In today's society, with most if not all of the surface land masses claimed by existing nations, and nations' authority being supported by virtue of recognition of other states, how would a company be able to claim land, raise army, and eventually become recognize as a nation?

Give me your idea of a feasible path that the corporation would take, starting today, without any science-fiction (i.e. no space colonization).

I'm thinking on the scale of the Dutch East India Company but if it had been able to claim more power and independence. See also: "megacorporation".

Related, but not the same, because we're strictly looking at Earth of today without modifications and without possibility of near-future sci-fi: How could a corporation become a sovereign state in two or three hundred years?

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    $\begingroup$ The basic problem with this kind of scenarios is that corporations have no reason whatsoever to want to become states. Corporations make money, states spend money. What modern sovereign state does not run a deficit? Corporations have enough complications in their lives without bothering with social welfare, education, culture, defense, diplomacy and so on. Corporations want to specialize in what they are good at doing, states by necessity need to fulfil many different, divergent and often competing functions. $\endgroup$ – AlexP Sep 19 '18 at 13:25
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    $\begingroup$ This questions is too opinion based and broad. Not only is state formation a very complex process, but how can you tell that one answer is more correct than another? $\endgroup$ – kingledion Sep 19 '18 at 13:34
  • $\begingroup$ @kingledion I agree somewhat, but isn’t that a similar problem to any world building question? $\endgroup$ – personjerry Sep 19 '18 at 14:31
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    $\begingroup$ The question lacks details: what would this corporation do? How would it differ from a normal state (any state has profiteers, salaried personnel; many corporations offer health services, or sick pay..)? How would it differ from some construct like Costa Rica? Would it need to be recognized by all states on earth? The UN? Is it traded? $\endgroup$ – bukwyrm Sep 19 '18 at 15:07

The experience of the British East India Company is illustrative.

The British East India Company started out administering small enclaves, usually around ports. These enclaves experienced dramatic population inflows from surrounding areas, based on the economic activity they represented and the fact that they were also generally better governed, even from the Indian perspective, than the surrounding areas.

In the modern era, central American states marked by corrupt governance are currently considering the establishment of such enclaves, as both an economic growth measure and a corruption-fighting measure, so it's not totally far-fetched to think that this could occur all over again.

The line between local administration and state power disintegrates quickly in such a scenario. Inevitably, there would be a lack of congruity between the company's administrative decisions (which begin to take on the character of judicial decisions) and the policy aims of the surrounding state. All it takes is one situation where the host power changes its mind, or tries to override an administrative decision it previously delegated to the company in its area, and the company decides to refuse the host's demands - and a new, micro-state has sprung into existence, in rebellion against the host state.

In the modern diplomatic context, of course, no other state would "recognize" the new state...unless and until it was victorious in its conflict with the host state. Diplomatic recognition tends to "follow the power".


The company grows up under the wings of sovereign nations, then develops a significant private security (private army) branch. The sovereign nations get involved in a war and contract the company to use their private army to create peace in a contested region. At this point the corporation is not quite fully sovereign, as it is still deriving it's power to send troops/police to enforce laws from a charter given by some nation. But then the nations involved in the war decide that contested region isn't worth the trouble, and after some bribery from the company, the company is given a permanent contract to be 'custodians' over that land and its citizens. The idea is to grant the company license to do the peace-keeping and nation-rebuilding for profit.

So then you've got a corporation that has the power to make laws and use force in a region. That's very close to sovereignty. What's left is to fully sever any dependence on the nations that initially granted the permanent charter. About 50 years after the permanent charter begins, the company does something that pisses off the nation that gave the charter. The nation says "I know we said it'd be permanent, but we're a sovereign nation and you're a company so fuck you, we're taking it back." and then the company says "We know we said we were just acting as custodians on your behalf, but we don't need you anymore, and we've got a military, so fuck you, we built a nation and we're keeping it". Some other nations recognize the corporation as sovereign, and start making treaties with it.

And then the corporation has sovereignty over that region. It can make laws, use force, and no other nations can influence it other than by negotiating as equals, going to war, or sanctions.


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