the Government of the Kingdom of Italy, represented by M. R. Montagna, as Agent,
the Government of the French Republic, represented by M. J. Basdevant, as Agent, and Me. Lémonon, as Assistant Agent,
The Court, composed as above, delivers the following judgment :
By an Application filed with the Registry of the Court on March 30th, 1936, under Article 40 of the Statute and Article 32 of the Rules of Court, the Italian Government has instituted proceedings before the Court against the French Government concerning phosphates in Morocco.
The Application of the Italian Government was as follows :
"Having regard to Articles 105, 112, 73 and 74 of the General Act signed at Algeciras on April 7th, 1906, and to Articles 1, 4 and 7 of the Franco-German Treaty of November 4th, 1911 ;
Having regard to the declaration, dated November 7th, 1911, whereby the Italian Government acceded to the said Treaty ;
Having regard to the declarations of accession made by Italy and France to the Optional Clause of Article 36, paragraph 2, of the Statute of the Permanent Court of International Justice;
Having regard to Article 40 of the Court’s Statute and to Article 35, paragraph 2, of the Rules of Court which relates thereto;
Has the honour to submit the following application :
Whereas between October 17th, 1918, and April 29th, 1919, thirty-three licences to prospect for phosphates in reserved areas in the Oued Zem—Bir Fenzer district were issued by the Department of Mines of Morocco, in the order of priority, to the French nationals MM. Francis Busset and Frier Deruis.
Whereas twenty-eight of the said licences, which had been handed over by the original holders to the Italian national M. Costantino Tassara, are now the property of the Italian Company Miniere e Fosfati of which Commander Gaspare de Gennaro Musti is the representative and agent.
Whereas these licences were governed by the Mining Regulations, promulgated by the dahir of January 19th, 1914.
Whereas, under Article 51 of the Regulations, concessions for the working of phosphates might only be disposed of by public award on tenders offering a royalty, payable on every ton extracted.
Whereas, in particular, it was laid down that : ‘Prospectors holding prospecting licences for a reserved area, who have discovered new phosphate deposits... within their area, and have shown that they can be worked, shall be entitled, during a period of fifteen years, reckoned from the date of the decision recognizing them as discoverers, to one-fifth of the royalties payable on every ton by the successful tenderers.’
Whereas on August 4th, 1919, the General Board of Public Works published the following note in the Morocco Official Gazette : 'Phosphate deposits of considerable extent and of exceptional content have been located in the El Boroudj and Oued Zem districts. In accordance with Article 51 of the dahir of January 19th, 1914, prescribing mining regulations, the right to work these deposits will be disposed of by public tender at a date which the Administration hopes to fix in the near future.'
Whereas, notwithstanding the above notice, a new dahir, dated January 27th, 1920, reserved exclusively to the Maghzen the right to prospect for and work phosphates.
Whereas this reservation was, however, limited by the clause safeguarding the rights which prospectors had acquired under the above-mentioned Article 51.
Whereas a subsequent, dahir, dated 21 August 1920, specified the procedure for the recognition of these vested rights and left the question of the indemnities provided for in paragraph 3 of the said Article 51 to be settled by subsequent provisions.
Whereas M. Costantino Tassara applied to the Department of Mines, by registered letter dated October 14th, 1921, in his capacity as transferee of the Busset and Deruis licences, to be recognized as discoverer of the deposits covered by the said licences.
Whereas the Department of Mines, after unsuccessfully endeavouring to decline the application, unreasonably delayed the announcement of its decision, and informed M. Tassara only on January 9th, 1925, that it had rejected his above-mentioned request, upon the following grounds : ‘Whereas the technical enquiries which have been carried out show that the applicant
Whereas, secondly, the decision of the Mines Department of January 8th, 1925, is ultra vires and constitutes a misuse of power. It conflicts with the official announcement of August 4th, 1919, and, under the cloak of meeting departmental exigencies, aims at getting rid of the dreaded foreign holding and even avoiding the payment of compensation for expropriation in disregard of vested rights which were safeguarded by international conventions.
