Spain acquired sovereignty over the Caroline Islands in 1886 but sold the archipelago to Germany in 1899. Japan occupied the Islands at the beginning of the First World War and in 1921 they were mandated to Japan by the League of Nations. Captured by Allied Forces in the Second World War, the Islands became part of the UN Trust Territory of the Pacific Islands created on 18 July 1947 and administered by the USA. The Federated States of Micronesia came into being on 10 May 1979. American trusteeship was terminated on 3 Nov. 1986 by the UN Security Council and on the same day Micronesia entered into a 15-year Free Association with the USA. An amended 20-year Compact of Free Association was signed into law on 17 Dec. 2003, guaranteeing US$1•8bn. to Micronesia in grants for a government trust fund.
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