most favored nation clause

each signatory grants to the other the broadest rights and privileges which it accords to any other nation in other treaties it has made or will make

Defined by the Supreme Court in - Kolovrat v. Oregon, 366 U.S. 187 (1961).

A clause found in ^ most treaties providing piat the citizens or subjects of the contracting states may enjoy the privileges accorded by either party to those of the most favored nations. It is said that the general design of such clauses is to establish the principle of equality of international treatment. The test of whether this principle is violated by the concession of advantages to a particular nation is, not the form in which such concession is made, but the condition on which it is granted; whether it is given for a price, or whether this price is in the nature of a substantial equivalent, and not of a mere evasion. The United States has always taken the stand that reciprocal commercial concessions are given for a valuable consideration and are not within the scope of this clause. Bartram v. Robertson, 122 U. S. 116, 7 Sup. Ct. 1115, 30 L. Ed. 1118; Whitney V. Robertson, 124 'U. S. 190, 8 Sup. Ct. 456, 31 L. Ed. 386. Great Britain has taken the opposite position. See Consular Treaty Rights and Comments on the “Most Favored Nation” Clause, by Ernest Ludwig. Political relations between two states may be of a kind to afford a fair basis for commercial concessions which other states could not claim to enjoy under this clause; for instance. as between the United States and Cuba. The clause has been considered as not extending to extradition treaties, nor to the provisions of a pilot law excepting from pilotage American coastwise vessels. But it does cover a law providing for the levying of lower rates of tonnage dues on vessels sailing from certain foreign ports, as against the ports of a country outside of the specified area whose commerce is, by treaty, to be accorded the most favored nation treatment. 3 Amer. Journ. InL L. 67. A simple form of the clause is that “in all that concerns commerce and navigation, favors wh^ch either party has granted or may hereafter grant to any other state shall be granted to the other party”; sometimes followed by a promise that the other party “shall enjoy the same freely if the concession is freely made, and allowing the same compensation if the concession was conditional.” The reciprocal civil rights of the subjects or citizens of the contracting powers are frequently covered by such a clause. See Herod, Most Favored Nation Treatment; Moore’s Dig. Int. Law; 8 Amer. Journ. InL ^#w 395.