Khalidi Transfer
Khalidi Transfer
Khalidi Transfer
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THE JEVISH-OTTOMAN LAND
COMPANY: HERZL'S
BLUEPRINT FOR THE
COLONIZATION OF PALESTINE
WALID KHALIDI
Walid Khalidi is a founder of The Institute for Palestine Studies and its
general secretary. He is a leading authority on the Palestine problem and the
Arab-Israeli conflict, and is currently a senior research fellow at the Center
for Middle Eastern Studies, Harvard University. This article has been
adapted from his forthcoming book on the root causes of the 1948 exodus.
* Two volumes. Berlin, 1935-37.
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THE JEWISH-OTTOMAN LAND COMPANY 31
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32 JOURNAL OF PALESTINE STUDIES
la JOLC, although he did "propound" the idea a few days after the audience
with members of the Sultan's entourage.6 With the Sultan, he directed the
conversation towards the financial help that he insinuated his access to Jew-
ish capital could obtain to alleviate Istanbul's public indebtedness. He told
the Sultan the story of Androcles and the lion, explaining: "His Majesty is
the Lion, perhaps I am Androcles, and maybe there is a thorn that has to be
pulled out.... The thorn, as I see it, is your dette publique."7 Herzl's strategy
was clearly first to get the Sultan to agree to the principle that he (Herzl)
should help him financially. With this agreement secured, he could then
raise Jewish capital for funding the Ottoman public debt. He would then
return to Istanbul and get his charter on a quid pro quo basis.8
It did not quite work out that way. Early on, Istanbul would seem to have
suspected what Herzl's real purpose was. At the same time, it was interested
in getting any financial assistance it could, provided such assistance was on
Istanbul's own terms. Herzl left his audience with the Sultan with the latter's
general blessing that he could seek Jewish capital to fund the Ottoman debt,
but with nothing more.
From internal evidence in Herzl's Diaries it would seem that work on the
actual drafting of the charter for the JOLC began after the audience with the
Sultan. On 29 May 1901, for example, Arminius V'ambery asked Herzl for a
draft of the charter "which he intends to present to the Sultan and get it
signed by him without any Secretary or Minister finding out about it."9 On
21 August 1901 Herzl "returns" [sic] to Vambery "Draft I" of "the Charter,
specifically, to the Jewish Colonial Trust for the formation of the Compagnie
Ottomane-Juive pour lAsie Mineure, la Palestine et la Syrie. " 10 This is the sole
mention of the full designation of the JOLC in the Diaries as published in
English.
It was during his February 1902 sojourn in Istanbul that the real discus-
sions relating to the charter took place. But before dealing with these, let us
have a look at the text of the JOLC draft.
The draft has a preamble and eleven articles, article VII being subdivided
into four sub-articles.
In the preamble as drafted by Herzl, the Sultan "grants and guarantees the
JOLC the following special rights and privileges for the purpose of settling
Palestine and Syria with Jews who assume Ottoman citizenship [in order to
enable them] to open up the natural food and occupational resources of these
countries.... " The articles spell out both the rights requested and the
conditions under which they are to be granted.
The rights requested fall under three general headings: rights of owner-
ship and usage; the status of the JOLC; and the powers of the JOLC.
The JOLC would have the following rights of ownership: to buy outright
all private landholdings, large and small (article I); to own state domain be-
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THE JEWISH-OTTOMAN LAND COMPANY 33
longing to the Sultan in return for a yearly payment of three Turkish piasters
per dunum; and to occupy all land for which there is no legal title on the
same terms as the state domain (article II). Concerning usage of the land, the
company would have the following rights: to use these lands for "agriculture,
horticulture, forestry, and mining . . . [to] build all installations, roads,
bridges, buildings and houses, industrial and other facilities, which it consid-
ers appropriate, without being restricted in the choice of means to be used";
and to establish "small and large settlements, and to settle Jews in them"
(article I).
The JOLC would have "complete autonomy, guaranteed by the Ottoman
Empire." The president of the JOLC would head the administration in the
territory (article VI). He would be elected by the JOLC but approved by the
Sultan (article IX). He would have political immunity and would be account-
able solely to the Sultan whom he represents in the territory (article IX). The
president would send a permanent representative to Istanbul who would be
the sole conduit for transmitting the president's reports to the Sultan and the
Sultan's "wishes and orders" to the president (article IX). Jews already set-
tled in Palestine and Syria "who consider themselves proteges of the JOLC"
could sign a document to this effect. Colonists who enter as proteges of the
JOLC would "ipso facto abandon their former citizenship" and acquire the
Ottoman citizenship, like the Jews "already settled" there (article VII A).
