OF AMERICA

IN MOROCCO
(FRANCE v. UNITED STATES OF AMERICA)

Economic liberty without any inequality in Morocco in the General
Act of Algecivas.—Effect of establishment of Protectorate thereon.—E ffect
of discrimination on validity of Residential Decree of December 3oth,
1948, regulating imports.

Consular jurisdiction in French Zone of Morocco as based én bilateral
treaties, most-favoured-nation clauses and multilateral treaties.—.leaning
of “dispute” in Treaty of 1836 between Morocco and the United
States ; whether applicable to criminal and civil matters.—Effect of
renunciation by other States of consular jurisdiction.—Effect of Con-
vention of Madrid and Act of Algeciras on consular jurisdiction.—
Custom and usage. |

“Right of assent’ to Moroccan legislation as corollary of consular
jurisdiction.—Assent necessary for application of Moroccan laws in
consular couris.— Local laws contrary to treaty rights.

Fiscal immunity as based on Convention of Madrid and Aci of
Algeciras and most-favoured-nation clauses.
Interpretation of Article 95 of Act of Algeciras.

JUDGMENT

Present: President Sir Arnold McNair; Judges BASDEVANT,
HACKWORTH, ZoORICIÉ, KLAESTAD, BADAWI, READ,
Hsu Mo, Levi CARNEIRO, Sir Benegal Rav, ARMAND-
Ucon ; Registray HAMBRO.
177. JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

In the case concerning the rights of nationals of the United

States of America in Morocco,

between

the French Republic,

represented by :

M. André Gros, Professor of the Faculties of Law, Legal Adviser
to the Ministry for Foreign Affairs,

as Agent,

assisted by :

M. Paul Reuter, Professor of the Faculty of Law of Aix-en-
Provence, Assistant Legal Adviser to the Ministry for Foreign
Affairs,

as Assistant Agent,

and by:

M. Henry Marchat, Minister Plenipotentiary,
as Counsel,

and by:

M. de Lavergne, inspecteur des finances,

M. Fougère, maître des requêtes au Conseil d’État,
M. de Laubadère, Professor of the Faculties of Law,

as Expert Advisers ;

and

the United States of America,
represented by :

on

Mr. Adrian S. Fisher, the Legal Adviser, Department of State,
as Agent,
assisted by :

Mr. Joseph M. Sweeney, Assistant to the Legal Adviser, Depart-
ment of State,

Mr. Seymour J. Rubin, member of the Bar of the District of
Columbia,

as Counsel,
and by:

Mr. John A. Bovey Jr., Consul, United States Consulate-General,
Casablanca,
178 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

Mr. Edwin L. Smith, Legal Adviser, United States Legation,
Tangier,

Mr. John E. Utter, First Secretary, United States Embassy,
Paris,

as Expert Advisers,

THE COURT,
composed as above,

delivers the following Judgment :

On October 28th, 1950, the Chargé d’affaires a.1. of France to
the Netherlands filed in the Registry, on behalf of the Government
of the French Republic, an Application instituting proceedings
before the Court against the United States of America, concerning
the rights of nationals of the United States of America in Morocco.
The Application referred to the Declarations by which the Govern-
ment of the United States of America and the French Government
accepted the compulsory jurisdiction of the Court in accordance
with Article 36, paragraph 2, of the Court’s Statute. It also referred
to the Economic Co-operation Agreement of June 28th, 1948,
between the United States and France, and to the Treaty for the
Organization of the French Protectorate in the Shereefian Empire,
signed at Fez on March 30th, 1912, between France and the Sheree-
flan Empire. It mentioned the Treaty of Peace and Friendship of
September 16th, 1836, between the United States and the Sheree-
fian Empire, as well as the General Act of the International
Conference of Algeciras of April 7th, 1906.

Pursuant to Article 40, paragraphs 2 and 3, of the Statute, the
Application was communicated to the Government of the United
States as well as to the States entitled to appear before the Court.
It was also transmitted to the Secretary-General of the United
Nations.

The time-limits for the deposit of the Pleadings were fixed by
Order of November 22nd, 1950. The Memorial of the French Govern-
ment, which was filed on the appointed date, quoted several provi-
sions of the General Act of Algeciras and drew conclusions therefrom
as to the rights of the United States. The construction of a conven-
tion to which States other than those concerned in the case were
parties being thus in question, such States were notified in accord-
ance with Article 63, paragraph I, of the Statute : for this purpose
notes were addressed on April 6th, 1951, to the Governments of
Belgium, Spain, Italy, the Netherlands, Portugal, the United
Kingdom of Great Britain and Northern Ireland and Sweden.

On June 21st, 1951, within the time-limit fixed for the deposit
of its Counter-Memorial, the Government of the United States of

6
179 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

America filed a document entitled ‘‘Preliminary Objection”. The
proceedings on the merits were thereby suspended. The Preliminary
Objection was communicated to the States entitled to appear before
the Court as well as to the States which had been notified of the
deposit of the Application pursuant to Article 63 of the Statute.
The proceedings thus instituted by the Preliminary Objection were
terminated following a declaration by the Government of the United
States that it was prepared to withdraw its objection, having regard
to the explanations and clarifications given on behalf of the French
Government, and following a declaration by the French Government
that it did not oppose the withdrawal. An Order of October 31st,
1951, placed on record the discontinuance, recorded that the pro-
ceedings on the merits were resumed, and fixed new time-limits for
the filing of the Counter-Memorial, Reply and Rejoinder.

The Counter-Memorial and Reply were filed within the time-
limits thus fixed. As regard the Rejoinder, the time-limit was
extended at the request of the Government of the United States
from April 11th to April 18th, 1952, by Order of March 31st, 1952.
On April 18th, 1952, the Rejoinder was filed and the case was ready
for hearing. Public hearings were held on July 15th, 16th, 17th,
zist, 22nd, 23rd, 24th and 26th, 1952, during which the Court
heard : MM. André Gros and Paul Reuter on behalf of the French
Government ; and Mr. Adrian S. Fisher and Mr. Joseph M. Sweeney
on behalf of the Government of the United States.

At the conclusion of the argument before the Court, the Submis-
sions of the Parties were presented as follows :

On behalf of the French Government :

“May it please the Court,
To adjudge and declare

That the privileges of the nationals of the United States of
America in Morocco are only those which result from the text of
Articles 20 and 21 of the Treaty of September 16th, 1836, and that
since the most-favoured-nation clause contained in Article 24 of
the said treaty can no longer be invoked by the United States in the
present state of the international obligations of the Shereefian
Empire, there is nothing to justify the granting to the nationals of
the United States of preferential treatment which would be contrary
to the provisions of the treaties ;

That the Government of the United States of America is not
entitled to claim that the application of all laws and regulations
to its nationals in Morocco requires its express consent ;

That the nationals of the United States of America in Morocco
are subject to the laws and regulations in force in the Shereefian
Empire and in particular the regulation of December 30th, 1948,
on imports not involving an allocation of currency, without the
prior consent of the United States Government ;
180

JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

That the decree of December 30th, 1948, concerning the regula-
tion of imports not involving an allocation of currency, is in confor-
mity with the economic system which is applicable to Morocco,
according to the conventions which bind France and the United
States ;

That Article 95 of the Act of Algeciras defines value for
customs purposes as the value of the merchandise at the time and
at the place where it is presented for customs clearance ;

That no treaty has conferred on the United States fiscal immunity
for its nationals in Morocco, either directly or through the effect of
the most-favoured-nation clause ;

That the laws and regulations on fiscal matters which have been
put into force in the Shereefian Empire are applicable to the nationals
of the United States without the prior consent of the Government
of the United States ;

That, consequently, consumption taxes provided by the Dahir of
February 28th, 1948, have been legally collected from the nationals
of the United States, and should not be refunded to them.”

On behalf of the Government of the United States :

“1, The Submissions and Conclusions presented by the French
Government in this case should be rejected on the ground that the
French Government has failed to maintain the burden of proof
which it assumed as party plaintiff and by reason of the nature
of the legal issues involved.

2. The treaty rights of the United States in Morocco forbid
Morocco to impose prohibitions on American imports, save those
specified by the treaties, and these rights are still in full force and
effect.

The Dahir of December 30, 1948, imposing a prohibition on
imports is in direct contravention of the treaty rights of the United
States forbidding prohibitions on American imports and the French
Government by applying the Dahir of December 30, 1948, to
American nationals, without the consent of the United States, from
December 31, 1948, to May 11, 1949, violated the treaty rights
of the United States and was guilty of a breach of international law.

American nationals can not legally be submitted to the Dahir of
December 30, 1948, without the prior consent of the United States
which operates to waive temporarily its treaty rights.

3. The jurisdiction conferred upon the United States by the
Treaties of 1787 and 1836 was jurisdiction, civil and criminal, in
all cases arising between American citizens.

In addition, the United States acquired in Morocco jurisdiction
in all cases in which an American citizen or protégé was defendant
through the effect of the most-favoured-nation clause and through
custom and usage.

Such jurisdiction was not affected by the surrender by Great
Britain in 1937 of its rights of jurisdiction in the French Zone of
Morocco.
181 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

Such jurisdiction has never been renounced, expressly or im-
pliedly, by the United States.

4. Under the regime of extraterritorial jurisdiction now exercised
by the United States in Morocco, United States citizens are not
subject, in principle, to the application of Moroccan laws.

Such laws become applicable to the United States citizens only
if they are submitted to the prior assent of the United States
Government and if this Government agrees to make them applicable
to its citizens. The Dahir of December 30, 1948, not having been
submitted to the prior assent of the United States Government,
cannot be made applicable to United States citizens.

As a counter-claim :

1. Under Article 95 of the Act of Algeciras, the value of imports
from the United States must be determined for the purpose of
customs assessments by adding to the purchase value of the imported
merchandise in the United States the expenses incidental to its
transportation to the custom-house in Morocco, exclusive of all
expenses following its delivery to the custom-house, such as customs
duties and storage fees.

It is a violation of the Act of Algeciras and a breach of inter-
national law for the customs authorities to depart from the method
of valuation so defined and to determine the value of imported
merchandise for customs purposes by relying on the value of the
imported merchandise on the local Moroccan market.

