[119] The question how far concessions granted by a subjugated State to a private individual or to a company must be upheld by the subjugating State, is difficult to answer in its generality. The merits of each case would seem to have to be taken into consideration. See Westlake, I. p. 82; Moore, I. § 98; Gidel, "Des effets de l'annexion sur les concessions" (1904).
The case of a Federal State arising—like the German Empire in 1871—above a number of several hitherto full Sovereign States also presents, with regard to many points, a case of State succession.[120] However, no hard-and-fast rules can be laid down concerning it, since everything depends upon the question whether the Federal State is one which—like all those of America—totally absorbs all international relations of the member-States, or whether it absorbs—like the German Empire and Switzerland—these relations to a greater extent only.[121]
[120] See Huber, op. cit. pp. 163-169, and Keith, op. cit. pp. 92-98.
Succession in consequence of Dismemberment.
§ 83. When a State breaks up into fragments which themselves become States and International Persons, or which are annexed by surrounding States, it becomes extinct as an International Person, and the same rules are valid as regards the case of absorption of one State by another. A difficulty is, however, created when the territory of the extinct State is absorbed by several States. Succession actually takes place here too, first, with regard to the international rights and duties locally connected with those parts of the territory which the respective States have absorbed. Succession takes place, secondly, with regard to the fiscal property and the fiscal funds which each of the several absorbing States finds on the part of the territory it absorbs. And the debts of the extinct State must be taken over. But the case is complicated through the fact that there are several successors to the fiscal property and funds, and the only rule which can be laid down is that proportionate parts of the debts must be taken over by the different successors.
When—as in the case of Sweden-Norway in 1905—a Real Union[122] is dissolved and the members become International Persons of their own, a succession likewise takes place. All treaties concluded by the Union devolve upon the former members, except those which were concluded by the Union for one member only—e.g. by Sweden-Norway for Norway—and which, therefore, devolve upon such former member only, and, further, except those which concerned the very Union and lose all meaning by its dissolution.
Succession in case of Separation or Cession.
§ 84. When in consequence of war or otherwise one State cedes a part of its territory to another, or when a part of the territory of a State breaks off and becomes a State and an International Person of its own, succession takes place with regard to such international rights and duties of the predecessor as are locally connected with the part of the territory ceded or broken off, and with regard to the fiscal property found on that part of the territory. It would only be just, if the successor had to take over a corresponding part of the debt of its predecessor, but no rule of International Law concerning this point can be said to exist, although many treaties have stipulated a devolution of a part of the debt of the predecessor upon the successor.[123] Thus, for instance, arts. 9, 33, 42 of the Treaty of Berlin[124] of 1878 stipulate that Bulgaria, Montenegro, and Servia should take over a part of the Turkish debt. On the other hand, the United States refused, after the cession of Cuba in 1898, to take over from Spain the so-called Cuban debt—that is, the debt which was settled by Spain on Cuba before the war.[125] Spain argued that it was not intended to transfer to the United States a proportional part of the debt of Spain, but only such debt as attached individually to the island of Cuba. The United States, however, met this argument by the correct assertion that the debt concerned was not one incurred by Cuba, but by Spain, and settled by her on Cuba.