THE THEORY OF NATIONALISATION
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1 THE THEORY OF NATIONALISATION
2 Translated from THEORIE DE LA NATIONALISATION Travaux et Recherehes de l'institut de Droit Compare de l'universite de Editions de la Baconniere, Boudry-NeucMtel ISBN ISBN (ebook) DOI V. Martinus Nijhoff, The Hague Softcover reprint ofthe hardcover 1 st edition 1964
3 THE THEORY OF NATIONALISATION KONSTANTIN KATZAROV Professor of Law in the University of Sofia ( ) Lecturer in Law in the University of Geneva Assisted in the preparation of the English edition by A. W. BRADLEY Lecturer in Law in the University of Cambridge, Fellow of Trinity Hall, Cambridge With apreface by WILLIAM A. ROBSON Professor Emeritus of Public Administration, London School of Economics and Political Science, University of London, Barrister-at-Law of Lincoln's rnn..... ~.. :y ~ MARTINUS NIJHOFF I THE HAGUE I 1964
4 IV NOTE ON THE ENGLISH EDITION This is a revised edition in the English language of my book, Theorie de la Nationalisation, first published in the series, "Travaux et Recherehes de l'institut de Droit compare de l'universite de Paris," in 1960, followed by an unchanged edition in Spanish, published by the "Instituto de Derecho Comparado" of the University of Mexico, Certain sections of the original edition, in particular those dealing with the nationalisation of land and labour, are not here reproduced; for this edition additional British material has been incorporated and additional references have been supplied, but the book remains essentially the same. Quotations from other writings have all been rendered into English; in general the titles of books and articles ci ted, other than those in the French or German languages, have also been translated into English, but in these cases the language of origin is indicated. Although Mr. A. W. Bradley, of Trinity Hall, Cambridge, has given me considerable assistance in the preparation of this edition, responsibility for the book is mine alone. Pages of this edition were first published in the English language in (1959) 22 Modern Law Review, pp ; and pages were first published in summary form in the Revue internationale de Droit compare for 1958, No. 2. K.K.
5 v PREFACE In this book Professor Katzarov has made the first comprehensive study 0/ nationalisation /rom the legal point 0/ view. The author's knowledge 0/ European languages, in addition to his mother tongue 0/ Bulgarian, has enabled him to draw on material/rom England, France, the U.s.S.R. and the other communist countries 0/ Eastern Europe, and many countries 0/ Asia and Latin America. The book ranges widely in another sense. Professor Katzarov is a jurist in the best Continental tradition in that his work does not spring /rom a narrow technical outlook, but is a synthesis 0/ historical, philosophic, political, economic and legal elements. Thus, he shows the way in which the constitutional and legal /ramework 0/ nationalisation has been in/luenced by extra-legal elements. It is difficult to imagine a legal scholar trained in one 0/ the Common Law countries producing a work as broadly conceived; and this is one 0/ several reasons why the publication 0/ an English edition is welcome. The author insists that nationalisation as a legal concept is a new phenomenon which is characteristic 0/ our own age. It dates /rom 1917, when nationalisation made its first appearance in the Constitution 0/ Mexico and was embodied in the first decrees 0/ the U.S.S.R. after the Russian Revolution. Re realises that prior to this the State had intervened /or centuries in economic li/e, and owned and operated many public enterprises, but the signi/icance 0/ the years /rom 1917 to 1939 lay in the fact that the social /unction 0/ property was, /or the first time, explicitly recognised in legislation. This meant that property was regarded not merely as i% relationship between the owner and the things he owned but as a tripartite relationship which also involved society. The fundamental ideas 0/ nationalisation are, in Professor Katzarov's opinion, /airly clearly de/ined. They comprise the utilisation 0/ all or part 0/ the means 0/ production in the interests 0/ society and not 0/ private individuals. To attain this aim it is necessary /or the means 0/ production, i/ in private hands, to be co me the property 0/ the community. Such an idea is wholly opposed to the principle 0/ absolute property rights derived /rom natural law which was embodied /or centuries in positive law in all civilized countries. In consequence, it has been generally impossible to effect any large measures 0/ nationalisation except in tim es 0/ crisis, war or revolutions. Nationalisation, in the author's opinion, is quite different /rom expropriation con/iscation or requisition because it involves basic economic, political and philosophicprinciples concerning the use 0/ property. Rence it is usually authorised by constitutional provisions or organic laws /ormulated in broad terms rather than by me re executive
6 VI decisions. Nationalisation in this sense 0/ the term is /ound only in such countries as the U.S.S.R., Poland, Czechoslovakia, Hungary, Rumania, Y ugoslavia, Bulgaria, and Albania where vast transformations were ef/ected in time 0/ war or revolution to eliminate private property in the means 0/ production. These upheavals have led to radical changes in the municipallegal systems af/ected, but in all these countries both co-operative property and certain kinds 0/ private property are expressly recognised by law. At the other extreme we find the limited or ad hoc nationalisations ef/ected in France and Great Britain. They are distinguished, the author considers, by a respect /or private enterprise and private property, and do not seek to limit them in a general way. They are not the results 0/ a socialist economy but represent an effort to improve the liberal economy. In all countries, however, socialist principles have entered the sphere 0/ law in recent decades. Professor Katzarov demonstrates this general proposition with a wealth 0/ examples drawn both /rom municipallaw and /rom internationallaw. The theme in this part 0/ the work reminds one 0/ Dicey's "Lawand Opinion in England during the Nineteenth Century",1 except that Dicey wrote /rom a very different point 0/ view /rom that 0/ Professor Katzarov. The latter is weil aware 0/ the fact that even in the countries which rely mainly on private enterprise, the State has intervened to an ever-increasing extent in the economic sphere. The book contains an immense amount 0/ detailed information about the legal structure and organisation 0/ industrial activity in a nationalised or partly nationalised economy. Despite great diversity in the economic and political systems 0/ the many countries under review, the author concludes that, as regards the ownership and the operation 0/ nationalised industries, everywhere there is a marked tendency to make a formal separation between the instruments 0/ economic activity and the legal entity 0/ the State. I am greatly impressed by the high standard 0/ scholarship which the author displays in this remarkable book; by the depth of his analysis; by the acuteness 0/ his perceptions; by his skill in presenting so vast a mass of material in a systematic form; by the lucidity 0/ his presentation; and by the sustained effort he has made to achieve objectivity in dealing with a highly controversial subject. lt would, 0/ course, be unreasonable to expect a work 0/ this range and magnitude to provide a complete and final answer to all the many legal and practical problems with which it deals; and the diligent reader may discover occasional inaccuracies or shortcomings 0/ omission and commission. There is, however, no doubt that "The Theory 0/ Nationalisation" is a book 0/ outstanding importance which will /or long be alandmark in the literature 0/ a movement 0/ worldwide signi/icance. William A. Robson 1 See also "Lawand Opinion in England in the Twentieth Century," edited by Morris Ginsberg (Stevens, London 1959).