2. The treaties exempt American nationals from taxes, except as
specifically provided by the same treaties ; to collect taxes from
American nationals in violation of the terms of the treaties is a
breach of international law.

Such taxes can legally be collected from American nationals only
with the previous consent of the United States which operates to
waive temporarily its treaty right, and from the date upon which
such consent is given, unless otherwise specified by the terms of the
consent.

Consumption taxes provided by the Dahir of February 28, 1948,
which were collected from American nationals up to August 15, 1950,
the date on which the United States consented to these taxes, were
illegally collected and should be refunded to them.

3. Since Moroccan laws do not become applicable to American
citizens until they have received the prior assent of the United
States Government, the lack of assent of the United States Govern-
ment to the Dahir of February 28, 1948, rendered illegal the collec-
tion of the consumption taxes provided by that Dahir.”

*
* *

The Court will first deal with the dispute relating to the Decree
issued by the Resident General of the French Republic in Morocco,
dated December 30th, 1948, concerning the regulation of imports

9
18Z JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

into the French Zone of Morocco. The following Submissions are
presented :

On behalf of the Government of France :

“That the Decree of December 30th, 1948, concerning the regu-
lation of imports not involving an allocation of currency, is in
conformity with the economic system which is applicable to
Morocco, according to the conventions which bind France and
the United States.”

On behalf of the Government of the United States of America :

“The treaty rights of the United States in Morocco forbid Morocco
to impose prohibitions on American imports, save those specified
by the treaties, and these rights are still in full force and effect.

The Dahir of December 30, 1948, imposing a prohibition on
imports is in direct contravention of the treaty rights of the United
States forbidding prohibitions on American imports....”’

The French Government contends that the Decree of Decem-
ber 30th, 1948, is in conformity with the treaty provisions which
are applicable to Morocco and binding on France and the United
States. This contention is disputed by the United States Govern-
ment for various reasons. The Court will first consider the claim
that the Decree involves a discrimination in favour of France
which contravenes the treaty rights of the United States.

By a Dahir of September gth, 1939, His Shercefian Majesty decided
as follows :

“Article z.—It is prohibited to import into the French Zone of
the Shereefian Empire, whatever may be the customs regulations
in force, goods other than gold in any form.

Article 2.—The Director General of Communications may, how-
ever, waive this prohibition on entry as regards combustible solid
mineral matter and petroleum products, and the Director of Econo-
mic Affairs may do likewise as regards any other products.

Article 3.—It is left to the decision of the Resident General to
determine the measures whereby the provisions herein contained
shall be put into effect.”

A Residential Decree of the same date laid down the terms of
application of the Dahir, including provisions relating to requests
for a waiver of the prohibition of imports. Article 4 provided :

“Goods of French or Algerian origin shipped from France or
Algeria, shall for the time being be admitted without any special
formalities.”

Further regulations were prescribed by a Residential Decree of
September 10th, 1939, subjecting imports without official allocation

10
183 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

of currency to special authorization. Article 7 provided in its first
paragraph :
“Commercial arrangements with France, Algeria, French Colonies,

African territories under French Mandate, and Tunisia, are not
subject to the provisions herein contained.”

By a Residential Decree of March 11th, 1948, a new Article 5
was added to the Decree of September gth, 1939:

“Article 5.—Save for such exceptions as may be specified by the
appropriate heads of departments, the prohibition on entry shall
hereafter be generally waived as regards goods imported from any
origin or source, when import does not entail any financial settle-
ment between the French zone of the Shereefian Empire, France,
or any territory of the French Union on the one part and foreign
territory on the other part.”

Finally, this new Article 5 was revoked by the Decree of Decem-
ber 30th, 1948, which is the subject-matter of the present dispute.
After having referred to the Dahir of September gth, 1939, and to
the Decrees of that date and of March 11th, 1948, the Resident
General of the French Republic decreed :

“Article 1,—The provisions of Article 5 of the aforesaid Residen-
tial Decree of September gth, 1939, will cease to apply as from
January 1st, 1949, save for the exception set out in Article 2 hereof.

Article 2.—Goods which are proved to have been shipped
directly to the French Zone of the Shereefian Empire before
January 15th, 1949, shall still fall within the provisions of Article 5
of the aforesaid Residential Decree of September gth, 1939.

a”

The effect of this Decree was to restore the import regulations
introduced in September 1939. Imports without official allocation
of currency were again subjected to a system of licensing control.
But these import regulations did not apply to France or other parts
of the French Union. From France and other parts of the French
Union imports into the French zone of Morocco were free. The
Decree of December 30th, 1948, involved consequently a discrimi-
nation in favour of France, and the Government of the United
States contends that this discrimination contravenes its treaty
rights.

It is common ground between the Parties that the characteristic
of the status of Morocco, as resulting from the General Act of
Algeciras of April 7th, 1906, is respect for the three principles stated
in the Preamble of the Act, namely: “the sovereignty and inde-
pendence of His Majesty the Sultan, the integrity of his domains,
and economic liberty without any inequality’. The last-mentioned
principle of economic liberty without any inequality must, in its

II
184 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

application to Morocco, be considered against the background of
the treaty provisions relating to trade and equality of treatment in
economic matters existing at that time.

By the Treaty of Commerce with Great Britain of December gth,
1856, as well as by Treaties with Spain of November 2oth, 1861,
and with Germany of June Ist, 1890, the Sultan of Morocco gua-
ranteed certain rights in matters of trade, including imports into
Morocco. These States, together with a number of other States,
including the United States, were guaranteed equality of treatment
by virtue of most-favoured-nation clauses in their treaties with
Morocco. On the eve of the Algeciras Conference the three principles
mentioned above, including the principle of “economic liberty with-
out any inequality’, were expressly accepted by France and Ger-
many in an exchange of letters of July 8th, 1905, concerning their
attitude with regard to Morocco. This principle, in its application to
Morocco, was thus already well established, when it was reaffirmed
by that Conference and inserted in the Preamble of the Act of 1906.
Considered in the light of these circumstances, it seems clear that
the principle was intended to be of a binding character and not
merely an empty phrase. This was confirmed by Article 105, where
the principle was expressly applied in relation to the public services
in Morocco. It was also confirmed by declarations made at the
Conference by the representative of Spain, who referred to ‘‘equa-
lity of treatment in commercial matters’’, as well as by the repre-
sentative of France.

The establishment of the French Protectorate over Morocco by
the Treaty of March 30th, 1912, between France and Morocco, did
not involve any modification in this respect. In the Convention
between France and Germany of November 4th, 1911, concerning
the establishment of this Protectorate, the Government of Germany
made in Article 1 the reservation that “‘the action of France should
secure in Morocco economic equality between the nations”. On the
other hand, the Government of France declared in Article 4 that it
would use its good offices with the Moroccan Government “‘in order
to prevent any differential treatment of the subjects of the various
Powers.”

The other States on behalf of which the Act of Algeciras was
signed, with the exception of the United States, adhered later to
the Franco-German Convention of 1g11, thereby again accepting
the principle of equality of treatment in economic matters in
Morocco, France endeavoured to obtain also the adherence of the
United States, and in a Note of November 3rd, 1911, from the
French Ambassador in Washington to the United States Secretary
of State, reference was made to the Franco-German Convention, It
was declared that France would use her good offices with the Moroc-
can Government in order to prevent any differential treatment of
the subjects of the Powers. In another Note from the French
Ambassador to the Secretary of State, dated November 14th, 1918,

12
185 JUDGMENT OF 27 VII 52 (U.S. NATIONALS IN MOROCCO)

it was declared that the benefit of commercial equality in Morocco
results, not only from the most-favoured-nation clause, but also
from the clause of economic equality which is inserted in the Act of
Algeciras and reproduced in the Franco-German Convention of 1911.

These various facts show that commercial or economic equality
in Morocco was assured to the United States, not only by Morocco,
but also by France as the protecting State. It may be asked whether
France, in spite of her position as the protector of Morocco, is
herself subject to this principle of equality and can not enjoy com-
mercial or economic privileges which are not equally enjoyed by the
United States.

It is not disputed by the French Government that Morocco, even
under the Protectorate, has retained its personality as a State in
international law. The rights of France in Morocco are defined by
the Protectorate Treaty of 1912. In economic matters France is
accorded no privileged position in Morocco. Such a privileged posi-
tion would not be compatible with the principle of economic liberty
without any inequality, on which the Act of Algeciras is based. This
was confirmed by the above-mentioned Note from the French
Ambassador in Washington of November 14th, 1918, where it is
stated that, by virtue of the clause of economic equality inserted in
the Act of Algeciras, other States have preserved their right to
enjoy such equality, ‘même vis-à-vis de la Puissance protectrice”,
and that the United States can, therefore, not only recognize French
courts in Morocco, but also give up, in the French Zone, the enjoy-
ment of all privileges following from capitulations, without thereby
losing this advantage.

It follows from the above-mentioned considerations that the pro-
visions of the Decree of December 30th, 1948, contravene the rights
which the United States has acquired under the Act of Algeciras,
because they discriminate between imports from France and other
parts of the French Union, on the one hand, and imports from the
United States on the other. France was exempted from control of
imports without allocation of currency, while the United States was
subjected to such control. This differential treatment was not com-
patible with the Act of Algeciras, by virtue of which the United
States can claim to be treated as favourably as France, as far as
economic matters in Morocco are concerned.

This conclusion can also be derived from the Treaty between the
United States and Morocco of September x6th, 1836, Article 24,
where it is “declared that whatever indulgence, in trade or other-
wise, shall be granted to any of the Christian Powers, the citizens
of the United States shall be equally entitled to them’. Having
regard to the conclusion already arrived at on the basis of the Act
of Algeciras, the Court will limit itself to stating as its opinion that
the United States, by virtue of this most-favoured-nation clause,

13
186 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

has the right to object to any discrimination in favour of France,
in the matter of imports into the French Zone of Morocco.

The Government of France has submitted various contentions
purporting to demonstrate the legality of exchange control. The
Court does not consider it necessary to pronounce upon these conten-
tions. Even assuming the legality of exchange control, the fact
nevertheless remains that the measures applied by virtue of the
Decree of December 30th, 1948, have involved a discrimination in
favour of imports from France and other parts of the French Union.
This discrimination can not be justified by considerations relating
to exchange control.

