Chapter 2 traces Nauru’s incorporation into the arena of European imperial competition, first as a trading outpost of a Hanseatic firm from Hamburg, then as part of the German protectorate of the Marshall Islands. It traces the activity of Hanseatic firms in the Pacific and Africa in the late nineteenth century, and examines the significance of Hanseatic activity to the geography of German protectorates declared around the Berlin Conference in 1884, and the relationship between that activity and the Australasian federation movement. The chapter moves to assess the relationship between the protectorate concept and the actual forms of protectorate that proliferated from the mid-1880s, when the label was applied to diverse imperial forms involving vague and often contradictory assertions of sovereignty, property and territory. It argues that the protectorate concept bore little relation to the actual balance of company and state rule struck between the Reich and the Jaluit Gesellschaft in 1888 in Nauru. It concludes that this distinction between status and form establishes a new perspective from which to retrace the shift from imperial to international administration in the twentieth century.