overview

This note considers 'virtual states' and supposed 'data havens'.

It covers -

• this overview, with an introduction to such states and major studies
• issues - questions about their legal basis, practical considerations and scams
• projects - notes on selected past and contemporary virtual states, such as Atlantium, the Dominion of Melchizedek, Talossa, United Federation of Koronis, Duchy of Avram, Holy Empire of Reunion and Insulo de la Rozoj
• data havens - fantasies about censorship-free and copyright-free 'cyberhavens' in putative microstates such as Sealand

It supplements discussion elsewhere on this site regarding governance of the global information infrastructure, intellectual property, taxation, politics and currency.

     introduction

So-called 'virtual states' (also characterised as 'stealth states', 'ephemeral political entities' or members of the 'Fifth World') are of interest because they pose questions about political legitimacy, international governance and the way that some online communities conceptualise law and citizenship.

They are also of interest as a basis for scams, as a subject of media attention and of problematical claims about the feasibility of establishing anarchical cyberhavens that are free of censorship, copyright, taxes, soap and other supposed embodiments of a repressive 'new world order'.

They are virtual because they are weak simulations of real countries. They typically involve only a handful of people - most virtual states claim a membership of less than 50 people and the only active person is typically the state's founder (its king, duke, emperor, president or arch-wizard). Contrary to their pretensions, virtual states have no basis in international law and no recognition by real countries. As the following page notes, they do not meet accepted criteria for nationhood and are in essence either an embodiment of the founder's eccentricity or a commercial exercise that may or may not breach law in their country of domicile.

Virtual states can be distinguished from online diasporas (with political and economic refugees maintaining a global community through the internet) and from governments-in-exile.

They can also be distinguished from virtual world entities - those in massive multiplayer online roleplaying games (MMPORGs), although such games often have a 'population' that is larger and more committed than that of pseudo-states such as Minerva.

     how many states?

There is no comprehensive list of virtual states and figures are uncertain.

That is unsurprising given the nature of many of the states, which are often started by schoolboys at the age of 15 or 16 and expire as the adolescent moves beyond a 'dungeons & dragons' mindset, or that were announced as a protest against a tax agency, bank or globalisation and disappear once grievance has been expressed.

It is also unsurprising because virtual states are not acknowledged by the ITU, ISO, UN General Assembly and other international entities. They do not for example gain ccTLDs, are not recognised by the ISO 3166 Maintenance Agency and are not members of the Universal Postal Union (UPU). Those bodies typically encounter virtual states when dealing with communiques from self-declared monarchs or with scams affecting consumers in several jurisdictions. One contact in Geneva thus refers to his 'kooks, cons & coronets' file.

It is conceivable that there are well over 200 virtual states asserting their existence at any one time. Some disappear quickly. Others in practice do not appear, because they fail to get attention beyond the founder's family or two best friends. The main evidence for the rise and fall of the prominent virtual states is their artifacts - coins and notes that have a curiosity value and appear in independent numismatic catalogues - and collisions with law enforcement bodies.

     micronations and fictions

Enthusiasts for virtual states have appropriated the term 'micronation'. That term more appropriately used to characterise countries in the Pacific, Europe and elsewhere that have a small geographical territory and/or population.

As noted in the following page, size is not all and legitimacy is not necessarily a function of population size, hectares claimed or military spending. From the perspective of China, with over a billion citizens, Australia may appear as a microstate – albeit one in possession of substantial real estate and with a substantial GDP. Microstates are more commonly held to include entities such as San Marino, Liechtenstein and Andorra in Europe and Niue, Kiribati, Nauru and Tokelau in the Pacific. They typically command only a small land area; some of Pacific states have a correspondingly small population (much of it resident offshore) and economy. It has been less common to characterise the Gulf States as micronations (an instance of petro-exceptionalism?), although by one account there are more lawyers in the US than there are citizens of Qatar, more hairdressers in Europe than citizens of Abu Dhabi.

International recognition of some of those states is longstanding. Their regalia and Burgundian-style court costume, much copied by pretenders among virtual duchies and principalities, predates the Congress of Vienna. Others date from Britain's departure from the Pacific in the 1960s. Some, such as Monaco, are so closely aligned with a larger neighbour as to be protectorates. Some are dependent on international welfare and may indeed disappear due to rising sea levels. They may however have economic clout.

     establishment

What is involved in establishing a virtual state?

The answer to that question is, of course, very little.

Establishment typically appears to involve the founder awarding his or herself a suitably resonant title. (As time goes by a process of title inflation is usually apparent. People often start by characterising themselves as dukes and later upgrade the title to king or emperor. Others add ecclesiastical to civil titles. The self-proclaimed Duke of Avram in Australia is thus a Prince and Cardinal with a plethora of honorifics, few recognised by an independent authority.)

The next step is to announce establishment of the state. Establishment is sometimes pitched as a secession from a nation such as Australia on the basis of refusal to pay that nation's taxes (or merely repay a bank loan). It may instead be described as assertion of hitherto unrecognised rights. In the past few people would have become aware of the establishment, which generally came to attention through media coverage of legal action by tax or other agencies or by a 'slow news day' item on a colourful eccentric. The web now allows announcement to a global audience. Whether that audience is listening is another matter.

Some virtual state proprietors restrict themselves to being photographed in ruritanian regalia and costumes and bestowing honorifics on friends and associates.

Others move on to commercialise the project. That commercialisation may be benign, through sale of collectible banknotes and coinage or through chivalric orders that are only recognised by recipients. It may instead extend to sale of academic degrees, naturalisation certificates and passports, and a range of money laundering or investment scams. Passports are often sold on the basis that the putative state has international recognition and that the passport can accordingly be used for international travel.

