Anonymity and Intellectual Capital

Here is a draft article by David Post of Georgetown Law Center.  He
offered it on the Cyberia list and it includes permission to
redistribute.  I thought it had some interesting ideas on anonymity and
pseudonymity, as well as our old bugaboo "reputation capital".  I have
reformatted it slightly to improve readability but made no changes to the
content:


Pooling Intellectual Capital: Anonymity, Pseudonymity, and
Contingent
Identity in Cyberspace    

DRAFT OUTLINE
October 31, 1995
David G. Post [NOTE 1]

	  Most discussions of "anonymity" in cyberspace focus on
whether or not to regulate the availability of "untraceably anonymous"
messaging functions -- anonymous remailer services and the like -- and
the related question of how, in the special circumstances of
cyberspace, one might accomplish such regulation).  To be sure, this is
an important perspective; although we are embedded in a world in which
anonymous transactions are pervasive, we have never before been able to
manipulate anonymity, or to undertake as wide a range of anonymous
transactions, as cyberspace allows us to undertake (and we have,
therefore, only begun to think about the implications of being able to
do so).  At the same time, however, the technology offers, it would
seem, new prospects for eliminating anonymous communication, i.e., for
requiring (and enforcing the requirement for) completely "traceable"
communication.

     We need, in the first instance, to understand more about the costs
and benefits of anonymity in this new environment before we can
sensibly talk about the best way to regulate it (or whether to regulate
it at all).  Harms associated with an anonymous messaging  regime
include, notably, the inability of "law enforcement" (broadly defined
to include both public and private enforcement) to obtain information
on persons responsible for harm perpetrated by individual actors;
benefits include the ability of individuals to engage in communicative
activity without putting any aspects of their "identity" at risk (see
below for additional discussion of the reasons for the quotation marks
here).

	  My thesis here is that, because of the close links
between anonymity and pseudonymity in cyberspace, new elements need to
be added to this equation -- primarily on the benefits side.  This
requires disentangling, at the outset, three related concepts:
anonymity, pseudonymity, and traceability.  We can define an
"anonymous" communication as one in which the message itself contains
(and hence the recipient of the message receives) no information
regarding the identity of the sender.[NOTE 2]  Although there can be
truly anonymous messages even in this strict sense -- messages
containing no information about the originator -- it makes more sense
to talk about anonymity as a continuous rather than a binary attribute
(present/absent) of messages:  even messages we ordinarily think of as
"anonymous," after all, contain some information about the author
(e.g., graffiti scrawled on a subway platform informs us that the
author was literate, and was geographically located in a certain place
within the last x months/years, all of which probably effects a
significant reduction in the reader's uncertainty about the identity of
the author by ruling out the vast majority of individuals in the world
as possible authors).

     Messages, however, rarely contain a fixed amount of information
about the sender's identity; [NOTE 3] the degree to which a message may
be considered "anonymous" is rarely (if ever) an inherent
characteristic of the message itself.  Relevant information about the
originator's identity may well often be available, but only at some
additional cost.  For example, an "anonymous" note slipped under the
door may be covered with fingerprints from which, were we able easily
to access both a fingerprint reader and the FBI's fingerprint database,
we could obtain significant information about likely originators.
"Traceabililty" measures the cost of obtaining information about the
identity of the sender in addition to the information that is "readily
apparent" -- i.e., obtainable at (virtually) no cost -- from the
message itself.[NOTE 4]

	  Finally, we can define a pseudonymous message as one
that contains information (of varying reliability, to be sure) about
the identity of the originator -- the cognizable entity responsible for
transmitting the message -- without simultaneously providing
information about the actual, biological, individuals responsible for
transmission of the message.  Pseudonymity, like anonymity, shields
aspects of the identity of the "real" actor from view; information that
a book was written by "Mark Twain" by itself gives you no more (or
less) information about the true identity of the author than does the
information that it was written by "Anon." Indeed, if Samuel Clemens
had chosen to publish each of his novels under a different pseudonym,
that would have been the essential equivalent of publishing all of the
novels under the pseudonym "Anon.," or "John Doe." Pseudonymity allows
each message to carry additional information, cumulative over time,
about the pseudonymous actor; i.e., the difference between pseudonymity
and anonymity is that the former, but not the latter, allows the
accumulation of reputational capital in the pseudonymous entity.  The
use of the a single pseudonym "Mark Twain" allowed Clemens to invest a
single entity with reputational capital, built up over time and across
different novels; "Anon." will not serve that purpose, primarily (if
not exclusively) because it is unprotected and used by any number of
other authors (many of whom might not be quite as talented as
Clemens).[NOTE 5]

	  In other words, pseudonymity, like anonymity, allows
individuals to act without putting at risk any aspects of their own,
personal identity (including their physical assets, reputational
capital, financial capital, and the like); pseudonymity differs,
however, from anonymity in that it allows the accumulation of
reputational capital in the pseudonymous entity.  Both anonymity and
pseudonymity are thus forms of "limited liability," and the extent to
which they serve that function effectively is determined, in both
cases, by whatever traceability requirements are imposed.  To
illustrate, take the extreme case, e.g., a requirement that all
messages contain certain information about specified aspects of the
originator's "identity."  This would not only eliminate anonymous
messages (at least to the extent it could be enforced), but it would
make certain forms of pseudonymity effectively unavailable as well; the
reputational capital belonging to "Mark Twain" and to "Samuel Clemens"
would be identical, and whatever aspects of Clemens' identity had to be
revealed would no longer be shielded in the course of any transactions
in which "Mark Twain" was involved.

