A commercial treaty is a formal agreement between states for the purpose of establishing mutual rights and regulating conditions of trade. It is a bilateral act whereby definite arrangements are entered into by each contracting party towards the other—not mere concessions. This article includes a detailed discussion of the history and status of such treaties as of the early 20th century.

Examples

For example, the

Methuen Treaty The Methuen Treaty was a military and commercial treaty between England and Portugal that was signed in 1703 as part of the War of the Spanish Succession. The treaty stipulated that no tax higher than the tax charged for an equal amount of Frenc ...

was a commercial treaty between

Portugal Portugal, officially the Portuguese Republic ( pt, República Portuguesa, links=yes ), is a country whose mainland is located on the Iberian Peninsula of Southwestern Europe, and whose territory also includes the Atlantic archipelagos of ...

and

England England is a country that is part of the United Kingdom. It shares land borders with Wales to its west and Scotland to its north. The Irish Sea lies northwest and the Celtic Sea to the southwest. It is separated from continental Europe b ...

. Another example, between the close of the

Napoleonic Wars The Napoleonic Wars (1803–1815) were a series of major global conflicts pitting the French Empire and its allies, led by Napoleon I, against a fluctuating array of European states formed into various coalitions. It produced a period of Fren ...

of 1815 and the year 1860, the tariff system of

United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the European mainland, continental mainland. It comprises England, Scotlan ...

was changed from elaborate protection to practically complete free trade. An attempt had indeed been made in 1786 to modify the rigidly protective legislation of the 18th century. In that year Pitt concluded a commercial treaty with

France France (), officially the French Republic ( ), is a country primarily located in Western Europe. It also comprises of overseas regions and territories in the Americas and the Atlantic, Pacific and Indian Oceans. Its metropolitan area ...

, providing for large reductions of duties in both countries. But the treaty was swept away with the outbreak of the wars with

, and accordingly the old system was still in force in 1815. The first important step, and in some respects the decisive step, towards modifying it was taken in 1824, under the policy of

William Huskisson William Huskisson (11 March 177015 September 1830) was a British statesman, financier, and Member of Parliament for several constituencies, including Liverpool. He is commonly known as the world's first widely reported railway passenger casu ...

. In that year, and again in 1825, great reductions were made in the duties on raw materials, especially on

wool Wool is the textile fibre obtained from sheep and other mammals, especially goats, rabbits, and camelids. The term may also refer to inorganic materials, such as mineral wool and glass wool, that have properties similar to animal wool. ...

raw silk Raw Silk was an American dance band, which originated in New York. History Raw Silk first signed to West End Records, which was once a popular garage label, where they recorded moderate hits. Their songs were remixed by post-disco/ R&B produ ...

, flax, and

iron Iron () is a chemical element with Symbol (chemistry), symbol Fe (from la, Wikt:ferrum, ferrum) and atomic number 26. It is a metal that belongs to the first transition series and group 8 element, group 8 of the periodic table. It is, Abundanc ...

, while considerable reductions were also made in the duties on manufactured goods. The most sharply contested of the changes was in regard to silks, which had been completely prohibited, and were now admitted at a duty of 30 per cent. A considerable breach was thus made in the protective system; and some further changes in the same direction were made in the next decade, especially under

Lord Althorp John Charles Spencer, 3rd Earl Spencer, (30 May 1782 – 1 October 1845), styled Viscount Althorp from 1783 to 1834, was a British statesman A statesman or stateswoman typically is a politician who has had a long and respected political care ...

in 1833. But in the decade from 1830 to 1840 the

Corn Laws The Corn Laws were tariffs and other trade restrictions on imported food and corn enforced in the United Kingdom between 1815 and 1846. The word ''corn'' in British English denotes all cereal grains, including wheat, oats and barley. They wer ...

were the chief subject of contention. The great increase in population since the middle of the 18th century had made England a corn-importing country, especially with the rapid growth of manufactures in the early years of the 19th century. The first systematic Corn Laws imposing duties on grain had been passed in 1773. From 1816 onwards a series of measures were passed, all designed to maintain the high price of grain. The Act of 1816 prohibited the importation of

wheat Wheat is a grass widely cultivated for its seed, a cereal grain that is a worldwide staple food. The many species of wheat together make up the genus ''Triticum'' ; the most widely grown is common wheat (''T. aestivum''). The archaeologi ...

when the price was less than 80 shillings a quarter (=$2.50 a bushel). In 1822 the prohibitive point was lowered to 70 shillings. In 1828 the sliding scale was introduced, under which the duty went up and down as the price of grain went down and up; and it was against this form of the Corn Law that the great agitation led by Cobden and Bright was directed after 1830. For a long time the anti-Corn-Law agitation seemed to have no effect, although conducted with extraordinary skill and enthusiasm. In 1842, however, Sir Robert Peel made the first important concession, by modifying the sliding scale, his opponent, Lord John Russell, having proposed in the previous year a fixed duty of 8 shillings a quarter. In view of the bad harvest of 1845-46, and the famine in

Ireland Ireland ( ; ga, Éire ; Ulster Scots dialect, Ulster-Scots: ) is an island in the Atlantic Ocean, North Atlantic Ocean, in Northwestern Europe, north-western Europe. It is separated from Great Britain to its east by the North Channel (Grea ...

. In 1846, Peel surrendered, and proposed in 1846 the admission of grain with only a fixed duty of one shilling a quarter as a registration fee. This change was carried, but Peel, being able to carry only a fraction of his party with him, was compelled shortly afterwards to resign. The Corn Laws had great political strength, serving as they did the interests of the landowners, whose hold on parliament was still very strong; but the general economic situation in Great Britain, from the rapid growth of the manufacturing population and the imperative need of more food, made the abolition inevitable. After having been maintained till the middle of the century, apparently with irresistible support, they suddenly collapsed under the strain of a season of exceptionally short crops. Both their continued maintenance and their final sudden abolition are in some respects divergent from the general course of British tariff history.

References

{{DEFAULTSORT:Commercial Treaty

Examples

Further reading

See also

References