associations for foreign trade, exploration, and colonization that came into existence with the formation of the European nation states and their overseas expansion. An association received its charter from the state and sometimes had state support. In the regulated company each member was an independent trader operating with his own capital and bound only by the general rules of the company charter. In the joint stock company the organization itself transacted the business, operating on the joint capital invested by members, each of whom shared proportionately in the profits and losses. The company received a monopoly of trade or colonization in a certain region and customarily exercised lawmaking, military, and treaty-making functions, subject to the approval of the home government, besides other privileges. The English Merchants Adventurers (1359) was more of a guild organization, but it foreshadowed such companies as England's Muscovy (1555), Levant (1581), East India (1600, perhaps the greatest of them all), Hudson's Bay (1670) and Holland's Dutch East India (1602). Such colonizing companies as the Virginia Company (1606), the Massachusetts Bay Company (1629), the French Royal West Indian Company (1664–74), the Santo Domingo Company (1698), and the Dutch West India Company (1621) were more quickly taken over by their governments. Later 19th-century colonizing and trading companies, such as the British North Borneo (1881), Royal Niger (1886), British South Africa (1888), and German East Africa (1884), did not last long and had more restricted powers, but attested to the continuing significance of the chartered company. In a technical sense, the modern corporation is a chartered company.

See G. Cawston, The Early Chartered Companies, 1296–1858 (1896, repr. 1968); R. Robert, Chartered Companies and their Role in the Development of Overseas Trade (1969).

The Columbia Encyclopedia, Sixth Edition Copyright© 2004, Columbia University Press. Licensed from Lernout & Hauspie Speech Products N.V. All rights reserved.

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