The powers of the JOLC are impressively extensive. They include the right
(1) to build and operate railroads, to construct canals, and to build harbors
and shipyards and a merchant fleet; in general, the JOLC may use the rivers
and bodies of water "which are on Company territory industrially . . . and
utilize their resources" (article IV); (2) to assume all responsibility for edu-
cation, the construction and maintenance of schools and institutions of
higher leaming, in which peoples must be educated "not only in their na-
tional language and history, in religion ... but also in . .. patriotism in order
to make them reliable Ottoman citizens" (article VII A); (3) to levy taxes and
tariffs and "to reform taxation and make it more efficient" (article V); and
(4) to assume responsibility for "the personal security and the property" of
the inhabitants, and for this purpose to pay and equip its own civil servants
and police (article VI).
Perhaps the most striking power requested is the right to create the "Impe-
rial Ottoman Syrian-Palestinian Land or Navy division." All male proteges of
the JOLC upon reaching the age of 19 would serve one year in the standing
army followed by a half year's service in a special formation. Until age 26,
they would serve in the militia, with three week's reserve duty a year. From
that time until age 35, they could be called up for service at any time as part
of the general levy (Landsturm). The armed forces are to be "entirely com-
posed of Jewish soldiers," and foreign nationals can only be "accepted tem-
porarily as instructors and trainers." The equipping of these forces would be
undertaken by the JOLC. The formation of the land forces "is to begin im-
mediately" and that of the navy division within ten years (article VII B).
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34 JOURNAL OF PALESTINE STUDIES
During peacetime these troops would "secure the borders of Syria and Pal-
estine against attack" and maintain "law and order in the interior of the
country" (article VII C). In case of war, they would be used "for the defense
of Asian parts of the Ottoman Empire. . ." (article VII C). In this latter case,
the JOLC would incur the expense in the form of a loan to be repaid by His
Majesty at 4 percent annual interest rate (article VII E). Moreover, the JOLC
would provide the means for "the required military academies, barracks, de-
pots, weapons and ammunition factories" as well as the ships needed by the
navy for training purposes (article VII D). To cover the expenses of con-
structing and maintaining these military installations, the JOLC would retain
40 percent of the revenues owed to His Majesty for the right to own his state
domain (article XI).
The most crucial right requested by the JOLC is formulated in article III.
It pertains to the Palestinian and other Arab owners and inhabitants of the
three categories of land to be purchased/owned by the JOLC-the large and
small private landholdings, the Sultan's state domain, and the land for which
there is no title. Herzl's proposal is that the JOLC has "the right to ex-
change" these lands with land "procured by it [the JOLCI in other provinces
and territories of the Ottoman Empire" (article III). These lands would be
"of equal size and quality" (article III). The JOLC "will not only compensate
these owners with the costs of resettlement from its own funds . . . it will also
grant modest loans for . . . housing . . . and . . . equipment" (article III). The
loans "are to be repaid in equal installments over several years . . . " (article
III). Only Jerusalem is specifically exempted from the provisions of article
III (i.e., the territorial "exchange"), but "the proteges of the JOLC there are
still subject to its jurisdiction," and with regard to taxes Jerusalem belongs to
the JOLC territory. To be sure, the supervision of the holy places remains
with the Sublime Porte and "can only at the wish of the same be taken over
by the JOLC" (article X).
The JOLC charter is remarkable not only for its content, but also because
of the circumstances that prevailed at the time it was conceived around the
turn of the century. At that time, the World Zionist Organization was still in
its infancy, commanding few resources. No great power had recognized it.
Herzl himself was a private citizen. The Jewish community in the area that
subsequently became Mandatory Palestine numbered at the very utmost
34,000,11 or 5.7 percent of the population. In 1900, Jewish land ownership
totalled 220,700 dunums, or 0.8 percent of the country.12 There were at the
time 22 colonies with a rural population of 4,950,13 most of whom lived on
the charity of one single individual, Baron Edmond de Rothschild.14
Be that as it may, by the time Herzl retumed to Istanbul in February 1902,
the final draft of the JOLC charter had most probably been completed,
although from the Diaries it is almost certain that it was not actually passed
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THE JEWISH-OTTOMAN LAND COMPANY 35
on to the palace. Since the audience with the Sultan the previous year, the
fifth Zionist Congress had been held at Basle 26-30 December 1901. Herzl
arrived at Istanbul by a Rumanian steamer and headed straight to the palace
on the aftemoon of 14 February.
