When during the Franco-German war of 1870 the King of Prussia, as President of the North German Confederation, ordered the creation of a volunteer navy by inviting the owners of private German vessels to make them part of the German navy, the question was raised whether this scheme violated the Declaration of Paris by which the signatories had engaged themselves no to employ privateers. While in the following decades the principle was generally admitted that merchant ships might be incorporated into the regular navy, several questions remained unsolved. The signatories of the present Convention, concluded at the Second Hague Peace Conference, although agreeing on the general principle, were unable to settle all the questions which gave rise to controversy. In particular, they could not agree on the question whether conversion might be performed in a harbour of the converting State only or also on the high seas (see preamble). Nor could they solve the question whether or not it was permissible to reconvert into a merchantman, before the end of war, a vessel which during the war had been converted into a warship.
D.Schindler and J.Toman, The Laws of Armed Conflicts, Martinus Nijhoff Publisher, 1988, pp.798-800.