What is the outcome of establishing a virtual state?

Consistent with the ease of establishing a virtual state its impact is often barely discernable. Abandonment may involve nothing more a decision to cease payment for hosting the supposed state's site.

     studies

Benedict Anderson's Imagined Communities: Reflections on the Origin and Spread of Nationalism (London: Verso 1983) and Ernest Gellner's Nations & Nationalism (Ithaca: Cornell Uni Press 1983) consider what we mean by 'nation'. Other works are highlighted here.

For questions of recognition see in particular the lucid The Creation of States in International Law (Oxford: Clarendon Press 2006) by James Crawford, complemented by Stefan Talmon's Recognition of Governments in International Law, With Particular Reference to Governments in Exile (Oxford: Clarendon Press 1998), Thomas Grant's The Recognition of States: Law and Practice in Debate and Evolution (Westport: Praeger 1999) and Christian Hillgruber's 1998 article 'The Admission of New States to the International Community' in 9 European Journal of International Law 491.

Points of entry to literature about the disappearance or non-disappearance of the state include Jerry Everard's Virtual States: The Internet & the Boundaries of the Nation State (London: Routledge 1999), Crypto Anarchy, Cyberstates, & Pirate Utopias (Cambridge: MIT Press 1999) edited by Peter Ludlow, The Myth of the Powerless State (Ithaca: Cornell Uni Press 1998) by Linda Weiss, The Retreat of the State: The Diffusion of Power in the World Economy (Cambridge: Cambridge Uni Press 1996) by Susan Strange and other works highlighted here. Essays in The State of Play: Law, Games & Virtual Worlds (New York: New York Uni Press 2006) edited by Jack Balkin & Beth Noveck will stimulate thought about clickocracy and the blurring of traditional demarcations.

Points of entry to the literature on international public law include Malcolm Shaw's International Law (Cambridge: Cambridge Uni Press 2002), Antonio Cassesse's International Law (Oxford: Oxford Uni Press 2005), Nikos Papadakis' The International Legal Regime of Artificial Islands (Leiden: Sijthoff 1977), Anthony Aust's Handbook of International Law (Cambridge: Cambridge Uni Press 2005) and The New Sovereignty: Compliance With International Regulatory Agreements (Cambridge: Harvard Uni Press 1995) by Abram & Antonia Chayes. Questions about the legitimacy of governments (and of nations) are highlighted in the discussion of human rights and the Australian Constitution, with pointers to salient works such as Hans Kelsen's provocative General Theory of Law & State (New Brunswick: Transaction 2005).

Material on territorial and international waters, such as Ram Anand's Origin & Development of the Law of the Sea: History of International Law Revisited (The Hague: Martinus Nijhoff 1983), The Law Of The Sea (Manchester: Manchester Uni Press 1999) by Robin Churchill & Vaughan Lowe and The exclusive economic zone in international law (Oxford: Clarendon Press 1987) by David Attard is noted here.

For evanescent tax havens see Noel Cox's 2003 Tax and Regulatory Avoidance Through NonTraditional Alternatives to Tax Havens. Other works include Tax Havens of the World (New York: Matthew Bender 1998) by Walter & Dorothy Diamond. Other works on tax regimes are noted in the Taxation Guide elsewhere on this site.

For Australian microstates and the politics of resentment see DIY Sovereignty and the Popular Right in Australia (PDF) by Judy Lattas.

Poyais, a protype for contemporary scams, features in David Sinclair's Sir Gregor MacGregor and the Land That Never Was (London: Review 2003). Pirate radio is discussed in Paul Harris's Broadcasting from the High Seas (Edinburgh: Paul Harris Publishing 1976) and in the 1967 'Legal Aspects of Pirate Broadcasting: A Dutch Approach' in 60 American Journal of International Law 303 by HF van Panhuys & Menno van Emde Boas.

The evanescent nature of virtual states - proclaimed today, gone tomorrows (or when the tide comes in) - means that there is not a substantial literature on individual projects. A 2006 NLA and LoC literature search for example revealed that there are more books on the art of the sandcastle than monographs on virtual states. Coverage in the mass media has been uneven, ranging from items that take pseudo-imperial communiques at face value to pieces that are gently derisive.

For the Republic of Minerva see Lawrence Horn's 1973 'To Be or Not to Be: The Republic of Minerva: Nation-founding by Individuals' in 12 Columbia Journal of Transnational Law 520 and Samuel Menefee's 'Republics of the Reefs: Nation-building on the Continental Shelf and in the World's Oceans' in 25 California Western International Law Journal 81.

A perspective is provided in Michael Oliver's A New Constitution for a New Country (Reno: Fine Arts Press 1967), one of those tracts that makes Ayn Rand seem readable, and even zanier How to Start Your Own Country: how you can profit from the coming decline of the nation state (Port Townsend: Loompanics 1984) by Erwin Strauss. The latter recommends acquisition and willingness to use weapons of mass destruction.

For Ray and the Grand Capri Republic see Sherry Eckhardt's 1969 'Proprietary Interest of United States in Continental Shelf Precludes Claims of Acquisition by Private Entrepreneurs - United States v. Ray' in 6 San Diego Law Review 487. Rose Island features in Pasquale Paone's 1968 'Il Caso Dell' 'Isola Delle Rose' in 51 Rivista di Diritto Internazionale 505. Writing about Sealand includes Simson Garfinkel's 2000 article Welcome to Sealand. Now Bugger Off, replete with claims that "freedom is the next killer app" (ie commercial freedom "to store and move data without answering to anybody, including competitors, regulators, and lawyers").

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