Free Trade Act

Updated About encyclopedia.com content Print Article Share Article
views updated

Free Trade Act

Free Trade Act, measure signed on 12 October 1778 that crowned Charles III's work to modernize Spanish mercantilism through commercial deregulation. Preceded by piecemeal reforms for the Caribbean islands (1765), Yucatán (1770), Santa Marta and Riohacha (1776), and Buenos Aires, Chile, and Peru (2 February 1778), it extended imperial free trade to all of the American empire except Venezuela and Mexico and opened thirteen Spanish ports to the colonial trade. For Spanish exports, licensing procedures were simplified and ad valorem tariffs replaced levies based on weight and volume. Duties on imports into Spain varied, totaling 4 percent for most, and 5.5 percent for silver. Venezuela, where the Caracas Company commanded influence, and Mexico, whose commercial strength threatened to overwhelm the other colonies, were not brought under the act until 1788–1789, except for tax rates. Meanwhile, tonnage limits constricted Spanish exports to Veracruz. Imperial trade increased impressively following deregulation, although it waned during the wars of the French Revolution and Napoleon.

See alsoCommercial Policy: Colonial Spanish America .

BIBLIOGRAPHY

John R. Fisher, Commercial Relations Between Spain and Spanish America in the Era of Free Trade, 1778–1796 (1985).

Josep Fontana and Antonio Miguel Bernal, eds., El "comercio libre" entre España y América (1765–1824) (1987).

Additional Bibliography

Booker, Jackie R. Veracruz Merchants, 1770–1829: A Mercantile Elite in Late Bourbon and Early Independent Mexico. Boulder, CO: Westview Press, 1993.

Fisher, John R. Trade, War and Revolution: Exports from Spain to Spanish America, 1797–1820. Liverpool: Institute of Latin American Studies, University of Liverpool, 1992.

Mazzeo, Cristina Ana. El comercio libre en el Perú: Las estrategias de un comerciante criollo, José Antonio de Lavalle y Cortés, Conde de Premio Real, 1777–1815. Lima: Pontificia Universidad Católica del Perú, Fondo Editorial, 1994.

Silva, Hernán A. El comercio entre España y el Río de la Plata (1778–1810). Madrid: Banco de España, Servicio de Estudios, 1993.

                                        Allan J. Kuethe