Using Mongoose's ship shares in CT

[aramis]

Ldam?
............

Supp 8: Library Data A–M

 

[BlackBat242]

Ah... I've never seen it abbreviated that way... always as Supp 8 or the full name..

 

[FreeTrav]

"Except for those pre-dating the Imperium, all corporations engaging in interstellar commerce are required to possess an Imperial charter." [LDAM:40]​

That Free Traders are allowed to engage in interstellar trade is implied by the rules. That they don't have an Imperial charter is implied by the lack of reference to any such thing. That the reason why they don't need a charter is that they're not a corporation is an assumption, but, I submit, a good one.

Agreed with respect to the assumption - but not all companies are necessarily corporations. "Corporation" implies certain structures, and more specifically, a limitation of liability of any individual associated with the organization, when the individual is representing the organization. Private partnerships, not structured as corporations (i.e., not having formal officers, and not limiting the liability of any partner - compare the original structure of Lloyd's of London, and their early Names), could presumably engage in interstellar trade without a charter, and could quite possibly end up owning and operating multiple ships.

The key downside to being a non-corporation is probably going to be the liability issues - an Imperially-chartered corporation would, in all probability, have its officers insulated from certain regulatory liability vulnerabilities on member worlds, and may have additional legal protections (e.g., against seiszure of certain assets), while a nonchartered partnership takes its chances.

 

[rancke]

Agreed with respect to the assumption - but not all companies are necessarily corporations. "Corporation" implies certain structures, and more specifically, a limitation of liability of any individual associated with the organization, when the individual is representing the organization. Private partnerships, not structured as corporations (i.e., not having formal officers, and not limiting the liability of any partner - compare the original structure of Lloyd's of London, and their early Names), could presumably engage in interstellar trade without a charter, and could quite possibly end up owning and operating multiple ships.

The key downside to being a non-corporation is probably going to be the liability issues - an Imperially-chartered corporation would, in all probability, have its officers insulated from certain regulatory liability vulnerabilities on member worlds, and may have additional legal protections (e.g., against seiszure of certain assets), while a nonchartered partnership takes its chances.

All this is why I put a smiley at the end of my original post.

FWIW, I agree that the crucial difference is the question of limited liability. However, it's possible that the Imperium frowns on any sort of company that engages in interstellar trade without contributing to its coffers, so it's at least possible that it automatically defines any company with more than X partners as the equivalent of a corporation for this particular purpose -- that'll be 2% of the company, please.


Hans

 

[FreeTrav]

All this is why I put a smiley at the end of my original post.

FWIW, I agree that the crucial difference is the question of limited liability. However, it's possible that the Imperium frowns on any sort of company that engages in interstellar trade without contributing to its coffers, so it's at least possible that it automatically defines any company with more than X partners as the equivalent of a corporation for this particular purpose -- that'll be 2% of the company, please.

Yes, I can see this as being the case, though I'm not sure it would be IMTU. I would consider it quite likely that any government level with taxing authority - and this would include the Imperium itself - would make more from a universal GST or VAT, or even an income tax or transaction tax, than it would from having a 2% share in any company - because bear in mind that a stockholder only gets paid off when the company declares a dividend, and there is no mandate that a corporation do so - and there may be sound business reasons NOT to, like "We're saving up for the acquisition of another ship - no dividend this quarter." And therefore no contribution to Strephon's pockets. Whereas the corporate profits tax (income tax) applies even if the company is not a stock corporation, and thus will be contributing, period.

 

[rancke]

Yes, I can see this as being the case, though I'm not sure it would be IMTU. I would consider it quite likely that any government level with taxing authority - and this would include the Imperium itself - would make more from a universal GST or VAT, or even an income tax or transaction tax, than it would from having a 2% share in any company -

True enough, but I like the idea (Not surprisingly, since I came up with it).

...because bear in mind that a stockholder only gets paid off when the company declares a dividend, and there is no mandate that a corporation do so - and there may be sound business reasons NOT to, like "We're saving up for the acquisition of another ship - no dividend this quarter." And therefore no contribution to Strephon's pockets.

But if a company does that too often, sooner or later one of Strephon's forensic accountants are going to show up and ask for a look at the books. And if any OTHER shareholders have gotten anything more than a modest salary out of the corporation during that time, they'll be facing trial and confiscation and maybe even treason charges :devil:.


Hans

 

[dean]

My thoughts on the differences between an Imperially chartered corporation and a private company:

Imperially chartered corporations conduct "interstellar trade" because they maintain a business presence on multiple worlds and work the system from both ends. They maintain offices, warehouses, and may provide transportation (shipping) services and/or my consign the goods to be shipped to another one of their facilities on another planet. Thus, they are truly interstellar in nature, having a simultaneous presence on multiple worlds at the same time.

A non-chartered company, or free trader, does not maintain an office on a world. The trader uses local resources to obtain freight or speculative cargo and then casts off for another world as either a prepaid delivery service (shipper), or as an entrepreneurial operation (speculative cargo hauling), or some combination of the two. Since the entire "business presence" literally moves from start to star, the company isn't actually "interstellar" at any given instant. It's only local to whatever system the ship happens to be in at that time.

"Free" trader, by definition.

 

[FreeTrav]

Dean, I like this distinction; it works nicely for the single-ship free trader.

However, as soon as Captain Jameson can afford to buy a second Marava and hire another crew, it becomes a problem, no? At that point, he's on multiple worlds, although his operational mode doesn't change.