For these reasons the Court has arrived at the conclusion that
the French Submission relating to the Decree of December 30th,
1948, must be rejected. It therefore becomes unnecessary to consider
whether this Submission might be rejected also for other reasons
invoked by the Government of the United States. In these circum-
stances, the Court is not called upon to consider and decide the
general question of the extent of the control over importation that
may be exercised by the Moroccan authorities.

* * *

The Court will now consider the extent of the consular jurisdic-
tion of the United States of America in the French Zone of Morocco.

The French Submission in this regard reads as follows :

“That the privileges of the nationals of the United States of
America in Morocco are only those which result from the text of
Articles 20 and 27 of the Treaty of September 16th, 1836, and that
since the most-favoured-nation clause contained in Article 24 of the
said Treaty can no longer be invoked by the United States in the
present state of the international obligations of the Shereefian
Empire, there is nothing to justify the granting to the nationals of
the United States of preferential treatment which would be contrary
to the provisions of the treaties.”

The United States Submission concerning consular jurisdiction
reads as follows :

“3. The jurisdiction conferred upon the United States by the
Treaties of 1787 and 1836 was jurisdiction, civil and criminal, in
all cases arising between American citizens.

In addition, the United States acquired in Morocco jurisdiction
in all cases in which an American citizen or protégé was defendant
through the effect of the most-favoured-nation clause and through
custom and usage.

Such jurisdiction was not affected by the surrender by Great
Britain in 1937 of its rights of jurisdiction in the French Zone of
Morocco.

Such jurisdiction has never becn renounced, expressly or impliedly,
by the United States.”

It is common ground between the Parties that the present dispute
is limited to the French Zone of Morocco. It is on this ground that

14
187 JUDGMENT OF 27 VIII §2 (U.S. NATIONALS IN MOROCCO)

it has been argued. The Court cannot, therefore, pronounce upon
the legal situation in other parts of Morocco.

In order to consider the extent of the rights of the United States
relating to consular jurisdiction, it has been necessary to examine
three groups of treaties. ‘

The first group includes the bilateral treaties of Morocco with
France, the Netherlands, Great Britain, Denmark, Spain, the
United States, Sardinia, Austria, Belgium and Germany, which
cover the period from 1631 to 1802.

Thesc treaties, which were largely concerned with commerce,
including the rights and privileges of foreign traders in Morocco,
dealt with the question of consular jurisdiction in three different
Ways :

(x) Certain of the treaties included specific and comprehensive
grants of rights of consular jurisdiction to the Powers
concerned, e.g., the Treaties with Great Britain of 1856 and
with Spain of 1799 and 1861.

(2) Certain of the treaties made strictly limited grants of privi-
leges with regard to consular jurisdiction, e.g., the Treaties
with the United States of 1787 and 1836.

(3) There were other treaties, which did not define in specific
terms the treaty rights granted by Morocco, but, instead,
granted to the foreign nations through the device of most-
favoured-nation clauses, the advantages and privileges
already granted, or to be granted, to other nations.

There is a common element to be found in the most-favoured-
nation clauses which have brought about and maintained a situa-
tion in which there could be no discrimination as between any of
the Powers in Morocco, regardless of specific grants of treaty rights.
When the most extensive privileges as regards consular jurisdiction
were granted by Morocco to Great Britain in 1856 and to Spain in
1861, these enured automatically and immediately to the benefit of
the other Powers by virtue of the operation of the most-favoured-
nation clauses.

The second group consisted of multilateral treaties, the Madrid
Convention of 1880 and the Act of Algeciras of 1906. The method
of relying on individual action by interested Powers, equalized by
the operation of the most-favoured-nation clauses, had led to abuse
and it had become necessary not merely to ensure economic liberty
without discrimination, but also to impose an element of restraint
upon the Powers and to take steps to render possible the develop-
ment of Morocco into a modern State. Accordingly, the rights of
protection were restricted, and some of the limitations on the powers
of the Sultan as regards foreigners, which had resulted from the
provisions of the earlier bilateral treaties, were abated. The possi-

15
188 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

bility of abuse in the exercise by Morocco of the powers thus
extended, was taken care of by reserving an element of supervision
and control in the Diplomatic Body at Tangier.

The third group of treaties concerned the establishment of the
Protectorate. It included the agreements which preceded the assump-
tion by France of a protectorate over Morocco, and the Treaty of
Fez of 1912. Under this Treaty, Morocco remained a sovereign State
but it made an arrangement of a contractual character whereby
France undertook to exercise certain sovereign powers in the name
and on behalf of Morocco, and, in principle, all of the international
relations of Morocco. France, in the exercise of this function, is
bound not only by the provisions of the Treaty of Fez, but also by
all treaty obligations to which Morocco had been subject before the
Protectorate and which have not since been terminated or sus-
pended by arrangement with the interested States.

The establishment of the Protectorate, and the organization of
the tribunals of the Protectorate which guaranteed judicial equality
to foreigners, brought about a situation essentially different from
that which had led to the establishment of consular jurisdiction
under the earlier treaties. Accordingly, France initiated negotiations
designed to bring about the renunciation of the regime of capitula-
tions by the Powers exercising consular jurisdiction in the French
Zone. In the case of all the Powers except the United States, these
negotiations led to a renunciation of capitulatory rights and privi-
leges which, in the case of Great Britain, was embodied in the
Convention of July 29th, 1937. In the case of the United States,
there have been negotiations throughout which the United States
had reserved its treaty rights.

The French Submission is based upon the Treaty between the
United States and Morocco of September 16th, 1836, and it is com-
mon ground between the Parties that the United States is entitled
to exercise consular jurisdiction in the case of disputes arising
between its citizens or. protégés. There is therefore no doubt as to
the existence of consular jurisdiction in this case. The only question
to be decided is the extent of that jurisdiction in the year 1950,
when the Application was filed.

*
* *

The first point raised by the Submissions relates to the scope of
the jurisdictional clauses of the Treaty of 1836, which read as follows:

“Article 20.—If any of the citizens of the United States, or any
persons under their protection, shall have any dispute with each

16
189 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

other, the Consul shall decide between the parties ; and whenever
the Consul shall require any aid, or assistance from our government,
to enforce his decisions, it shall be immediately granted to him.

Article 2r.—lf a citizen of the United States should kill or wound
a Moor, or, on the contrary, if a Moor shall kill or wound a citizen
of the United States, the law of the country shall take place, and
equal justice shall be rendered, the Consul assisting at the trial ;
and if any delinquent shall make his escape, the Consul shall not
be answerable for him in any manner whatever.”

It is argued that Article 20 should be construed as giving consular
jurisdiction over all disputes, civil and criminal, between United
States citizens and protégés. France, on the other hand, contends
that the word ‘‘dispute’’ is limited to civil cases. It has been argued
that this word in its ordinary and natural sense would be confined
to civil disputes, and that crimes are offences against the State and
not disputes between private individuals.

The Treaty of 1836 replaced an earlier treaty between the United
States and Morocco which was concluded in 1787. The two treaties
were substantially identical in terms and Articles 20 and 21 are the
same in both. Accordingly, in construing the provisions of Article 20
—and, in particular, the expression “‘shall have any dispute with
each other’’—it is necessary to take into account the meaning of
the word “dispute” at the times when the two treaties were con-
cluded. For this purpose it is possible to look at the way in which the
word ‘‘dispute” or its French counterpart was used in the different
treaties concluded by Morocco : e.g., with France in 1631 and 1682,
with Great Britain in 1721, 1750, 1751, 1760 and 1801. It is clear
that in these instances the word was used to cover both civil and
criminal disputes.

It is also necessary to take into account that, at the times of
these two treaties, the clear-cut distinction between civil and
criminal matters had not yet been developed in Morocco.

Accordingly, it is necessary to construe the word “‘dispute’’, as
used in Article 20, as referring both to civil disputes and to criminal
disputes, in so far as they relate to breaches of the criminal law
committed by a United States citizen or protégé upon another
United States citizen or protégé.

%
* %

The second point arises out of the United States Submission that
consular jurisdiction was acquired ‘in all cases in which an American
citizen or protégé was defendant through the effect of the most-
favoured-nation clause and through custom and usage” and that
such jurisdiction was not affected by the surrender by Great Britain
in 1937 of its rights of jurisdiction in the French Zone and has never
been renounced expressly or impliedly by the United States.

17
Ig0 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

It is necessary to give special attention to the most-favoured-
nation clauses of the United States Treaty of 1836. There were two
grants of most-favoured-nation treatment.

Article 14 provides :

“The commerce with the United States shall be on the same
footing as is the commerce with Spain, or as that with the most
favored nation for the time being ; and their citizens shall be res-
pected and esteemed, and have full liberty to pass and repass our
country and seaports whenever they please, without interruption.”

Article 24 deals with the contingencies of war, but it contains a
final sentence :

“\.. and it is further declared, that whatever indulgence, in
trade or otherwise, shall be granted to any of the Christian Powers,
the citizens of the United States shall be equally entitled to them.”

These articles entitle the United States to invoke the provisions
of other treaties relating to the capitulatory regime.

The most extensive privileges in the matter of consular juris-
diction granted by Morocco were those which were contained in the
Gencral Treaty with Great Britain of 1856 and in the Treaty of
Commerce and Navigation with Spain of 1861. Under the provisions
of Article IX of the British Treaty, there was a grant of consular
jurisdiction in all cases, civil and criminal, when British nationals
were defendants. Similarly, in Articles IX, X and XI of the Spanish
Treaty of 1861, civil and criminal jurisdiction was established for
cases in which Spanish nationals were defendants.

Accordingly, the United States acquired by virtue of the most-
favoured-nation clauses, civil and criminal consular jurisdiction in
all cases in which United States nationals were defendants.

The controversy between the Parties with regard to consular
jurisdiction results from the renunciation of capitulatory rights and
privileges by Spain in 1914 and by Great Britain in 1937. The
renunciation by Spain in 1914 had no immediate effect upon the
United States position because it was still possible to invoke the
provisions of the General Treaty with Great Britain of 1856. After
1937, however, no Power other than the United States has exer-
cised consular jurisdiction in the French Zone of Morocco and none
has been entitled to exercise such jurisdiction.

