Compensated emancipation was a method of ending slavery, under which the enslaved person's owner received compensation from the government in exchange for manumitting the slave. This could be monetary, and it could allow the owner to retain the slave for a period of labor, an indenture. Cash compensation rarely was equal to the slave's market value.

An indenture was seen as a compromise between slavery and outright emancipation, an intermediate step. However, no one was happy with compensated emancipation. Owners complained that their compensation was small compared with their loss; they were paid less, often much less, than what the slaveowner could have sold the enslaved person for (the market value). Governments and non-slaveholding citizens complained about the financial burden of compensating the owners, while for the formerly enslaved it seemed ludicrous that those who had all along benefited from slavery should now receive additional compensation, while its victims received no compensation whatsoever. Historian Eric Foner wrote, "Even Haiti, where slavery died amid a violent revolution, agreed in 1824 to pay a large indemnity to former slaveholders in exchange for French recognition of its independence.... No one proposed to compensate slaves for their years of unrequited toil." Compensation of slaveholders has been viewed as akin to compensating a thief for returning stolen property, or paying ransom to a kidnapper for releasing his victim, and therefore not so much compensation as a reward for committing what should be a crime.

To be sure, the indenture system represented for the formerly enslaved an improvement over slavery itself; those indentured could not be forcibly relocated, children and other family members could not be taken away by force, and they could no longer be whipped or raped. However, they were still not free.

Transition away from slavery 
Compensated emancipation was typically enacted as part of an act that outlawed slavery outright or established a scheme whereby slavery would eventually be phased out. It frequently was accompanied or preceded by laws which approached gradual emancipation by granting freedom to those born to slaves after a given date. Among the European powers, slavery was primarily an issue with their overseas colonies. The British Empire enacted a policy of compensated emancipation (about 40%) for its colonies in 1833, followed by France in 1848, Denmark in 1849, and the Netherlands in 1863. Most South American and Caribbean nations emancipated slavery through compensated schemes in the 1850s and 1860s, while Brazil passed a plan for gradual, compensated emancipation in 1871, and Cuba followed in 1880 after having enacted freedom at birth a decade earlier.

United States 
Only in the District of Columbia, which fell under direct Federal auspices, was compensated emancipation enacted. On April 16, 1862, President Lincoln signed the District of Columbia Compensated Emancipation Act. This law prohibited slavery in the District, forcing its 900-odd slaveholders to free their slaves, with the federal government paying owners an average of about $300 () for each.

Other nations and empires
Nations and empires that implemented compensated emancipation:
Argentina
Bolivia
Brazil
British Empire
Chile
Colombia
Cuba
Danish colonies
Dutch empire
Ecuador
Kingdom of France, 1315, see Louis X
French colonial empire
Haiti
Mexico and  Central America
Paraguay
Peru
Puerto Rico
Spanish Empire
Sweden
Uruguay
Venezuela
United Kingdom
United States (District of Columbia only)

Further reading

Araujo, Ana Lucia. 2017. "Reparations for Slavery and the Slave Trade: A Transnational and Comparative History", New York: Bloomsbury Academic. Pp. 276. 
Barragan, Yesenia. 2021. "Freedom's Captives: Slavery and Gradual Emancipation on the Colombian Black Pacific (Afro-Latin America)". Cambridge: Cambridge University Press. doi:10.1017/9781108935890
Cox, LaWanda, C. Fenlason. 1981, "Lincoln and Black Freedom: A Study in Presidential Leadership", Columbia: University of South Carolina Press.
Holloway, Kaly, March 23, 2020, "Since Emancipation, the United States Has Refused to Make Reparations for Slavery", The Nation. 
Manjapra, Kris. June 17, 2022. "D.C.'s Enslavers Got Reparations. Freed People Got Nothing", Politico.
Manjapra, Kris. 2019. "The Scandal of the British Slavery Abolition Act Loan", Social and Economic Studies, 68(3/4), 165–184. http://www.jstor.org/stable/45299245
McDowell, Evelyn, and Theresa Hammond. 2023. “A ‘Disguised Scheme for Compensated Emancipation’: Accounting for Gradual Abolition in Nineteenth Century New Jersey.” Accounting History, May, 1. doi:10.1177/10323732231174669.

See also
Abolitionism
Abolitionism in France
Abolitionism in the United Kingdom
Abolitionism in the United States
Right to property
Reparations for slavery (proposed payments to former slaves and their descendants)

References

Abolitionism
Abolitionism in the United States
History of slavery in the District of Columbia