In 1861 a new difficulty arose when France proposed to the Zollverein complete reciprocity and freedom of transit, freedom from export duties, and treatment as the most, favored withal. Prussia alone conducted the negotiations, with out consulting the other States of the Zollverein. On Mandl 29. 1862, Prussia signed the eouvention with France, and some time after invited the other members of the Zollverein to stand by the t ren I y. Saxony, by reason of its commend:11 in terests, accepted the treaty. Bavaria. Wilittem berg, Hanover. Nassau. and 'Hesse-Darmstadt, on the contrary, refused to accept the treaty and went with Austria. which renounced all idea of commercial union in 1864. and in 1865 Prus sia definitely excluded that State from the bill verein. During the war between Austria and Prussia in 1866, the political allies of Austria Ihivaria, Wurttemberg, Baden, Nassau, and Frankfort—kept the terms of the Zollvcrein with Prussia, so that there was exhibited the curious spectacle of countries engaged in open hostilities living under the same tariff system and main taining free exchange. After the War of 1866 Prussia forced upon Wiirttemberg, Baden, and Bavaria a new pact which substituted for the conference of delegates from the sovereign and independent St:11VA ( Z0111:011ferClIz) an in-and-init assembly consisting of a Zollbundesrat, repre senting the States, and a Zollparlament, composed of the North German Reichstag and representa tives from the Smith German States. Instead of the unanimous vote for enacting new regulations, a mere majority of each assembly was made sufficient. The representation of the States was not equal, Prussia having 17 out of 58 repre sentatives in the Zollbundesrat and a prepon derating influence in the Zollparlament. Be sides, Prussia had the presidency of the Zoll bundesrat, with the right to make treaties of com merce in the name of the union with foreign powers. This union was replaced by the 'Gott verein, the German Empire of 1871.
In 1872 Alsace-Lorraine was included in the German Zollverein under the Imperial Govern ment, and in 1888 the free cities of Hamburg and Bremen joined. The new German customs union embraces all the States of Germany, though its limits do not conform exactly to the Emits of the Empire, the so-called 'free ports' (parts of Bremen and being excluded, while the Grand Duchy of Luxemburg and the Austrian communities of Jungholz and Mittel burg form part of the union. Duties on exports were abolished in 1873. The customs receipts for the most part go to the Imperial treasury, but one-half of the duties on tobacco in excess or 130 million marks is divided among the federated States according to population.
Among other instances of custom unions may be mentioned that established in 1889 between Cape Colony and other British colonies and the Orange Free State. More recently attempts have been made to bring about a closer commercial union between the several Darts of the British Empire. In 1887, at the conference, Hofineyr, of Cape Colony, for the first time de veloped a scheme for a uniform extra-differential duty upon all foreign imports into Great Britain. In 1891 this idea was brought before the House of Lords by Lord Dunraven. la 1894 the Ottawa Conference discussed the matter at some length. Since 1899 the matter has been pressed by Joseph Chamberlain, formerly Colonial Secretary of the Empire. It has been suggested that the United States form a customs union with the South American States, Mexico, and Central America, and Mr. Blaine while Secretary of State, 1889-92, attempted to bring about closer commercial re lations by means of reciprocity treaties. No ap preciable results have been accomplished by this policy, and there are no prospects of a Zollrerein being formed among the American countries.
Consult: Dittmar, Der deutsche Zollrrrein (Leipzig, 1867) : Worms:7;A //cmaime economignc on histoire du Zollverein allemand (Paris, 1874).