| Short Title: | Royal Exchange and London Assurance Corporation Act 1719 |
| Type: | Act |
| Parliament: | Parliament of Great Britain |
| Long Title: | An Act for better securing certain Powers and Privileges intended to be granted by His Majesty by Two Charters for Assurance of Ships and Merchandizes at Sea, and for lending Money on Bottomry; and for restraining several extravagant and unwarrantable Practices therein mentioned. |
| Year: | 1720 |
| Citation: | 6 Geo. 1. c. 18 |
| Territorial Extent: | Great Britain Later extended to American colonies, including: |
| Royal Assent: | 11 June 1720 |
| Repeal Date: | 5 July 1825 |
| Repealing Legislation: | Royal Exchange Assurance Act 1901 |
| Status: | repealed |
The Bubble Act 1720 (also Royal Exchange and London Assurance Corporation Act 1719)[1] was an act of the Parliament of Great Britain passed on 11 June 1720 that incorporated the Royal Exchange Assurance Corporation and London Assurance Corporation, but more significantly forbade the formation of any other joint-stock companies unless approved by royal charter.
| Short Title: | Bubble Schemes (Colonies) Act 1740 |
| Type: | Act |
| Parliament: | Parliament of Great Britain |
| Long Title: | An Act for restraining and preventing several unwarrantable Schemes and Undertakings in His Majesty's Colonies and Plantations in America. |
| Year: | 1740 |
| Citation: | 14 Geo. 2. c. 37 |
| Royal Assent: | 25 April 1741 |
| Repeal Date: | 15 July 1867 |
| Repealing Legislation: | Statute Law Revision Act 1867 |
| Status: | repealed |
| Collapsed: | yes |
Its provisions were extended later by the Bubble Schemes (Colonies) Act 1740 (14 Geo. 2. c. 37)[2] to include its colonies, particularly Massachusetts.[3]
The act gave the South Sea Company a monopoly over British trade with South America[4] until the South Sea Bubble "popped" in Britain's first major stock market collapse.
Various motivations have been suggested for the act. They include the desire to prevent the speculation that produced the contemporary South Sea Bubble, an attempt to prevent smaller non-charter companies from forming and so reduce the importance of Parliament in regulating businesses; or the South Sea Company itself wanting to prevent other bubbles from forming that might have decreased the intensity of its own.[5]
Recent scholarship indicates that the last was the cause: it was passed to prevent other companies from competing with the South Sea Company for investors' capital.[5] [6] [7]
| Short Title: | Bubble Companies, etc. Act 1825 |
| Type: | Act |
| Parliament: | Parliament of the United Kingdom |
| Long Title: | An Act to repeal so much of an Act passed in the Sixth Year of His late Majesty King George the First, as relates to the restraining several extravagant and unwarrantable Practices in the said Act mentioned; and for conferring additional Powers upon His Majesty, with respect to the granting of Charters of Incorporation to trading and other Companies. |
| Year: | 1825 |
| Citation: | 6 Geo. 4. c. 91 |
| Royal Assent: | 5 July 1825 |
| Commencement: | 5 July 1825 |
| Collapsed: | yes |
In fact, the act was passed in June 1720, before the peak of the bubble. The act was partially repealed in 1825 by the Bubble Companies, etc. Act 1825 (6 Geo. 4. c. 91).[8] The residue of the Act was repealed in 1901.[9]
The Act declared "illegal and void" all business that raised money or offered shares in the manner of a chartered company without a charter from the royal government.[5] Under the terms of the act, the Royal Exchange Assurance Corporation and the London Assurance Corporation were granted charters to write marine insurance. Until 1824, they remained the only joint-stock firms with such a charter.