Map of the disputed territory of Acre, claimed by Peru, Bolivia and Brazil, before a settlement where Brazil purchased the land.
The territory of Acre was recognized by Brazil as Bolivian, despite Peru also claiming the land. Tensions rose in the late 19th century however as the Amazon region became economically important due to the rubber boom, with many Brazilian settlers occupying lands in the Amazon to work on rubber extraction.
Bolivia lacked a military presence or its own settlers in the region, causing a huge influx of Brazilians that dominated the territory. Those Brazilians resented Bolivian attempts to tax or regulate them, and on three occasions rose up against Bolivia to establish an independent state and seek annexation into Brazil.
This caused a huge diplomatic incident between the countries that was resolved in 1903, with Bolivia agreeing to transfer the territory to Brazil in exchange for infrastructure works, financial compensation and access to the Amazon River to reach the Atlantic. A few years later Brazil reached an agreement with Peru for recognition of Brazilian sovereignty in Acre and the delimitation of borders between the Peruvian and Brazilian Amazons.