CHAPTER III

NEUTRAL TRADE

THE entrance of the great commercial nations of Europe into the war at once involved our country in a struggle for its neutral rights. With the German merchant shipping swept from the seas, and the German fleet, save a few commerce raiders, driven into the ports and harbors of Germany, Great Britain was free to turn her attention to the destruction of that neutral trade from which Germany might obtain supplies of a warlike character. Water-borne traffic of this sort going direct to Germany in neutral bottoms was easily stopped. But to cut off the supply which found its way through neutral countries she was forced to adopt a policy which pressed heavily on the commerce of the neutrals concerned.

At the outbreak of the war the Department of State in structed our Ambassador at London to inquire if the Government of Great Britain would agree "that the laws of naval warfare as laid down by the Declaration of London of 1909," should "be applicable to naval warfare during the present conflict in Europe," provided all the governments with whom Great Britain was or might be at war would do the same. Like instructions were sent to our Ambassadors at Paris, Berlin, Vienna, St. Petersburg and the Legation at Brussels. AustriaHungary and Germany agreed; Russia replied that whatever course of action Great Britain took she would follow. Great Britain "decided to adopt generally the rules and regulations of the Declaration in question, subject to certain modifications and additions," and set forth these additions in orders in Council. They consisted of new lists of absolute and conditional contraband, in lieu of those contained in articles 22 and 24 of the Declaration; of the announcement that the British Navy would "treat as liable to capture a vessel which carried contraband of war with false papers if she were encountered

on the return voyage"; of the conditions under which the existence of a blockade "shall be presumed to be known," and of other modifications too technical to be stated. Thereupon

the Department of State bade our Ambassador at London, Mr. Page, announce that the Government of the United States withdrew its suggestion, and that it "will insist that the rights and duties of the United States and its citizens in the present war be defined by the existing rules of international law and the treaties of the United States irrespective of the provisions of the Declaration of London."

Trade between neutral countries in neutral bottoms was now no longer regarded as presumably innocent; the final destination of the cargo determined its innocence; the accepted list of contraband articles was greatly extended, and our vessels, seized on the high seas, were taken into port for examination and often detained there for weeks before they were released. In September two shipments of copper to Holland were seized because the final destination was held to be the Krupp Works at Essen. In October three more were stopped at Gibraltar on their way to Italy consigned "to order." Italy had forbidden the export of copper but not its transit through the country. Next came the seizure of three tankers owned by the Standard Oil Company of New York. These three were the John D. Rockefeller, which cleared from New York in September for Copenhagen, and was taken off the Orkneys and ordered to Kirkwall; the Brindilla, seized when on her way to Alexandria, Egypt, and brought into Halifax; and the Platuria, stopped off the coast of Scotland and sent to Hornoway. The Brindilla and Platuria, when the war opened, were the property of a German company, one of the subsidiaries of the Standard Oil Company, but their registry had been changed and when captured they were under the American flag. The John D. Rockefeller, which had always been under the American flag, and was not subject to any question which might arise from the change of registry after the war began, was therefore made the subject of a protest, and was promptly released. Demand was then made for the release of the Brindilla; the case against her for change of registry was dropped, and, by order of Sir Edward Grey, the British Ambassador explained

the position of his Government. During the last few weeks, he said, there had been a marked increase in the export of certain articles to neutral countries adjacent to Germany. Thus, while the value of the chief exports from the United States during September, 1914, as compared with September, 1913, had fallen off $107,000,000, the export of gasoline, naphtha, etc., had risen from 20,000,000 to 23,000,000 gallons, and that of fuel oil from 36,000,000 to 58,000,000. A large part of the exports had been consigned to neutral countries and from them had been sent into a belligerent country. Desirous not to be used as a basis for hostilities by either belligerent, these neutral countries were making arrangements which would prevent the export from them of articles which might be used for war. When completed it was hoped trade between neutrals would be subject to little or no hindrance. The Rockefeller had been detained for examination because her cargo of oil was going to a port near the chief naval port of a belligerent, and was consigned to order. There was, therefore, no guarantee that it would not be forwarded to an enemy.

