issues

This page considers questions about the legal status of 'stealth states', some practical considerations and scams.

It covers -

• introduction
• what is a state
• practicalities
• stunts and scams
• reception
• micronations and fictions
• perspectives

     introduction

The preceding page of this note commented on the triviality of virtual states. Anyone can assert that a republic, principality, empire, duchy, kingdom or khanate has been established, can identify his or herself with a suitably gorgeous title, issue proclamations and - money permitting - pose in front of cameras while wearing the usual gaudy robes and tinfoil crowns, stars or other decorations.

The essential issue is whether people and countries accept such assertions. 'Virtual' states are virtual because in practice the assertions are not accepted - not accepted in international law, not recognised in national law, not providing exemption from tax or other requirements, not respected through inclusion in postal and other global communication schemes.

Self-proclaimed potentates can take on the trappings of nationhood by issuing passports and residence or citizenship papers, selling honours, conferring academic 'degrees' and awarding professional qualifications. That documentation has value as decoration but is not recognised as legitimate by governments and will not, for example, provide a basis for the bearer to gain entry to Australia and other nations with a serious border protection regime.

The promoters of virtual states can produce their own currency, ostensibly backed by gold or otherwise, and issue postage stamps. The stamps, banknotes and coinage of pseudo-nations has a collectible value but is not a recognised medium for international commerce. Do not, for example, expect Australia Post to carry a letter or parcel that relies on a stamp from Atlantis; similarly do not expect your local bank or credit card company to accept a payment using currency issued by a 'state' whose purported territory comprises asteroids or an apartment in Sydney.

Dukes, princes, presidents and other rulers of fictive states can claim to be immune from the law of "other nations" but that immunity is not recognised. Registering a company or hosting a server in the supposed territory of a virtual state will thus not prevent enforcement of a court order gained by ASIC or the SEC. Pretensions regarding independence are demonstrably false when the potentate is imprisoned for tax fraud or consumer scams and when bailiffs simply seize the entire 'state'.

It is clear that some rulers, when not mugging for the cameras or selling collectibles, do not believe their own claims. They use passports issued by real nations rather than their own 'states' (although happily selling their documents to the ignorant), observe the law of real nations and comply with the taxation requirements of those nations.

     what is a state?

Definitions of states and rationales for their recognition (and recognition of bodies such as the Knights of Malta that claim a sovereign status) have varied over time. Recognition reflects custom, perceived legitimacy and power.

The salient definition of a state in contemporary international law is provided by the 1933 Montevideo Convention on the Rights & Duties of States (here).

Criteria for statehood are that the state should possess a

a) permanent population; and
b) defined territory; and
c) government; and
d) capacity to enter into relations with the other states.

Those criteria embody what is sometimes characterised as the declaratory theory of statehood, superseding earlier constitutive theory that identified a state's existence exclusively through recognition by other nations (whether through "diplomatic recognition" or merely "recognition of existence").

As with much international law, disagreements have arisen over interpretation of the Montevideo criteria.

It is clear that a large population is not a prerequisite for international recognition. Figures in the Digital Divides profile elsewhere on this site for example note that small states in Europe and the Pacific include -

San Marino - 29,000 people
Tokelau - 1,400)
Andorra - 71,000
Nauru - 32,800
Iceland - 300,000
Tuvalu - 11,000
Liechtenstein - 33,900
Niue - 2,156
Qatar - 840,000

The criterion does not require that all, or even most, nationals were born in the nation's territory. However there is an expectation that most will reside in the territory (or be capable of residing in the territory, eg if not excluded by an army of occupation). They will not use the state as a form of hotel. That is a problem for virtual states where most citizens show no intention of residing in the purported jurisdiction or showing much commitment beyond a mouse click.

A large territory and economy similarly is not necessary for recognition. Some of the Pacific micronations for example comprise a single small island or a collection of islands scattered over a wide area. Some of those islands are uninhabited. Some European states also are geographically small. The territory can encompass coastal waters, offshore islands, seabeds and oil rigs or other structures. It must however be definable on a geographical and exclusive basis, a test typically failed by virtual states.

Assertions by pseudo-states that they control all territory, are based on an asteroid or ship, comprise the potentate's residence within a nation's jurisdiction or are based on a server are thus not credible in terms of international law.

The government criterion reflects the Westphalian tradition that states embody sufficient governance mechanisms to allow negotiation between states. Such mechanisms must be institutional rather than purely personal (with for example continuity beyond the life of an individual, so that the state is not regarded as automatically ceasing to exist when the ruler - and population of one - expires).

The criterion does not require that the state is democratic or that it respects human rights. It does not specify an elaborate administrative hierarchy, extensive provision of welfare services, large-scale defence forces or sophisticated court system. Some states in Africa do not have extensive administrative machinery and provide few services. Countries elsewhere may have only token armed forces or indeed no armed forces, instead relying on agreements with neighbours or allies and on international opinion.

