Franz Joseph II, Prince of Liechtenstein

On 31 March 1938, Franz I made Franz Joseph his regent following the Anschluss of Austria. After which he moved to Feldberg, Czechoslovakia and on 25 July, he died while at one of his family's castles, and Franz Joseph formally succeeded him as the Prince of Liechtenstein.[9][10]

Although officially Franz stated that he had given the regency to Franz Joseph due to his old age it was speculated that he did not wish to remain in control of Liechtenstein if Nazi Germany were to invade, primarily because his wife, Elisabeth von Gutmann was of Jewish relation.[11][12]

Upon becoming Prince of Liechtenstein in 1938 Franz Joseph settled permanently in the principality, making him the first ruling prince to live-full time there.

Liechtenstein remained neutral throughout World War II, and its neutrality was not violated by any of the combatants. Franz Joseph supported then Prime Minister of Liechtenstein Josef Hoop's policy of non-binding, non-provocative diplomacy towards Nazi Germany[13][14] while personally tying the country as closely as possible to Switzerland during the war in hopes of retaining Liechtenstein's neutrality.[12][15] Franz Joseph oversaw the formation of a coalition government that would prevent government deadlock and help retain Liechtenstein's neutrality.[16][17] In March 1939 he along with Josef Hoop and Otto Schaedler paid an official visit to Berlin where they met Adolf Hitler and Joachim von Ribbentrop where they discussed safeguarding Liechtenstein's independence and neutrality while maintaining good relations.[18][19] Franz Joseph later reminisced on the visit and stated that Hitler showed little interest in them and that it only took place in order to "flatter Hitler's ego".[20] In 1945 all the family’s estates in Czechoslovakia were expropriated without compensation by the Third Czechoslovak Republic.[21]

Just before the end of the war, Franz Joseph granted political asylum to First Russian National Army pro-Axis pro-emperor Vladimir White emigres led by General Boris Smyslovsky, who were being cared for by the Liechtenstein Red Cross.[22] On 16 August 1945, the Soviet Union sent a delegation to Liechtenstein in an attempt to repatriate the Russians, which was refused despite increasing Soviet pressure to participate in the repatriation program.[23] Eventually the government of Argentina offered the Russians asylum, and about a hundred people left.

According to Alexander Frick, Prime Minister of Liechtenstein at the time, the Russians were at no point in danger of being extradited. Franz Joseph had explicitly given support for the asylum of the Russians. The general population of Liechtenstein supported the government in providing asylum to the Russians.[23]

Franz Joseph II in the 1950s.

After losing roughly 80% of their property, Franz Joseph and his family sought to sell artworks from their collection in order to generate income, such as Leonardo da Vinci Ginevra de' Benci in 1967 and Frans Hals's Willem van Heythuysen portrait that was sold to the Bavarian State Painting Collections in 1969.[21]

Franz Joseph oversaw a family-owned bank ran by the House of Liechtenstein with branches in London, Zürich, New York City and Frankfurt which made the principality an ideal tax haven for wealthy individuals and private foreign companies, this allowed Liechtenstein to experience rapid economical growth throughout his reign, transforming the principality into one of the richest countries in the world.[24]

During his reign, women received voting rights for the first time, following a referendum on the topic (among men only) in 1984.[25]

Franz Joseph II and Countess Georgina von Wilczek in 1988.

Franz Joseph handed over most of his powers to his son, Hans-Adam, on 26 August 1984.[26] Franz Joseph II had been suffering from poor health and died on 13 November 1989, a mere twenty-six days after his wife.[16] Ruling Liechtenstein for 51 years, he was among the longest-ruling sovereigns in Europe and the longest-serving national leader in the world at the time of his death.[27]