France contends that, from the date of the renunciation of the
right of consular jurisdiction by Great Britain, the United States
has not been entitled, either through the operation of the most-
favoured-nation clauses of the Treaty of 1836 or by virtue of the
provisions of any other treaty, to exercise consular jurisdiction

18
191 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

beyond those cases which are covered by the provisions of Arti-
cles 20 and 21 of the Treaty of 1836.

The United States Submission is based upon a series of conten-
tions which must be dealt with in turn.

*

The first contention is based upon Article 17 of the Madrid
Convention of 1880, which reads as follows :

“The right to the treatment of the most favoured nation is recog-
nized by Morocco as belonging to all the Powers represented at the
Madrid Conference.”

Even if it could be assumed that Article 17 operated as a general
grant of most-favoured-nation rights to the United States and was
not confined to the matters dealt with in the Madrid Convention,
it would not follow that the United States is entitled to continue
to invoke the provisions of the British and Spanish Treaties, after
they have ceased to be operative as between Morocco and the two
countries in question.

The contention of the United States is based upon the view that
most-favoured-nation clauses contained in treaties with countries
like Morocco must be given a different construction from that which
is accorded to similar clauses in treaties with other countries. Two
special considerations need to be taken into account.

The first consideration depends upon the principle of a personal
law and the history of the old conflict between two concepts of law
and jurisdiction : the one based upon persons and the other upon
territory. The right of consular jurisdiction was designed to provide
for a situation in which Moroccan law was essentially personal in
character and could not be applied to foreigners.

The second consideration was based on the view that the most-
favoured-nation clauses in treaties made with countries like Morocco
should be regarded as a form of drafting by reference rather than
as a method for the establishment and maintenance of equality of
treatment without discrimination amongst the various countries
concerned. According to this view, rights or privileges which a
country was entitled to invoke by virtue of a most-favoured-nation
clause, and which were in existence at the date of its coming into
force, would be incorporated permanently by reference and enjoyed
and exercised even after the abrogation of the treaty provisions
from which they had been derived.

From cither point of view, this contention is inconsistent with
the intentions of the parties to the treaties now in question. This
is shown both by the wording of the particular treaties, and by the

19
192 JUDGMENT OF 27 VII 52 (U.S. NATIONALS IN MOROCCO)

general treaty pattern which emerges from an examination of the
treaties made by Morocco with France, the Netherlands, Great
Britain, Denmark, Spain, United States, Sardinia, Austria, Belgium
and Germany over the period from 1631 to 1892. These treaties
show that the intention of the most-favoured-nation clauses was to
establish and to maintain at all times fundamental equality without
discrimination among all of the countries concerned. Further, the
provisions of Article 17 of the Madrid Convention, regardless of
their scope, were clearly based on the maintenance of equality.

The contention would therefore run contrary to the principle of
equality and it would perpetuate discrimination. It can not support
the Submission of the United States regarding the extent of the
consular jurisdiction in the French Zone.

#

The second contention of the United States is based upon the
geographically limited character of the renunciation of consular
jurisdiction by Great Britain. This was restricted in its scope to
the French Zone.

It has been claimed on behalf of the United States that Great
Britain retained its jurisdictional rights in the Spanish Zone and it
has been argued that ‘‘the United States, which still treats Morocco
as a single country, is entitled under the most-favoured-nation
clavse in Article 24 of its treaty to the same jurisdictional rights
which Great Britain to-day exercises in a part of Morocco by virtue
of the Treaty of 1856”.

The Court is not called upon to determine the existence or extent
of the jurisdictional rights of Great Britain in the Spanish Zone. It
is sufficient to reject this argument on the ground that it would lead
to a position in which the United States was entitled to exercise
consular jurisdiction in the French Zone notwithstanding the loss
of this right by Great Britain. This result would be contrary to the
intention of the most-favoured-nation clauses to establish and main-
tain at all times fundamental equality without discrimination as
between the countries concerned.

Reliance has also been placed upon the position of France and
French nationals as regards the new tribunals of the Protectorate,
which have been established for the purpose of exercising jurisdic-
tion over forcigners and applying Moroccan laws to them in the
French Zone. These tribunals have been constituted with French
aid and under French direction and supervision. It is suggested that
these are, in reality, consular courts and that the United States is
entitled to be placed, in this regard, in a position of equality with
France.

But the tribunals of the Protectorate in the French Zone are not
in any sense consular courts. They are Moroccan courts, organized

20
193 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

on French models and standards, affording guarantees of judicial
equality to foreigners.
Accordingly the Court can not accept this contention.

Eo

The third contention of the United States is based upon the
nature of the arrangements which led to the termination of Spanish
consular jurisdiction in the French Zone. By a Convention between
France and Spain of November 27th, 1912, provision was made for
the exercise by Spain of special rights and privileges in the Spanish
Zone. By a bilateral Declaration between France and Spain of
March 7th, 1914, Spain surrendered its jurisdictional and other
extraterritorial rights in the French Zone, and provision was made
for the subsequent surrender by France of similar rights in the
Spanish Zone. This was accomplished by a bilateral Declaration
between France and Spain of November 17th of the same year.

The United States contends that, as both the Convention of 1912
and the Declarations of 1914 were agreements between France and
Spain, and as Morocco was not named as a party to either agree-
ment, the rights of Spain under the earlier provision still exist de
jure, notwithstanding that there may be a de facto situation which
temporarily prevents their exercise.

Even if this contention is accepted, the position is one in which
Spain has been unable to insist on the right to exercise consular
jurisdiction in the French Zone since 1914. The rights which the
United States would be entitled to invoke by virtue of the most-
favoured-nation clauses would therefore not include the right to
exercise consular jurisdiction in the year 1950. They would be
limited to the contingent right of re-establishing consular jurisdic-
tion at some later date in the event of France and Spain abrogating
the agreements made by the Convention of 1912 and the Declara-
tions of 1914.

France contends that these agreements were concluded pursuant
to the power which Morocco conferred on France by the provisions
of the Treaty of Fez of 1912. The general terms of Articles V and VI
were broad enough to give to France the conduct of the international
relations of Morocco, including the exercise of the treaty-making
power. The Convention and the Declarations must therefore be
regarded as agreements made by a protecting Power, within the
scope of its authority, touching the affairs of and intended to bind
the protected State, as is made clear by the third paragraph of
Article I of the Treaty of Fez of 1912 which provided that : “The
Government of the Republic will come to an understanding with
the Spanish Government regarding the interests which the latter
Government has in virtue of its geographical position and terri-
torial possessions on the Moroccan coast.” In these circumstances,
it is necessary to hold that these agreements bound and enured to

2I
194 JUNGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

the benefit of Morocco and that the Spanish rights as regards con-
sular jurisdiction came to an end de juve as well as de facto.

It is necessary to deal with another aspect of this question which
arises out of the wording of the Declaration made by France and
Spain on March 7th, 1914. This Declaration contained the follow-
ing provisions :

“Taking into consideration the guarantees of judicial equality
offered to foreigners by the French Tribunals of the Protectorate,
His Catholic Majesty's Government renounces claiming for its
consuls, its subjects, and its establishments in the French Zone
of the Shereefian Empire all the rights and privileges arising out
of the regime of the Capitulations.

So far as the Government of the French Republic is concerned,
it binds itself to renounce euqally the rights and privileges existing
in favour of its consuls, its subjects, and its establishments in the
Spanish Zone as soon as the Spanish Tribunals are established in
the said Zone.

”

The Declaration whereby France complied with the above under-
taking was made on November 17th, 1914, and included the follow-
ing paragraph :

“Taking into consideration the guarantees of judicial equality
offered to foreigners by the Spanish Tribunals in the Protectorate,
the Government of the French Republic hereby renounces claiming
for its consuls, its subjects and its establishments in the Spanish
Zone of the Shereefian Empire, all the rights and privileges arising
out of the regime of the Capitulations.”

It will be observed that both Declarations use the words “renonce
à réclamer” (renounces claiming) and the question has arisen whether
these words were intended as a surrender or renunciation of all the
rights and privileges arising out of the capitulatory regime, or
whether they must be considered as temporary undertakings not
to claim those rights or privileges so long as the guarantees for
judicial equality are maintained in the French Zone by the tribunals
of the Protectorate and so long as the corresponding guarantees are
maintained in the Spanish Zone.

The question is academic rather than practical. Even if the words
in question should be construed as meaning a temporary under-
taking not to claim the rights and privileges, the fact remains that
Spain, in 1950, as a result of these undertakings was not entitled to
exercisc consular jurisdiction in the French Zone. It follows that
the United States would be equally not entitled to exercise such
jurisdiction in the French Zone in the year 1950.

22
195 JUDGMENT OF 27 VHI 52 (U.S. NATIONALS IN MOROCCO)

Nevertheless, it is necessary for the Court to examine these
Declarations in order to determine what the parties had in mind
when they used the words in question.

The parties in both Declarations used the expression “‘taking into
consideration the guarantees of judicial equality ....”. These are
words which, if given their ordinary and natural meaning, state the
consideration which led to the making of the surrender, but they
are not words which would normally be used if it was intended to
make a conditional surrender.

The Court is of opinion that the words “renonce à réclamer” must
be regarded as an out-and-out renunciation of the capitulatory
rights and privileges. This view is confirmed by taking into account
the declarations and other arrangements made by France with other
interested Powers designed to bring about the surrender of their
jurisdictional and other extraterritorial rights in the French Zone.

The two Declarations made by France and Spain in 1914 show
that they both regarded the expression “renonce à réclamer” as
equivalent to a renunciation of the rights in question. In the Declar-
ation of March 7th, 1914, the French Government bound itself “to
renounce equally the rights and privileges ....”. In the later Declar-
ation of November 17th, 1914, France gave effect to this obligation
by using the expression “‘venonce à réclamer’’. It is clear, therefore,
that both France and Spain regarded this expression as proper for
bringing about a complete surrender or renunciation of the rights
and privileges in question.

