The Charter of 1600: A Company That Could Make Law
Chapter Two
Syllabus topic 1.1.1, "Period from 1600-1726"; and again at 4.1.1, "Charter of 1600"
Pages 6 to 9 of 491
In one line
On the last day of 1600 Queen Elizabeth I gave a group of London merchants a charter to trade in the East Indies, and in the same document gave them the power to make laws and to punish those who broke them.
In the wording a student can write in an exam: the Charter of 31 December 1600 incorporated "the Governor and Company of Merchants of London trading into the East Indies", granted it a monopoly of trade east of the Cape of Good Hope for fifteen years, and conferred on it a limited power of legislation and punishment over its own servants, subject to the condition that its laws be reasonable and not repugnant to the laws of England.
Why this document is the beginning of everything
The Company that eventually governed India was, on 31 December 1600, a group of about two hundred and eighteen merchants who wanted a share of the spice trade. Nothing in the charter contemplates courts of justice, still less an empire. What it does contain is a small, ordinary provision that any trading corporation of the period would have been given: the power to make rules for its own people and to enforce them.
That provision is the seed. Every court in this book grows from it or from the charters that enlarged it, and the limit written into it in 1600 was still being argued about in the Supreme Court at Calcutta in 1780.
What the charter actually granted
A corporation. The charter created a body corporate, that is, an artificial legal person that continues although its members change, with perpetual succession and a common seal. Its name was "The Governor and Company of Merchants of London, Trading into the East Indies". It was to be governed by a Governor and twenty-four committees, elected annually, which is the ancestor of the Court of Directors you will meet in every later chapter.
A monopoly. The exclusive right, for fifteen years, to trade in all the seas and territories beyond the Cape of Good Hope to the Straits of Magellan. Anybody else who traded there did so unlawfully and could have his ships and goods forfeited.
A power to make law. This is the part that matters here. The charter authorised the Governor and Company, in their general assembly, to make "Laws, Constitutions, Orders and Ordinances" for the good government of the Company and its servants, and to impose "Imprisonments, Fines and Amerciaments" (an amerciament is a money penalty fixed by the court rather than by a fixed tariff) on offenders.
A limit on that power. The charter attaches the condition in a single clause, and the clause is the most important sentence in the document for a law student. The laws, orders, constitutions, ordinances, imprisonments, fines and amerciaments were to be made "so always as the said Laws, Orders, Constitutions, Ordinances, Imprisonments, Fines and Amerciaments be reasonable, and not contrary or repugnant to the Laws, Statutes, or Customs of this our Realm."
The Charter of 1600: A Company That Could Make Law
The repugnancy rule, and why it never went away
Two conditions were imposed, and it is worth separating them because students commonly merge them into one.
- The law made must be reasonable.
- It must not be contrary or repugnant to the laws, statutes or customs of England.
The second condition is called the rule against repugnancy, and it is the first restriction ever placed on law-making for India. A rule made by the Company that contradicted English law was void.
That rule outlived the Company by a century and a half. The Charter Act of 1833 gave the Indian legislature power to make laws that had the same force as Acts of Parliament, but only subject to restrictions; the Indian Councils Act 1861 listed what the Council could not touch; the Government of India Act 1935 provided for repugnancy between Federal and Provincial laws; and article 254 of the Constitution of India is a repugnancy clause today. The idea that a subordinate legislature's law fails where it conflicts with a superior law starts here, in a charter granted to a spice-trading corporation.
What the charter did NOT do
It gave the Company no power over anybody except its own members and servants. A merchant of Surat, a weaver of Bengal or a servant of the Mughal Emperor was outside it entirely. The Company had no territory, no subjects and no jurisdiction over anyone but its own employees, and would have none for sixty years.
It created no court. The power to fine and imprison had to be exercised by somebody, and in practice it was exercised by the Governor and Council of a factory. A factory, in this subject, is not a place where things are manufactured: it is a trading post, the place where the Company's factors, meaning its agents, lived and did business. Surat was a factory; so was Madras before it became a fortified settlement.
It gave no power to punish crime. Fines and imprisonment for breaches of the Company's own orders are a long way from trying a man for murder, and the Company spent most of the next century acquiring, charter by charter, the criminal powers it needed. That story is the next chapter.
A worked example
Imagine a Company servant at Surat in 1615, a factor named Thomas Aldworth, who trades privately on his own account in defiance of the Company's standing orders.
The Charter of 1600: A Company That Could Make Law
Under the charter the Company's general assembly in London may make an ordinance forbidding private trade. That ordinance may impose a fine, or imprisonment, on a servant who breaks it. The President and Council at Surat may then fine Aldworth, or confine him, and ship him home.
