The Company of Scotland Trading to Africa and the Indies, also called the Scottish Darien Company, was an overseas trading company created by an Act of the Parliament of Scotland in 1695. The Act granted the Company a monopoly of Scottish trade to India, Africa and the Americas, extraordinary sovereign rights[1]:25 and 21 years of exemptions from taxation.[2]:100
Financial and political troubles plagued its early years. The court of directors was divided between those residing and meeting in Edinburgh and those in London, amongst whom were both Scots and English.[1]:26 They were also divided by business intentions; some intended to trade in India and on the African coast, as an effective competitor to the English East India Company, while others were drawn to William Paterson's Darien scheme, which ultimately prevailed.[2]:111–2
In July 1698 the company launched its first expedition, led by Paterson, who hoped to establish a colony in Darien (on the Isthmus of Panama), which could then be used as a trading point between Europe and the Far East. Though five ships and 1,200 Scottish colonists landed successfully in Darien, the settlement was poorly provisioned and eventually abandoned.[1]:28 A second, larger expedition (launched before the fate of the first was known) took up the deserted settlement, but was quickly besieged by the Spanish. More than a thousand succumbed to hunger and disease, and in April 1700, two ships carried the few survivors home.
In 1700–01 the Company sent further expeditions to Java and China, but suffered shipwrecks at Malacca and seizure of cargo by pirates at Madagascar.[1]:29
Founding
On 26 June 1695 the Parliament of Scotland passed the Act for a Company Tradeing to Affrica and the Indies, establishing the Company of Scotland trading to Africa and the Indies. The subscription book of the Company of Scotland was opened in Edinburgh on 26 February 1696, inviting investments from a minimum of £100 up to a maximum of £3,000. Such was the popularity of the scheme that on the first day alone 69 subscriptions were taken, worth £50,400. A second book was open in Glasgow between 5 March and 22 April. Although attempts to raise funds in London, Hamburg[2]:109 and Amsterdam had been blocked, by the beginning of August 1696 the full target of £400,000 sterling had been reached.[1]:28
When the Company of Scotland was first formed, it was managed by its promoters, whose key task was to encourage subscriptions to the Company. Once the subscription target of £400,000 sterling had been reached, however, the Company required a more formal management structure. On 3 April 1696 a general meeting of subscribers elected a committee of twenty from their number to work with the promoters to establish rules and a constitution. By the middle of the month they had agreed that the Company would be managed by a Court of Directors and a Council General. The Court of Directors was to be an elected body with a maximum of fifty members, with each £1,000 of stock entitling its holder to one vote in the election. Twenty-five members would be elected by the subscribers, with up to a further twenty-five being elected by the first twenty-five. Subscribers with a holding of £1,000 or more could stand for election. A different director was to act as president of the Court at each meeting. The first Court of twenty-five directors was elected by shareholders on 12 May 1696. Candidates for election had to own at least £1,000 of company stock and so a limited number of shareholders, 119 out of a total of 1,320 (1,267 individuals and 53 institutions), were eligible to become directors. The Court's directors came from across Scotland's wealthy classes, comprising two nobles, eight merchants and 15 lairds. Shortly afterwards, the first twenty-five directors appointed William Paterson and three others as additional directors. From July 1696 the Court of Directors met in the Company's offices in Mylne Square on Edinburgh's High Street.
The Council General was to be a larger body than the Court of Directors, comprising both the directors themselves and representatives of the remaining subscribers, with one representative for each £10,000 of stock. Whilst the Court of Directors was responsible for the day-to-day running of the Company, the Council General was convened to discuss major decisions, such as capital-raising, the election of future directors and the payment of dividends. The Council General was only convened as and when there were matters to discuss, and therefore meetings were not held at regular intervals.
Consequences of failure
All told, the venture, dubbed the Darien Scheme, drained Scotland of an estimated quarter of its liquid assets and played a key role in forcing the country to the 1707 Act of Union which united the Kingdoms of Scotland and England. By 1707, the Company's debt was over £14,000 (equivalent to £2,506,110in 2021).[2]:101
The new joint government, in a political bargain, agreed to cover the costs of winding up the Company of Scotland, in addition to compensate for servicing the English national debt and higher taxes for Scotland.[3]
Refer: Papers Relating to the Ships and Voyages of the Company of Scotland Trading to Africa and the Indies, 1696-1707 edited by George Pratt Insh, M.A., Scottish History Society, Edinburgh University Press, 1924.
