Treaty of Sevalne

The **Treaty of Sevalne** was an omnibus diplomatic and economic treaty signed on Sevalne on June 22nd 448 A.U.

## Background

*See also: The Grand Strategy Campaign*
The international fiscal summit held at Sevalne, the capital of the Republic of Sermaye, represented the broadest gathering of international representatives in known history, with diplomats from every independent state in Imperial Space. The treaty reflected diverse threads of international diplomacy tied together by the urgency of the monetary crisis and the strong Aeldman-Alusian diplomatic bloc. Signed less than a year after the end of the Second Coalition War, it helped to establish and cement post-war economic and diplomatic relations.

## Full Document Text

### Article 1: Recognition of Territory

* 1.1 - All signatories mutually recognize the territorial sovereignty and official territorial boundaries of all other signatories.

### Article 2: Sanction Measures in Case of Wars of Aggression

* 2.1 - All signatories agree that a War of Aggression shall be defined as a violation of the territorial sovereignty of one nation by the military force of another nation without prior military provocation or other acts of war.
* 2.2 - The Serene Duchy of Aeldrum, Shantine Empire, Fialta Imperium and Empire of Alusia agree to annul trade with any country which initiates a War of Aggression against any signatory to this agreement.
* 2.3 - All signatories party to the Treaty of Saldan Trade Agreement agree to expel any member who commits an act of aggression as outlined in article 2.1

### Article 3: Immediate Emancipation and Reparations

* 3.1 - The Thalranese Marches consent to the immediate emancipation of all persons from slavery or indentured service within their territory or other jurisdiction. This emancipation shall entail no debt on the part of any emancipated person or any imposition of adverse legal status due to emancipation.
* 3.2 - The Shantine Empire and the Kirvan Church of Bishant undertake to pay an indemnity of 2,500 economic units to the Thalranese Marches.
* 3.3 - The Empire of Alusia shall compensate the Shantine Empire in the amount of 900 economic units, equal to the amount of its remaining economic obligation to the Thalranese Marches for emancipation under the Treaty of Saldan. This compensation shall be payable over a six month period beginning no later than a year from the signing of this treaty. This compensation shall be accepted by the Shantine Empire in the cash-equivalent (at time of signing) of Alusian modular consumer goods factories, equal to exactly 1059 factories.
* 3.4 - The Bank of Valdos shall compensate the Thalranese Marches in the amount of 1000 economic units, on behalf of the Fialta Imperium and in reparation.
* 3.5 - The Thalranese Marches consent to abnegate the financial reparations due them for emancipation under the Treaty of Saldan, being compensated adequately by this article.

### Article 4: Gold Convertibility

* 4.1 - The Elvish Enclaves, New Celestial Confederation and Nippon States shall be exempt from the terms of this article outside of 4.1. These signatories assent to the legitimacy of the principle which governs Article 4.4.
* 4.2 - Whereas the Orcish Directorate already operates without a specie currency, it shall be permitted to manage its internal currency in the accustomed manner and be exempt from the terms of this article outside of 4.2, except that it shall assent to the legitimacy of the principle which governs Article 4.4. The Orcish Directorate undertakes to maintains suitable reserves of foreign currencies for international exchange.
* 4.3 - All other signatories agree to end the convertibility of their currency to gold or any other specie material from the 1st of 449 After Unification, and to issue a recall of commercial gold within their economies to their treasuries, to be compensated in the local currency. This compensation shall be at the prevailing certificate value at time of the signing of this treaty or the rate set by the recipient treasury, whichever value is higher.
* 4.4 - All other signatories agree that "full faith and credit" shall govern the value of their currency and shall withhold from guaranteed material convertibility as a basis of value.

### Article 5: Bond Compensation for Gold Stores

* 5.1 - Aeldrum and Alusia agree to the construction and issuance of an instrument, the Ducat Inflation Protected Bond (DIP Bond) which shall be used to compensate state holders of gold for ending currency convertibility as specified in Article 4. These bonds once issued may be resold to any party and in any amount. The DIP Bond shall yield an annual interest rate of 2 percent plus the rate of inflation of the Aeldman Ducat (as calculated from the Emiir Group Consumer Price Index), payable semiannually. The DIP Bond's face value and all payments shall be denominated in Aeldman Ducats.
* 5.2 - DIP Bonds shall not be redeemable until the 1st of 455 (i.e. 5 full years after the end of currency convertibility), after which they shall be redeemable unilaterally by the issuing party at their face value in ducats.
* 5.3 - The economic value of gold for purposes of exchange for DIP Bonds at point of issue shall be pegged at the gold-redemption value of the Aeldman ducat at the time of the signing of this treaty or at the time of DIP Bond issuance, whichever is higher.
* 5.4 - The obligation of issuing parties to issue DIP Bonds shall be binding until the 1st of 449, when gold convertibility shall be ended.
* 5.4 - The Serene Duchy of Aeldrum shall issue DIP Bonds with a total face value of up to 4,200 economic units to the Republic of Sermaye. The first 2,200 economic units of face value shall be exchanged for hard specie (gold) at a rate of 1.1 units face value per economic unit of gold. The next 2,000 economic units of face value shall be exchanged for hard specie at a rate of 1 unit face value per economic unit of gold.
* 5.4 - The Empire of Alusia shall issue DIP Bonds with a total face value of up to 6,000 economic units to the Shantine Empire. These bonds shall be exchanged for hard specie at a rate of 1 unit face value per economic unit of gold.
* 5.5 - The Republic of Sermaye undertakes to exchange gold for DIP Bonds at a rate of 1.5 economic units of gold per economic unit of face value.