Now change the facts. Aldworth kills a fellow factor in a quarrel. Nothing in the Charter of 1600 permits the President and Council to try him for murder or to hang him. The power granted is over the Company's own discipline, and homicide is not a matter of Company discipline. In practice such a man had to be sent to England for trial, which across a voyage of six months was no remedy at all. Closing that gap took the Company most of a century, charter by charter: the charter of 31 May 1609 confirmed and extended the Company's privileges without altering its constitution, twenty-four more followed between 1609 and 1639, and the powers that made a real criminal jurisdiction possible came with the charter of 1661 and the Admiralty charters of 1683 and 1686. Those are the next chapter.
Distinctions worth having straight
| Charter of 1600 | The position after 1726 | |
|---|---|---|
| Who granted it | Queen Elizabeth I, under the Great Seal | George I, under the Great Seal |
| Who is bound | The Company's own members and servants | Everybody in the Presidency Towns |
| What law applies | Company ordinances, not repugnant to English law | English law, as administered by the Mayors' Courts |
| Is there a court | No. The Governor and Company, and in India the President and Council | Yes. Three Mayors' Courts, and courts of Quarter Sessions |
| Criminal power | Fines, imprisonment and amerciaments only | Oyer and terminer and general gaol delivery, that is, full criminal trial |
What beginners get wrong
"The Charter of 1600 established the East India Company's courts in India." It did not. It gave a power to make rules and to punish breaches of them. Courts, in any sense a lawyer would recognise, arrive with the Charter of 1661 and, on the civil side, with the Madras charter of 1687.
"The monopoly was permanent." It was granted for fifteen years, renewable, and it was renewed and enlarged many times. It ended piece by piece: for India by the Charter Act of 1813 and altogether by the Charter Act of 1833.
"Repugnancy meant the Company had to apply English law in India." No. It meant the Company's rules could not contradict English law. Applying English law to inhabitants of India is a much later and much more contentious development, and it arrives with the Mayors' Courts.
Limits and criticism
The charter is a commercial instrument and reads like one. Its drafters were thinking about ships, customs duties and bullion exports, not about justice. The power of legislation is squeezed into one clause among many, and the words "reasonable" and "not repugnant" are the only guidance given about how it was to be used. For a body that would in time govern a subcontinent, that is a slender foundation, and the looseness is not accidental: nobody in 1600 imagined it would ever be needed for more than a few hundred men in a few trading posts.
The Charter of 1600: A Company That Could Make Law
The deeper criticism belongs to Module IV rather than here. A power to legislate for India was granted by an English Queen to an English corporation without a single Indian being consulted, and the same fact is true of every instrument in this book until the Indian Councils Act 1861 and, in any real sense, until much later than that.
Quick revision
- Granted 31 December 1600 by Queen Elizabeth I.
- Incorporated "The Governor and Company of Merchants of London, Trading into the East Indies", with perpetual succession and a common seal.
- Monopoly of trade beyond the Cape of Good Hope, for fifteen years.
- Power to make "Laws, Constitutions, Orders and Ordinances" and to impose imprisonments, fines and amerciaments.
- Limited by the repugnancy rule: the laws must be reasonable and not contrary or repugnant to the laws, statutes or customs of England.
- Power extended over the Company's own servants only. No court, no territory, no criminal jurisdiction over strangers.
Test yourself
1. State the two conditions the Charter of 1600 attached to the Company's power of legislation. That the laws be reasonable, and that they be not contrary or repugnant to the laws, statutes or customs of England.
2. Over whom could the Company exercise the powers granted in 1600? Over its own members and servants only. It had no authority over Indians, over servants of the Mughal Emperor, or over Englishmen not in its employment.
3. Why is the repugnancy rule important beyond 1600? Because it is the first limit ever placed on law-making for India, and the same idea reappears in every constitutional instrument down to article 254 of the Constitution.
4. Was the Charter of 1600 a statute? No. It was a grant by the Crown under the Great Seal, that is, letters patent. Parliament did not begin legislating for India until 1773.
5. If a Company servant at Surat in 1620 committed murder, could the President and Council try and hang him under the Charter of 1600? No. The charter gave power to fine, imprison and amerce for breaches of the Company's ordinances, not to try capital crime. Criminal powers were acquired in later charters, beginning with 1615 and enlarged in 1661 and 1683.
The rest of this subject
These notes are cut from the University's printed syllabus. Open the syllabus itself, or the past papers, for the same subject.