Fate of Prize.
§ 197. Through being captured and afterwards condemned by a Prize Court, a captured enemy vessel and captured enemy goods become the property of the belligerent whose forces made the capture. What becomes of the prize after the condemnation is not for International, but for Municipal Law to determine. A belligerent can hand the prize over to the officers and crew who made the capture, or can keep her altogether for himself, or can give a share to those who made the capture. As a rule, prizes are sold after they are condemned, and the whole or a part of the net proceeds is distributed among the officers and crew who made the capture. For Great Britain this distribution is regulated by the "Royal Proclamation as to Distribution of Prize Money" of August 3, 1886.[399] There is no doubt whatever that, if a neutral subject buys a captured ship after her condemnation, she may not be attacked and captured by the belligerent to whose subject she formerly belonged, although, if she is bought by an enemy subject and afterwards captured, she might be restored[400] to her former owner.
[399] See Holland, Prize Law, pp. 142-150.
Vessels belonging to Subjects of Neutral States, but sailing under Enemy Flag.
§ 198. It has been already stated above in § [89] that merchantmen owned by subjects of neutral States but sailing under enemy flag are vested with enemy character. It is, therefore, evident that they may be captured and condemned. As at present no non-littoral State has a maritime flag, vessels belonging to subjects of such States are forced to navigate under the flag of another State,[401] and they are, therefore, in case of war exposed to capture.
[401] See above, [vol. I. § 261].
Effect of Sale of Enemy Vessels during War.
§ 199. Since enemy vessels are liable to capture, the question must be taken into consideration whether the fact that an enemy vessel has been sold during the war to a subject of a neutral or to a subject of the belligerent State whose forces seized her, has the effect of excluding her appropriation. It is obvious that, if the question is answered in the affirmative, the owners of enemy vessels can evade the danger of having their property captured by selling their vessels. The question of transfer of enemy vessels must, therefore, be regarded as forming part of the larger questions of enemy character and has consequently been treated in detail above, § 91.
Goods sold by and to Enemy Subjects during War.