has no exact counterpart in Anglo-American institutions. This department is known as Fomento, and has jurisdiction in general over all sources of natural wealth. To this department, therefore, appertain all concessions for the development of the public domain. To the department of communications and public works are referred concessions relating to railroads and the telegraph and telephone services, with the right of intervention by the department of finance and public credit, whenever a matter of subsidy or other money grant is involved. The procedure to be followed in obtaining a concession will now be outlined. Method of Obtaining: The first step consists in the filing of a petition with the proper executive branch, specifying the privilege it is desired to enjoy, e. g., the use of a certain volume of water for purposes of irrigation or water-power, the privilege to fell a specified number of trees within defined boundaries on national lands, the right to build and operate a railroad between designated points, etc. If the petition satisfy the requirements of form, the application is published in the Official Gazette, in accordance with the administrative regulations of the competent department. This publication affords an opportunity to any interested party to offer an objection, or to submit a claim, valid or alleged, against the granting of the concession. Furthermore, the applicant must show good cause, and his petition stand a rigid test of public interest. On the expiration of the term for protest, a more searching investigation of the genuineness of the enterprise and of the reliability of the applicant is undertaken; and not until its satisfactory conclusion is the concession granted. The regulation of these applications during the Diaz régime was the subject of increasing study. In the early days, it was common to grant "a railway concession to anyone asking for it without investigating the responsibility of the concern." Immense progress is recorded from this condition, and that prevailing in the later days of the Diaz administration. This is well exemplified by the conditions required for a petition for a concession under the water law of December 14, 1910. They are as follows: (1) Publication of the application in the federal and state official gazettes; (2) Assignment of a period of sixty days after last appearance for the filing of opposing claims; (3) Filing of bond to guarantee performance; (4) Appeal from this ruling to the courts allowed either applicant or claimant, if exercised within thirty days; (5) Summary decision of suits instituted, the term for taking evidence being limited to forty days. The several conditions of the grant are now embodied in a contract between the executive and the concessionaire. This contract comprises a number of articles imposing reciprocal obligations and conferring reciprocal benefits. An important departure from this rule should be noted in the case of mining. While the mining grant furnishes perhaps the most complete example of a concesión, the terms of the grant are not incorporated in a separate contract. The reason for this is to be found in the historic evolution of mining. Indeed, the only specific obligation contained in the mining grant or patent is the payment of the annual rent in recognition of a superior estate in the nation. Forfeiture: A concession as we have seen takes the form of a contractual relationship; it can not therefore be modified except by mutual consent. The 1917 constitution sweeps this principle aside, and vests in the Executive absolute power to review all contracts and concessions since 1917, and even to declare their nullity under certain conditions. The exact language is as follows: "All contracts and concessions made by former governments from and after the year 1876 which shall have resulted in a monopoly of the lands, waters and natural resources of the nation by a single individual or corporation are declared subject to review, and the Executive is authorized to declare those null and void which seriously prejudice the public interest. (Article 27.) Every concession contains an enumeration of the grounds for forfeiture. This clause usually provides for forfeiture through administrative declaration; but a tendency kept asserting itself in the later laws of the Diaz administration to allow appeal to the courts from the action of the executive. This principle has been embodied in the mining law of November 25, 1909, and the water law of December 14, 1910. Restrictions on Foreigners: The next element to consider is the recipient of the privilege. The first natural division is into national and alien, with the subdivision of each into individual and corporate. The prohibition against foreigners holding land within a prescribed zone from the border without special permission from the Executive dates back to the earliest legislation of independent Mexico. It was customary during the Diaz administration to grant this permission largely as a matter of course, except where the precept was absolute. Thus the mining law of November 25, 1909, makes absolute the restriction to hold patent or title to properties within a certain area from the border in the case of foreign companies. Similarly, the water law of December 14, 1910, while making no distinction as between individuals, limits the grant of a concession to "companies organized under the laws of Mexico, and to such Mexican associations, public or private, as have legal capacity to enjoy such grants. There was, accordingly, precedent for the provision inserted in the 1917 constitution whereby foreigners are forbidden to acquire the owner ship of lands and waters within an area of one hundred kilometers from the frontiers and fifty kilometers from the seacoast; but the precept broadens the scope of the former limitations by including the seacoast strip and by depriving the Executive of the discretionary power of making exceptions heretofore exercised by him. Similarly, under the same instrument, foreign corporation may not acquire concessions to develop the natural resources of the country, while foreign individuals may do so only after waiver of their right to the diplomatic protection of their governments. Common Provisions: While the diversity of subject-matter makes it impossible to reduce all concessions to a standard form, there are certain conditions common to all. They may be enumerated as follows: 1. Reservation regarding interests of third parties; 3. Forfeiture clauses; 4. Waiver of diplomatic protection; 5. Time limitation. It might be thought that for historical reasons the land and mining grants furnished the model for other lines of activity. Such is not the case, however, and the reason is not far to seek. The system of concessions in Mexico has grown up since 1876 around the foreign capital which was first attracted to the possibilities of railroading in that country. It is the railroad franchise that set the standard; it must hence be our starting-point. Railroads: Railroad history in Mexico falls naturally into three