On July 31st, 1916, the French Ambassador at Washington sent
to the Secretary of State of the United States “the text of the
Declaration signed, with reference to the abrogation of capitula-
tions in the French Zone of Morocco, by all the Powers signatory
of the Algeciras Conference and by the South-American Republics”.
In the text, thus transmitted, the expression used in English was
“relinquishes its claim to all the rights and privileges growing out
of the Capitulation regime ....’”’. It is thus clear that at that date,
long before the present dispute had arisen, France regarded the
expression “relinquishes its claim” (or, in other words, “‘renonce à
véclamer’’) as bringing about the abrogation of the privileges in
question.

The Declaration made by France and Spain of March 7th, 1914,
was one of a series of agreements negotiated by France with more
than twenty foreign States “for the surrender of their jurisdictional
and other extraterritorial rights so far as concerned the French
Zone of Morocco”. At least seventeen of these agreements used the
expression ‘‘renonce à réclamer’’ as a means of bringing about a
complete abrogation of all rights and privileges arising out of the
regime of Capitulations. They are referred to in the Counter-
Memorial in the following words : “for the surrender of their juris-

23
196 JUDGMENT OF 27 VIII §2 (U.S. NATIONALS IN MOROCCO)

dictional and other extraterritorial rights”, and again, ‘for the
renunciation of extraterritorial rights”. Further, all of the States
which had signed these agreements abandoned forthwith the exer-
cise of consular jurisdiction or other capitulatory rights or privi-
leges in the French Zone.

In these circumstances, it is necessary to conclude that the
Spanish Declaration of March 7th, 1914, brought about the surrender
or renunciation of all Spanish jurisdictional or other extraterritorial
rights in the French Zone, and an abrogation of those provisions of
the Spanish Treaty of 1861 which concern “the rights and privileges
arising out of the regime of Capitulations”.

The Court, therefore, can not accept the contention that the
United States is entitled, by virtue of the most-favoured-nation
clauses, to invoke in respect of the French Zone those provisions
of the Spanish Treaty of 1861 which concern consular jurisdiction.

as

The fourth contention of the United States is that the extensive
consular jurisdiction as it existed in Morocco in the year 1880 was
recognized and confirmed by the provisions of the Madrid Conven-
tion, and that the United States, as a party to that Convention,
thereby acquired an autonomous right to the exercise of such
jurisdiction, independently of the operation of the most-favoured-
nation clauses.

There can be no doubt that the exercise of consular jurisdiction
in Morocco in the year 1880 was general, or that the Convention
presupposed the existence of such jurisdiction. It dealt with the
special position of protégés and contained provisions for the exercise
of jurisdiction with regard to them.

On the other hand, it is equally clear that there were no provi-
sions of the Convention which expressly brought about a confirm-
ation of the then existing system of consular jurisdiction, or its
establishment as an independent and autonomous right.

The purposes and objects of this Convention were stated in its
Preamble in the following words : “the necessity of establishing, on
fixed and uniform bases, the exercise of the right of protection in
Morocco and of settling certain questions connected therewith....’’.
In these circumstances, the Court can not adopt a construction by
implication of the provisions of the Madrid Convention which would
go beyond the scope of its declared purposes and objects. Further,
this contention would involve radical changes and additions
to the provisions of the Convention. The Court, in its Opinion—
Interpretation of Peace Treaties (Second Phase) (f.C. J. Reports
1950, p. 229)—stated: “It is the duty of the Court to interpret
the Treaties, not to revise them.”
197 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

The fifth contention of the United States is that the consular
jurisdiction in Morocco was recognized and confirmed by various
provisions of the Act of Algeciras, and that the United States
acquired an autonomous right to exercise such jurisdiction inde-
pendently of the operation of the most-favoured-nation clauses.

In 1906 the twelve Powers at Algeciras all exercised capitulatory
rights and privileges to the extent that they were prescribed either
by the General Treaty with Great Britain of 1856 or by the Spanish
Treaty of 1861. They did so by virtue of direct treaty grant, as in
the case of Great Britain or Spain ; or by virtue of most-favoured-
nation clauses, as in the case of the United States; or without
treaty rights, but with the consent or acquiescence of Morocco, as
in the case of certain other States. Accordingly, the Act of Algeciras
pre-supposed the existence of the regime of Capitulations, including
the rights of consular jurisdiction, and many of its provisions
assigned particular functions to the then existing consular tribunals.
Reference has been made in the course of the argument to Arti-
cles 19, 23, 24, 25, 20, 45, 59, 80, 81, 87, 9I, 101, 102 and 119. For
example, Chapter V, which deals with “the customs of the Empire
and the repression of fraud and smuggling’, contains Article 102,
which provides :

“Every confiscation, fine or penalty must be imposed on foreigners
by consular jurisdiction, and on Moorish subjects by Shereefian
jurisdiction.”

In the conditions which existed at the time, this Article made it
necessary for the prosecution of nationals of the twelve Powers for
fraud and smuggling to be dealt with in the consular courts.

Since 1937, the position has been one in which eleven of the
Powers have abandoned their capitulatory privileges, and their
consular jurisdiction has ceased to exist. Accordingly, Morocco has
been able to make laws and to provide for the trial and punishment
of offenders who are nationals of these eleven countries. The posi-
tion of the United States is different, and must now be examined.

Unlike the Madrid Convention, the Act of Algeciras was general
in its scope and was not confined to a limited problem such as that
of protection. On the other hand, the interpretation of the provisions
of the Act must take into account its purposes, which are set forth
in the Preamble in the following words :

“Inspired by the interest attaching itself to the reign of order,
peace, and prosperity in Morocco, and recognizing that the attain-
ment thereof can only be effected by means of the introduction of
reforms based upon the triple principle of the sovereignty and inde-
pendence of His Majesty the Sultan, the integrity of his domains,
and economic liberty without any inequality...”

25
198 JUDGMENT OF 27 VII 52 (U.S. NATIONALS IN MOROCCO)

Neither the Articles to which reference has been made above nor
any other provisions of the Act of Algeciras purport to establish
consular jurisdiction or to confirm the rights or privileges of the
regime of Capitulations which were then in existence. The question,
therefore, is whether the establishment or confirmation of such
jurisdiction or privileges can be based upon the implied intentions
of the parties to the Act as indicated by its provisions.

An interpretation, by implication from the provisions of the Act,
establishing or confirming consular jurisdiction would involve a
transformation of the then existing treaty rights of most of the
twelve Powers into new and autonomous rights based upon the Act.
It would change treaty rights of the Powers, some of them termin-
able at short notice, e.g., those of the United States which were
terminable by twelve months’ notice, into rights enjoyable for an
unlimited period by the Powers and incapable of being terminated
or modified by Morocco. Neither the preparatory work nor the
Preamble gives the least indication of any such intention. The Court
finds itself unable to imply so fundamental a change in the character
of the then existing treaty rights as would be involved in the
acceptance of this contention.

There is, however, another aspect of this problem arising out of
the particular Articles to which reference has bee made above.
These are the Articles which include provisions necessarily involving
the exercise of consular jurisdiction. In this case, there is a clear
indication of the intention of the parties to the effect that certain
matters are to be dealt with Ly the consular tribunals and to this
extent it is possible to interpret the provisions of the Act as estab-
lishing or confirming the exercise of consular jurisdiction for these
limited purposes. The maintenance of consular jurisdiction in so
far as it may be necessary to give effect to these specific provisions
can, therefore, be justified as based upon the necessary intendment
of the provisions of the Act.

This result is confirmed by the provisions of Articles 10 and 16
of the Convention between Great Britain and France of July 29th,
1937. These Articles refer to the jurisdictional privileges “accorded
on the basis of existing treaties’ or “enjoyed by the United States
of America under treaties at present in force”. They pre-suppose,
therefore, that the jurisdictional privileges of the United States,
even after the surrender of British capitulatory rights, would not
be limited to the jurisdiction provided by Articles 20 and 21 of the
Treaty with Morocco of 1836. This view is also supported by the
provisions of Article 4 of the Protocol of Signature to this Conven-
tion. This Article provided for the abrogation of certain provisions
of the General Treaty of 1856 and, as regards the Act of Algeciras,
for the renunciation ‘of the right to rely upon Articles 1 to 50,
54 to 65, 70, 71, all provisions of Article 72 after the word ‘permit’,

26
199 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

75, 76, 80, 97, IOI, 102, 104, 113 to 11g”, and it also provided that
“in Article 81 the words ‘by the competent consular authority’
must be deemed to be omitted and in Article 91, the word ‘compe-
tent’ must henceforth be substituted for the word ‘consular’ ”.

It is clear that, in 1937, France (representing Morocco) and Great
Britain were proceeding upon the assumption that certain of the
provisions of the Act of Algeciras recognized a limited consular
jurisdiction for the purposes of the judicial proceedings therein
described.

The Court is not called upon to examine the particular articles
of the Act of Algeciras which are involved. It considers it sufficient
to state as its opinion that the consular jurisdiction of the United
States continues to exist to the extent that may be necessary to
render effective those provisions of the Act of Algeciras which
depend on the existence of consular jurisdiction.

This interpretation of the Act, in some instances, leads to results
which may not appear to be entirely satisfactory. But that is an
unavoidable consequence of the manner in which the Algeciras
Conference dealt with the question of consular jurisdiction. The
Court can not, by way of interpretation, derive from the Act a
general rule as to full consular jurisdiction which it does not contain.
On the other hand, the Court can not disregard particular provisions
involving a limited resort to consular jurisdiction, which are, in
fact, contained in the Act, and which are still in force as far as the
relations between the United States and Morocco are concerned.

*

The sixth contention of the United States is that its consular
jurisdiction and other capitulatory rights in Morocco are founded
upon “custom and usage”.

This contention has been developed in two different ways. The
first relates to custom and usage preceding the abandonment of
capitulatory rights in the French Zone by Great Britain in 1937.
The second relates to the practice since that date.

Dealing first with the period of 150 years, 1787 to 1937, there
are two considerations which prevent the acceptance of this con-
tention,

The first is that throughout this whole period, the United States
consular jurisdiction was in fact based, not on custom or usage,
but on treaty rights. At all stages, it was based on the provisions
either of the Treaty of 1787 or of the Treaty of 1836, together with
the provisions of treaties concluded by Morocco with other Powers,
especially with Great Britain and Spain, invoked by virtue of the
most-favoured-nation clauses. This was the case not merely of the
United States but of most of the countries whose nationals were
trading in Morocco. It is true that there were Powers represented
at the Conference of Madrid in 1880 and at Algeciras in 1906 which
had no treaty rights but were exercising consular jurisdiction with

27
200 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

the consent or acquiescence of Morocco. It is also true that France,
after the institution of the Protectorate, obtained declarations of
renunciation from a large number of other States which were in a
similar position. This is not enough to establish that the States
exercising consular jurisdiction in pursuance of treaty rights
enjoyed in addition an independent title thereto based on custom
or usage.

