11 AUGUST 1866, Page 1

The preliminaries of peace have been published in full, but

they contain little that is new, except a distinct provision that the Southern States may bind themselves to Prussia on terms to be arranged by themselves, without Austria. Preliminaries of peace have been arranged with them all, Bavaria ceding Franconia to Prussia and the Palatinate to Hesse Darmstadt, which in its turn gives up its northern provinces to Prussia. It is asserted in Berlin that a decree will appear next week incorporating the new Prussian dominion, in order to prevent Austria from affecting to misunderstand what she has conceded, but this is not quite certain, and as yet the diplomatists are settling matters with Austria at Prague, with the Southern States at Berlin, and with Italy on the Venetian frontier.