North Borneo (now the Malaysian state of Sabah) was, by the 1940s, the last country in the world to be still run by a private company – the British North Borneo (Chartered) Company.
Over the centuries there have been many examples of companies administering territories, the most famous of which was the Honourable East India Company which ruled vast swathes of India until the British Government took over responsibility in 1858 following the Indian Mutiny.
Other examples were the Verenigde Oostindische Compagnie which ran the Dutch East Indies (Indonesia), the British South Africa Company (Rhodesia and Zambia), the Portuguese Companhia de Mocambique and the German New Guinea Company.
Some of the chartered companies were very exploitative, interested only in generating profits by any means including slavery (English Royal African Company) and the opium trade (East India Company).
Others, such as the British North Borneo (Chartered) Company (BNBCC), were more benevolent towards their subjects and were careful to retain the goodwill and cooperation of the local population on whom the company’s survival depended.
In the mid 19th century, when Western nations were scrambling to acquire more colonies, North Borneo was still a blank on the map, nominally owned by the Sultan of Brunei although the Sultan of Sulu controlled part of it.
An American adventurer managed to hoodwink the Sultan of Brunei into ceding North Borneo to him in return for the promise of certain payments. There followed an attempt to establish an American colony. When that failed, the cession papers changed hands and the territory could easily have ended up as a German, Austrian or Italian colony, all of whom were sniffing around at the time. Instead the BNBCC was formed in 1881 to administer the territory of North Borneo over which it had acquired sovereign rights.
Continue reading (Incl. Pics) at: North Borneo – What a Way to Run a Country!.