The Acts of Union were two Acts of Parliament: the Union with Scotland Act 1706 passed by the Parliament of England, and the Union with England Act 1707 passed by the Parliament of Scotland. They put into effect the terms of the Treaty of Union that had been agreed on 22 July 1706, following negotiation between commissioners representing the parliaments of the two countries. By the two Acts, the Kingdom of England and the Kingdom of Scotland—which at the time were separate states in a personal union—were, in the words of the Treaty, "United into One Kingdom by the Name of Great Britain".
The Darien scheme was an unsuccessful attempt, backed largely by investors of the Kingdom of Scotland, to gain wealth and influence by establishing New Caledonia, a colony in the Darién Gap on the Isthmus of Panama, in the late 1690s. The plan was for the colony, located on the Gulf of Darién, to establish and manage an overland route to connect the Pacific and Atlantic Oceans. The backers knew that the first sighting of the Pacific Ocean by Balboa was after crossing the isthmus through Darién.
Berwickshire is a historic county, registration county and lieutenancy area in south-eastern Scotland, on the English border. The county takes its name from Berwick-upon-Tweed, its original county town, which was part of Scotland at the time of the county's formation in the twelfth century, but became part of England in 1482 after several centuries of swapping back and forth between the two kingdoms. After the loss of Berwick, Duns and Greenlaw both served as county town at different periods.
Duns is a town in the Scottish Borders, Scotland. It was the county town of the historic county of Berwickshire.
Sir William Paterson was a Scottish trader and banker. He was the founder of the Bank of England and was one of the main proponents of the catastrophic Darien scheme. Later he became an advocate of Union with England.
The Treaty of Union is the name usually now given to the treaty which led to the creation of the new state of Great Britain, providing that the Kingdom of England and the Kingdom of Scotland were to be "United into One Kingdom by the Name of Great Britain". At the time it was more often referred to as the Articles of Union.
Scottish colonisation of the Americas comprised a number of failed or abandoned Scottish settlements in North America; a colony at Darien on the Isthmus of Panama; and a number of wholly or largely Scottish settlements made after the Acts of Union 1707, and those made by the enforced resettlement after the Battle of Culloden and the Highland Clearances.
David Boyle, 1st Earl of Glasgow was a Scottish politician and peer. He was the last Treasurer-depute before the Union with England.
Adam Cockburn, Laird of Ormiston, Lord Ormiston, was a Scottish administrator, politician and judge. He served as Commissioner for Haddington Constabulary in the parliaments of 1681-2 and 1689, and in the conventions of 1678 and 1689. He was appointed Lord Justice Clerk on 28 November 1692.
Clan Swinton is a Scottish clan of the Scottish Lowlands.
"Such a Parcel of Rogues in a Nation" is a Scottish folk song whose lyrics are taken from a poem written by Robert Burns in 1791, listed as number 5516 in the Roud Folk Song Index. It has continued to be associated with Scottish nationalism and also been referenced in other situations where politicians' actions have gone against popular opinion.
James Foulis of Colinton, Lord Retfurd or Redford, was a Scottish judge and politician. He was one of the main investors in the Company of Scotland and their Darien Expedition.
George Baillie was a Scottish politician who sat in the Parliament of Scotland from 1691 to 1707 and in the British House of Commons from 1708 to 1734.
Sir John Swinton of Swinton sometimes called John Swinton of that Ilk was a Scottish politician.
Sir Patrick Johnston (1650–1736) of Edinburgh was a Scottish merchant and politician who sat in the Parliament of Scotland from 1702 to 1707 and as a Whig in the British House of Commons between 1707 and 1713. He was Lord Provost of Edinburgh three times from 1700 to 1702, from 1704 to 1706, and from 1708 to 1710.
Sir Robert Chieslie of Dalry was a Scottish merchant who served as Lord Provost of Edinburgh from 1694 to 1696.
Robert Corseof Corse (1639–1705) was a 17th-century Scottish merchant who traded sugar and tobacco in Glasgow and was a Baillie and Dean of Guild of the City Council. He lost a fortune due to his involvement in the Company of Scotland.
Francis Montgomerie of Giffen, Ayr was a Scottish politician who sat in the Parliament of Scotland from 1689 to 1707 and in the British House of Commons from 1707 to 1710.
Sir George Home of Kello was Lord Provost of Edinburgh from 1698 to 1700. He then became principal tax collector for the Scottish Borders. He was later accused of not passing the taxes to the government in 1707, the year of the abolition of the Scottish parliament.
The first Leith Sugar House was established in 1677 by Robert Douglas and partners. Between 1667 and 1701 four sugar boiling and rum-distilling enterprises were established in Scotland, three in Glasgow and one in Leith. The financial success of the Leith Sugar house in the seventeenth and eighteenth century demonstrates Edinburgh's economic connection to the Atlantic economy and enslaved labour.
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