7 VII CONTENTS INTRODUCTION: The Pre-Iegal Foundation 0/ Nationalisation 1. The Social Foundation (pp. 1-5); 2. The Economic Foundation (pp. 5-11); 3. The Political Foundation (pp ); 4. Conclusion (pp ). Pages 1-19 Part 1. - THE ACHIEVEMENT Section I: Introduction (pp ) 1. The Scope of Nationalisation (pp ); 2. Preliminary Signs before 1917 (pp ); 3. Nationalisation between 1917 and 1939 (pp ); 4. Nationalisation after 1939 (p. 41). Section II: Industry and Commerce (pp ) 1. Nationalisation in France and Great Britain (pp ); 2. Nationalisation in Eastern Europe (pp ); 3. Nationalisation in other Countries (pp ). Section III: General and Systematic Conclusions (pp ) Part II. - THE LEGAL STRUCTURE Section I: Introduction (pp ) Section II: The Socialisation 0/ Law (pp ) 1. Legal Aspects of the Controlled Economy (pp ); 2. The Socialisation of Law (pp ); 3. The Fusion of Private Law and Public Law (pp ). Section III: The Socialisation 0/ Property (pp ) 1. The Uniformity of Property (pp ); 2. The Evolution of Property (pp ); 3. The "Social Function" of Property (pp ); 4. The "Fragmentation" of Property (pp ). Section IV: The Legal Nature 0/ Nationalisation (pp ) 1. The Constitutional Basis (pp ); 2. The Scope and Nature of the Act of Nationalisation (pp ); 3. Nationalisation and Expropriation (pp ); 4. Nationalisation and Confiscation (pp ); 5. Nationalisation and "Etatisation" (pp ). Section V: Conclusions (pp ) Part IH. - OPERATION Section I: Introduction (pp )
8 VIII Section 1I: The Form 01 Nationalisation (pp ) 1. The Form of State Participation in Economic Exchange (pp ); 2. The Link between the Old and the New Undertakings (pp ); 3. Forms of Nationalised Undertakings: Contemporary Law (pp ); 4. Forms of Nationalised Undertakings: Characteristics (pp ); 5. Mixed Undertakings (pp ). Pages Section lii: Place and Function (pp ) 1. Coexistence with the Private Sector (pp ); 2. The Influence of Coexistence on Legal Structure (pp ); 3. Effects on the Civil Law (pp ); 4. The Coordination and Subordination of Nationalised Undertakings (pp ); 5. Control (pp ); 6. Repercussions on Criminal Law (pp ); 7. Nationalisation and Cooperation (pp ); 8. Denationalisation (pp ). Section IV: The State Plan (pp ) 1. The Essence of Planning (pp ); 2. Planning as a Juridical Problem (pp ); 3. The Plan as a Constitutional Institution (pp ); 4. The Plan as a Super-Law and Super-Source of Rights and Obligations (pp ); 5. The Implementation of the Plan (pp ). Part IV. - INTERNATIONAL LAW Section I: Private Property in Public International Law (pp ) 1. Preliminary Remarks (pp ); 2. From the Conferences at The Hague (1899 and 1907) to 1939 (pp ); 3. After Potsdam (1945) (pp ); 4. Conclusions (pp ). Section II: International Status 0/ Nationalisation (pp ) 1. The Validity of the Act of Nationalisation on the International Plane (pp ); 2. The International Status of Nationalised Undertakings (pp ); 3. International Control and Sanctions (pp ). Section III: Compensation (pp ) 1. Compensation in Municipal Law (pp ); 2. Analysis of Municipal Law (pp ); 3. Compensation and International Public Policy (pp ); 4. Extent of Compensation in International Law (pp ). Section IV: Procedure (pp ) 1. The Determination of Compensation (pp ); 2. Responsibility (pp ). APPEND IX: «Inter" -N ationalisation Bibliography Index
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