Herzl's task was delicate. His real purpose was to obtain a charter along
the lines of those spelled out in the JOLC draft. But how much of this could
he reveal without alienating the Sultan? Despite all his talk during his audi-
ence with him nine months earlier about Jewish finance to consolidate the
Ottoman public debt, he was retuming empty-handed except for personal
presents: fruits from "the foremost Viennese gourmet food shop" and a
warming pan.15
Herzl was received at the palace by Ibrahim, the Grand Master of Ceremo-
nies. The Sultan was too tired to grant him an audience that day, but asked
him to regard himself as his guest during his entire stay.16 He should return
at 11 A.M. the following day. And when informed that His Imperial Majesty
did not accept "comestibles" (foodstuffs) as presents, Herzl asked the palace
officials "to be kind enough to accept the fruit from me; we would consume it
together."17
During the morning of 15 February, Ibrahim asked Herzl point-blank what
"the aims of the Zionist Congress" were. Herzl replied that "the purely na-
tionalist Judaism of the Zionists" was opposed to "absorption by other na-
tions . . . desired by our Jewish opponents." Ibrahim said that there had
been "distorted" reports to the effect that Herzl had announced at the Con-
gress (December 1901) that the Sultan had "permitted the immigration of
Jews to Palestine for the purpose of establishing a Jewish kingdom." This
Herzl denied, and Ibrahim remarked that they had not believed the reports,
as evidenced by the Sultan's invitation to Herzl to be his guest.18
The afternoon was spent in a meeting between Herzl and Izzet al-Abed, a
Syrian Arab who was court chamberlain. Izzet began with "rudesse"
(brusqueness): "What was the purpose of your visit last May?" Herzl re-
plied: " . . . To come to the aid of Turkey if she in tum wants to aid us. We
Jews need a strong Turkey.... " Izzet pointed out that little "moral or
material aid" had "materialized" since Herzl's last visit, to which Herzl re-
torted that he had in fact succeeded in creating "a favorable climate of opin-
ion for His Imperial Majesty."'9
Clearly Istanbul had been doing its homework on Zionism. Izzet now
said: "I shall give it to you straight," and proceeded to outline his govern-
ment's position. The empire would be opened to Jewish refugees from all
countries. The immigrants would renounce their previous nationality and
would be subject to Ottoman law, including military service. They could
establish themselves in "any of our provinces except-at first-Palestine."
In retum, Herzl would form a syndicate for the consolidation of the public
debt and assume a concession for the exploitation of all mines "already dis-
covered and yet to be discovered" including gold, silver, coal, as well as oil
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36 JOURNAL OF PALESTINE STUDIES
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THE JEWISH-OTTOMAN LAND COMPANY 37
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38 JOURNAL OF PALESTINE STUDIES
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THE JEWISH-OTTOMAN LAND COMPANY 39
money with Ibrahim and Izzet or take it away. "The idea of keeping these
5,000 francs, which by rights are my personal property inasmuch as they are
an honorarium for my efforts, never occurred to me for a moment." So Herzl
decided to make a gift of them to "our poor A.C. [Actions Committee, i.e.,
Zionist Executive] treasury."
As he took his leave of Ibrahim and Izzet, " 'I leave loaded with gold,' I
said to them with superior humor, and they bowed low before my noncha-
lance in the face of such a sum.' 32
And as he passed through the palace gates he "showered" gold pieces
"like an Oriental prince." For "if I give so much even to the doormen, how
much must the Excellencies be getting with whom I have such long secret
conferences.... All Yildiz probably thinks that, and soon the Porte, the city,
the country will too. These gold pieces which I lose at the gate are among my
most fruitful investments."33
Looking back at this last episode in the light of the vastness of the sums
Herzl claimed he could secure "in very short order," could it be that Izzet
and his master had seen through Herzl's pretense and intended to put the
issue to a practical test by calling his bluff?