Whereas, thirdly, the obstacles placed in the way of a petition to the Resident-General and the allegation that the decision of the Mines Department had finally settled the question despite the terms of Article 8 of the dahir of August 12th, 1913, for the judicial organization of the Protectorate, constitute a veritable denial of justice.
Whereas this denial of justice has been confirmed and aggravated by the refusal to submit the dispute to a competent tribunal able to redress the wrong suffered by the Italian company and to restore the position in accordance with municipal law and international law.
Whereas the proposal that recourse should be had to the civil courts of Morocco with a view to obtaining damages for the wrong suffered is not calculated to give the satisfaction which is due, and is designed rather to ensure that the Italian subjects who have been expropriated without compensation shall remain despoiled of their property as at present.
Whereas the legal dispute which has arisen could not form the subject of a special arbitration agreement, owing to the persistently evasive attitude of the Government of the Republic, and is therefore submitted to the Court by a unilateral application.
Whereas the Royal Government holds that, owing to the above-mentioned unlawful act, France has incurred international responsibility of two kinds, namely : indirect responsibility as the State protecting Morocco, and personal and direct responsibility resulting from action taken by the French authorities, or with their co-operation, purely for the sake of French interests.
Whereas it rests with the Court to appraise the extent of that responsibility and the nature of the reparation which is due.
Whereas in the present case, restitution in kind being possible, the Court can, in accordance with its jurisprudence, order that the necessary steps be taken to efface all the consequences of the unlawful act and to restore the situation as it would have been if the aforesaid act had not been committed.
Whereas the Royal Government, being concerned to uphold its full rights, after all attempts at an amicable settlement have proved fruitless, feels justified in demanding that, as regards the Moroccan phosphates, the economic freedom, which was sacrificed in the interests of the unlawful monopoly, should be restored, or that, at the least, the rights acquired in virtue of
Whereas the working of phosphates being now less profitable than during the past ten years, it would further be fitting to award damages for the losses not covered by the restitutio in integrum.
Whereas, in case the Court should hold that the vested rights only extend to compensation for expropriation, the amount of that compensation must be assessed with due regard to two essential circumstances : namely, that the revenues of the Shereefian Phosphates Office, up to date, have exceeded one milliard, as shown by the official publications, and that, if the rights had been disposed of by public tender, the Miniere e Fosfati Company, being able to get the benefit of the one-fifth share of the royalties accruing to it as the recognized discoverer, could have outbid any other competitor, and would therefore have infallibly been the successful tenderer.
Whereas, in any case, compensation will be necessary for damage of another kind, represented by the considerable expense to which the interested parties have been put, during this long period, owing to the protracted negotiations in which they have had to engage with the authorities of the Protectorate and with the French authorities.
In view of the foregoing, and subject to the subsequent presentation to the Court of any memorials, counter-memorials, and in general of any documents or evidence ;
May it please the Court :
To notify the present application, in conformity with Article 40, paragraph 2, of the Court’s Statute, to the Government of the French Republic, as such, and as protector of Morocco ;
To judge and declare, whether the said Government enters an appearance or not, and after such time-limits as the Court may fix, in the absence of an agreement between the Parties :
(a) that the monopolization of the Moroccan phosphates, which was accomplished by stages between 1920 and 1934 for the benefit of French interests, is inconsistent with the international obligations of Morocco and of France, and that it must for that reason be annulled with all the consequences that ensue ;
(b) alternatively, that the decision of the Mines Department dated January 8th, 1925, and the denial of justice which followed it, are inconsistent with the international obligation incumbent upon Morocco and upon France to respect the rights acquired by the Italian Company Miniere e Fosfati, and therefore that the Protectorate authorities are bound to recognize the said company as discoverer, and to invite tenders without delay for the working of the deposits covered by the company’s licences ;
