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Originally the Memel Territory was to be given has an access to the Baltic Sea to the recently independent state of Lithuania. But its borders where no delimited until the end of the 1920s due to its conflict with Poland. By 1920 the Paris Peace Conference, and mainly France, decided to mandate Memel to the LoN until the Lithuanian-Polish quarrels were resolved. Also, East Prussia claimed Memel as part of its territory and pressed in the LoN for its integration. The Treaty of Versailles established that the Conference of Ambassadors (France, U.K., Italy and Japan) would determine the future status of Memel. This understood has its annexation to Lithuania.
Its administration was in charge of France that named a High Commissioner, who was also the Commander in Chief of the Allied Defense Force and Memel Gendarmerie. It also had power of veto on the decisions of the local authorities.
The French authorities established District Directorate (6-8 members) that pursued all government functions of the Territory, an elected legislative State Council (20 members elected for a 3 year term) and an Administrative Court. The District Directorate was in charge of public institutions (railroad, postal service, customs, etc.), but its jurisdiction over of the police and courts was limited to financial matters. The President of the Directory was the head of the administration and had extensive powers in his own right. The members of the Directorate were appointed and dismissed by the French commissioner.
The Territorial politics was divided between pro-German and pro-Lithuanian parties. The pro-German parties were Memel Agricultural Party (Memelländische Landwirtschaftspartei, MLP), Memel People's Party (Memelländische Volkspartei, MVP) and Social Democratic Party of the Memel Territory(Sozialdemokratische Partei des Memelgebietes, SDPM). The Pro-Lithuanian were the Lithuanian People's Party (Litauische Volkspartei, LVP) and Lithuanian Autonomists (Litauische Autonomisten).
The Port was administered between France, the LoN and Lithuania by Joint Port Authority, that also controlled the railways.
The main contingent of Allied Defense Force were French and Italian troops. UK provided a small detachment to serve has coastal police. The Memel Gendarmerie was recruited from the local population but its Commissioner and Staff where French, who also provided the training.
The Memel Territory had no important industry, being dependent economically of Lithuania and East Prussia. The French administration agreed with the local authorities in giving economical subsidies and preferential tariff for French goods. Studies and funds for reconstruction of port infrastructure where negotiated. For Lithuania the Port was the main access point of export (flax, flax seed, grains and furs) and import (industrial and agricultural machinery and manufactured goods).
The end of the Mandate
Several factors marked the end of the mandate. The economic crisis of 1930. The economic aid given by France was planned to be severely cut down. The reconstruction and modernisation of the port infrastructure was writing off due to its cost and lack of funding. Lithuania had by this time settled its issues with Poland (Lithuanian-Polish War had ended). The Conference of Ambassadors, with the agreement of the LoN, transfers the mandate to Lithuania despite diplomatic protest from East Prussia and Poland. The Memel Convention signed between France, on behalf of the LoN, and Lithuania established the former mandate has an autonomous region of Lithuania.