### Article 6: Factory and Capital Goods Sales

* 6.1 - The Empire of Alusia shall provide 1,400 modular consumer goods factories to the Republic of Sermaye within the next six months. The Republic of Sermaye shall compensate the Empire of Alusia in the amount of 337 economic units and Aeldman Inflation Protected Bonds with a face value of 480 economic units.
* 6.2 - The Empire of Alusia shall provide three orders of factories to the Shantine Empire on a semiannual basis beginning 6 months before the enactment of Article 4.3. The first two orders shall each be of 1,176 factories, for which the Shantine Empire will compensate the Alusian Empire 1000 economic units worth of Shantine Drachmas per order. The third order shall be of 1,059 factories, as specified in article 3.3, with no further compensation to Alusia. This rate of payment shall be at face value pegged to time of signing.
* 6.3 - The Empire of Alusia shall provide 1,176 factories to the Orcish Directorate in exchange for a payment of 1000 economic units of gold or pre-convertibility currency by the Directorate. This rate of payment shall be at face value pegged to time of signing. This order shall be fulfilled at the highest priority except for the satisfaction of Articles 6.1 and 6.2.
* 6.4 - The Serene Duchy of Aeldrum shall provide 700 economic units worth of farming equipment and other agricultural capital goods to the Shantine Empire at-cost before the enactment of Article 4.3. The Shantine Empire shall compensate the Serene Duchy of Aeldrum with 700 economic units worth of Drachmas. This rate of payment shall be at face value pegged to time of signing.

### Article 7: Debt Forgiveness

* 7.1 - The Serene Duchy of Aeldrum shall forgive all sovereign debt that it currently holds from the Kingdom of Druz.

### Article 8: Establishment of a Gold Conversion Exchange

* 8.1 - The Serene Duchy of Aeldrum, Nippon States and New Celestial Confederation (NCC) agree to the establishment of a Gold Conversion Exchange with mandates to operate between Imperial commerce and the gold-convertible currencies of Celestial Space and the Kingdom of Veran. The Exchange shall be responsible for converting between Aeldman Ducats and hard specie, gold-backed currencies or gold certificates endorsed by the Exchange.
* 8.2 - The Exchange shall maintain a gold reserve of at least one thousand economic units worth of gold or at least 10 percent of the volume of Celestial Trade conducted by Aeldrum and the Orcish Directorate. All operations of the Exchange shall be subject to the consensus of Aeldrum, the Nippon States and the NCC.
* 8.3 - The Orcish Directorate and the Republic of Sermaye shall be granted advisory positions in the operations of the Exchange.
* 8.4 - The Exchange shall have branches located in the Pin Jump and in the Foreign Quarter of the Nippon States.

### Article 9: Economic Integration of Aeldrum and Sermaye

* 9.1 - The Serene Duchy of Aeldrum and the Republic of Sermaye agree to economically integrate with each other. The two countries shall form a free trade zone, with visa-free travel for passport holders of either country and pass-through rights for all commerce and investment.
* 9.2 - The Serene Duchy of Aeldrum and the Republic of Sermaye consent to the formation of a jointly advised Central Banking Committee, and to the establishment of an International Investment Bureau responsible for assessing the foreign ownership stake of firms in both countries and enforcing joint investment regulations.
* 9.3 - The Serene Duchy of Aeldrum and the Republic of Sermaye consent to a 0-markup rate of exchange between Sermayan Notes and Aeldman Ducats at specially designated Aeldrum-Sermaye customs houses.
* 9.4 - Aeldrum guarantees the independence of Sermaye.

