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The Occupying Power may also set exchange rates for currency in occupied territory. 465The Occupying Power’s powers to regulate currency must not be used to confiscateprivate property. 466 For example, intentional debasement of currency by the establishment offictitious valuation or exchange rates, or like devices, as well as failure to take reasonable stepsto prevent inflation, with the result of enrichment of the Occupying Power, would violateinternational law. 46711.23 OTHER ECONOMIC REGULATION OF OCCUPIED TERRITORY11.23.1 General Authority of the Occupying Power to Regulate Commercial Intercourse.The Occupying Power has the right to regulate commercial intercourse within, into, or out of theoccupied territory. It may subject such intercourse to such prohibitions or restrictions as areessential to the purposes of the occupation. 468 The Occupying Power also may remove existing(Jun. 17-18, 1947) (“The currency policies deliberately followed by the Axis in retreat were designed to make themaintenance of ‘public order and safety’ by the Allied powers as difficult as possible. The variety of forms ofeconomic sabotage which the Germans might use is illustrated by the seemingly opposite practices followed inTunisia and in Sicily. In Tunisia, the Germans distributed Bank of France notes on a grand scale, increasing wagerates to some classes of employees manifold, patronizing the black market freely, and paying collaborationistslavishly. … In Sicily, Mussolini went even further [than in Italy] and ordered the banks to be substantially depletedto the point where additional new currency was urgently needed for immediate use to permit the resumption ofnormal commercial activity. … Thus, the Axis practices made a ready supply of new currency even more essentialthan otherwise, and provide a complete justification for the use of such currency under the test of the HagueConvention.”).465 For example, Coalition Provisional Authority Order No. 43, New Iraqi Dinar Banknotes, §5 (Oct. 14, 2003)(“The 1990 dinar banknotes and the Swiss dinar banknotes and coins shall be exchanged against New Iraqi dinarbanknotes at the official conversion rates of one (1) 1990 dinar to one (1) New Iraqi dinar, and of one (1) Swissdinar to one-hundred-and-fifty (150) New Iraqi dinars.”).466 Refer to § 11.18.6.1 (Prohibition on Confiscation of Private Property in Occupied Territory).467 1956 FM 27-10 (Change No. 1 1976) 430 (“Intentional debasement of currency by the establishment offictitious valuation or exchange rates, or like devices, as well as failure to take reasonable steps to prevent inflation,are violative of international law.”). See also Opinion on the Legality of the Issuance of AMG (Allied MilitaryGovernment) Currency in Sicily, Sept. 23, 1943, reprinted in Occupation Currency Transactions: Hearings Beforethe Committees on Appropriations Armed Services and Banking and Currency, U.S. Senate, 80th Congress, FirstSession, 73, 82 (Jun. 17-18, 1947) (“The Germans were roundly criticized during the First World War, and again inthis war, for introducing occupation marks and similar currency devices. … The vice of the German practice is notin the use of currency, but in the excessive issue of valueless currency as a device for stripping the occupied area ofits good and its labor for the benefit of Germany.”).468 1956 FM 27-10 (Change No. 1 1976) 376 (“The occupant has the right to regulate commercial intercourse in theoccupied territory. It may subject such intercourse to such prohibitions and restrictions as are essential to thepurposes of the occupation.”). See also WILLIAM E. BIRKHIMER, MILITARY GOVERNMENT AND MARTIAL LAW 268(1914) (“One of the most important incidents of military government is the regulation of trade with the subjugatedstate. The Occupying State has an unquestioned right to regulate commercial intercourse with conquered territory.It may be absolutely prohibited, or permitted to be unrestricted, or such limitations may be imposed thereon as eitherpolicy or a proper attention to military measures may justify.”).817