403 
COMPANY. 
rally to bo expected, therefore, that folly, 
nogligeiioe, and profusion, should prevail in 
th ■ whole management of their affairs. Their 
stock-joob ng speculations were succeeded 
by mercantile projects, which, D r. Smith ob- 
serves, were. not much better conducted. At 
lengtn, in the year 1 7 ‘ 12 , this company 'peti- 
tioned parliament to be allowed to divide 
tneir immense capital of more than 
33,800,000/. the whole of which had been 
lent to government, into two equal parts : 
the one halt, or upwards of 16,900,000:. to be 
put upon the same footing with other go- 
vernment annuities, and not to be Subject to 
the debts contracted, or losses incurred, by 
the directors ot the company, in the prose- 
cution of their mercantile projects ; the 
other half to remain as before, a trading 
stock, and to be subject to those debts and 
losses. The petition was too reasonable not 
to be granted. In 1733 they again petition- 
ed the parliament, that three-fourths of their 
trading stock might be turtle 1 into annuity - 
stock, and billy one-fourth remain as trading 
stock, or exposed to the hazards arising from 
the bad management of their directors. Both 
their annuity and trading stocks had, by this 
time, been reduced more than 9,000,000/. 
<eaeh, by several different payments from go- 
vernment ; so that this fourth amounted onlv 
to 3,662,784/. 8s'. 6d. In 1748 all the de- 
mands of the company upon the king of 
Spain, in consequence of the Assiento con- 
tract, were, by the treaty of Aix-la-Chapelle, 
given up for what was supposed an equiva- 
lent; an end was put to their trade in the 
Spanish W c*st Indies, the remainder of their 
trading stock was turned into annuity stock, 
and the company ceased in every respect to 
be a trading company. 
This company is under the direction of a 
governor, sub-governor, deputy-governor, 
and 21 directors; but no person is qualified 
to lie a governor, his majesty excepted, un- 
less such goverjior has, in his own name and- 
right, 5,000/. in the trailing stock ; the sub- 
governor is to have 4000/. the deputy-go- 
vernor 3000/. and a director 2000/. in the 
same stock. In every general court every 
member having, in his own name and right, 
500/. in trading-stock, has one vote ; if 2000/. 
two votes; if 3000/. three votes; and if 
5000/. four votes. 
2. The Cast India company. The first, 
or, as it is called, the old East India compa- 
ny, was established by a charter from queen 
Elizabeth in l600; but for some time the 
partners seem to have traded with separate 
stocks, though only in the ships belonging to 
the whole company. In 16 12 they joined 
their stocks into one common capital; and 
though their charter was not as yet confirmed 
by act of parliament, it was looked upon in 
that early period to be sufficiently valid, and 
nobody ventured to interfere with their 
trade. At this time their capital amounted 
to about 740,000/. and the' shares were as low 
as 50/. Their trade was in general success- 
ful, not .vit'i standing some heavy losses, chiefly 
sustained through the malice of the Dutch 
East India company. In process of time, 
however, it came to be understood that a 
royal charter could not by itself convey an 
exclusive privilege to traders ; and the com- 
pany was reduced to distress by the multi- 
tude of interlopers, who carried off most of 
their trade. T his continued during the latter 
part of the reign of Charles H. the whole of 
that of James II. and part of William III 
when, in 1698, a proposal was made to par- 
liament for advancing the sum of 2,000,000/. 
to government, on condition of erecting the 
subscribers into a new company with exclu- 
sive privileges. The old company endea- 
voured to prevent the appearance of such a 
formidable rival, by offering government 
700,000/., nearly the amount of their capital 
at that time ; but such were the exigencies of 
the state at that lime, that the larger sum, 
though at eight percent, interest, was pre- 
ferred to the smaller at one-half the expence. 
Thus were two East India companies erect- 
ed in the same kingdom, which could not but 
be very prejudicial to each other. Through 
the negligence of those who prepared the act 
ot parliament also, the new company were 
not 'obliged to unite in a joint stock. The 
consequence of this was, that a few private 
traders, whose subscriptions scarcely exceed- 
ed 7200/. insisted on a right of trading sepa- 
rately at their own risk. Thus a kind of 
third company was established ; and bv their 
mutual contentions with one another, all 
the three were brought to the brink of ruin. 
