Near Tuscany Italy in Northern Umbria, there is a small Italian village known as Cospaia. While it is not a quaint collection of buildings, it used to be the center of the tobbacco trade for the whole region – and it used to be its own country.
For nearly four centuries, Cospaia was an independent republic of about three square kilometers. It had no laws, no taxes, or really anything that made it its own nation. Regardless, it was never invaded and no other country claimed it as their own.
This might sound a little strange in an era of border disputes and exact measurement, but this tiny republic was actually a rather comical gaff of Renaissance surveying.
In 1431, Pope Eugene IV needed cash, so he took out a loan of 25,000 gold florins from the neighboring Duke of Florence. 9 years after he took this loan, the Pope found himself unable to pay up. So, the two decided that the pope would transfer the town of Borgo San Sepolcro and it’s district over to the Duke. The two set their new border as the river Rio on the upper Tiber. But here’s the thing, Rio simply means river, so it’s a pretty common name for rivers in that area. There were hundreds of small streams in Italy named Rio – but the survey teams from both countries didn’t know that.
The Pope and the Duke sent their own teams to set the border, each using the closest river Rio in their region, being unfamiliar with the fact that there were two. They used two different streams, both named Rio, leaving a tiny section in the middle, Hamlet of Cospaia.
The villagers in this town discovered they had been left out and immediately declared themselves an independent Republic. This embarrassed the Pope and the Duke, but neither wanted to negotiate a new agreement. So… nothing happened.
In 1440, Cospaia gained independence. The Republic didn’t form a governement, establish an army, wrote no laws, and paid no taxes. Instead, the people just worked to become superb at agriculture. This worked out well for them as Tobacco grew into a key product throughout Europe and the Americas. While the world went into a frenzy over tobacco in the 1500s, the Catholic Church tried to curb the consumption of this vice. In the mid-1600s, the pope threatened to excommunicate anyone found smoking.
All of this came to mean that legally, cultivating tobacco was pretty difficult in Italy, but the Republic of Cospaia wasn’t Italy. The state fell outside the jurisdiction of the pope, so the tiny republic became the center of tobacco cultivation in Tuscany. By matter of relation, it also became the hub of the illicit tobacco trade in Italy as well. The tiny nation grew rich from the demand for its tobacco. Farmers could sell the tobacco tax-free to other countries and pay no taxes to their own nation on the income. It was a tax haven of economic freedom.
This freedom is what eventually led to the demise of Cospaia though…
In 1826, the Pope and the Duke of Tuscany broke up the Republic and divided the territory among themselves. The Papal States got the most of it and Cospaia lost their freedom of rule. However, in the negotiation, the town got the right to continue cultivating tobacco limited to half a million plants a year – plenty to sustain their economy.
Once a flourishing lawless nation, Cospaia today has become a small collection of forgotten houses in Umbria in Italy. The only remnants of its past is a small yellow sign by the side of the road that says “Ex-Republic of Cospaia.”