Frith Gilds, with much the same objects, had been common anterior to the Conquest[22]. In most places where there was a market it was essential that some recognised authority should be in existence to keep the peace, as well as to be witness to sales[23]. The “laws of the city of London” were apparently drawn up with the express design of supplementing defective law[24]. They exhibit to us a complete authority for the supervision of trade, corresponding to the later Merchant Gild in nearly every particular: there is the common stock, the head man, the periodical meetings at which “byt-fylling” plays its usual important part[25]. The “ordinance which King Ethelred and his Witan ordained as ‘frith-bot’ for the whole nation” imposed the duty of pursuing offenders on the town to which they belonged[26]. There was thus evidently some organisation within the boundaries of the town, and as the chief of the burgesses forming this organisation were also the chief merchants (since trade was the raison-d’être of the towns) it soon began naturally to frame commercial regulations[27]. So the Town Gild became, when, after the Norman Conquest, trade had assumed important dimensions, the Gilda Mercatoria with exclusive powers and privileges by royal charter. The earliest unmistakable mention of a Merchant Gild is at the end of the eleventh or the beginning of the twelfth century[28]. Under Henry I. grants of Merchant Gilds appear in one or two of the charters granted to towns[29], and under Henry II., Richard and John they become more frequent[30]. Shrewsbury was one of the few which had the Merchant Gild confirmed as early as the reign of Henry II.[31]
By these charters what had originally been a voluntary association now became an exclusive body to which trade was restricted.
Important as were the advantages gained by the procuring of such royal authorisation, these charters only set the seal to what had existed in effect before. The landed and mercantile interests were practically identical within the towns: the great merchants were also the great landowners; the Gilda Mercatoria could thus frame regulations which it would be extremely difficult for any trader to disregard[32].
Functions.
Besides, the benefits which resulted from common trading would be too obvious for any individual who could procure entrance into the Gild to abstain from doing so. It was far more to the common interest that one representative should buy for all and then divide the purchase equitably than that each should compete with each and so minister simply to the profit of the seller.
There are several examples of such combined purchasing by a royal or municipal officer in towns where there was no Merchant Gild[33]. It was however generally effected by means of the latter, the granting of which meant the according of permission to the members to settle for themselves their custom in buying and selling.
The retail trade within the town was restricted to their own members individually, and the wholesale trade coming to the town was reserved to themselves collectively. Members of the Merchant Gild alone might sell within the walls, and traders coming from without might sell only to the Merchant Gild.
There was no danger then as there would be now of such a practice driving all trade away from the town, for the restrictions in force at one place would be paralleled almost exactly in every other. At the periodical fairs alone did free trade prevail.
But the exclusive privileges might be exceedingly harmful if the main body of householders were not members of the Merchant Gild. It was then the fact that the restricted trading was not “to the advantage of the community of the borough but only to the advantage of those who are of the said society[34].” When however the great majority of the householders were members of the trading corporation the arrangement would work well and beneficially for the whole town.
All Burgesses are Gildsmen.