Herzl in Palestine
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40 JOURNAL OF PALESTINE STUDIES
ticed the bunting by the road where Herzl and his colleagues stood. The
Kaiser pulled up his horse, at which Herzl signalled the Mikveh choir to
intone (to the tune of "God Save the King") the German song "Here Dir im
Siegerkranz" ("Hail to thee with the victor's wreath").36 The two exchanged
a few pleasantries before the Kaiser rode on to Jerusalem, whither Herzl fol-
lowed by train.
In Jerusalem Herzl and his colleagues had a single overriding preoccupa-
tion: whether and when the Kaiser would grant them an audience. They
agonized over the wording of the address to him, the questions he might ask,
the replies they should give. Herzl nagged his colleagues about their deport-
ment in the Kaiser's presence and fussed over their appearance: "Their
clothes, linen, neckties, gloves, shoes and hats.' 37 Five days later, on 2 No-
vember, the audience was finally granted. It lasted a little over 30 minutes.
As they left the imperial tent, Herzl summed it up to his colleagues in
French: "II n'a dit ni oui ni non. "38 After a short visit to the neighboring
colony of Motsa, where it was with the help of Palestinians that they planted
a cedar and a date palm, the delegation returned to their hotel. There Herzl
enjoined his colleagues not to pack until nightfall "so as not to have attention
of any sort at our departure.... "39 They took the early morning train to
Jaffa, with Herzl yearning "to leave the city and the country without delay"
and willing to do "anything to avoid staying here any longer."40 After a
frantic search for accommodation on a ship, on 4 November they boarded the
English orange freighter Dundee bound for Alexandria.
Herzl's entries on his Palestine visit cover some twenty-six pages in the
English edition. What is most relevant to us in these pages are Herzl's reac-
tions to the existence of Palestinians in the country. And what were these
reactions? The answer is that there were none. Having landed in Jaffa, the
main port of the country, did he evince any interest in its buildings and in-
habitants? None at all. What he saw was "poverty and misery and heat in
gay colors. Confusion in the streets, at the hotel, not a carriage to be had. I
was already on horse to ride to Rishon [le Zion].... X41 Crossing the main
orange belt between Jaffa and Mikveh Israel, did he wonder who planted
these groves? He did not. What he noticed was a "countryside neglected in
Arab fashion . . . [t]hick dust on the roads, a bit of greenery."42 On his visits
to the colonies near Mikveh a doctor had told him about the prevalence of
fever. He immediately thought of the Arabs: "Such Arabs as are immune to
the fever might be used for the work [of drainage]."43 Awaiting the Kaiser's
cavalcade at Mikveh, he did notice "a mixed multitude of Arab beggars, wo-
menfolk, children" lining the highway.44 These were his only direct or indi-
rect references to the Palestinians before entering Jerusalem. In the exchange
of pleasantries with the Kaiser at Mikveh, the Kaiser had said: "Very hot!
But the country has a future." And Herzl, who had arrived two days before
and seen a tiny portion of it, had promptly replied: "At the moment it is still
sick.'45
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THE JEWISH-OTTOMAN LAND COMPANY 41
I can still see him before me, this Sultan of the declining robber empire.
Small, shabby, with his badly dyed beard.... The hooked nose of a Pun-
chinello, the long yellow teeth with a big gap on the upper right. The fez
pulled low over his probably bald head; the prominent ears "serving as
pants-protector," as I used to say about such fez-wearers to my friends'
amusement-that is, to keep the fez from slipping down onto the pants
52
And yet in his 17 May entry just before his audience, Herzl had been re-
hearsing in front of a mirror: "Est-ce que Sa Majeste permet queje parle simple-
ment, ouvertement, serieusement [Will His Majesty permit me to speak plainly,
frankly, seriously] ... ?"53 During the audience, he had told the Sultan that
he was "devoted to him because he was good to the Jews." Jews all over the
world are grateful for this, and "I in particular was ready to render him any
service . . . great services."54
The contrast between Herzl's impressions of the Sultan and his entourage
and those of the Kaiser and his is too striking to be merely coincidental. It
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42 JOURNAL OF PALESTINE STUDIES
probably tells as much about Herzl himself and his feelings about the nation-
alities they represent as about the individuals themselves. Thus, on his way
to the audience with the Kaiser in Istanbul:
I went up the stairs rather calmly. At the top there stood, most splendidly,
the aide-de-camp on duty, a gentleman of Prussian elegance, who watched
my ascent l'oeil narquois [with a quizzical expression]. Still he seemed to be
satisfied with my coat, the crease of my trousers, and my patent-leather
shoes. . ..
