Engines of Empire: The Chartered, Limited Liability Joint Stock Companies

Regulated trading companies were de rigueur in the early modern era. However, in order to streamline and reorganize the long-distance trade to Asia that various maritime trading companies had been engaged in since 1595, six port towns of Holland and Zeeland joined forces and established in 1601, under the supervision of the States-General, a further development of the well-proven regulated com­pany, the limited joint stock “United East India Company” (Verenigde Oostindische Compagnie, VOC).

Although the riches of the other continents lured Dutch merchants, the estab­lishment of these two companies was not dictated by a purely commercial agenda. Their business activities responded to local trading conditions. In maritime Asia the Dutch entered into a millennium-old trading world in which the Portuguese had gained control of strategic passages between various maritime regions by building fortresses at Hormuz, Goa, Galle (on Ceylon), Malacca, and the Moluccas or Spice Islands. The Atlantic represented an open theater where, along with the trade for the benefit of the Spanish crown, private traders and privateers roamed between Africa and the New World. The founding of the WIC in 1621, immediately after the end of a 12-year truce with Spain, was directly related to the ongoing Dutch struggle with Spain and Portugal, fought both on land and at sea. The VOC and the WIC differed considerably in aim, organization, exploitation, and performance, because the geopolitical spheres and the trading networks within which they operated were quite different. While the VOC lasted in the same form for two centuries, the WIC went bankrupt within 50 years, but then rejuvenated itself and continued to func­tion in one way or another until it was finally nationalized in 1791.