The capacity to enter into relations with other states (individually and through dealings with international bodies such as the ITU and UPU) is significant. Not all nations have diplomatic recognition by other nations: some Islamic autocracies for example do not formally acknowledge the existence of Israel and do not recognise passports issued by that state. 'Capacity' encompasses some sense of whether a nation can function: is its overall legal regime recognised by its cititzens, can the government give effect to decisions (eg levy taxes, prosecute and imprison offenders) and determine who are members of the nation?

Influential jurist Hersch Lauterpacht commented that

International practice shows that persons and bodies other than states are often made subjects of international rights and duties, that such developments are not inconsistent with the structure of international law and that in each particular case the question whether a person or a body is a subject of international law must be answered in a pragmatic manner by reference to actual experience and to the reason of the law as distinguished from the preconceived notion as to who can be the subjects of international law

Lauterpacht has sometimes been cited as supporting the pretensions of virtual states but his emphasis on actual experience is important, as those states have not been shown to meet the criteria and have not gained support from real nations.

The Administrative Court of Cologne famously dismissed claims that Sealand, the small gunnery platform located in UK territorial waters, could confer citizenship on a German national. In 1978 the court held that Sealand was not a state for the purposes of international law because it lacked territory, people and government.

A man-made artificial platform, such as the so-called Duchy of Sealand, cannot be called either 'a part of the earth's surface' or 'land territory' and only structures which make use of a specific piece of the earth's surface can be recognised as State territory within the meaning of international law. ...

The State, as an amalgamation of many individuals … has the duty to promote community life. This duty does not merely consist of the promotion of a loose association aimed at the furtherance of common hobbies and interests. Rather it must be aimed at the maintenance of an essentially permanent form of communal life in the sense of sharing a common destiny …

The so-called 'nationals' of the 'Duchy of Sealand' do not satisfy these criteria for community life. Apart from the 30 to 40 persons permanently living on the platform, who are responsible for its defence and the maintenance of its installations, the presence of the other so-called ‘nationals’ is limited to occasional visits. The territorial extent of the 'Duchy' of merely 1300 square metres does not satisfy the requirements for the permanent residence of all its 'nationals'. The life of the State is not limited to the provision of casinos and places of entertainment. Rather a State community must play a more decisive role in serving the other vital human needs of people from their birth to their death. These needs include education and professional training, assistance in all the eventualities of life and the provision of subsistence allowances where necessary.

The so-called 'Duchy of Sealand' fails to satisfy any of these requirements. Regardless of the material prerequisites which an entity must have in order to constitute a 'people' under international law, the 'nationals' of the 'Duchy' themselves fail to satisfy an essential condition for their classification as a people. These 'nationals' have not acquired their 'nationality' in order to live with one another and handle all aspects of their lives on a collective basis, but on the contrary they continue to pursue their individual interests outside the 'Duchy'.

The common purpose of their association is limited to a small part of their lives, namely their commercial and tax affairs. This degree of common interest cannot be regarded as sufficient for the recognition of a 'people' within the meaning of international law.

Subsequent observers have noted that actual occupation of Sealand has generally involved less than five people and that the supposed royal family, apart from usual residence on the UK mainland and compliance with UK tax law, appears to use UK passports rather than Sealand passports. Ship-based and platform-based 'states' off the coast of Scandinavia, Italy and the Netherlands evaporated when the armed forces or police of those nations boarded and seized the pseudo-nations.

     practicalities

Samuel Menefee, in discussing the pretensions of virtual states such as Minerva and Abalonia, commented that

"Reef republics" have the further disadvantage of being delicate political ecosystems, open to disruption through the most minor external pressures (a Corps of Engineers permit) or internal rivalries. Their communities can be levelled by a single hurricane, moved by a parted mooring line, sunk without trace in a typhoon. Dependent for their revenues on offshore banking, commemorative coins, postage stamps, flags of convenience, or gambling, they are continually open to exploitation, and their very vulnerability makes them a danger to others. In time some might acquire the paraphernalia of statehood - territory, citizens, a government, recognition - but time is what they do not have; they are continually open to the challenges of all and sundry. If in the future such states are to rise with their flags from the deep, it seems likely they will be either secessionist slivers of larger entities, or else catspaws, sponsored by nations with ulterior motives. Until that day, may they lie in peace, with the drowned hopes of their founders - gone but not forgotten.

It is easy to issue edicts and enact laws but apart from gratification of the founder's ego there seems little point if that law cannot be put into effect.

Assertions by Australian residents, for example that they are independent nations are at best quaint if

• the state is not internationally recognised and is seized by a bank for nonpayment of a loan
• the self-described ruler is imprisoned for breaching Australian law
• the state can be shut down by placing a padlock on its front door
• all 'citizens' are too young to get an Australian driver's licence
• if the supposed nation's currency and stamps are recognised by no financial institution or post office.