(c) alternatively again, that fair compensation must be paid for expropriation, such compensation to be assessed by the
Whereas, far from so doing, the Royal Italian Government has only furnished inadequate information on this point, and has not attempted to make good the omissions or to explain the inconsistencies apparent from a perusal of the documents which it has produced,
Whereas, for its part, the Government of the French Republic has drawn the attention of the Court to facts which, to say the least, give rise to doubts as to whether the said claim is Italian,
Whereas, in particular, the Royal Italian Government has not furnished adequate explanations and evidence as to the date of the transfers by MM. Busset and Frier Deruis, or as to the transferees, the part played by M. Tassara, the alleged assignment to the Miniere e Fosfati Company and the character of that company, or the transfer to an American company and its cancellation ;
With regard to the part of the Application relating to the alleged unlawful monopolization of phosphates :
Whereas this question has not been investigated through diplomatic channels and as, accordingly, it cannot be submitted to the Court by application on the basis of the declarations whereby France and Italy have accepted the compulsory jurisdiction of the Court ;
With regard to the part of the Application relating to the claim of the Miniere e Fosfati Company :
Whereas it is open to this company to have recourse to the civil courts of the Protectorate adjudicating upon administrative questions and as this means of redress has not been exhausted or even tried,
Whereas, accordingly, in this case the rule subordinating diplomatic action and, consequently, application to the Court under Article 36, paragraph 2, of the Statute, to the exhaustion of local means of redress applies, there being no circumstances in the case justifying a departure from this rule ;
With regard to the Application as a whole :
Whereas the dispute which the Royal Italian Government has submitted to the Court has arisen in regard to situations or facts prior to September 7th, 1931, and as, accordingly, it falls outside the scope of the Court’s compulsory jurisdiction as determined between France and Italy by the declarations on the subject made by the two Governments ;
For these reasons and for any others which may be submitted or which the Court may see fit to add or substitute,
To adjudge and declare that the Application filed on March 30th, 1936, by the Royal Italian Government cannot be entertained."
The Italian Government, in its written statement, which was duly filed within the prescribed time-limit, presented the following submissions in regard to the preliminary objections :
"Whereas the Royal Government’s Application, supplemented by the Memorial, is sufficiently clear for all who have no motive for failing to understand it ; and whereas, in fact, the respondent Party has understood it so well that not a single question nor any allegation put forward by the Royal Government has been left unanswered in the document filed by that Party ; whereas the alleged obscurities in regard to the nature of the claim have been artificially contrived for the needs of the case ; whereas the Royal Government considers that it has submitted to the Court, with all necessary particulars and clarity, the dispute that has arisen over the monopolization of the Moroccan phosphates for the benefit of France through the medium of the protected State ; whereas the word ‘monopolization’ has been expressly used to indicate the series of acts performed with that end in view between 1920 and 1934 ; whereas it is the whole of this series of acts which has to be annulled, with all the consequences that ensue, in accordance with the main submission of the Application, not by the Court, but pursuant to a declaratory judgment by the Court, this phrase as to all the consequences being added to indicate the allinclusive character of the main submission, which, in the applicant Government’s mind, covers all the measures necessary to give effect to, or designed to complete, the monopoly or the dispossession of the Italian private citizens, and covers, in particular, the North-African cartel, in regard to which the Royal Government was not sufficiently informed when the Application was drawn up ; and whereas the alternative submissions b and c, put forward in accordance with the Court’s jurisprudence, are framed in view of hypotheses, among which the Court is only asked to consider the unlawful seizure of the rights appertaining to the Italians, or the gradual expropriation of the said rights ; whereas submission d relates to additional compensation ; whereas such submissions, elucidated by the Memorial, suffice to enable the proceedings to be opened, without prejudice to the possibility of further elucidating the submissions during the discussion on the merits.