     Most discussions of "the regulation of anonymity in cyberspace"
are really discussions about traceability requirements.  The potential
benefits and harms that accompany an anonymous messaging regime are
directly related not to the availability of "anonymity" per se, but to
the availability of untraceable anonymity.  I know of no serious
proposals, for example, to prohibit individuals from leaving their
electronic mail messages unsigned; the hard questions all concern the
nature of the traceability requirements that will be put in place in
regard to those messages, i.e., how easy or difficult will it be for
the recipients of such messages, third parties, or law enforcement
officials, to obtain additional information about the identity of the
message originator.

	  But traceability requirements will have an impact --
possibly a profound impact -- not merely on the availability of
anonymous communication, but on the availability of pseudonymous
communication as well. For example, a sufficiently high degree of
traceability eliminates both anonymous and pseudonymous messages;
requiring all authors to provide information about their "real"
identity not only makes it impossible for them to communicate
anonymously, it is, in effect, impossible for them to communicate
pseudonymously as well.  Analyzing the consequences of a "ban on
anonymity" in cyberspace needs to take more than the benefits and costs
of anonymous messaging into account; it needs to be evaluated in light
of the benefits and costs of pseudonymous communication as well,
considerations that have received less attention from those looking at
these questions. So the question "what is the best traceability
requirement to apply to electronic communication" needs to consider not
only the harms and benefits flowing from anonymous communication but
these additional considerations as well.

	  Because all communication in cyberspace is entirely
machine-mediated -- i.e., because the "identity" of the relevant actors
in a biological sense is necessarily at one remove from the
communication itself -- everyone acts "pseudonymously," at least in the
sense that you can only be identified by a stream of bits when you act
in cyberspace [NOTE 6].  The prospect for more creative uses of
pseudonymous action -- the ability for individuals to pool their
individual intellectual capital with great flexibility and with very
low start-up or transactions costs, into a wide range of new kinds of
actors and entities, each capable of accumulating reputational capital
-- is a profound and exciting feature of this environment.[NOTE 7]

	       The "limited liability" metaphor now becomes a bit
more useful.  Just as limited liability in the corporate context was
designed to encourage the pooling of physical and financial assets into
corporate entities, assuring investors that their personal assets would
not be placed at risk, so, too, should protection against traceability
(i.e., protection for pseudonymous action) encourage "investors" to
pool their intellectual capital into pseudonymous entities, assuring
those investors that only the reputation of the pseudonymous actor, and
not their own personal assets, are at risk when the entity acts.

     This approach probably answers none of the hard questions about
the proper scope of regulation; it may, hopefully, lead to a
consideration of those questions that need to be answered before any
regulatory actions are undertaken.  If there are benefits to be gained
from the actions of these entities -- if the pooling of intellectual
capital into entities leads to new and valuable forms of intellectual
undertakings (itself a question open to discussion) -- we should seek
to design our rules of limited liability to simultaneously induce
"investors" to form these new entities while minimizing the costs that
may be associated with their formation?  Analyses of corporate limited
liability are useful analogues for this inquiry; when should "piercing
the veil" of pseudonymity be permitted or required? Can we disaggregate
the various aspects of personal identity that should receive more, or
less, protection from disclosure?

************************************************

NOTES.

	  1.   Visiting Associate Professor of Law, Georgetown
University Law Center, and Co-director, Cyberspace Law Institute.
Email:  Postd@law.georgetown.edu or DPostn00@counsel.com.  Permission
is hereby granted to freely copy and distribute this paper; please
retain the "Draft" designation as well as attribution to the author.

	  2.   I use "information" in the information-theoretic
sense, in which information is measured as a reduction in uncertainty;
that is, a message that contains information about the identity of the
sender is one that, by definition, lowers the recipient's uncertainty
concerning the identity of the sender.

	  3.   "Identity," of course, is not a static,
context-less piece of information, but is, rather, a complex cluster of
characteristics attributable to an individual, subsets of which may be
more or less relevant in particular contexts (and information about
which may be differentially transmitted in particular messages).
Consider the graffiti again -- even assuming that this may be an
"untraceable" message, in what sense is it an "anonymous" one?  The
reader may obtain a great deal of information relevant to (certain
aspects of) the originator's "identity" -- information about the
originator's political views, perhaps, or familiarity with certain
historical events.  On the other hand, the original message provides no
information (i.e., it is "anonymous") with regard to the originator's
state of domicile (or where the originator went to school, or how many
children the originator may have -- all attributes relevant, in other
contexts, to the question of the originator's "identity").

