John Arrowsmith, map, “Map of North America. Drawn by J. Arrowsmith,” (1857), showing the ‘plantation’ claimed by the Hudson’s Bay Company by virtue of the charter granted by King Charles II, as coloured green (nearly visible are the other British territories shaded pink — in the North-West and the Labrador peninsula (and present-day Nunavut) as well as British Columbia and the Pacific coast — and those of Russia shaded yellow). Source: Library and Archives Canada, CARTO24287, Copyright: Expired = Domaine public.

In the case of Red River Settlement, having a proprietary government meant that the directors of the Hudson’s Bay Company [HBC], as the “true and absolute Lordes and Proprietors” of the plantation of Rupert’s Land, held rights to govern that plantation (with minimal stipulations) — Britain’s monarch having conferred that power by way of a royal charter in 1670.[i] There was no governing connection to Parliament in Britain, or anywhere else in the Empire. Nor was there such a connection to the ruling monarch: until such time as the charter came up for renewal (which it did periodically), neither monarch nor parliament paid much attention to who was being governed by whom in Rupert’s Land.

By 1869, the HBC operated as a political anachronism — being the last proprietary government in existence in the British Empire.[ii]

Additional Sources online:

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[i] See transcript, Citation: Royal Charter Incorporating the Hudson's Bay Company, 1680, http://web2.uvcs.uvic.ca/courses/lawdemo/DOCS/RC1670.htm.