If a royal family is deposed do their jewels etc become the property of the nation or can the descendants sell them at auction?

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Well, there really is not an exact answer to the question. It varies by country and even within a country some jewels are handled differently. For example, in the United Kingdom, all jewels housed in the Tower of London (the Imperial State Crown, St. Edward's Crown, the Scepter with Cross, the Orb, etc.), the Honours of Scotland (housed in either Edinburgh Castle of the Palace of Hollyroodhouse) as well as the Honours of Wales all belong to the State. These are the crown jewels which are worn by the Queen only at the most formal ceremounies (Opening of Parliament, etc.) Essentially all other jewels that any of the British royal family is seen wearling belong personally to the Queen, or have been given as gifts or loaned to other members of the royal family. Upon marriage, female members of the royal family are often gifted suites of jewels (Tiara, Necklace, Earrings, Brooch, etc.,) by foreign countries (for example when the Queen was married, Brazil gave her the Aquamarine and Diamond Suite of jewels; Brazil was one of many counties, or foreign sovereigns who did this). These gifts belong to the recepient personally. The Star of Afica, the largest cut diamond in the world at over 500 cts, was origionally a personal gift from the de Beers diamond company to Queen Alexandra or Mary (I can't recall which at the moment). The Star of Africe, along with some "smaller" diamonds are currently set in the Scepter with Cross and the Imperial State Crown. Both of which belong to the state and not the Queen herself. These diamonds as well as certain other jewels have been bequest to the state upon a sovereigns death over the years. The current Queen's grandmother, Queen Mary (nee Princess Mary of Teck) is known for having assembled perhaps the largest collection of family jewels ever. Even after later monarchs giving tiaras to their daughers and granddather's or daughter's in law, the Queen is still believed to have the largest collection in the world. And her collection doesn't even count all the jewels that Diana was given, which are assumed to be held in trust for her sons (likely Harry as she left the bulk of her estate to him since William would inherit the throne, and all the personal real estate properties belonging to the sovereign (including Balmoral Castle, the Sandringham Estate, Castle of Mey, and others). The only residences used by the Queen that belong to the State are Buckingham Palace (which was once private but was gifted to the nation), Windsor Castle, and The Palace of Hollyroodhouse in Scotland. The British royal website actually gives a decent bit of information on what belongs to whom. It's interesting to note that in the past, all taxes collected on behalf of His/Her Majesty (as it still is) went into the accounts of the sovereign who was then responsibile for paying for military defense, parliament, public works, and everything else. Begining with George III, such income (also including revenue from the crown estate which owns vast land holdings, mineral rites under the sea bed, unmarked swans, whales,and many other things) has been deposited into His/Her Majesty's Treasury controlled by parliament in exchange for a "Civil List," of annual payment/salary for the Queen. She herself then pays her husband and all other members of her family for their work carrying out state visits, etc. Do some research because you'd be shocked at how little the Civil List payment is. If I recall correctly it's about 10million USD, but it's expensive to be her and have to buy clothes that you can't wear publically again to do her day to day job. The only person who she does not pay is The Prince of Wales who receives his income from the traditional holdings of the Duchy of Lancaster, which owns vast farm land, residental properties that area leased, etc. As I said, the Civil List has been used since George III in the 1700's. However, it has been up to each successive monarch to choose to continue this method or revert back to control (which at this point in time would likely cause a constituational crisis). Should the British monarchy ever be abolished, the question would remain would those holdings be returned to the sovereigh.
As for other countries...bitterness often times overpowers right and wrong. When Greece was in need of a sovereign but didn't have a royal family, they elected George I as King of the Hellenes (the Greek people) from the Royal House of Denmark. He moved to Greece to take the throne and brought with him his personal property to use in his homes. The Greek people "gave" him as a gift a royal palace and the option of his being responsible for the costs of government and he wouldn't have to pay any person taxes on his income, OR he could pay taxes and they would pay for government costs. He chose to not pay taxes and went on to build a dynasty. He reigned of over 50 years and purchased/built other palaces and furnishings as well as decades of gifts to him and his family. A son and three grandsons became king in a very short time, with some being deposed, replaced, and then even put back on the throne again. Eventually in the 1940's the royal family was ordered not to leave Greece and although there was a new form of governent the monarchy wasn't officially abolished until the 1970's. When it was officially abolished the family was exiled and not alled to take with them any of their property which they had owned previously, bought, inherited or was given...and to top it off they spent 70 years or so paying for all government operations. Talk about being screwed over! As of a couple years ago, the former King Konstine II and his siblings and heirs won a court case at the International Court of Human Rights and was awarded a pathetic sum of roughtly $8million....considering the estate is worth conservatively $500m it's a bit unfair.
Like the UK, Sweden, Norway, Denmark, the Netherland's all have both state owned jewels and privatly owned jewels. A good rule of thumb is that if it's not being worn for coronation, openings or parliament or the like, then it's privately owned.
Principalities like Monaco and Liechtenstein own their jewels personally. Liechtenstein is a good example of the closest thing to absolutism in Europe today. All the land that makes up Liechtenstein was purcased by the first princes, The County of Vaduz and a smaller Lordship which was united by decree of the Holy Roman Emperor and named Liechtenstein after the castle in Austria where the family had came from. In fact, they ruled the territory for over 100 years before anyone from the family ever visited it...and was another 20 years or so before a ruling prince ever stepped foot in the principality. My point is, they OWNED the entire country. Today, they have a constitution that was origionally adpoted in the mid-1800's but the sovereign prince recently regained many powers previously invested in their assembly/parliament. In fact, it was reported that he threated to sell the country to Bill Gates and premit him to rename it Mircosoft if the powers sought was not restored to the prince. If he truly made such a statement, it worked, as their laws were amended in his favor. They also have the biggest royal family in Europe, because by law all legitimate descendants in the male line are entitled to be styled HSH Prince/Princess of Liechtenstein. Currently every living member of the House of Liechtenstein descend from a prince who lived in the mid to late 1800's. There are currently over 100 male princes not counting at least that many female princesses. He's also the 4th wealthiest head of state in the world, with a net worth of about $5Billion, larely from banking ventues. Liechtenstein is a tax haven and at about 62 sq miles one of the smallest sovereign states in the world.
Germany royal families who lost their thrones generally kept their property, jewels, etc., and are infact allowed to retain their titles but as a surname. They are allowed to adjust the title if for daughers so there aren't cases where a girl is Alexandra, Prince of Hanover!
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