Whereas the ground of the Court’s jurisdiction is clearly indicated in the Application ; and whereas this ground consists of the declarations of Italy and France acceding to the Optional Clause of Article 36, paragraph 2, of the Statute of the Permanent Court ; and whereas there was no occasion to go into detailed explanations as to whether, and in what manner, the
Whereas the Italian character of the claim is clear beyond all cavil, as is indeed shown by the fact that the respondent Party raised no objection on that score during the preliminary diplomatic discussions ; whereas the respondent Party has’, thus, no justification for submitting that the claim should without examination be declared inadmissible ; whereas the fact and the date of the transfer of the licences from Busset and Deruis to Tassara are sufficiently proved by the letters which these three persons wrote at different times, to the Department of Mines, and by the fact that the Mines Department acknowledged and recorded this transfer ; whereas M. Tassara, an Italian national, was the manager of a partnership association consisting almost entirely of Italians, the existence of which was not unknown to the Department of Mines ; indeed the only non-Italians were MM. Colle-Deudon and Levy ; whereas, since the partnership association did not possess a legal personality, the nationality of the manager—Tassara—is the decisive factor ; whereas an association constituted at Genoa, in accordance with Italian law, under Italian control, and having a large majority of Italian members, could not be other than Italian ; whereas the successive transfers from M. Tassara to M. de Gennaro Musti and from M. de Gennaro Musti to the Miniere e Fosfati Company left the licences still in Italian hands; whereas the only circumstance capable of raising any doubt was the sale of some of the licences to the ‘American and Moroccan Phosphate Corporation’ ; whereas, however, nothing can be deduced from that fact in favour of the submissions of the respondent Party ; whereas, indeed, a certain number of the licences remained in the hands of the Italian company, a fact which suffices to enable the Royal Government’s claim to be entertained with all its submissions ; whereas the sale was soon afterwards cancelled ; whereas, moreover, the unyielding attitude of the Government of the Republic made it impossible for the American company to pay even a sum on account of the purchase price, so that the Italian company still retained a substantial legal interest in a successful issue, an interest which is sufficient warrant for the extension of the Royal Government’s claim to all the licences.
Whereas the preliminary diplomatic negotiations covered the whole of the controversy submitted to the Court; whereas the Respondent, in affirming the contrary in so far as concerns the general measures establishing and organizing the phosphates monopoly and the North-African cartel, overlooks the positive statements made to it by the interested parties, by the Italian Embassy and by the Royal Government’s Agent ; whereas it also overlooks the démarches sought to be made in Rome and the two notes, one of which was handed to M. Laval on the occasion of his visit to Rome and the other to the Quai d’Orsay by the Italian Ambassador.
Whereas the facts and situations in regard to which the dispute arose are not anterior to the date on which the acceptance of the Court’s jurisdiction became effective as between the two States ; whereas the controversy relates either to facts which actually occurred after the date referred to or to permanent situations which still persist at the present time ; whereas furthermore these facts and situations taken together constitute an unlawful, continuing and progressive course of action (the monopolization of the phosphates) which falls within the Court’s compulsory jurisdiction on two grounds : first, because it was completed at a date subsequent to the crucial date, and secondly because it gives rise to a situation of wider aspect which still constitutes a continuing violation of international law.
For these reasons and for any others which may be submitted or which the Court may see fit to add or to substitute,
May it please the Court to adjudge and declare that the Application filed on March 30th, 1936, by the Royal Italian Government can be entertained in its entirety."
At the request of the Agent for the French Government, the Court, on September 20th, 1937, made an Order authorizing that Agent, under Article 62, paragraph 4, of the Rules, to file a written answer to the observations and submissions contained in the statement of the Italian Government within a time-limit expiring on November 17th, 1937 ; the Court at the same time stated that if need be it would make a subsequent order fixing a time-limit for the filing by the Agent for the Italian Government of written observations in regard to this answer.
The French Government’s Answer was duly filed within the prescribed time-limit.
At the request of the Agent for the Italian Government, the President of the Court made an Order on December 8th, 1937, fixing February 21st, 1938, as the date for the expiry of the time-limit for the filing by that Agent of written Observations in regard to the Answer of the French Government.
In the course of public sittings held on May 2nd, 3rd, 4th, 5th, 6th, 10th, 11th, 12th, 13th, 14th and 16th, 1938, the Court heard:
M. Basdevant, Agent, and Me. Lémonon, Assistant Agent, on behalf of France, and
M. Montagna, Agent, and M. Ago, Counsel, on behalf of Italy.
The submissions formulated in the documents of the written proceedings were not in substance amended on either side in the course of the oral proceedings.
