Personal union with Holland ceased at the death of William III. in 189o. The king having no male descendant, while his daughter Wilhelmina could succeed to the throne of Holland, the grand duchy, according to the family pact of the house of Nassau, passed to the last agnate of that house, Adolphus, whose duchy of Nassau had been annexed by Prussia in the German war of 1866. Adolphus died in 1905 and was succeeded by his son William, whose eldest daughter, Marie-Adelaide, ascended the throne 1912. On Aug. 2, 1914, the German armies invaded the grand duchy, on the pretext that it was necessary to protect the German con trol and working of the Luxembourg railways against a French invasion. On Aug. 4 Herr von Bethmann-Hollweg admitted to the Reichstag that the violation of Luxembourg neutrality was wrong, and promised reparation. The Luxembourg Government and the sovereign protested against this violation, but the grand duchy remained in German occupation for the duration of the War.
Political complications decided the grand duchess, Marie Adelaide to abdicate (Jan. Io, 1919) in order to save the inde pendence of the grand duchy, and she was succeeded by her sister, Princess Charlotte (b. Jan. 23, 1896). Marie-Adelaide died in 1924.
By the referendum of Sept. '28, 1919, the Luxembourg people pronounced by 66,811 votes for the maintenance of the monarchy with Charlotte as grand duchess, as against 16,885 votes for a republican regime.
Constitution.—Luxembourg is a constitutional monarchy with the crown hereditary in the house of Nassau. The actual sovereign (1928) is the grand duchess Charlotte (born Jan. 23, 1896), who married on Nov. 6, 1919, Prince Felix of Bourbon-Parma, brother of the ex-empress Zita of Austria. The heir to the throne is Prince Jean (born Jan. 5, 192o).
By a law of May 15, 1919, the constitution of the grand duchy was revised in a more democratic direction. The powers of the sovereign were limited, universal suffrage, with proportional repre sentation, was instituted, and the franchise was conferred on women. But the most interesting innovation was the creation by the law of April 4, 1924, of five chambers for traders and indus trialists, agriculturists, artisans, private employees and workmen, election to the chambers being by electors in these occupations above the age of 21. These chambers have the power to create and maintain institutions, the right to propose bills which must be submitted to the chamber of deputies, and they have a right to be consulted before laws affecting their professional interests are passed by the chamber of deputies.
Customs Union with Belgium.—Af ter the evacuation of the country by the German troops in Nov. 1918, Luxembourg de nounced its membership of the German Zollverein, and from Jan. I, 1919, it constituted an autonomous customs territory, while, by virtue of articles 41 and 268 of the Treaty of Versailles, it enjoyed the right of exporting to Germany for five years, duty free, goods equivalent in quantity to its average pre-war export to Germany.
By the referendum of Sept. 28, 1919, the Luxembourg people pronounced by 60,133 votes for an economic union with France against 22,242 votes for an economic union with Belgium. Asso ciation with France would have helped the agrarian interest, while the winegrowers stood to gain from association with Belgium. After the occupation of Frankfurt, carried out jointly by French and Belgian troops (April 8, 192o), the French Government made a declaration renouncing the negotiation of a customs union with Luxembourg in favour of Belgium. Relations with Belgium had been strained as a result of the plebiscite, but the new negotiations between Belgium and Luxembourg culminated in a convention ( July 25, 1921) establishing an economic union between the two countries which came into force on May 1, 1922, to last for 5o years. By this treaty customs frontiers between the two countries were destroyed, and Luxembourg customs assimilated to those of Belgium, though the Luxembourg customs administration is re tained. The total customs, plus the product of certain internal excise duties, are divided after a small deduction used to encour age Luxembourg cereal growing, in the proportion of 28 to I. Luxembourg state paper currency is reduced to 25,000,000 francs.
Railways.—Luxembourg has two systems of railways : the Guillaume-Luxembourg and the Prince-Henri railways. While the latter company works its lines itself, the lines of the Guillaume-Luxembourg company, which form the main part of the railways and are also of strategical importance, were, after the armistice of Nov. 1918, provisionally run by the Alsace– Lorraine railways, which belong to the French state. According to the customs convention between Luxembourg and Belgium, the Belgian state should share in working both Luxembourg railways, the two systems of normal gauge being united. After long negotia tions a convention between the Luxembourg and the Belgian Gov ernments was signed at Brussels on May 13, 1924. Under its terms the entire railway system of Luxembourg was to have been administered by the Prince-Henri railway under the control of the grand Ducal Government, conjointly in so far as questions of interest to Belgium are concerned, particularly as regards transit, with the Belgian Government. But this convention was rejected by the Luxembourg chamber of deputies on Jan. 20, 1925. In 1928 the Guillaume–Luxembourg lines were still under French control and the negotiations were still continuing.