The second consideration relates to the question of proof. This
Court, in the Asylum Case (J.C. J. Reports 1950, pp. 276-277), when
dealing with the question of the establishment of a local custom
peculiar to Latin-American States, said :

“The Party which relies on a custom of this kind must prove
that this custom is established in such a manner that it has become
binding on the other Party. The Colombian Government must prove
that the rule invoked by it is in accordance with a constant and
uniform usage practised by the States in question, and that this
usage is the expression of a right appertaining to the State granting
asylum and a duty incumbent on the territorial State. This follows
from Article 38 of the Statute of the Court, which refers to inter-

3 59

national custom ‘as evidence of a general practice accepted as law’.

In the present case there has not been sufficient evidence to
enable the Court to reach a conclusion that a right to exercise
consular jurisdiction founded upon custom or usage has been estab-
lished in such a manner that it has become binding on Morocco.

This contention has also been based upon the practice since the
date when the treaty right of the United States to exercise extended
consular jurisdiction and derivative rights came to an end with the
coming into operation of the Convention between France and Great
Britain of 1937.

During this period France and the United States were in negoti-
ation with regard to a number of questions, including t he renuncia-
tion of capitulatory rights. There are isolated expressions to be
found in the diplomatic correspondence which, if considered with-
out regard to their context, might be regarded as acknowledgments
of United States claims to exercise consular jurisdiction and other
capitulatory rights. On the other hand, the Court can not ignore
the general tenor of the correspondence, which indicates that at
all times France and the United States were looking for a solution
based upon mutual agreement and that neither Party intended to
concede its legal position. In these circumstance, the situation in
which the United States continued after 1937 to exercise consular
jurisdiction over all criminal and civil cases in which United States
nationals were defendants, is one that must be regarded as in the

28
201 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

nature of a provisional situation acquiesced in by the Moroccan
authorities.

*

Accordingly, it is necessary to conclude that, apart from the
special rights under Articles 20 and 21 of the Treaty of 1836 and
those which arise from the provisions of the Act of Algeciras, to
which reference has been made above, the United States claim to
exercise and enjoy, as of right, consular jurisdiction and other capitu-
latory rights in the French Zone came to an end with the term-
ination of “‘all rights and privileges of a capitulatory character in
the French Zone of the Shereefian Empire” by Great Britain, in
pursuance of the provisions of the Convention of 1937.

*
* *

The Court will now consider the claim that United States nationals
are not subject, in principle, to the application of Moroccan laws,
unless they have first received the assent of the United States
Government.

The French Submission is this regard reads as follows :

“That the Government of the United States of America is not
entitled to claim that the application of all laws and regulations to
its nationals in Morocco requires its express consent ;

That the nationals of the United States of America in Morocco
are subject to the laws and regulations in force in the Shereefian
Empire and in particular the regulation of December 30th, 1948,
on imports not involving an allocation of currency, without the
prior consent of the United States Government.”

The United States Submission in this regard reads as follows :

‘4. Under the regime of extraterritorial jurisdiction now exer-
cised by the United States in Morocco, United States citizens are
not subject, in principle, to the application of Moroccan laws.

Such laws become applicable to the United States citizens only
if they are submitted to the prior assent of the United States Govern-
ment and if this Government agrees to make them applicable to
its citizens. The Dahir of December 30, 1948, not having been sub-
mitted to the prior assent of the United States Government, cannot
be made applicable to United States citizens.”

The claim that Moroccan laws are not binding on United States
nationals, unless assented to by the Government of the United

29
202 JUDGMENT OF 27 VIII 52 (U.S, NATIONALS IN MOROCCO)

States, is linked with the regime of Capitulations, and it will not
be necessary to repeat the considerations which have already been
discussed in dealing with consular jurisdiction.

There is no provision in any of the treaties which have been
under consideration in this case conferring upon the United States
any such right. The so-called “right of assent”” is merely a corollary
of the system of consular jurisdiction. The consular courts applied
their own law and they were not bound in any way by Moroccan
law or Moroccan legislation. Before a consular court could give
effect to a Moroccan law it was necessary for the foreign Power
concerned to provide for its adoption as a law binding on the consul
in his judicial capacity. It was the usual practice to do this by
embodying it either in the legislation of the foreign State or in
ministerial or consular decrees of that State issued in pursuance of
delegated powers. The foreign State could have this done or it could
refuse to provide for the enforcement of the law. There was a “right
of assent’’ only to the extent that the intervention of the consular
court was necessary to secure the effective enforcement of a Moroc-
can law as against the foreign nationals.

In the absence of any treaty provisions dealing with this matter,
it has been contended that a “right of assent’’ can be based on
custom, usage or practice. It is unnecessary to repeat the reasons
which have been given for rejecting custom, usage and practice
as a basis for extended consular jurisdiction, and which are largely
applicable to the “right of assent’’. It is, however, necessary to
point out that the very large number of instances in which Moroccan
laws were referred to the United States authorities can readily be
explained as a convenient way of ensuring their incorporation in
ministerial decrees binding upon the consular courts. In that way,
and in that way only, could these laws be made enforceable as
against United States nationals so long as the extended consular
jurisdiction was being exercised.

The problem arises in three ways, which must be considered
separately.

The first is in cases where the application of a Moroccan law to
United States nationals would be contrary to the treaty rights of
the United States. In such cases, the application of Moroccan laws,
whether directly or indirectly to these nationals, unless assented to
by the United States, would be contrary to international law, and
the dispute which might arise therefrom would have to be dealt
with according to the ordinary methods for the settlement of inter-
national disputes. These considerations apply to the Decree of
December 30th, 1948, which the Court has found to be contrary
to treaty rights of the United States.

30
203 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

The second way in which the problem arises is in cases in which
the co-operation of the consular courts is required in order to enforce
the Moroccan legislation. In such cases, regardless of whether the
application of the legislation would contravene treaty rights, the
assent of the United States would be essential to its enforcement
by the consular courts.

The third way in which the problem arises is in cases where the
application to United States nationals, otherwise than by enforce-
ment through the consular courts, of Moroccan laws which do not
violate any treaty rights of the United States is in question. In
such cases the assent of the United States authorities is not required.

Accordingly, and subject to the foregoing qualifications, the Court
holds that the United States is not entitled to claim that the applic-
ation of laws and regulations to its nationals in. the French Zone
requires its assent.

*
cd *

The Government of the United States of America has submitted
a Counter-Claim, a part of which relates to the question of immunity
from Moroccan taxes in general, and particularly from the consump-
tion taxes provided by the Shereefian Dahir of February 28th, 1948.
The following Submissions are presented with regard to these ques-
tions :

On behalf of the Government of the United States :

“2. The treaties exempt American nationals from taxes, except
as specifically provided by the same treaties ; to collect taxes from
American nationals in violation of the terms of the treaties is a
breach of international law.

Such taxes can legally be collected from American nationals
only with the previous consent of the United States which operates
to waive temporarily its treaty right, and from the date upon which
such consent is given, unless otherwise specified by the terms of
the consent.

Consumption taxes provided by the Dahir of February 28, 1948,
which were collected from American nationals up to August 15,
1950, the date on which the United States consented to these
taxes, were illegally collected and should be refunded to them.

3. Since Moroccan laws do not become applicable to American
citizens until they have received the prior assent of the United
States Government, the lack of assent of the United States Govern-
ment to the Dahir of February 28, 1948, rendered illegal the collec-
tion of the consumption taxes provided by that Dahir.”

On behalf of the Government of France :

_ “That no treaty has conferred on the United States fiscal immun-
ity for its nationals in Morocco, either directly or through the
effect of the most-favoured-nation clause ;

31
204 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

That the laws and regulations on fiscal matters which have been
put into force in the Shercefian Empire are applicable to the nationals
of the United States without the prior consent of the Government
of the United States ;

That, consequently, consumption taxes provided by the Dahir
of February 28th, 1948, have been legally collected from the nation-
als of the United States, and should not be refunded to them.”’

The Government of the United States contends that its treaty
rights in Morocco confer upon United States nationals an immunity
from taxes except the taxes specifically recognized and permitted
by the treaties. This contention is based on certain bilateral treaties
with Morocco as well as on the Madrid Convention of 1880 and the
Act of Algeciras of 1906.

The Court will first consider the contention that the right to
fiscal immunity can be derived from the most-favoured-nation
clauses in Article 24 of the Treaty between the United States and
Morocco of 1836 and in Article 17 of the Madrid Convention, in
conjunction with certain provisions in treaties between Morocco
and Great Britain and Morocco and Spain.

The General Treaty between Great Britain and Morocco of 1856
provided in the second paragraph of Article [V that British subjects
“shall not be obliged to pay, under any pretence whatever, any
taxes or impositions”. The Treaty between Morocco and Spain of
1861 provided in Article V that “Spanish subjects can not under
any pretext be forced to pay taxes or contributions”.

It is submitted on behalf of the United States that the most-
favoured-nation clauses in treaties with countries like Morocco were
not intended to create merely temporary or dependent rights, but
were intended to incorporate permanently these rights and render
them independent of the treaties by which they were originally
accorded. It is consequently contended that the right to fiscal
immunity accorded by the British General Treaty of 1856 and the
Spanish Treaty of 1861, was incorporated in the treaties which
guaranteed to the United States most-favoured-nation treatment,
with the result that this right would continue even if the rights and
privileges granted by the Treaties of 1856 and 1861 should come to
an end.

For the reasons stated above in connection with consular juris-
diction, the Court is unable to accept this contention. It is not
established that most-favoured-nation clauses in treaties with
Morocco have a meaning and effect other than such clauses in
other treaties or are governed by different rules of law. When pro-
visions granting fiscal immunity in treaties between Morocco and
third States have been abrogated or renounced, these provisions
can no longer be relied upon by virtue of a most-favoured-nation
clause. In such circumstances, it becomes necessary to examine

32
205 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

whether the above-mentioned provisions in the Treaties of 1856
and 1867 are still in force.