Having entered the audience chamber, the Kaiser
looked at me grandly with his great sea-blue eyes. He has truly Imperial
eyes. I have never seen such eyes. A remarkable, bold, inquisitive soul
shows in them . . . I kept my gaze on his fine, frank, genial and yet bold
eyes, which fairly bewitched me. . . . He looks at you squarely and
strongly-the Kaiser!-and when a remark . .. appeals to him, his magnifi-
cent eyes . .. say: I got you . . . There are innumerable portraits of him, but
because this ... glance, a most original, powerful flash, cannot be painted,
people don't know what his eyes are like.56
*0 0
Long after Herzl had despaired of securing a charter from the Sultan and
had turned to other capitals (e.g., London, for charters in the Sinai and East
Africa), he kept his sights on Istanbul. On 14 May 1904, in the penultimate
entry of his Diaries, he addresses a memorandum to a senior Austrian foreign
ministry official. In this note, he solicits the participation of the Austrian
government in an international effort to persuade Turkey to grant a charter
very much along the lines of the JOLC. He adds a detail absent in the JOLC
version examined above: he envisages "a settlement area in Palestine and the
vicinity large enough for five to six million Jews."57
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THE JEWISH-OTTOMAN LAND COMPANY 43
NOTES
1. Theodor Herzl, TheJewish State (New York: Ameri- 20. Ibid., pp. 1218-19.
can Zionist Emergency Council, 1946), pp. 98-123. 21. Ibid., p. 1219.
2. Aharon Cohen, Israel and the Arab World (New 22. Ibid., p. 1220.
York: Funk and Wagnalls, 1970), p. 39. 23. Ibid., p. 1221.
3. Theodor Herzl, The Complete Diaries of Theodor
24. Ibid., p. 1222.
Herzl, 5 vols., ed. Raphael Patai, tr. Harry Zohn (New 25. Ibid., p. 1223.
York and London: The Herzl Press and Thomas 26. Ibid., p. 1224.
Yoseloff, 1960), hereafter, Diaries, p. 734. 27. Ibid., p. 1225.
4. Adolf Bohm, Die Zioniistische Bewegung, 2nd ed., vol. 28. Ibid., pp. 1227-28.
I (Berlin, 1935), p. 191. 29. Ibid., p. 1229.
5. Ibid. 30. Ibid., p. 1228.
6. Diaries, pp. 1135-36. 31. Ibid., p. 1230.
7. Ibid., pp. 1114-15. 32. Ibid., p. 1231.
8. Ibid., p. 1113ff. 33. Ibid., p. 1232.
9. Ibid., p. 1144. 34. Ibid., p. 733.
10. Ibid., p. 1174. 35. Ibid., p. 742.
11. See Justin McCarthy, The Populationi of Palestinie
36. Ibid., p. 743.
(New York: Columbia University Press, 1990). The 37. Ibid., p. 748.
figure in 1900 for Jewish Ottoman subjects was 23,662 38. Ibid., p. 757.
(p. 10). To this must be added the non-citizen Jews. 39. Ibid., p. 758.
Ottoman statistics of resident non-citizens for 1893 to- 40. Ibid., p. 759.
talled 8,200 for the Beirut Vilayet and Jerusalem Sanjak 41. Ibid., p. 739.
combined, of which McCarthy assumes 4,000 for Pales- 42. Ibid., p. 740.
tine. For 1900, he estimates a maximum of 10,000 for- 43. Ibid., p. 741.
eign Jews, though this "may be exaggerated" (see p. 44. Ibid., p. 743.
23). 45. Ibid.
12. A Survey of Palestine, 2 vols. plus Supplement 46. Ibid., p. 745.
(Washington, D.C.: The Institute for Palestine Studies, 47. Ibid.
1991), p. 372. 48. Ibid., p. 755.
13. Ibid. 49. Ibid., p. 745.
14. See Derek J. Penslar, Zionism anid Technocracy. The
50. Ibid., p. 747.
51. Ibid., p. 1128.
Enginieering of Jewish Settlenment in Palestinie, 1870-1918
(Bloomington: Indiana University Press, 1991), pp. 4, 52. Ibid.