epochs: (1) Early history down to the Tuxtepec revolution which brought General Diaz into power; (2) Period between 1876 and 1898; (3) The Limantour policy, as embodied in the railroad law of April 29, 1899. Early history centers around the Mexico City-Vera Cruz line. The first charter for this road bears date of August 22, 1837, and took the form of an exclusive privilege. After passing through several hands, and enjoying no less than twenty-five legislative enactments, the line was finally completed on January 1, 1873, chiefly through the unflinching perseverance of two Mexican citizens, Manuel and Antonio Escandón, aided by British enterprise and capital. The franchises of this period granted certain exclusive and perpetual privileges as a bonus to private initiative which in the light of modern theories of government would probably deserve condemnation, but which when projected against the background of instability then prevailing seem none too liberal. The second epoch from 1876 to 1898 marks the heydey of railroad charters. Franchises were given "freely, almost with prodi gality, to any applicant, without standard nor measure, and it may even be said without order nor system." On December 16, 1881, there was enacted the first railroad law. It defined the constitutional term, "general ways of communication." The measure is important for two reasons. First, the control of the federal government over railroads, telegraphs, and telephones was made virtually complete. Secondly, a state monopoly was created over telegraph lines. This monopoly has now been sanctioned by the 1917 constitution. Two franchises conferred in this period deserve more than passing reference: The charter granted to the Mexican Central Railway on September 8, 1880, and that given to the Mexican National Railway on September 13, 1880. Both franchises contain fundamentally the same terms. They are: (1) Reversionary right in favor of the nation, at the end of ninety-nine years, of the railroad, unencumbered; (2) Rolling stock to be valued by experts and the amount paid to the company; (3) The operation of the line to be in the hands of the concessionaire, subject to governmental inspection; (4) Maximum freight and passenger rates fixed; (5) Free mail service; (6) Rebate of sixty per cent in freight and passenger service for the army and federal civilian employees, when engaged in official business. To offset these severe obligations, the government afforded the companies the following privileges: (1) Free importation of equipment and rolling stock; (2) Right to take property for the construction of the line, stations, etc., under condemnation proceedings; (3) Almost complete exemption from all kinds of "taxes, tolls, and imposts, levied or to be levied by any authority in the republic, whatever be the nature, denomination or purpose of the said imposts"; (4) Subsidy of nine thousand pesos per kilometer completed; (5) No subsidy to be given to any parallel lines built within seventy-five miles on either side. The third epoch pivots around the figure of Limantour. In the annual report of his department for 1898-1899, he unfolded a comprehensive railroad plan, the main ideas of which were incorporated into the law of December 17, 1898, later amplified by the railroad act of April 29, 1899. The basic principle of this measure stipulates that "franchises shall be granted for a term of not over ninety-nine years; and at the termination of the franchise, the railroad, together with all its appurtenances, shall become the property of the nation, free from encumbrance, and the nation shall be bound to pay only for the rolling-stock and personalty." In consonance with the ideas expounded in the Liman. tour report, there are stringent regulations surrounding the grant of a railroad franchise. On the approval of the application by the department of communications and public works, there is required, in the case of lines classified as of primary importance, an initial deposit in bonds of the public debt at the rate of one hundred and fifty pesos per kilometer measured "as the crow flies," increased by ten per cent. After complying with this stipulation, the applicant is called upon: (1) To show the bona. fide existence of the company seeking the concession and its ability to operate the road; and (2) To furnish satisfactory evidence that the capital stock necessary to complete the survey of the line has been subscribed. The grounds for forfeiture are: I. Failure to begin the survey within the term set; II. Failure to complete in any year the number of kilometers stipulated; III. Total or partial interruption of the public service of the line, except in case of force majeyre; IV. Transfer of the concession, or of the rights thereunder, without authority; V. Transfer, alienation, or encumbrance of the concession or of the lines to any foreign state or government, or the admission of either as a partner. Land: The first systematic attempt to survey and adjudicate waste lands is the famous Juarez law of July 20, 1863. This important measure has been well summarized in the report submitted to Congress by the Minister of Fomento, Colonization and Industry in 1896. It follows: "The Juarez administration enacted at San Luis Potosí, in the midst of the horrors and hazards of war, the memorable law of July 20, 1863, fixing the conditions for the occupation and alienation of waste lands. It established the right of every inhabitant to make entry on waste lands up to 2500 hectares (6175 acres); set moderate rates for these lands; facilitated terms of payment, prescribing that two-thirds should be paid in cash and the balance in bonds of the public debt. It recognized possession, although accompanied by certain irregular title-deeds; protected and favored the possessor, offering rebates on the regular valuation and compensating improvements made on the land; it respected lawful ownership; established the legal procedure for the survey of lands; and imposed upon owners under this law the obligation to maintain a settler for each 200 hectares during ten years."' On May 31, 1875, Congress enacted another colonization law. It authorized the execution of contracts on the following conditions: (1) Subvention to be paid the colonization company for each family established; (2) Sale, at moderate rates and on long terms, of suitable lands; (3) Payment of a bonus to each immigrant family; (4) Guarantee of reliability on the part of the companies: (5) Exemption for the settlers from military service; (6) Exemption "from all forms of taxation, except municipal taxes, and from all import and internal dues on farm implements, foodstuffs, etc." There was passed on December 15, 1883, another important colonization law. It maintained the limit of two thousand five hundred hectares set in the law of July 20, 1863, for the acquisition of lands by a single individual, but introduced a novel feature. The survey of waste lands was entrusted to private companies, which were to receive as compensation for their services one-third of the land surveyed. |