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In 1926 an Imperial Conference was held in England to determine the future of the British Empire and how it's Dominions would be dealt wit in the future. One of the main issues was the growing demand from the Dominions for control over their own affairs and their foreign relations. The result of the conference was the Balfour report which recognized the changing nature of British, Dominion relations and it recognized the right of every Dominion to advise the Crown concerning it's own affairs.

Another result was the termination of the right of the British Government to disallow any legislation passed by the Dominions. The evolution of Canada towards more independence was natural and had been given a boost during the First World War when it had sacrificed so much and so many lives on the battlefields of Europe. A feeling of nationalism had grown from that event and the Balfour report merely recognized the changes that had to take place. 

In 1926 Canada had appointed it's first representative to a foreign government when Vincent Massey was named as Canada's Minister to the United States. This was the first small but important step towards gaining control of it's own foreign policy.

By 1931 the British Parliament were ready to give legal recognition to this process and the decisions arrived at in the Balfour Report by passing the Statute of Westminster. To replace the British Empire, the British Commonwealth was brought into being and was defined as "the symbol of the free association of the members of the British Commonwealth of Nations"

The noted Canadian historian A.R.M. Lower stated

"The indirect refusal to assist Great Britain over the Chanak incident, 1922, was the first notice given that Canada would make up her own mind about foreign affairs. It was followed by the still more emphatic show of independence involved in the way in which the Halibut Treaty of 1923 with the United States was signed.

The Statute of Westminster came as close as was practical without revolutionary scissors to legislating the independence of the 'Dominions' . There is good ground for holding December 11, 1931 as Canada's Independence Day, for on that day she became a sovereign state.

Although Canada was not given the right to change the British North American Act which was the mainstay of the Canadian system (that would have to wait until Trudeau brought it home in the 80's), she was recognized as the only power that could command and control Canadian internal and foreign affairs from that point on. By 1949, the Supreme Court of Canada had become the recognized arena of final appeal rather then the British Privy Council. Canada had taken the next big step towards absolute autonomy as a nation had this had been achieved with benevolent cooperation from all parties concerned.