Hudson's Bay Company

Hudson's Bay Company is the oldest commercial corporation in North America and is one of the oldest in the world. It was once the de facto government in parts of North America before European-based colonies and nation states existed. It was at one time the largest landowner in the world, with Rupert's Land being a large part of North America. Its traders and trappers forged early relationships with many groups of First Nations/Native Americans and its network of trading posts formed the nucleus for later official authority in many areas of western Canada and the United States. In the late 19th century, its vast territory became the largest component in the newly formed Dominion of Canada, in which the company was the largest private landowner. With the decline of the fur trade, the company evolved into mercantile business selling vital goods to settlers in the Canadian West. Today the company is best known for its department stores throughout Canada. The Hudson's Bay Company Archives are located in Winnipeg, Manitoba, Canada. They also classify the Bay in downtown Winnipeg as the flagship store.

HISTORY

EARLY YEARS

The Governor and Company of Adventurers of England trading into Hudson's Bay was incorporated on May 2, 1670, with a Royal Charter from King Charles II. The charter granted the company a monopoly over the Indian Trade, especially the fur trade, in the region watered by all rivers and streams flowing into Hudson Bay in northern Canada, an area known as Rupert's Land after the first director of the Company, Prince Rupert of the Rhine. This region constitutes 1.5 million square miles (3.9 million km²) in the drainage basin of Hudson Bay, comprising over one third the area of modern-day Canada and stretching into the north central United States, but the specific boundaries were unknown at the time.

The company founded its first headquarters at Fort Nelson at the mouth of the Nelson River in present-day northeastern Manitoba. The location afforded convenient access to the fort from the vast interior waterway systems of the Saskatchewan and Red rivers. Other posts were quickly established around the southern edge of Hudson Bay in Manitoba and present-day Ontario and Quebec. Called "factories" (because the "factor", i.e. a person acting as a mercantile agent and frequently specializing in one or a small number of commodities, did business from there), these posts operated in the manner of the Dutch fur trading operations in New Netherland.

During the spring and summer, First Nations traders, who did the vast majority of the actual trapping, traveled by canoe and were received at the fort to sell their pelts. In exchange they typically received metal tools and hunting gear, often imported by the company from Germany, the center of inexpensive manufacturing in that era.

The early coastal factory model contrasted with the system of the French, who established an extensive system of inland posts and sent traders to live among the tribes of the region. The conservative nature of the English company's more centralized factory system frustrated the company's founders, Radisson and Des Groseilliers, who urged bolder explorations of the continental interior. In 1674 they switched their allegiance back to France and in 1682 they founded North West Company to directly compete with the company. After war broke out in Europe between France and England in the 1680s, the two nations regularly sent expeditions to raid and capture each other's fur trading posts. In March 1686, the French sent a raiding party under Chevalier des Troyes over 1300 km (800 miles) to capture the company's posts along James Bay. The French appointed Pierre Le Moyne d'Iberville, who had shown extreme heroism during the raids, as commander of the company's captured posts. In 1697, d'Iberville commanded a French naval raid on the company's headquarters at York Factory. On the way to the fort, he defeated three ships of the Royal Navy in the Battle of the Bay, the largest naval battle in the history of the North American Arctic. D'Iberville's depleted French force captured York Factory by a ruse in which they laid siege to fort while pretending to be a much larger army. York Factory changed hands several times in the next decade. It was finally ceded permanently to what was by then the Kingdom of Great Britain (following the union of Scotland and England in 1707) in the 1713 Treaty of Utrecht. After the treaty, the company rebuilt York Factory as a brick star fort at the mouth of the nearby Hayes River, its present location.

In its trade with native peoples, the company adopted the widespread use of issuing wool blankets, called Hudson's Bay point blankets, in exchange for the beaver pelts trapped by native hunters.

19th Century

In 1821, the North West Company of Montreal and Hudson's Bay Company merged, with a combined territory that was extended by a licence to the North-Western Territory, which reached to the Arctic Ocean on the north and the Pacific Ocean on the west. Before the merger, the employees of the HBC, unlike the North West Company, did not participate in its profits. After the merger, with all of its operations under the management of Sir George Simpson from 1826 to 1860, the company had a corps of commissioned officers, 25 chief factors and 28 chief traders who shared in the profits of the company during the monopoly years. Its trade covered 7 770 000 km² (3,000,000 square miles) and it had 1,500 contract employees.

Throughout the 1820s and 1830s the company controlled nearly all trading operations in the Oregon Country, based out of the company headquarters at Fort Vancouver on the Columbia River. Although authority over the region was nominally shared by the United States and Britain through the Anglo-American Convention of 1818, company policy, enforced via Chief Factor John McLoughlin of the company's Columbia District, was to actively discourage U.S. settlement of the territory. The company's effective monopoly on trade virtually forbade any settlement in the region. It established Fort Boise in 1834 (in present-day southwestern Idaho) to compete with the American Fort Hall, 483 km (300 miles) to the east. In 1837 it purchased Fort Hall, also along the route of the Oregon Trail, where the outpost director displayed the abandoned wagons of discouraged settlers to those seeking to move west along the trail. The company's stranglehold on the region was broken by the first successful large wagon train to reach Oregon in 1843, led by Marcus Whitman. In the years that followed, thousands of emigrants poured into the Willamette Valley and in 1846 the United States acquired full authority of the most settled areas of the Oregon Country south of the 49th parallel. McLoughlin, who had once turned away would-be settlers as company director, now welcomed them from his general store at Oregon City and was later proclaimed the "Father of Oregon". The company retains no presence in the Pacific Northwest of the United States today.

Also during the 1820s and 1830s, HBC trappers were deeply involved in the early exploration and development of Northern California. Company trapping brigades were sent south from Fort Vancouver, along what became known as the Siskiyou Trail into Northern California as far south as the San Francisco Bay Area. These trapping brigades sent into Northern California faced serious risks, and were often the first to explore what was one of the last regions of North America to remain unexplored by Europeans or Americans.

One major event that lead to the demise of the HBC's monopoly in Rupert's Land was the Guillaume Sayer Trial in 1849. Sayer, a Métis trapper and trader, was accused of the illegal trading of furs and brought to trial by the Court of Assiniboia, which was heavily stacked with either HBC officials or HBC supporters. During the trial, a crowd of armed Métis men led by Louis Riel Sr. gathered outside the courtroom, ready to support their Métis brother peacefully or by force if necessary. Although found guilty of illegal trade by Judge Adam Thom, no fine or punishment was levied — many reports state it was due to the intimidating crowd gathered outside the courthouse. With the cry, "Le commerce est libre! Le commerce est libre!" ("Trade is free! Trade is free!"), the HBC could no longer use the courts to enforce their monopoly on the settlers of Red River.

Another factor was the findings of the Palliser Expedition of 1857 to 1860, led by Captain John Palliser. Although the initial report was unfavourable towards settlement, it sparked a debate which ended the myth being propagated by the Hudson's Bay Company that the Canadian West was unfit for agricultural settlement.

In 1870 the trade monopoly was abolished and trade in the region was opened to any entrepreneur. The company relinquished its ownership of Rupert's Land under the Rupert's Land Act of 1868 enacted by the Parliament of the United Kingdom.

Today's modern HBC has diversified into joint ventures and other types of business products. HBC has credit card, mortgage, and personal insurance branches.