And now the Kroonland, of the Red Star Line, with passengers, rubber and copper, while on her way from New York to Naples, was stopped at Gibraltar. Her destination, Naples; the consignment of her copper "to order"; and the fact that Italy had not prohibited the shipment of copper by land to Austria or Germany were the reasons for seizing and sending the cargo before a prize court to decide whether it was or was not destined for Germany.

November 2 the Department of State was informed that the Platuria had been released. That same day the British. Admiralty announced that the whole North Sea was a military

area.

For some weeks past the Germans had been sowing mines in the waters north of Ireland. "Peaceful merchant ships," said the British Admiralty in their order of November 2, "have been blown up by this agency. The White Star liner Olympic escaped disaster through pure good luck, and, but for warning given by British cruisers, other British and neutral passenger ships would have been destroyed." These mines had not been laid by a German warship, but by some merchant ship flying a

neutral flag, "which came along the trade route as if for purposes of peaceful commerce," and sowed the route with mines. "This mine-laying under neutral flags and reconnaissance conducted by trawlers, hospital ships and neutral ships are ordinary features of German naval warfare." Exceptional measures were necessary to meet this novel way of conducting war at sea. The Admiralty therefore gave notice "that the whole North Sea must be considered a military zone." Within it merchant shipping of every kind, traders of all countries, fishing craft, vessels of every sort, were exposed to destruction from mines it had been found necessary to lay, and from warships ❝searching vigilantly, night and day, suspicious craft."

After November 5 all vessels "passing a line drawn from the northern point of the Hebrides, through the Faroe Islands to Iceland, do so at their own peril." Ships bound for Denmark, Norway and Sweden should come by the English Channel to the Strait of Dover for sailing directions.

Denmark, Norway, Sweden and the Netherlands promptly protested to Great Britain and Germany against mine sowing in the North Sea save at the entrance of harbors, and were understood to intimate a hope that the United States would take part in a joint protest against mine planting. But the Secretary of State waited until the close of the year and then protested against the whole maritime policy of Great Britain, so far as it interfered with American trade. Instructions to communicate his views to the British Government were cabled to the American Ambassador on December 26; but the communication was not made public until the last day of the year.

It was needless, Secretary Bryan said, to point out to Great Britain, usually the champion of the freedom of the seas, that trade between neutrals should not be interfered with by nations at war unless absolutely necessary to protect their safety and even then only so far as was absolutely necessary. But the present policy of his Majesty's Government towards neutral ships and cargoes exceeded the manifest necessity of a belligerent and imposed on the rights of American citizens on the high seas, restrictions not justified by international law or the requirements of self-preservation. "Articles listed as absolute contraband, shipped from the United States and consigned to

neutral countries," had been seized and detained because the countries to which they were destined had not forbidden the export of such articles.

Detentions of this kind were unwarranted and the situation was made worse by the indecision of the authorities in applying their own rules. A cargo of copper shipped to a specified consignee in Sweden was held because Sweden had placed no embargo on copper. Italy had not only prohibited the export of copper, but had forbidden shipments of copper to Italian consignees or "to order" to be exported or transshipped. Yet the British Foreign Office had declined to affirm that copper consigned to Italy would not be molested. Seizures, thirty-one consignments amounting to 19,350 tons, worth some $5,500,000, had by that time been made, were so numerous and the detentions so long that steamship lines would not take copper to Italy, insurance companies would not insure it, and a lawful trade was greatly impaired through the uncertainty as to treatment at the hands of the British authorities.

Foodstuffs and articles of common use in all countries had been stopped despite the presumption of innocent use because destined for neutral countries, and without facts which warranted a belief that the shipments had a really belligerent destination. Mere suspicion was not evidence. Nor was reimbursement for interrupted voyages and detained cargoes after investigation failed to discover enemy destination sufficient. The injury was to American commerce diverted from neutral countries.

The Government of the United States readily admitted the right of a belligerent to visit and search, on the high seas, American vessels or neutral vessels carrying American goods, "when there is sufficient evidence to justify a belief that contraband articles are in their cargoes." But it could not permit, without protest, American ships or cargoes to be taken into British ports, there to search for evidence of contraband.

The situation brought about by the policy of Great Britain was "a critical one to the commercial interests of the United States." Great industries were suffering because their products were denied long established markets. "Producers and exporters, steamship and insurance companies" were pressing, and