### Article 10: Economic Integration of Alusia and Deutschreich

* 10.1 - The Empire of Alusia and Deutschreich agree to economically integrate. Deutschreich shall form an administrative region, the Deutsreich-Alusia Economic Zone, bordering Alusia and representing approximately 20% of Deutschreich's current GDP. This zone and Alusia shall form a free trade region, with visa-free travel for passport holders of either country and pass-through rights for all commerce and investment. Deutschreich shall regulate the interactions between Alusia and the rest of the Deutschreich economy unilaterally. Deutschreich shall reserve all other administrative and government rights over the Deutschreich-Alusia Economic Zone.
* 10.2 - Deutschreich and Alusia consent to a 0-markup rate of exchange between their currencies at specially designated customs houses within the Deutschreich-Alusia Economic Zone and at the Deutschreich-Alusia border.
* 10.3 - Alusia guarantees the independence of Deutschreich.

### Article 11: Embedded Factories and Factory Transfers

* 11.1 - The Empire of Alusia agrees to endow a Factory-Factory (F2) and its attendant supply chain in the name of the Academy of Saldan. The Empire of Alusia shall provide Saldan with an amount of factory production profits equal to total factory sale revenues multiplied by 400 units divided by total sales volume, less 400 times marginal non-supply chain production cost (approximately 1.05 economic units per factory at time of signing) as well as all state tax revenues from supply chain integration for the endowed factory.
* 11.2 - The Empire of Alusia agrees to establish an F2 in the Deutschreich-Alusia Economic Zone and perform supply chain integration. Deutschreich will receive all benefits of supply chain integration and the right to purchase the output of the factory at-cost. Deutschreich shall receive all profits from output that it does not directly purchase according to the same principles as 11.1.
* 11.3 - The Empire of Alusia agrees to deliver two F2 factories to the Fialta Imperium within 1 year of signing this agreement.
* 11.4 - The Empire of Alusia agrees to provide economic development assistance to the Fialta Union equivalent to half the supply chain integration effect of an F2.

### Article 12: Legal Recognition of the Bank of Valdos

* 12.1 - All signatories recognize the legal standing and right to exist of the Bank of Valdos, and the right of the Bank to maintain its investments.
* 12.2 - All signatories recognize the legal right of the Bank of Valdos to transact any bilateral investment or business with any consenting nation state. All signatories assent that they will not execute retaliatory measures for the establishment, expansion or continuance of any relationship between the Bank and any nation or foreign institution. If a third-party nation changes contracts or other relationships with the Bank or an independent nation, the Bank or that nation is permitted to demand an independent accounting of the reasons for this change to verify that it is not retaliatory.
* 12.3 - The Shantine Empire recognizes the right of the Bank of Valdos to maintain investments on Zanevuela and other worlds transferred from the Fialta Imperium to the Shantine Empire in the Treaty of Tar'Thalran. The Shantine Empire consents to an economic presence no greater than 0.825% of Shantine GDP for Valdosian investments. The Shantine Empire agrees to make no interference in Valdosian investments but reserves the right to purchase Valdosian assets in the Shantine Empire at a fair market value in the future.
* 12.4 - To comply with the Shantine investment limit set in article 12.3, the Bank of Valdos shall liquidate 1,000 economic units worth of investment in the Shantine Empire and verify that it is within the investment bound of 0.825% set by Bishant.
* 12.5 - The Alusian Empire grants the Bank of Valdos the right of investment in Alusian territory, in a degree and fashion to be managed bilaterally by the Alusian Empire and the Bank.
* 12.6 - The Serene Duchy of Aeldrum and the Empire of Bishant reserve the right to an ongoing review and evaluation of all terms of Article 12 in coordination with the Bank of Valdos.

### Article 13: Admission to Treaty of Saldan Trade Association

* 13.1 - The Fialta Imperium shall be readmitted to the Treaty of Saldan Trade Association (hereafter ToSTA) and accept all membership provisions.
* 13.2 - The Kingdom of Druz shall be admitted to ToSTA and accept all membership provisions.
* 13.3 - Deutschreich shall consent to the extension of Alusian ToSTA provisions into the Deutschreich-Alusia Economic Zone. Deutschreich merchants originating from the zone shall enjoy the trade privileges of Alusian merchants under ToSTA.
* 13.4 - The Orcish Directorate shall be admitted to ToSTA and accept all membership provisions except as might conflict with Directorate foreign-domestic currency regulation.

### Article 14: Establishment of Bilateral Trade Relations

* 14.1 - The Serene Duchy of Aeldrum shall establish a bilateral relationship of trade with the Republic of Delarma.
* 14.2 - The Elvish Enclaves shall provide customs operations and support for all commerce between Aeldrum and Delarma.
* 14.3 - Aeldman commercial vessels shall be admitted into Delarma only through a customs checkpoint on the Delarman-Enclave border, subject to the granting of a temporary passage visa to each merchant through Enclave Space.