Upon a subsequent occasion, in 1700, a pro- 
posal was made to parliament for putting the 
trade under the management of- a regulated 
company, and thus laying it in some mea- 
sure open. This, however, was opposed bv 
the company; who represented in strong- 
terms the mischiefs likely to arise from such a 
proceeding. In 1702 the companies were in 
some measure united by an indenture tripar- 
tite, to which the queen was the third party; 
and in 1708, they were, by act of parlia- 
ment, perfectly consolidated into one com- 
pany by their present name of “ the united 
company of merchants trading to the East 
Indies.” Into this act it was thought worthy 
to insert a clause, allowing the separate tra- 
ders to continue their traffic till Michaelmas 
1711; but at the same time empowering the 
directors, upon three years notice, to redeem 
their capital of 7200/. and thereby convert 
the whole capital of the company into a joint 
stock. By tiie same act the capital of the 
company, in consequence of a new loan to 
government, was augmented from 2,000,000/. 
to 3,200,000/. In 1743 another m llron was 
advanced to government; but this being 
raised, not by a call upon the proprietors, but 
by selling annuities and contracting bond- 
debts, it did not augment the stock upon 
which the proprietors could claim a divi- 
dend. Thus, however, their trading stock 
was augmented; it being equally liable with 
the other 3,200,000/. to the losses sustained 
and debts contracted by the company, in the 
prosecution of their mercantile projects. 
From 1708, or at least from 17,1 1 , this compa- 
ny, being freed from all competitors, and fully 
established in the monopoly of the English 
commerce to the East Indies, carried on a 
successful trade ; and from their profits made 
annually a moderate dividend to their pro- 
prietors. Unhappily, however, in a short 
time, an inclination for war and conquest be- 
gan to take place among its servants ; which, 
though it put them in possession of extensive 
territories and vast nominal revenues, yet 
embarrassed their affairs in such a manner, 
that they have not to this day been able to 
recover themselves. D uring the war of 1 7 55, 
indeed, they acquired the revenues of 
a rich and extensive territory, amounting, 
as was then said, to near 3,000,000/. per 
annum. 
For several years they remained in quiet 
possession of the revenue arising from this 
territory, though it certainly never answered 
the expectations that had been formed con- 
cerning it. But in 1767 the British ministry 
laid claim to the territorial possessions of the 
company, and the revenue arising from them, 
as oi right belonging to the crown ; and the 
company, rather than yield up their territo- 
ries in this manner, agreed to pay govern- 
ment a yearly sum of 400,000/. They had 
before this gradually augmented their divi- 
dend from about six to ten per cent, that is, 
on their capital of 3,200,000/. they had raised 
it from 192,000/. to 320,000/. a year. About] 
this-time also they were attempting to raise it 
still further, viz. from ten to twelve and a half 
per cent, but from this they were prevented 
by two successive acts of parliament, the de- 
sign of which was to enable them to make a 
more speedy payment of their debts, at this 
time estimated at more than six or seven mil- 
lions sterling. In 1769 they renewed their 
agreement with government for live years 
more, stipulating, that during the course of! 
that period they should be allowed gradually 
to augment their dividend to twelve and a 
half per cent, never increasing it, however, 
more than one per cent, annually. Thus 
their annual payments could only” 1 be aug- 
mented by 608,000/. beyond what they had 
been before their late territorial acquisitions 
By accounts from India in the year 1768, this 
revenue, clear of all deductions and military 
charges, was stated at 2,048,747/. At the 
same time they were said to possess another 
revenue, arising partly from lands, but chiefly 
from the customs established at their different 
settlements, amounting to about 439,000/. 
The profits of their trade, too, according to 
the evidence of their chairman before the 
house of commons, amounted to at least 
400,000/. per annum ; their accountant madl 
it 500,000/. and the lowest accountant statecS 
it at least equal to the highest dividend paid' 
to their proprietors. Notwithstanding this 
apparent wealth, however, the affairs of the' 
company from this time fell into disorder ; 
insomuch that, in 1773, their debts were augl 
men ted by an arrear to the treasury in the 
payment of the 400,000/. stipulated; by au-1 
other to the custom-house for duties unpaid ; 
by a large sum borrowed from the Bank; and 
by bills drawn upon them from India to the 
amount of more than 1,200,000/. d ims they 
were not only obliged to reduce their divi- 
dend all at once to six per cent, but to apply 
to government for assistance. Here it may 
be mentioned in general, that the event prov- 
ed very unfavourable to the company, as they 
were now subjected to an interference of go- 
vernment altogether unknown before. Se- 
veral important alterations were made in their 
constitution both at home and abroad. The 
settlements of Madras, Bombay, and Cal- 
cutta, which had hitherto been affinely inde- 
pendent of one another, were subjected to a 
governor-general, ass.sted by a council of 
four assessors. The nomination of the first 
governor and council, who were to reside at 
Calcutta, was assumed by parliament ; the 
power of the court of Calcutta, which had 
gradually extended its jurisdiction over the 
rest, was now reduced and confined to the 
