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| Partnerships & Joint Stock Companies with Share Capital It may come as a surprise to you to know that the Joint Stock Companies were invented by the Ordo Equester around the time of the Punic Wars. The members of this Order invested their funds in societates publicanorum, joint stock companies, the equivalent of a UK Ltd. or Plc. company, set up with capital in return for shares, partes, and in which they took no part in the running of the businesses. That role was left to managers, mancipes et magistri, see the adjacent organizational chart. They were effectively shareholders, participes, with limited liability. Shares could be bought and sold at the Temple of Pollux in the Forum, the first Stock Exchange site. These joint stock companies covered three main market sectors, but one that is mostly talked about in the literature is "farming the revenues" on behalf of the State, both income tax and custom duties on the movement of goods and people. You may be tempted to think that duties levied on the movement of people was not civilized? But, reflect: we pay duties today every time we fly on a plane, and we pay them twice, at the departing and arrival airport. What has changed? The technology, only! Ad rem! Basically, "farming the revenues" meant to be granted a lease by the State to collect the public taxes of a region, or province, on behalf of the State, but pay the State an agreed percentage of the collected taxes. The contract was awarded by auction, and the president of the company, the manceps, was expected, by the government's office, to be the person to make the bid on account of the importance of the contract worth the equivalent of billions of dollars of our money today. The manceps therefore provided, directly as the representative of the company, and indirectly according to his standing, prestige in society, and track-record in business, the surety that the company can fulfill its obligations and deliver an effective execution. Can you imagine the "negotiatores" of the manceps arguing on behalf of the directors and shareholders of the company with the State officials, normally the office of the Censor, and prior to the actual auction date, whether the percentage should be x% or y%, or less, on account of the element of risk and uncertainty that the collection of taxes involved, especially if the region was, say, Judaea? Has anyone written a play on this subject? If no one has, then someone should, as it would make hilarious reading. Where is the evidence, you may ask? Read on! Partnerships According to Dionysius 1 of Halicarnassus, who lived in the first century B.C., Consul Postumius contracted out the building of temples for the deities Ceres, Liber and Liberia2. We know that the consulship of Postumius Cominius Auruncus II and Sp. Cassius Vitellinus II took place in 493 B.C. The practice by the government to offer public leases to contractors must, it is fair to imply, have been already established before this date, and it is even reasonable to assume that it existed under the period of the elected Monarchy, especially as the centrepiece of the Servian constitutional reformation was centred really on the formation of the Equities Classes. Please refer to the page Comitiae. Companies that entered into such lease agreements with the State were referred to as publicani. The type of organization created by these publicani was a partnership with unlimited liability, societas; the partners, socii, were therefore fully liable for the debts of the company. Legislation existed which set definitive rules on the conduct of such partnerships. One notable evidence of the existence of societates, already long established, is given by Livy in Book XXIII.3 In this passage Livy tells us that when the appointed day arrived, three societates of 19 people in all were represented who made acceptance of the contract conditional to: one, that they should be exempt from the military service during the period as contractors to the government; two, that the government should take responsibility for the risk of loss of the goods transported by sea either due to storms or enemy action. Joint Stock Company Setting up a company to engage in a contract of Publicanus4 with the State to "farm the revenues" was a formidable task, not unlikely that of a modern company wanting to set-up an Agency for the collection of taxes from the citizens of a state. It required large sums of up-front capital and a diligent organizational plan in terms of managers, negotiatores (salesmen), skilled labour, general workers (slaves) and facilities for stock holding as well as vessels for transport, both land transport and sea transport. It would mean to have to fund right from the start a payroll that would be counted in several hundreds, if not thousand, personnel at different levels. The requirement, therefore, for capital expenditure and working capital for an enterprise of this magnitude would have been quite high, and beyond the means of smaller societates. This need was fulfilled by the societates publicanorum. The establishment of such companies has been known for quite a long time. In the Manual of Roman Antiquities published in 1894, and the first edition in 1851, Proff. Ramsay & Lanciani5 wrote that "the members of the Ordo Equester indeed, which, from the time of the Gracchi, was composed of the class of monied men, invested their funds in the joint stock companies (societates) which farmed the public revenues, but they merely furnished the capital to conduct these enterprises, the whole burden of the practical details being in the hands of subordinate agents and managers." This evidence is not knew to scholars of Roman History, Law and Literature, as references to such organizations abound in the Latin Literature. However, more recently this topic has received renewed interest prompted by a relatively new finding from St. John's Basilica in Ephesus, Turkey. A large piece of marble (see adjacent photo now held at the Ephesus Museum) had been used as a foot slab at the entrance of the Church. During renovation work the marble slab was removed and it was discovered that the other side of the slab, the interred side, [check this version of the finding] had an inscription written in Greek of the Lex Portorii Provinciae Asiae. If you reaction is indifferent to the word "portorii", then be sure that if you had been living in that period you, probably, would have hated it: it means import and export tax levied at seaports in Italy and