A few weeks ago I read about the purchase in 2008 by China of a copper mine at Mount Toromocho in Peru for the sum of 3 billion dollars. It reminded me that I still have a story up my sleeve about another copper mine to illustrate the early history of companies with shareholders, and even better, the company in question still exists. When writing here in 2011 about the oldest share of the Dutch East India Company from 1606 I read also about companies founded much earlier. In this post I want to follow that track. However, this will lead also to questioning the idea and practice of searching for and claiming the earliest occurrence of legal constructions.
Searching for the oldest companies
My search for companies older than the Dutch example of a company which issued stocks in the early seventeenth century is in itself in no way new or original. In fact I am surprised how much space has been devoted to this search in the English Wikipedia, with inevitably a list of oldest companies. This list is marred by the fact that a number of companies can claim indeed a foundation at a very early date, but they did not start outright as stock companies, the definition to be explored here. It was during a search last year for a particular person that I encountered the website of the Hudson Bay Company, founded officially in 1670. The Hudson Bay Company is proud of its long history. The full name, Governor and Company of Adventurers of England trading into Hudson’s Bay, indicates clearly the role of stockholders. Its archives are since 1974 at Winnipeg, Manitoba. In 2007 the UNESCO admitted these archives to the Memory of the World Register.
Another necessary distinction to be made is between temporary stock companies and more permanent ventures. In ancient and medieval history and law you will encounter examples of joint ventures which last for just one voyage of a ship. Temporary companies such as the English Guinea or African Company (1577-1580) were followed by the East India Company (1600), the Dutch Noordse Compagnie and the Companie van Verre predated the Verenigde Oost-Indische Compagnie (VOC), founded in 1602. The name of the VOC indicates that in it a number of earlier companies merged together.
The “founding charter” for Stora Kopparberg, 1288 – image Riksarkivet, Stockholm
When I wrote in November 2011 about the oldest share of the VOC dating from 1606 I found comments on the website of Radio Netherlands Worldwide stating that Stora Kopparberg, a Swedish company, is the oldest existing stock company documented as early as 1288. The text of the June 16, 1288 charter can be found in the printed version of the Svenskt Diplomatarium, digitized at a website maintained at the Riksarkivet in Stockholm (SDHK, no. 1406). You can also use a modern transcription and a more extensive summary in the Svenskt Diplomatarium, all in Swedish. In this charter bishop Peter of Västerås acknowledges the sale of an eight part of the copper mountain called Tiskasjöberg, octauam partem montis cupri dicti Tiscasioberg, to his nephew Nils Christinaeson, who however commutes the sale for the possession of two parishes, Fröslunda and Hasselbäck. The sale was certainly important, because the charter was sealed also by king Magnus Ladulås and four other bishops. How the division of this property into eight parts came into existence is not clear, nor is there any mentioning here of the issue of shares. I feel sympathy for the anonymous comment on the RNW website that one can perhaps describe it better as a privately owned firm with external shareholders. In view of medieval canon law it is indeed the question whether you should see this property of the diocese Västerås as property of the chapter and bishop, a part perhaps of the mensa episcopalis. Were the king and the other bishops sealing themselves shareholders?
Mining at the Stora Kopparberget, also known as the Falu Grava, had started already in the tenth century. A charter from 1347 records the granting of several rights to the miners by king Magnus IV (SHDK, no. 5394; February 17, 1347), and here it becomes clear the mine worked as a company. In the seventeenth and eighteenth centuries this copper mine was the largest source of copper worldwide. In 1862 the official name became Stora Kopparsberg Bergslags Aktie Bolga, a name indicating the issue of stocks. The delving of copper ended in 1992. The UNESCO added the site of the copper mine in 2001 to the World Heritage List. In 1998 Stora AB fused with the firm Enso into StoraEnso.
Are there any other examples of early stock companies? The firm of Francesco di Marco Datini in fourteenth century Prato had certainly partners. The Fondo Datini at the Archivio di Stato in Prato is one of the largest medieval commercial archives still preserved. If I would have to answer at point blank for examples still existing medieval companies I am tempted to look at the so-called Livery Companies in London, late medieval craft and trade associations, but they did originally function as guilds and did not trade as companies. Helmut Coing’s Europäisches Privatrecht 1500-1800 I, Älteres Gemeines Recht (Munich 1985) 523-530, distinguishes between different kinds of trade companies: Personengesellschaften, partnerships with mining companies as a special subspecies, Kapitalgeschafften with for examples the Italian montes – excluding the montes pietatis -, privileged seafaring and colonial companies in England and the Low Countries, and more modern companies from the late seventeenth century onwards.
In France the Société des Moulins du Bazacle was a milling company near Toulouse which was owned since the mid-thirteenth century by shareholders. The mills were driven by the water at the barrage de Bazacle, a dam in the Garonne river. Eventually the shares got traded on the market in Toulouse. The company existed until 1946. Companies are already mentioned in French law in the Livre de Jostice et de Plet around 1260 (Li livres de jostice et de plet, Louis-Nicolas Rapetti (ed.) (Paris, 1850) ch. 7.15, pp. 167-168; online for example in the Hathi Trust Digital Library).
The webpages of the Hudson Bay Company Archives mention the Japanese keiretsu (business group) Sumitomo. It took over a copper mine founded in 1591 by Riemon Soga in Kyoto. In 1691 the firm started winning copper from the Besshi copper mine which closed only in 1973. Sumitomo Mining Company is the very heart of this business group, one of the world’s largest firms. It is interesting to note that both Stora Kopparberg and Sumitomo had copper mining as a basic activity.