20f. 53. Ibid., p. 1110.
15. Diaries, pp. 1216-17. 54. Ibid., p. 1113.
16. Ibid., p. 1216. 55. Ibid., p. 726.
17. Ibid. 56. Ibid., pp. 727-28.
18. Ibid., p. 1217. 57. Ibid., p. 1629.
19. Ibid., p. 1218.
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44 JOURNAL OF PALESTINE STUDIES
APPENDIX
AGREEMENT
His Majesty the Sultan grants and guarantees the JOLC the following spe-
cial rights and privileges for the purpose of settling Palestine and Syria with
Jews who assume Ottoman citizenship [in order to enable them] to open up
the natural food and occupational resources of these countries under the fol-
lowing conditions, and in return for assuming the obligations listed below.
II. The limited proprietorship of all estates and landed properties be-
longing to His Majesty the Sultan in the above mentioned "Privileged Territo-
ries." [The JOLC shall express its] eternal recognition of his supreme
proprietorship through a permanent annual payment of 3 Turkish Piasters
per dunum. This refers to the areas which [the company] has the right to
utilize according to article I of this agreement. Likewise, a special right to
occupy all those areas for which nobody can prove legal title or the right of
ownership. This occupation has to be carried out in the name of His Majesty
the Sultan, and the occupied areas have to be treated like the estates men-
tioned in the first paragraph of this item with regard to the supreme proprie-
torship, the annual payment, and the utilization.
III. The right to exchange economic enclaves of its territory, with the
exception of the holy places or places already designated for worship. The
owners shall receive plots of equal size and quality procured by it [the JOLC]
in other provinces and territories of the Ottoman Empire. It will not only
compensate these owners for the costs of resettlement from its own funds,
but it will also grant modest loans for the building of necessary housing and
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THE JEWISH-OTTOMAN [AND COMPANY 45
IV. The right to purchase railroads [Bahnen] already existing on the terri-
tories of the Company, including all rights, privileges, and any other special
authorities, from the legal owners by means of free agreements. Moreover, an
exclusive privilege to build and operate such railroads and railroad links with
the same special rights and preferences which have been granted to any pro-
ject of this kind in the Ottoman Empire, or will be granted in the future.
Likewise [the right] to build canals between rivers or to the adjacent sea, to
construct shipyards and harbors, and to allow navigation in them by its own
or others' commercial ships; in general, [the JOLC] may use the rivers, lakes,
seas or parts of seas which are on Company territory industrially and under
special law, and utilize their resources.
V. The JOLC will take over taxation in the "Privileged Territory," stipu-
lating that it [the company] is entitled to reform taxation and make it more
efficient. The purpose of this measure is [to enable it] to cover its needs
resulting from its liabilities mentioned below, as well as for the payment and
amortization of the annuity-loans (mentioned in article VIII) which the
JOLC will take out, and for which the "Privileged Territory" will be charged
for the account of His Majesty the Sultan. On the other hand, if it imposes
customs duties, it has to respect the international treaties of the Ottoman
government, adhering to the customary procedures and amounts.
VI. Within its "Privileged Territory," and under the protection of His
Majesty the Sultan, the JOLC has complete autonomy, guaranteed by the Ot-
toman Empire. But it is obligated to ensure on its territory the maintenance
of law and order, as well as the personal security and the property both of the
inhabitants and of peaceful visitors and groups of pilgrims from foreign
countries. [In addition] it has to secure the borders against attack, and to
equip and pay from its own funds the officials, civil servants, policemen and
constables, who are required for the administration of justice and public af-
fairs. The president of the JOLC is at the head of the administration (article
IX).
VII.A. All Jews whom the JOLC has settled in the "Privileged Territory"
become subjects of His Majesty the Sultan by virtue of their acceptance as
colonists or their employment as functionaries; they enjoy full Ottoman citi-
zenship. By joining the JOLC as colonists or as its functionaries they ipso
facto abandon their former citizenship. The same applies for the Jews who
are already settled in Palestine and Syria, who consider themselves proteges
of the JOLC, and who sign a certificate of admission of the Company. The
JOLC is responsible for keeping the legal register, as well as for building and
maintaining schools and institutions of higher learning, where the children
and pupils must be educated not only in their national language and history,
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46 JOURNAL OF PALESTINE STUDIES
in religion and general science, but also in physical education and patriotism
in order to make them reliable Ottoman citizens and grateful subjects of His
Majesty the Sultan.