The second paragraph of Article IV in the General Treaty with
Great Britain was abrogated by the Franco-British Convention of
July 29th, 1937, Protocol of Signature, Article 4 (a). As from the
coming into force of this Convention, that paragraph of Article IV
of the General Treaty of 1856 could no longer be relied upon by the
United States by virtue of a most-favoured-nation clause.

As already held above, the effect of the Declaration made by
France and Spain of March 7th, 1914, was an unconditional renun-
ciation by Spain of all the rights and privileges arising out of the
regime of Capitulations in the French Zone. This renunciation
involved, in the opinion of the Court, a renunciation by Spain of
the right of its nationals to immunity from taxes under Article V
of its Treaty with Morocco of 1861, since such a general and com-
plete immunity from taxes must be considered as an element of the
regime of capitulations in Morocco. When Spain relinquished all the
capitulatory rights, it must thereby be considered as having given
up the rights to fiscal immunity.

This view is confirmed by the attitude taken by number of other
States in this respect. Great Britain renounced all rights and privi-
leges of a capitulatory character in the French Zone by Article 1
of its Convention with France of 1937. In the Protocol of Signature
it was declared that the effect of this Article and of Article 16 is
to abrogate a number of articles in the General Treaty of 1856,
including, as has been stated above, the second paragraph of
Article IV. This seems to show that France, representing Morocco,
and Great Britain were proceeding on the assumption that the tax
immunity accorded by that Article was a right of a capitulatory
character. The other States, which, during the years 1914-1916,
equally renounced all rights and privileges arising out of the regime
of Capitulations in the French Zone, have acquiesced in the taxation
of their nationals.

For these reasons, the Court holds that the right to tax immunity
accorded by Article V of the Spanish Treaty of 1861, having been
surrendered by Spain, can no longer be invoked by the United
States by virtue of a most-favoured-nation clause.

The Government of the United States has further contended that
it has an independent claim to tax immunity by virtue of being a
party to the Convention of Madrid and the Act of Algeciras. It
contends that by these instruments a regime as to taxes was set
up, which continued the tax immunity in favour of the nationals
of foreign States, thereby confirming and incorporating this pre-
existing regime, which therefore is still in force, except for the
States which have agreed to give it up.

The Court is, however, of opinion that the Madrid Convention
did not confirm and incorporate the then existing principle of tax

33
206 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

immunity. It merely pre-supposed the existence of this principle
and curtailed it by exceptions in Articles 12 and 13 without modi-
fying its legal basis. It did not provide a new and independent
ground for any claim of tax immunity.

Similar considerations apply to the Act of Algeciras, which further
curtailed the regime of tax immunity by exceptions in Articles 59,
61, 64, and 65. It did not provide any new and independent legal
basis for exemption from taxes.

The Government of the United States has invoked Articles 2 and
3 of the Madrid Convention, which grant exemption from taxes,
other than those mentioned in Articles 12 and 13, to certain ‘‘pro-
tected persons”. But the ‘“‘protégés” mentioned in Articles 2 and 3
constituted only a limited class of persons in the service of diplo-
matic representatives and consuls of foreign States. No conclusion
as to tax immunity for nationals of the United States in general
can, in the opinion of the Court, be drawn from the privileges
granted to this limited class of protected persons.

It is finally contended, on behalf of the Government of the
United States, that the consumption taxes imposed by the Dahir of
February 28th, 1948, are in contravention of special treaty rights.
Reference is made to the Treaty of Commerce between Great
Britain and Morocco of 1856, Articles III, VII, VIII and IX, and
it is submitted that United States nationals are exempt from those
consumption taxes by virtue of these Articles in conjunction with
the most-favoured-nation clauses in the Treaty of 1836 between
Morocco and the United States.

These four Articles in the British Commercial Treaty of 1856
relate to taxes and duties on goods exported from or imported into
Morocco, or on goods conveyed from one Moroccan port to another.
The consumption taxes provided by the Dahir of February 28th,
1948, are, according to its Article 8, payable on all products whether
they are imported into the French Zone of Morocco or manufac-
tured or produced there. They can not, therefore, be assimilated
to the particular taxes mentioned in the articles of the British
Commercial Treaty, invoked by the United States, nor can they
be considered as a customs duty. The mere fact that it may be
convenient in the case of imported goods to collect the consumption
tax at the Customs Office does not alter its essential character as a
tax levied upon all goods, whether imported into, or produced in,
Morocco, It may be recalled in this connection that the Permanent
Court of International Justice recognized that fiscal duties collected
at the frontier on the entry of certain goods were not to be confused
with customs duties; in its Judgment of June 7th, 1932, in the
Free Zones Case (P.C.L.J., Series A/B, No. 46, p. 172), it laid down
that ‘the withdrawal of the customs line does not affect the right

34
207 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

of the French Government to collect at the political frontier fiscal
duties not possessing the character of customs duties’.

The Court is, consequently, unable to hold that the imposition
of these consumption taxes contravenes any treaty rights of the
United States. In such circumstances the question of a partial
refund of consumption taxes paid by United States nationals does
not arise.

It follows from the above-mentioned considerations that the
Government of the United States is not entitled to claim that
taxes, including consumption taxes, shall be submitted to the
previous consent of that Government before they can legally be
collected from nationals of the United States. Since they are, in the
opinion of the Court, not exempt from the payment of any taxes
in the French Zone, there is no legal basis for the claim that laws
and regulations on fiscal matters shall be submitted to United
States authorities for approval.

The conclusion which the Court has thus arrived at seems to be
in accordance with the attitude which other States have taken with
regard to this question. Tax immunity in the French Zone is not
claimed either by the United Kingdom or by Spain or any other
State which previously enjoyed such a privileged position. The
only State now claiming this privilege is the United States, though
no tax immunity is guaranteed by its Treaty with Morocco of
1836. To recognize tax immunity for United States nationals
alone would not be compatible with the principle of equality of
treatment in economic matters on which the Act of Algeciras is
based.

*
% *

The final Submission of the United States of America upon that
part of its Counter-Claim which is based upon Article 95 of the
General Act of Algeciras, is as follows :

“1. Under Article 95 of the Act of Algeciras, the value of imports
from the United States must be determined for the purpose of
customs assessments by adding to the purchase value of the imported
merchandise in the United States the expenses incidental to its
transportation to the custom-house in Morocco, exclusive of all
expenses following its delivery to the custom-house, such as customs
duties and storage fees.

It is a violation of the Act of Algeciras and a breach of inter-
national law for the customs authorities to depart from the method
of valuation so defined and to determine the value of imported
merchandise for customs purposes by relying on the value of the
imported merchandise on the local Moroccan market.”

35
208 JUDGMENT OF 27 VIL 52 (U.S. NATIONALS IN MOROCCO)

The final Submission of the Government of France upon this part
of the Counter-Claim is as follows :
“That Article 95 of the Act of Algeciras defines value for customs

purposes as the value of the merchandise at the time and at the
place where it is presented for customs clearance ;”

which, as was made clear in the oral argument, means the value in
the local, i.e. Moroccan, market.

The necessity, evidenced by Articles 95, 96 and 97 of the Act
of Algeciras, of creating some kind of machinery for securing a
just valuation of goods by the Customs authorities would appear to
follow, inter alia, (a) from the principle of economic equality which
is one of the principles underlying the Act, and (6) from the fact
that the import duties were fixed by the signatory Powers at 124 %.
Clearly, it would be easy, if it were desired to do so, to discriminate
against particular importers by means of arbitrary valuations or to
evade a fixed limitation of duties by means of inflated valuations.
But while the signatory Powers realized the necessity for some such
machinery, it does not appear that the machinery has given rise
to a practice which has been consistently followed since the Act
entered into force.

Article 95 specifies four factors in valuing merchandise :

(a) the valuation must be based upon its cash wholesale value ;

(b) the time and place of the valuation are fixed at the entry of
the merchandise at the custom-house ;

(c) the merchandise must be valued “free from customs duties
and storage dues”, that is to say, the value must not include these
charges ;

(d) the valuation must take account of depreciation resulting
from damage, if any.

Article 96, which relates only to the principal goods taxed by the
Moorish Customs Administration, contemplated an annual fixing
of values by a “Committee on Customs Valuations” sitting at
Tangier. The local character of this Committee, and of the persons
whom it is directed to consult, should be noted. The schedule of
values fixed by it was to be subject to revision at the end of six
months if any considerable changes had taken place in the value of
certain goods. Article 96 is procedural and is intended to operate
within the ambit of Article 95.

Article 97 provided for the establishment of a permanent ‘‘Com-
mittee of Customs”, intended to supervise the customs service on
a high level and to watch over the application of Article 96 and
97, subject to the advice and consent of the ‘‘Diplomatic Body at
Tangier’.

The Committee on Customs Valuations referred to in Article 96
appears to have lapsed in 1924 when the Convention of Decem-
36
209 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

ber 18th, 1923, on the Tangier Zone came into force, and replaced
it by a Committee representing the three Zones. The latter Com-
mittee has not met since 1936.

Articles 82 to 86 of the Act, which relate to declarations by
importers, must also be noted. Article 82 requires an importer to
file a declaration, which must contain a detailed statement setting
forth the nature, quality, weight, number, measurement and value
of the merchandise, as well as the nature, marks and numbers of
the packages containing the same. A declaration of value made by
the importer can clearly not be decisive, because he is an interested
party, but at the same time he knows more about the goods than
anybody else, and, unless fraud is suspected, it is right that the
value appearing in the declaration should form an important ele-
ment in the valuation about to be made.

It can not be said that the provisions of Article 95 alone, or of
Chapter V of the Act considered as a whole, afford decisive evidence
in support of either of the interpretations contended for by the
Parties respectively. The four factors specified by Article 95 are
consistent with either interpretation ; in particular, the expression
“free from customs duties and storage dues”’ affords no clear indica-
tion, because, if the value in the country of origin, increased by the
amount of insurance, freight, etc., is to be taken as the basis, this
expression means “before entering the customs office and paying
duties” ; whereas, if the value in the local market is to be accepted
as the basis, some such expression is necessary (or at any rate
prudent) in order to indicate that the duty of 124 % must not be
levied on a value which already contains the 123 %.

