Up to early 19th century, the Basque districts maintained a great degree of self-government under their charters (they came to be known as the Exempt Provinces), i.e. they held a different status from other areas within the Crown of Castile/Spain, involving taxes and customs, separate military conscription, etc.), operating almost autonomously.
After the First Carlist War (1833–1839), home rule was abolished and substituted by the Compromise Act (Ley Paccionada) in Navarre (1841) and a diminished chartered regime in the three western provinces (up to 1876). After the definite abolition of the Charters (end of Third Carlist War), former laws and customs were largely absorbed into Spanish centralist rule with little regard for regional idiosyncrasies. As a result, attempts were made by Carlists, Basque nationalists and some liberal forces in the Basque region of Spain to establish a collaboration among them and restore some kind of self-empowerment ("autonomy"), while the Catalans developed their own Catalan Commonwealth.
Attempts at a unified Basque statute including Navarre were repeatedly postponed until the occasion seemed to have arrived at the onset of the Second Spanish Republic with a statute for the four Basque provinces. A draft Basque Statute was approved by all four provinces (1931), but Carlists were divided, and the 1931 draft Statute of Estella did not achieve enough support, against a backdrop of heated controversy over the validity of the votes, as well as allegations of strong pressures on local representatives to tip the scale against the unitarian option (Assembly of Pamplona, 1932).
Following the works started for the Basque Statute, another proposal was eventually approved by the government of the Spanish Republic, already awash in the Civil War, this time only including the provinces of Gipuzkoa, Biscay and Álava. Its effectivity was limited to the Republic-controlled areas of Biscay and a fringe of Gipuzkoa.
After the surrendering of the Basque Army in 1937, the statute was abolished. However, Francisco Franco allowed the continuation of a limited self-government for Alava and Navarre, thanking their support for the Spanish Nationalist uprising.
It is on the republican statute and the Alavese institutions that the current Statute of Gernika takes its legitimacy.