### Article 15: Debt Denomination

* 15.1 - The Republic of Sermaye, Orcish Directorate, Republic of Delarma and Kingdom of Druz shall denominate their future sovereign debt in Aeldman ducats.
* 15.2 - The Academy of Saldan shall denominate future internationally saleable sovereign debt in Aeldman ducats. This article shall not include endowment obligations, inter-departmental or other domestic institutional debt arrangements.

### Article 16: Labor Passage Rights

* 16.1 - The Serene Duchy of Aeldrum shall grant worker visas for up to 10 million subjects of the Kingdom of Druz and provide contracts for their accommodation and remuneration.

### Article 17: Currency Exchange Standards

* 17.1 - The Republic of Sermaye and the Serene Duchy of Aeldrum agree to set the rate of exchange between the Sermayan Note and the Aeldman Ducat according to the relative level of inflation in the consumer price indices of Aeldrum and Sermaye.
* 17.2 - The Empire of Alusia agrees to set its currency exchange rates for the Alusian Drachma with respect to the Aeldman Ducat and the Sermayan Note proportionately to the exchange rates established in 17.1
* 17.3 - All signatories agree to peg their currency exchanges with each other proportionally to the exchange rate of their currency with the Aeldman ducat and to denominate their exchanges in ducats.

### Article 18: Redemption of DIP Bonds for Goods

* 18.1 - The Serene Duchy of Aeldrum assents that in the event of hyperinflation preventing the ordinary payment of DIP Bonds, the Academy of Saldan shall be permitted to redeem up to 1,000 economic units face value of DIP Bonds at a premium of 50 percent (1,500 economic units of value), for an inflation-protected equivalent of consumer or industrial goods supplied by the Serene Duchy of Aeldrum, pegged to price indices at the time of this agreement.

### Article 19: Ratification of the Treaty of Tar'Thalran by the Thalranese Marches

* 19.1 - The Thalranese Marches, being satisfied by the payment of indemnity from the Fialta Imperium, extend their assent to all articles of the Treaty of Tar'Thalran.

### Signatory Nations

* Serene Duchy of Aeldrum
	+ 22nd of the 6th , 448 Years After Unification of Aeldrum
	+ Monsieur Manuel Emiir, Aeldman Finance Minister
	+ His Excellency Count Sinvas Luvelath, Doge of Neveth and Aeldrum Colonial Commissioner
	+ His Excellency Count Guillarme du Montreal, Serene Doge of Aeldrum
* Empire of Alusia
	+ D. 51, Year 7 of the Reign of Empress Illyana I
	+ Her Imperial Majesty, Illyana I, Empress of Alusia
	+ Giannis Politis, Alusian Minister of Foreign Affairs
	+ Marina Nueva cer Puertos, Alusian Finance Minister
* Empire of Bishant
	+ D. 120, Year 13 of the Reign of Empress Theoboda IV
	+ Her Imperial Majesty, Theoboda Valentina Theodosia, Anointed of Kirva and Blessed of the Flame, Sword and Cup of the Faithful, Protector of Korinth, Emancipator of the Enslaved, etc.

* Fialta Imperium
	+ D. 361, Anno Imperii 149
	+ His Imperial Majesty, Phillip Neptos son of Wenceslas Rogers son of Vermes, Imperator Rael'Fialt
* Thalranese Marches
	+ 12th Concordia, 5371 Anno Fialta
	+ Prince Armalos on Behalf of the High Lords and Princes of the Thalranese Marches
* Orcish Directorate
	+ 22.6.488
	+ Braddon Armog, Orcish Director General
* Republic of Sermaye
	+ 84th Day of the 115th Superior Council
	+ Joanna Fallev, Councilor-President
* Kingdom of Druz
	+ 22nd of the 5th Decimal of Year 1 of Kamrand's Eighth King
	+ King of Clans Gunnar Kamrand
* Republic of Delarma
	+ 22.6.488
	+ President Olaf Mielnar
* Elvish Enclaves
	+ 11th Day of the 7th Cycle, Ten Thousand and Ninetieth Year of Reckoning
	+ Samaral, Voice of the Triad
* Deutschreich
	+ 75th Aurboch, 210th Year of the Constitution
	+ Prime Minister Hansel Brandt
* Fialta Union
	+ 12th Concordia, 5371 Anno Fialta
	+ Prince Paloctus

### Signatory Institutions

* Bank of Valdos
	+ D. 361, Anno Imperii 149 & 12th Concordia, 5371 Anno Fialta
	+ Her Excellency Filiki, Chairwoman of the Bank of Valdos
* Shantine Kirvan Church
	+ D. 120, Year 13 of the Reign of Empress Theoboda IV
	+ His Holiness Patriarch Jan of Bishant