The Court has examined the earlier practice, and the preparatory
work of the Conference of Algeciras of 1906, but not much guidance
is obtainable from these sources. The Commercial Agreement made
between France and Morocco, dated October 4th, 1892, consists of
two letters exchanged between the Foreign Minister of Morocco and
the Minister of France in Morocco, the latter of which contains the
expression :

“These goods shall be assessed on the basis of their cash wholesale
market value in the port of discharge, in reals of vellon.”

A preliminary draft of the Act (p. 97 of French Documents diplo-
matiques, 1906, fascicule 1, Affaires du Maroc, entitled “II. Proto-
coles et comptes rendus de la Conférence d’Algésiras’’) contains
the following article :

“Article XIX.—Import and export duties shall be paid forthwith
in cash at the custom-house where clearance is effected. The ad
valorem duties shall be determined and paid on the basis of the cash
wholesale value of the goods at the port of discharge or the custom-

37
210 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

house in the case of imports. Merchandise can only be removed after
the payment of customs duties and storage.

The holding of the goods or the collection of duty shall, in every
case, be made the subject of a regular receipt delivered by the officer
in charge.”

Later (p. 100), upon a British proposal, the second sentence was
modified so as to read :

“The ad valorem duties shall be determined and paid on the basis
of the cash wholesale value of the goods at the custom-house, free
from customs duties.”

At a later stage the German delegation made the following pro-
posal (zbid., p. 232):

“The ad valorem duties imposed on imports in Morocco shall be
assessed on the value of the imported goods in the place of shipment
or of purchase, to which shall be added the transport and insurance
charges to the port of discharge in Morocco...”

That amendment was rejected, from which it may be inferred
that the value in the country of origin was rejected as the conclusive
test.

It is also necessary to examine the practice of the customs
authorities since 1906, in so far as it appears from the materials
made available to the Court by the Parties. It seems that there has
been a reluctance to attribute a decisive effect to any single factor
in valuing merchandise.

For instance, in a letter of July 16th, 1912, from the Controller
of Moroccan Customs to the American Minister at Tangier, it is
stated that the customs officers ‘‘apply for the appraisal of mer-
chandise the rules established by the Act of Algeciras and by the
Customs regulations. They use market prices, bills of sale and their
professional knowledge.”’

The following excerpts occur later in the same letter :

“The bill of sale is an element of valuation, but it is not conclusive
evidence.

The customs has always proceeded as described above in regard
to petroleum products imported from Fiume and from Trieste ;
for which importers furnish means of appraisal by attaching to the
declarations the original bills of sale, of which the prices are com-
pared with the market prices of origin.

This value [i.e. for customs purposes] includes the purchase
price of the petroleum f.o.b. New York, increased by all expenses
subsequent to the purchase, such as export duties paid to foreign
customs, transportation, packing, freight, insurance, handling,
211 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

unloading, etc.—in short, all that contributes to make up at the
moment of presentation at the customs office the cash wholesale
value of the product, according to which, under Article 95 of the
Act of Algeciras, the duties must be paid.

,»

It is also interesting to note from the Minutes of the meeting at
Tangier of the Committee on Customs Valuations on June 7th,
1933, that the Director of Customs explained :

‘“.. that his Department adopts as elements of valuation for the
application of the duties concerned, the invoice of origin, transport
costs to the port of importation, the value of the merchandise on
the local market on arrival, general market price lists and any
other information which may be useful to fix the value upon which
the duty is based”,

On the other hand, passages can be found in the Customs regula-
tions and in circulars issued by the Moroccan Debt Control in
which the emphasis is laid upon the value in the Moroccan market
as the important factor. The latest “Tables of minimum and
maximum values of the principal merchandise imported into
Morocco’, adopted by the Committee on Customs Valuations at
their last meeting on March 11th, 1936, at Tangier, reveal a range
so great that they could only afford the most general guidance as
to the actual valuation of a particular cargo or piece of merchandise.

The general impression created by an examination of the relevant
materials is that those responsible for the administration of the
customs since the date of the Act of Algeciras have made use of
all the various elements of valuation available to them, though
perhaps not always in a consistent manner.

In these circumstances, the Court is of the opinion that Article 95
lays down no strict rule on the point in dispute. It requires an
interpretation which is more flexible than either of those which
are respectively contended for by the Parties in this case.

The Court is of the opinion that it is the duty of the Customs
authorities in the French Zone, in fixing the valuation of imported
goods for customs purposes, to have regard to the following factors :

(a) the four factors specified by Article 95 and mentioned above ;

(b) the contents of the declaration which the importer is required
by the Act to file in the custom-house ;
(c) the wholesale cash value in the market of the French Zone ;

(ad) the cost in the country of origin, increased by the cost of
loading and unloading, insurance, freight, and other charges
incurred before the goods are delivered at the custom-house ;

39
212 JUDGMENT OF 27 VIII 52 (U.S. NATIONALS IN MOROCCO)

(e) the schedule of values, if any, which may have been prepared
by the Committee on Customs Valuations referred to in Article 96
or by any committee which may have been substituted therefor
by arrangements to which France and the United States have
assented expressly or by implication ;

(f) any other factor which is required by the special circumstances
of a particular consignment or kind of merchandise.

The factors referred to above are not arranged in order of priority
but should operate freely, within any limits that have been, or
may be, prescribed under Article 96 of the Act ; and, in view of
the governing principle of economic equality, the same methods
must be applied without discrimination to all importations, regard-
less of the origin of the goods or the nationality of the importers.
The power of making the valuation rests with the Customs author-
ities, but it is a power which must be exercised reasonably and in
good faith.

For these reasons,

THE Court,
on the Submissions of the Government of the French Republic,

unanimously,

Rejects its Submissions relating to the Decree of December 30th,
1948, issued by the Resident General of the French Republic in
Morocco ;

unanimously,

Finds that the United States of America is entitled, by virtue of
the provisions of its Treaty with Morocco of September 16th, 1836,
to exercise in the French Zone of Morocco consular jurisdiction in
all disputes, civil or criminal, between citizens or protégés of the
United States ;

by ten votes to one,

Finds that the United States of America is also entitled, by virtue
of the General Act of Algeciras of April 7th, 1906, to exercise in the
French Zone of Morocco consular jurisdiction in all cases, civil or
criminal, brought against citizens or protégés of the United States, to
the extent required by the provisions of the Act relating to consular
jurisdiction ;

by six votes to five,

Rejects, except as aforesaid, the Submissions of the United
States of America concerning consular jurisdiction ;

40
213 JUDGMENT OF 27 VII 52 (U.S. NATIONALS IN MOROCCO)

unanimously,

Finds that the United States of America is not entitled to
claim that the application to citizens of the United States of
all laws and regulations in the French Zone of Morocco requires
the assent of the Government of the United States, but that
the consular courts of the United States may refuse to apply
to United States citizens laws or regulations which have not been
assented to by the Government of the United States ;

on the Counter-Claim of the Government of the United States
of America,

by six votes to five,

Rejects the Submissions of the United States of America relating
to exemption from taxes ;

by seven votes to four,

Rejects the Submissions of the United States of America relating
to the consumption taxes imposed by the Shereefian Dahir of
February 28th, 1948 ;

by six votes to five,

Finds that, in applying Article 95 of the General Act of Alge-
ciras, the value of merchandise in the country of origin and its
value in the local Moroccan market are both elements in the
appraisal of its cash wholesale value delivered at the custom-
house.

Done in English and French, the English text being authoritative,
at the Peace Palace, The Hague, this twenty-seventh day of
August, one thousand nine hundred and fifty-two, in three copies,
one of which will be placed in the archives of the Court and the
others will be transmitted to the Government of the French
Republic and to the Government of the United States of America,
respectively.

(Signed) Arnold D. McNair,

President.

(Signed) E. HAMBRO,

Registrar.

AI
214 JUDGMENT OF 27 VII 52 (U.S. NATIONALS IN MOROCCO)

Judge Hsu Mo declares that, in his opinion, the jurisdictional
rights of the United States of America in the French Zone of Morocco
are limited to those provided in Articles 20 and 21 of its Treaty with
Morocco of September 16th, 1836, and that the United States is
not entitled to exercise consular jurisdiction in cases involving the
application to United States citizens of those provisions of the Act
of Algeciras of 19c6 which, for their enforcement, carried certain
sanctions. The Act of Algeciras, as far as the jurisdictional clauses
are concerned, was concluded on the basis of a kind of consular
jurisdiction as it existed at that time in its full form and in complete
uniformity among the Powers in Morocco. The various provisions,
in referring to “consular jurisdiction’, ‘“‘competent consular
authority”, “consular court of the defendant’, etc., clearly meant
that jurisdiction which was being uniformly exercised by foreign
States over their respective nationals as defendants in all cases.
They did not mean such limited jurisdiction as might be exercised
by the United States consular courts, in accordance with Article 20
of the Moroccan-United States Treaty of 1836, in cases involving
United States citizens or protégés only. When, therefore, consular
jurisdiction in its full form ceased to exist in respect of all the signa-
tory States to the Act of Algeciras, the basis for the application by
the various consular tribunals of the measures of sanction provided
in that Act disappeared, and the ordinary rules of international
law came into play. Consequently, such sanctions should thence-
forth be applied by the territorial courts, in the case of United
States citizens as well as in the case of all other foreign nationals.
As regards reference in the Franco-British Convention of 1937 to
the jurisdictional privileges enjoyed by the United States, it must
be considered as a precautionary measure on the part of France
against the possibility of the refusal of the United States to relin-
quish such privileges. In any case, the rights of the United States
vis-a-vis Morocco in matters of jurisdiction must be determined
by their own treaty relations, and could not derive from any
admission made by France on Morocco’s behalf to a third party.

Judges HACKWORTH, BADAWI, LEVI CARNEIRO and Sir Benegal
Rau, availing themselves of the right conferred on them by
Article 57 of the Statute, append to the Judgment the common
statement of their dissenting opinion.

(Initialled) A. D. McN.
({nitialled) E. H.

42