C. During peacetime the trained troops of the standing army and the
cadres of the militia have to secure the borders of Syria and Palestine against
attack; they have to be used for the maintenance of law and order in the
interior of the country. In the case of war with a foreign power the entire
militia can be used for the defense of Asian parts of the Ottoman Empire, to
be determined in more detail.
D. In the latter case, the Sublime Porte is responsible for the equipment
and payment of the troops for the duration of the war. During peacetime, the
Sublime Porte also provides the JOLC with the means for the required mili-
tary academies, barracks, depots, weapons and ammunition factories, as well
as ships [Sch.] which the navy needs in the initial period for training pur-
poses.-The general levy may only be used for the defense of Palestine and
Syria in the case of an actual or impending invasion of these territories, and
the S.P.N. [Syrian-Palestinian Navy] division may only be used for the protec-
tion and defense of the coastal areas of the countries mentioned above.
E. The Sublime Porte will repay the money which the JOLC advances for
the S.P.L.D. [Syrian-Palestinian Land Division] of His Majesty the Sultan
under item D. paragraph one, including an annual interest of 4 percent, not
later than at the contracting of a subsequent S.P. [Syrian-Palestinian] annuity
loan (article VIII).
VIII. Using as collateral its income, privileges, and other capital, which
are guaranteed by the Sublime Porte, the JOLC contracts an annuity debt of 4
million Turkish pounds, which shall be subject to 4 percent interest per an-
num; after the first ten years, payments of principle shall begin, which shall
be paid off within a period of another forty-five years. The loan revenues
[interest and principle] shall be paid to the Treasury of His Majesty the Sul-
tan, or upon his direction to another account to be placed at his disposal. In
order to ensure the punctual payment of interest during the initial period, [the
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THE JEWISH-OTTOMAN LAND COMPANY 47
JOLC] will be exempted from one quarter million pounds, while the systema-
tization and regulation of the income of the JOLC is being carried out. But
this amount has to be considered as an advance to the JOLC, and must be
repaid within five years. After thirty years, another annuity loan of the same
amount and subject to the same modalities shall be contracted. But first of
all, the revenues [interest and principle] from this loan have to be used to
refund whatever money may have been advanced by the JOLC under Article
VII.E., if that money has not been repaid at that time.
The JOLC will also be entitled to take out other loans, in the form of
bonds for public purposes, or to issue preferred shares to create or improve
industrial and transportational facilities. The former have to be secured by
the JOLC's general revenues; the latter by the individual enterprises. How-
ever, the "Syrian-Palestinian Sultan bonds" have priority over all other [forms
ofl loans by virtue of their collateral, being backed by the revenues of the
"Privileged Territory."
IX. The president of the JOLC, who is elected by this company and ap-
proved by His Majesty the Sultan, enjoys personal immunity and is subject to
the special protection of His Majesty the Sultan, to whom alone he is ac-
countable. Within the "Privileged Territory" he is the deputy of His Majesty
the Sultan. He has to send a permanent representative to the Sublime Porte;
[this representative] alone is to convey the wishes and orders of His Majesty
the Sultan to the president, as well as the reports of the president to His
Majesty. This representative can only be a Jew or a Muslim.
X. As the holy site of all religions, the city of Jerusalem is exempt from
the special rights of article III. The proteges of the JOLC there are still sub-
ject to its jurisdiction and administration, and it [the company], like any other
Ottoman citizen, can make acquisitions there. But the supervision of the holy
sites is left to the Sublime Porte, and can only at the wish of the same be
taken over by the JOLC. With respect to taxes and duties, Jerusalem is also
part of the "Privilege Territories." But [the company] is responsible for
equipping and paying the troops which the Sublime Porte provides for guard-
ing and protecting the holy sites.
XI. His Majesty the Sultan exempts the JOLC from 40 percent of the
permanent payment which it has to submit according to article II. [This is
meant] as a partial compensation for the means which according to article
VII.D., the Sublime Porte during peacetime will grant for the Syrian-Palestin-
ian divisions of His Majesty the Sultan for the purpose of establishing military
academies, depots, ammunition and weapons factories, etc. The remaining
60 percent, however, has to be paid on time to the treasuries of His Majesty
in two equal semi-annual installments.
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