Documents in support of their contentions were filed on behalf of each Party1.
The above being the state of the proceedings, the Court must now adjudicate upon the preliminary objections lodged by the French Government.
The facts and circumstances out of which the dispute between Italy and France originated are set out in the Application of the Italian Government. Without expressing any opinion upon the divergencies of view to which these facts and circumstances gave rise between the Parties, the Court, in referring to this statement, may, for the purposes of the present judgment which is limited to the question of its jurisdiction, confine itself to considering those the existence and date of which are not disputed.
The French Government has in the first place drawn the attention of the Court to certain obscurities relating to the nature of the claim. The Court considers that the explanations furnished in the course of the written arid oral proceedings enable it to form a sufficiently clear idea of the nature of the claim submitted in the Italian Government’s Application.
Among the preliminary objections which the French Government has lodged against the admissibility of the Application is one which contests, in regard to the Application as a whole, the compulsory jurisdiction of the Court, as established between France and Italy by the declarations of the two Governments.
The Court must therefore first adjudicate upon this objection in order to satisfy itself as to the grounds of its jurisdiction.
The declaration by which France accepted the Court’s compulsory jurisdiction, and of which the ratification was deposited on April 25th, 1931, was worded as follows :
The precise determination of that date gave rise to some debate between the Parties. The French Government placed it on September 7th, 1931, the date on which its declaration, being subject to reciprocity, became operative in regard to Italy, as a result of the deposit of the latter’s ratification ; on the other hand, the Italian Government declared for the date of the deposit of the French instrument of ratification, namely, April 25th, 1931, contending that the limitation ratione temporis only appeared in the declaration of France. The date preferred by one or other of the Governments would not in any way modify the conclusions which the Court has reached. It does not therefore feel called upon to express an opinion on that point.
The subject of the dispute has been presented by the Italian Government under two separate aspects : a general aspect, covered by submission (a) of the Application, which is concerned with what that Government describes as the "monopolization of the Moroccan phosphates", in other words a whole group of measures which are represented as being contrary to the international obligations of Morocco and of France : dahirs of January 27th and August 21st, 1920 ; expropriation of the Italian nationals, regarded in this case as an element in or expression of the policy of monopolization ; participation of the Moroccan Administration in the North-African phosphate cartel. The latter complaint, which does hot appear in the Application, was put forward only in the subsequent documents.
The more limited aspect of the dispute, which is presented alternatively in submission (b) of the Application, relates to the decision of January 8th, 1925, in which the Department of Mines rejected M. Tassara’s claim, and to the alleged denial of justice to him and his successors : these measures are also included under the general designation "monopolization of phosphates", but are put forward, in this submission (b), as contrary to the international obligation to respect the vested rights of the Italian nationals.
I.—What the Italian Government refers to as the "monopolization of the Moroccan phosphates" has been consistently presented by that Government as a régime instituted by the dahirs of 1920, which, by reserving to the Maghzen the right to prospect for and to work phosphates, have established a monopoly contrary to the international obligations of Morocco and of France. It contends that this régime, being still in operation, constitutes a situation subsequent to the crucial date, and that this situation therefore falls within the Court’s compulsory jurisdiction.
The Court cannot accept this view. The situation which the Italian Government denounces as unlawful is a legal position
The Italian Government has nevertheless sought to bring the complaint concerning monopolization within the Court’s compulsory jurisdiction by presenting it as a continuing and progressive unlawful action which has only been completed by certain acts subsequent to the crucial date : a denial of justice alleged to have been suffered by M. Tassara and his successors in 1931-1933 and the participation of the Moroccan Phosphates Administration in the North-African phosphates cartel in 1933-1934.