Is he involved in "interstellar trade" at this point?

For that reason, I prefer to rely on the liability difference. Having the charter offers protections that not having the charter doesn't. But having the charter also mandates two percent in the kitty.

And yes, going too long without declaring a dividend might prompt a visit from the Department of Forensic Accounting (an office of the Ministry of Trade, under the close supervision of the Chancellor of the Exchequer and the Keeper of the Privy Purse).

 

[FreeTrav]

But if a company does that too often, sooner or later one of Strephon's forensic accountants are going to show up and ask for a look at the books. And if any OTHER shareholders have gotten anything more than a modest salary out of the corporation during that time, they'll be facing trial and confiscation and maybe even treason charges :devil:.

Very definitely on the bit about other shareholders benefitting - but you DO need to define "too often" and "treason".

FWIW, I believe that the US Internal Revenue Service doesn't give a US company a hairy eyeball unless it reports losses for three years running, or four years in any seven. And a company doesn't ever HAVE to declare a dividend; it might be a "growth stock", where profits are reinvested to grow the company.

Microsoft, for example, didn't pay a dividend for several years after their IPO.

 

[tbeard1999]

Would you be willing to turn this into a more formal article, and send it to me (editor@freelancetraveller.com) for posting to "Doing It My Way" at Freelance Traveller?

Sure, but it might take some time. I haven't been able to be as active as I'd like lately...

 

[FreeTrav]

At your convenience; I figure I don't have a moral right to ask for more than that, as FT has never - and never will be able to - pay for content.

 

[dean]

Dean, I like this distinction; it works nicely for the single-ship free trader.

However, as soon as Captain Jameson can afford to buy a second Marava and hire another crew, it becomes a problem, no? At that point, he's on multiple worlds, although his operational mode doesn't change.

Is he involved in "interstellar trade" at this point?

For that reason, I prefer to rely on the liability difference. Having the charter offers protections that not having the charter doesn't. But having the charter also mandates two percent in the kitty.

And yes, going too long without declaring a dividend might prompt a visit from the Department of Forensic Accounting (an office of the Ministry of Trade, under the close supervision of the Chancellor of the Exchequer and the Keeper of the Privy Purse).

I disagree; unless and until Jameson begins to maintain a permanent business presence on one or more worlds, ships operating independently should still be considered Free Traders, as they cannot influence the local market (and thereby interstellar trade) unless they are present in-system.

It's a question of timing. A ship that is without an official representative (not broker) cannot take advantage of pricing except when they are there. If a local broker does so, he'll sell to the Free Trader at a markup and pocket the difference. If the trader has a permanent business presence, he can then absorb that profit himself and still gain whatever usual profit he'd normally realize.

I'd actually have to go as far as saying as soon as a "company" has a business presence on TWO worlds, they become "interstellar" and then will need to obtain a charter before doing so.

I believe the purpose of the interstellar charter is much like the FTC's anti-monopoly function; it serves to identify players that could influence trade in a significant way. I'd also say there's a lot of adventure seeds whereby players could be caught in a Imperial investigation into who's chartered, who's not, and who's playing fast and loose within the system : )

 

[FreeTrav]

I disagree; unless and until Jameson begins to maintain a permanent business presence on one or more worlds, ships operating independently should still be considered Free Traders, as they cannot influence the local market (and thereby interstellar trade) unless they are present in-system.

It's a question of timing. A ship that is without an official representative (not broker) cannot take advantage of pricing except when they are there. If a local broker does so, he'll sell to the Free Trader at a markup and pocket the difference. If the trader has a permanent business presence, he can then absorb that profit himself and still gain whatever usual profit he'd normally realize.

I'd actually have to go as far as saying as soon as a "company" has a business presence on TWO worlds, they become "interstellar" and then will need to obtain a charter before doing so.

So the key here is permanent planetary presence, sufficient to take long-term advantage of both short- and long-term local fluctuations in market price? OK, I can accept that. It's when Captain Jameson either puts a local broker on retainer, or hires someone to act as a local factor, and does so on two different worlds, that he needs that piece of paper from the MoT. Until it proves cost-efficient for him to do so, he won't, and remains exempt from the restrictions of the charter - and innocent of its protections.

I believe the purpose of the interstellar charter is much like the FTC's anti-monopoly function; it serves to identify players that could influence trade in a significant way. I'd also say there's a lot of adventure seeds whereby players could be caught in a Imperial investigation into who's chartered, who's not, and who's playing fast and loose within the system : )

Indeed, there are opportunities there; if you ever feel like developing one into a full adventure - or even an adventure seed - I'd be more than happy to post it to Freelance Traveller, with your permission.

 

[Max]

I never thought an Imperial charter was hard to get, useful for an occasional plot device (Imperial Bureaucrats threaten to revoke charter unless players do this one little favor), but not hard to get. Well if the person applying for the charter has a record of piracy or genocide I'm sure it might be hard to get an Imperial Charter, but for most people not a problem.

The Emperor's Share is a whole different thing, and I envision it 2 ways.

1) The Emperor (not the Imperium) provides funding at the start of companies and takes an ownership interest, acting as venture capitalist. This is also useful as there is an implied probability that the Imperium will favor companies which are partially owned by the Emperor when it comes time to award contracts.

2) The Imperium acting as a megacorporation has ownership as part of the interlocking ownership structure of the Villani megacorps, if every majow company is partially owned by the Imperium they are somewhat limited in taking actions which will adversely impact their owners (the Imperium and other megacorps).