In trade, competition is good. It keeps down prices, increases innovation, and is good for consumers.

Instability and restriction, however, is not.

And those are two words that accurately describe trade in the Baltic Sea at the moment. Attacks have occured from both sides in this war of ducats, with the Hansa heavily taxing Danish trade merchants, and Denmark tripling the Sound Toll for Hansa ships plus blocking all passage of Teuton ships. Emergency Diets have been called, finding allies and enemies at hand. Already clouds of war seem to be forming across the region, with both sides raising ships and troops for what feels like imminent conflict.

Unfortunately for all involved, positions have been overestimated, and the same tense atmosphere that has pushed them to action has pushed away trade. Already afraid of futher possible restriction of sound passage, fewer and fewer ships are passing through Denmark, lowering the already weakened effectiveness of the Sound Toll. This has not only affected Denmark, however, as the combination of fewer ships and increased taxes on Danish trade has drastically reduced trade flow to the cities of the Hansa as well.

The collective strength of the Hansa is strong, but slipping. With cities across the League already starting to assert more self-interest, a few individual locations have already started breaking off from the Hansa, although the majority remain loyal to the league because of their dependance on its trade. With less trade around the League, however, Denmark has been further weakened in its position, as this has made passage through the sound less attractive.

Some sort of agreement, therefore will have to be reached. Unless a compromise is reached soon, war feels inevitable, and the lack of trade goods has made ship prices skyrocket across the Baltic. The Hansa can always avoid the sound completely by directing imports to their ports on the North Sea coast, but the cost and time of then transporting them across land would keep trade efficiency lower. Denmark can always play its strength in controlling the sound and having a powerful navy, but its position appears untenible for much longer, especially with whispers of unrest making their way through the royal palace...

The situation is dire, and Europe waits with bated breath to see what comes next.

[M] Until an agreement is reached, either through war or diplomacy, the following penalties are in effect:

• Trade efficiency in each nation with a port in the Baltic is reduced by 50%

• Each territory with a Hansa port has their trade pips reduced by 1

• The Sound Toll "provence" has its trade pips reduced by half

• Hansa cities are looking for a relatively successful outcome to this situation. If one is not met, there could be further unrest and possible breaking off from the League

• Danish nobles and burghers are beginning to grow tired of the King's tyrannical antics, and unless they personally come out of this situation better off or no worse than they were going in to it, there could be further unrest and possible rebellion

This is the official state of the Baltic issue. Any rolls/comments/etc that would point to a different situation are hereby retconned, and any questions should be directed here.