The Court will state its opinion regarding the alleged denial of justice later on in this judgment. As regards the participation of the Moroccan Phosphates Administration in the phosphates cartel, the Court has already observed that that is a point which was not mentioned as a subject of dispute in the Application instituting proceedings ; which was referred to in the Italian Government’s Memorial mainly from a historical point of view—but which was finally described, in the Italian Government’s later documents, as the culminating point of the policy of monopolization.
It should be observed that neither the formation of the phosphates cartel nor the participation in this cartel of the Moroccan Phosphates Administration have been presented by the Italian Government as facts which, in themselves, and alone, would constitute ground for any dispute between Italy and France. The participation in the cartel is presented as a part of the monopolization of phosphates : it is described as the final step and crowning point of that policy. In the continuing and progressive violation constituted by the successive actions of the French Government, it is said to mark the final accomplishment of the unlawful design underlying these actions. It is alleged that, on this ground and by reason of its date, it involves all the actions of the Shereefian Administration and
The Court cannot admit the existence of the connection which the Italian Government seeks thus to establish between the phosphates cartel and the alleged monopolization of phosphates. The subject of the dispute between the Italian Government and the French Government is the alleged infringement, resulting from the monopoly, of the régime of economic liberty without inequality, which the Italian Government holds to have been imposed by the agreements in force. The participation of the Moroccan Phosphates Administration in the cartel did not result in withdrawing phosphates from the operation of this régime. It in no way altered the situation which had been established in this respect ever since 1920 by the monopoly, which alone could form the subject of complaint in this connection. The monopoly may have made the participation in the cartel possible ; but this participation does not in any way affect the legality or illegality of the monopoly.
II.—Regarded from its more restricted aspect—the aspect envisaged in submission (b) of the Application instituting proceedings—the dispute between the two Governments relates to the alleged dispossession of certain Italian nationals as the result of the decision of the Mines Department of January 8th, 1925, and of the denial of justice alleged to have followed that decision, these facts being alleged to be inconsistent with the international obligation incumbent on Morocco and on France to respect vested rights.
The Italian Government does not deny that the alleged dispossession of M. Tassara results from the Mines Department’s decision of 1925, and for that reason it seeks to obtain the annulment of that decision and the reinstatement of M. Tassara’s successors in the rights of which M. Tassara is alleged to have been illegally deprived.
This decision of the Mines Department, owing to its date, falls outside the Court’s jurisdiction. The Italian Government has sought to avert this consequence by arguing that the dispossession of M. Tassara and his successors only became definitive at a time subsequent to the crucial date. That Government contends that the decision of 1925 constituted only an uncompleted violation of international law ; that this violation only became definitive as a result of certain acts subsequent to the crucial date and of the final refusal to remedy in any way the situation created in 1925, and that these acts gave rise to the dispute between the two Governments.
In arguing thus, the Italian Government has relied mainly on a note of the French Ministry for Foreign Affairs to the
Accordingly, whatever aspect of the question is considered, it is the decision of the Department of Mines of January 8th, 1925, which is always found, in this matter of the dispossession of the Italian nationals, to be the fact with regard to which the dispute arose.
In conclusion, the Court finds that the dispute submitted to it by the Italian Government, whether regarded in its general aspect, represented by the alleged monopolization of the Moroccan phosphates, or in its more limited aspect, represented by the claim of the Italian nationals, did not arise with regard to situations or facts subsequent to the ratification of the acceptance by France of the compulsory jurisdiction, and that in consequence it has no jurisdiction to adjudicate on this dispute.
The Court, having arrived at this conclusion, does not feel called upon to adjudicate on the other objections submitted by the French Government.
For these reasons,
by eleven votes to one,
decides that the Application filed on March 30th, 1936, by the Italian Government cannot be entertained.
The present judgment has been drawn up in French and English, the French text being authoritative.
Jonkheer van Eysinga declares that he is unable to concur in the judgment given by the Court and, availing himself of the right conferred upon him by Article 57 of the Statute, has appended to the judgment the separate opinion which follows.
M. Cheng Tien-Hsi, while in agreement with the operative clause of the judgment, has appended a separate opinion regarding some of the grounds on which the judgment is based.