The Luxembourg Crisis: sale offer and Treaty of London neutrality

Background. The crisis arose from tensions following the Austro-Prussian War. Prussia had defeated Austria in 1866, creating an imminent threat. King William III of the Netherlands, who was also Grand Duke of Luxembourg, desperately needed money and was prepared to sell the Grand Duchy to France, leading to the diplomatic dispute and confrontation between France and Prussia over the political status of Luxembourg.

Sale Offer. In 1867, France offered to buy Luxembourg. King William III, being in deep financial trouble, accepted the offer on 23 March 1867. This transaction triggered the Luxembourg Crisis, which almost precipitated war between Prussia and France. The crisis involved a diplomatic dispute and confrontation over the political status of Luxembourg.

Treaty Resolution. The Treaty of London, often called the Second Treaty of London, was signed on 11 May 1867. It granted Luxembourg full independence and neutrality. The immediate effect was the reaffirmation of the personal union between the Netherlands and Luxembourg under the House of Orange-Nassau. France was forced to renounce any claim to Luxembourg.