The longue durée of extraterritoriality and global capital

ABSTRACT

This article investigates the shifting nature of the concept of extraterritoriality at particular junctures in history from the Italian city states to contemporary visions of floating micro-sovereignties. Extraterritoriality is the exercise of the jurisdiction by one state or non-state actor within the territory of another state. Since extraterritoriality is a challenge to the fundamental principle of sovereignty, it is by definition an exception in relation to sovereignty. As sovereignty evolved and changed over time, so did extraterritoriality – and, in the discussed cases, it changed primarily to be able to fulfil the needs of agents of global capital. The article discusses the privileges granted to the Italian city states by the Byzantines and the Ottoman capitulations, extraterritoriality on the colonial frontier, private investments in the Middle East and the proliferation of ideas of micro-sovereignty by Libertarian politicians and Silicon Valley billionaires. The article makes three distinct arguments: first, extraterritoriality has to be understood in relation to shifting notions of sovereignty. Secondly, extraterritoriality emerged within the context of colonial and imperial inequality and any extraterritorial relations contain the echoes of these structures of inequality. Finally, extraterritoriality is often driven and shaped by the needs of global capital, trying to avoid specific sovereign structures.

KEYWORDS:

• Sovereignty
• extraterritoriality
• colonialism
• global capital

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 When Wilson gave the speech, the scope of this principle was still more limited, for example excluding Czechoslovakia, as he still hoped to make a separate peace with the Austro-Hungarian Empire. After it became clear this was not to happen, Wilson broadened the scope of application. (Mamatey 1989)

2 State meant an increasingly standardised political entity in the international system, as outlined by the Montevideo Convention on the Rights and Duties of States 1933 which defined the four aspects of statehood; permanent population, defined territory, government and capacity to enter into relations with other states. With this, it was reiterated that statehood was the primary manifestation of sovereign authority.

3 Malcolm McIlwrith, ‘Lecture on “Legal War Work in Egypt” before Grotius Society’, reported in Egyptian Gazette, 6, 8 and 9 December 1918.

4 Malicorp Ltd v Arab Republic of Egypt, ICSID Case No ARB /08/18, Award (7 February 2011), para 119. This case involved alleged bribes being paid in return for securing of a contract.

5 What would happen if a resident calls the police of the host state, instead of the private security of the city? Would the host states be willing to give up that sovereignty, and if yes, would this not be equal to the creation of a new state?

6 According to Elwartowski, the structure was anchored ‘12 nautical miles from shore’ (Peck 2019).

7 According to the Bank for International Settlements, see: https://www.bis.org/statistics/rpfx19_fx.htm and https://www.bis.org/statistics/d5_1.pdf.

Additional information

Funding

This project received no external funding.

Notes on contributors

Moritz Anselm Mihatsch

Moritz A. Mihatsch is a global historian interested in nationalism, self-determination and sovereignty. He wrote his DPhil dissertation at the University of Oxford on political parties and the concept of nation in Sudan in the 1950s and 60s. He taught multiple years in Egypt (2014–17), spent two years between Brussels, Vienna, Copenhagen and Madrid (2017–19). He returned to the British University in Egypt in February 2020.

Michael Mulligan

Michael Mulligan is a researcher of international law who previously worked at the British University in Egypt and is currently teaching at the Law School of Lancaster University.