Some 'states' have sought to have the best of both worlds. The Federation of Koronis, for example, which claims to encompass a chain of asteroids and local terra firma, squares the circle by indicating that

As we are operating on Australian soil for most of our business any spacific [sic] Federation law is only applicable to matters between Citizens of The Federation conducted on federation territory. The Monarch and Government has also decreed that all offences carried out on federation territory will in addition be subject to Australian law as well

From 2007 the US IRS for example requires full disclosure from people claiming residency in the Virgin Islands: they must state where their homes are, where their children go to school and even where they attend religious services.

     stunts and scams

Virtual states are a focus for stunts and scams.

Greenpeace activists for example landed on the uninhabited chunk of rock known as Rockall (offshore from Iceland and Scotland) in 1997 and declared it to be the "sovereign territory of Waveland". The gesture gained he requisite media attention, ignoring inconveniences such as formal assertion of ownership by a British naval party in 1955 and the Rockall Act 1971.

Virtual states have often been justified as akin to onanism, giving pleasure to the individual promoter but not harming anyone else (and of course benefiting the web hosting and heraldic costume manufacturing industries). Some of the projects in the following page indicate that virtual states can be more than whimsy or pleas for love by overgrown spotty teens. Reality sometimes collides with fantasy.

The dadaist state of Ladonia in Sweden for example reports that

Ladonia has a parliament, several political parties, a newspaper, and many other activities. Recently Ladonia was forced into a difficult situation when it received applications for asylum from around 3,000 Pakistani citizens.

Other pseudo-states have been happy to sell 'citizenships', 'visas', 'passports' and 'diplomatic credentials' that although decorative do not allow the bearer to travel freely and do not provide international immunity.

That has not deterred some scammers, who have unloaded 'unofficial' versions of that documentation onto gullible buyers. The Sealand passport has thus been described as self-generating, with clones appearing outside the control of the supposed Sealand government.

Others have sought investment for the construction of the new utopias or have purported to issue "Business Registration Certificates" that will supposedly allow individuals and corporations to move outside the reach of tax agencies.

Romantics might care to consider money laundering regimes, discussed elsewhere on this site, and restrictions such as section 6-5(2) of Australia's Income Tax Assessment Act 1936, which provides that if you an Australian resident your assessable income includes ordinary income derived directly or indirectly from all sources, whether in or out of Australia. Claiming to be a citizen of Abalonia will thus not make the ATO disappear.

     reception

One of the curiosities of virtual states is that their claims are often taken at face value. Much reporting has a distinctly giddy flavour, presumably consistent with both the intended audience and with the values of the project promoters.

Garfinkel's Wired article for example enthuses about Sealand as

a fat-pipe Internet server farm and global networking hub that combines the spicier elements of a Caribbean tax shelter, Cryptonomicon, and 007. ... HavenCo's onboard staff will come and go on helicopters and speedboats. Four security people will be on hand at all times to maintain order; six computer geeks will run the network operations center. The security personnel, heavily armed and ready to blast anybody who shouldn't be around, will make sure that unauthorized boats and aircraft keep their distance. The geeks will perform maintenance tasks like replacing failed hard disks and installing new equipment. These routine chores will be a little more challenging than usual, given the maritime setting and Sealand's obsession with privacy. Fall over the edge of Sealand's deck, for instance, and you'll probably drown. Simply entering one of the machine rooms will require putting on scuba gear, because the rooms will be filled with an unbreathable pure nitrogen atmosphere instead of the normal oxygen mix - a measure designed to keep out sneaks, inhibit rust, and reduce the risk of fire.

We assume 007 will remember not to breathe in when disabling the machine rooms.

Reception by national and provincial bureaucracies has been problematical. It is common for proponents of pseudo-states to imply that interaction with government agencies (eg letters sent to/by the monarch or president) signals international recognition.

Proponents often also imply that failure of governments to take control through military or police action is a demonstration that the particular virtual state is legitimate, has been recognised by a government and is free to operate independently in future. Such claims are tendentious.

     perspectives

If proponents of Sealand and its pers consider that residence, non-provision of services and non-recognition by real nations do not matter, can we consider locations in Online Worlds - massively multiplayer onliine roleplaying games (MMPORGs) such as Everquest - as states?

Participants in those online spaces clearly interact with other 'citizens', have some form of law and governance, show an emotional commitment that is deeper than that of most pseudo-states, and engage in economic activity that is increasingly extensive.

The immediate response is that MMPORGs have the character of clubs or associations rather than states and that there is little value in confusing or blurring concepts.

From the perspective of international law a sodality, professional association or sports club is not a state. Such entities may embody an emotional investment by members, have rules and formal governance structures, provide some services to members, collect money from members or third parties, and even distribute money to non-members. Entities such as the International Committee of the Red Cross (ICRC) may enjoy some privileges under international law but are not countries.

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