all the Roman Provinces. In the case in question the levy was one fortieth of the value of the goods, or 2.5%. More details of the type of unlimited and limited companies are found in the legal Literature. A scholarly paper written by Prof. Ulrike Malmendier6 on this subject is highly recommended, especially for its extensive references to the Corpus Iuris Civilis and the Digest, compulsory reading for lawyers, but both of which I have only casually read. More on the Publicani - The Tax Collectors The following paragraph is a quotation from the book of A.C. Bouquet entitled Everyday Life in New Testament Times no longer available, regrettably. Quote: "How were tax collected? There was a Roman official called the Censor, and it was the business of his department to see that the revenue was collected in the cheapest manner possible. One common method was to auction the task to the lowest bidder, so that he who tendered the lowest rate of commission got made collector of taxes in a given area. This was no doubt the way that things were done in Palestine, and we know that tax-gatherers there were unpopular with the [local] citizens, partly because they were [considered] collaborators with an alien government, partly because they often exorted more money than they really had a right to do, and pocketed the difference. The contracts with these collectors were for five years at a time. Such a contract of course allowed them in theory a fixed scale of percentage, but they often exceed this, and cheated the tax payer and probably the government too, and it is very likely that they took bribes to let off rich citizens from paying their full share of the taxes" end quote. | | 
Ephesus Museum: Part of a marble pulpit carrying a Greek inscription of the Lex Portorii Provinciae Asiae found in 1976. The photo shows palaeographers making paper squeezes to transfer the inscriptions on the stone to paper. On the Roman Revenues Since the foundation of the City revenues were collected by the government. Originally the taxation system was mainly agrarian based, but over time it became more complex and subject to special legislation or edicts as the case required. It is useful to form a basic understanding of the different words used to mean revenue. The most common general terms were: Pascua, Subst. 1 Decl. f. nom. sing. meaning: pasture Vectigalia, Subst., 3rd decl. n., nom. pl. of vectigal, meaning: tax, duty, due, toll, excise. Publicum Adj. i Class, n., meaning: state property, public property
A full declension list can be seen here. In book XXIII,49 of his Historia Naturalis7, Pliny gives an account of the usage of the term pascua: "Even to this day, in the Registers of the Censors, it will be found what is referred to as pascua: everything from which the public revenue is derived because since a long time this had been the only form of tax." As you can see from the Latin text in reference 7, at the end of the sentence he refers to Pascua as being a form of tax, vectigal, the more modern and common name for all forms of taxes. There were various forms of taxation, some were direct and other indirect. Many of the taxes had specific names; here are the most popular: Decumae - This is a substantive of the 1st declension, nom. pl., f., and it means the tenth part. This was a land tax paid by farming tenants of the Ager Publicus (lands belonging to the state), and as the name implies, 10% of the arable produce was paid into the exchequer, the aerarium. Scriptura - Woodlands and cattle grazing lands attracted another form of vectigalia called scriptura. This type of land was written (scribere) in the Registers as Ager Scripturarius on account that shepherds (Pastores or Pecuarii) were mandated to register the size of their flock with he Collector of Revenues, the publicanus for the district in which they operated, and the tax was levied accordingly. So far as I know the literature doen not specify the percentage of this levy. But, it is reported that severe sanctions applied to those who tried to cheat the system. Metalla - This was a duty payable on mining activities. Metalla is the nom. pl., neutral, of metallum, 2nd declension substantivum. It means mines, though it can also mean metal. This tax could be expressed in many different compond names according to the type of mine, hence you can meet as: metalla auri (gold), metalla argenti (silver), metalla aeris (bronze, copper), ferri (iron), plumbi (lead), and even stone quarries. Portoria - This is an import-export levy charged at all seaports and also on goods transported by land, implying that there were key custom toll booth on main highways which levied the charge. A custom that became extinct in mainland Europe over the last few decades. If you happen to drive on the road from Gex ( a French town near Geneva) to the town of Bellegarde on the Route Nationale 206 towards Bourg en Bresse, Grenoble or Lyon, then you will drive past an empty portoria toll station just before the entrance to the town of Bellegarde in Valserine. The barriers were still there in the year 2000 but kept pointing to the heavens. Tributum - This was a property tax levied and based on the rated value of the property as kept in the Registers of the Censors. This property tax was levied in time of emergency and was thus different from the decumae which was an annual tax. Vigesima Hereditatium - This was a 5% inheritance tax. Vigesima Manumissionum - This was a 5% tax on the value of slaves freed from bondage.
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| 1- Dionysius of Halicarnassus, Antiquities of Rome, VI, 17,2. 2- 3- 215 BC: Ubi ea dies venit, ad conducendum tres societates aderant hominum undeviginti, quorum duo postulata fuere, unum ut militia vacarent dum in eo publico essent, alterum ut quae in naves imposuissent ab hostium tempestatisque vi publico periculo essent. 4- Cicero makes a reference to a "muliercula publicana" which can be translated in good English as: a "loose woman" contractor of the revenues. Muliercula is a 1st Declension substantivum. 5- Ramsay and Lanciani, Manual of Roman Antiquities, pages 281, 282 and 485. 6. Ulrike Malmendier, Roman Shares, In: W. Goetzmann and G. Rouwenhorst (eds.), The Origins of Value. The Financial Innovations that Created Modern Capital Markets. Oxford University Press, August 2005, pp. 31-42, 361-365. 7- Text: Etiam nunc in Tabulis Censoriis Pascua dicentur omnia ex quibus populus reditus habet, quia diu hoc solum vectigal fuerat. | |
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