Let’s return briefly to the Wikipedia list of oldest companies. You might indeed object I was too dismissive of its qualities and rejected it too quickly as unuseful. Of course it is a nice list of early enterprises which have continued active until modern times, but not every enterprise took off at its start as a stock company. Here a few examples should suffice to illustrate this argument. The British Royal Mint was founded in 886, but king Alfred the Great did certainly not found a firm. Only in 2009 the Royal Mint became a company with limited liability, Royal Mint Ltd. The second example I know from my own experience in South Germany. The Bayerische Staatsbrauerei Weihenstephan reckons its foundation as a brewery back to a charter issued by the city of Freising in 1040 allowing the abbey of Weihenstephan brewing and serving beer, but surely at that time the brewery was not a separate corporate entity. By the way, the genuineness of the 1040 charter is disputed.
Understandably I will not try to plod through a list of dates and firms to be checked, and produce yet another tedious list. Since already two mines figure in this post it is just an educated guess to look briefly at the Wieliczka salt mine near Cracow in Poland. This mine was already known in the Neolithicum (3500 BC). In the eleventh century the mine was nicknamed Magnum Sal. The oldest shaft still present dates from the thirteenth century. In the late thirteenth century the Cracow Mines Company was founded. The Wieliczka mine operated until 2007. This mine, too, has been added to the UNESCO’s World Heritage List.
Mining and law
At the end of this post it might seem I have offered here a kind of tour of the Memory of the World Register and the World Heritage List, with only a very vague link to legal history. You might feel lucky I did not yet include a Dutch twist to this post, but the history of mining law brings me an opportunity to do just that. Mining law is indeed a separate branch of private law. In 1978 J. de Boer defended at the Vrije Universiteit Amsterdam his Ph.D. thesis on De winning van delfstoffen in het Romeinse recht, de middeleeuwse juridische literatuur en het Franse recht tot 1810 [The extraction of minerals in Roman law, the medieval legal literature and French law to 1810](Leiden, 1978). This thesis has a summary in English. Coing’s survey mentioned above brings you to other studies concerning mining law including works by Early Modern lawyers, for instance the Speculum iuris metallici, oder Berg-Rechts-Spiegel by Sebastian Span (Dresden, 1698; digitized at Heidelberg). In Dutch history mining took place in Limburg and also in the former Dutch East Indies.
Using the catalogue of the Max-Planck-Institut für Europäische Rechtsgeschichte, Frankfurt am Main, you will quickly find more relevant and even earlier works on the history of mining law. In Norway mining law was already codified in 1540. When you combine the results obtained there with a search in the Karlsruher Virtueller Katalog for digitized books you will be able to look at a number of relevant works from your screen. The Metallicorum corpus iuris oder Bergk-Recht (Leipzig 1624) by Johann Deucer has been digitized at Dresden. Mining often belonged to the regalia, the royal rights. Eike von Repgow deals with this aspect of mining in the Sachsenspiegel (Landrecht I,35), written between 1220 and 1235, and the gloss by Johann vom Buch from the early fourteenth century expands on it (Glossen zum Sachsenspiegel-Landrecht: Buch’sche Glosse, Frank-Michael Kaufmann (ed.) (3 vol., Hannover, 2002; available online at dMGH, section Leges). The library at Frankfurt am Main is a treasure trove which you might indeed compare to a gold mine for legal historians! Here I have restricted myself to mentioning just a few titles and indicating some aspects.
The lure of looking for origins
American readers might have expected me to deal with originalism as the major subject of this post, but in a way my post is already in itself a comment on any form of originalism. The Legal History Blog is very helpful in tracking the discussions on originalism. One of the major problems with the approach favored by originalists is the question to which origin you would like to point. Do you go back to the debates of the Founding Fathers about the American Constitution, do you look at the early Congress or at congressional debates concerning specific amendments, or do you dare to consider also debates concerning the constitution and statutes of the original states before 1776? As for the Founding Fathers, in the book by Philip Kurland and Ralph Lerner and in the web version of their study The Founders’ Constitution (5 vol., Chicago 1987; reprint Indianapolis 2001) you can look even beyond them to the sources and arguments they adduced or debated.
In the wake of the controversies about the American Constitution and its present application many roads have been opened, some of them new and promising, some well trodden and somehow pale. The major flaw with the less interesting perspectives is the Whig interpretation of history, the tendency to use history and law as a handmaiden of the present, in fact only valuable because of the present, and thus sometimes called applied legal history. History and legal history can seem just fuel for debates and are reduced to ammunition for political views. At the very best history and the development of law are not totally neglected in Whig interpretations. In my country the ignorance about history of many members of the Dutch parliament is often shameful. Another problem in the present use and role of the American constitution is the tendency to avoid fundamental debate, and to press for solutions to political questions by the judiciary with as its main vehicle judicial review. A recent attempt in Dutch politics to let a court judge political matters was rightly rejected: the Dutch States General have to decide them, not the courts. Democracy and political debate can regain relevance when they become really relevant and decisive.
As for the history of early companies, it is better not to reduce the history of company law to the sometimes fascinating stories of their foundation or a series of snapshots of all kinds of companies in history, but to look at many aspects of commerce and law in context in longer periods, and to attempt perspectives from all around the world. Legal historians can bring in questions of law to gain insights which historians and other scholars can only neglect at their peril.