	  And while we ordinarily think of "identity" in the
context of individual biological persons, that is far too restrictive a
view.  Consider my receipt of an (unsigned) notice from the Department
of Motor Vehicles, or an (unsigned) advertising flyer from my local
McDonald's restaurant.  Each of these messages is "anonymous" in one
sense: I obtain virtually no information about the "identity" of the
(biologically-relevant) individual who typed the notice or otherwise
caused it to be transmitted to me (if indeed there is any such
person).  But it is hardly anonymous in another (and probably more
significant) sense: the letterhead clearly identifies the "identity" of
the more relevant actor (the DMV or McDonald's).  The relevant actor
here, i.e. the DMV or  McDonalds, has a reality unconnected with the
physical "identity" of any of its individual constituents (employees,
officers, etc.); indeed, a notice from the DMV that is mistakenly
placed on non-letterhead stationery (but that is signed by the typist)
surely has less reliable information about the originator's "identity"
than the reverse (i.e., an unsigned note placed on DMV letterhead).

	  4.   Traceability itself is highly context-dependent,
insofar as both the cost of obtaining additional identification
information, and the value of that information in reducing uncertainty
regarding identity, will vary, possibly greatly, from one situation to
another.  It may, for example, be relatively easy for a law enforcement
official to obtain information regarding the identity of the individual
who placed a particular phone call; the same information may be
prohibitively difficult for other individuals to obtain.  Traceability
is also affected by the (1) whether or not relevant identification
information exists in the hands of third parties (i.e., parties other
than the originator and recipient), (2) the third party's duty (or lack
of a duty) to keep the information secret, and (3) the ease with which
disclosure can be legally compelled (by process, subpoena, etc.).

     5.   Anonymity can thus be regarded as a subset of pseudonymity,
with the critical difference being, for my purposes at least, that
pseudonymity allows the accretion of reputational capital in the
pseudonym.

	  6.   This stream may have a high degree of traceability
-- if my electronic mail address is "Postd@law.georgetown.edu," for
example, there at least appears to be information allowing the message
to be traced to a real individual (though query, as always, how
reliable that information may be).  Or it may not -- the use of a
screen name on America Online, or, in the extreme, the use of anonymous
remailers.

	  7.   Examples: the Cancelmoose; the Cyberspace Law
Institute.

     8.   I use "regulation" in the broad sense, to include not only
State action but the "regulatory" activities of e.g., individual system
operators.

	  9.   Note, in this regard, that protecting the "limited
liability" features of pseudonymity does not necessarily mean that
harms imposed on third parties by pseudonymous entities must go
unredressed (as is the consequence of limited liability in the
corporate context); because reputational capital is not transferable,
i.e., is not useful for the purpose of compensating victims of harms
perpetrated by pseudonymous entities, redress can be achieved by
exposing individuals' financial assets, though not necessarily their
personal identities, to risk when the pseudonymous entity acts, and
there are various insurance and authentication/certification regimes
that I will discuss to accomplish this.

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To pick up on a couple of Professor Post's ideas - limited liability of
untraceable pseudonyms, and choice of rule sets in cyberspace (see Post,
"Anarchy, State, and the Internet: An Essay on Law-Making in Cyberspace"
1995 J Online Law art 3), I suggest that arbitration is well suited to
pseudonymous commerce, and  propose the use of an old device - the 
unincorporated, or deed of settlement, company.

Contract seems likely to be the basic building block of pseudonymous digital
commerce for the forseeable future (barring a mathematical solution to the
non-repudiation problem). But, of course, contracts have to be enforced in
courts, which opens the whole thing to state intervention a la the unenforce-
ability of gambling contracts etc, and, generally requires the nym to front
up with some form of True Name to launch or defend proceedings...

On the other hand, ADR is hot, and arbitration has long been encouraged as a
method of settling commercial disputes without troubling the courts. It seems
to be getting easier to enforce arbitral awards and harder to appeal them, or
to bypass the arbitration in the first place.

And it is becoming easier to specify your own arbitration procedures (for
instance, those suited to pseudonymous parties presenting argument and evidence
untraceably via the net) and even to specify the substantive law of the 
arbitration, which need not be the law of any state (eg the UNCITRAL contract
law, or even "those laws accepted in international commerce").

So it would be possible for arbitral tribunals specially adapted to
pseudonymous digital commerce to somewhat shield transactions from the
procedural and substantive laws of any state that makes enforcement of those
transactions problematic.

Now, as Prof Post points out, the limited liability corporation is an efficient
device for the pooling of capital and the taking of business risks. But the
grant of incorporation is by the State, and the State usually requires certain
information - such as the name and address of the stockholders - as a
condition of that grant.

The last time State granted incorporations were in short supply, the merchants
of Britain developed (or redeveloped) the deed-of-settlement company -
essentially a partnership with a Board of managing partners, the assets of the
partnership vested in trustees, and the shares in the partnership easily
transferrable.

There were two major drawbacks to the deed of settlement company (which didn't
stop them being very popular, or their shares being widely traded):

1. Under the procedural laws of the day it was very difficult to sue or be
sued, because all of the partners (ie shareholders) at the time the cause of
action arose had to be named in the action. This was ameliorated by the use
of arbitration, and, occasionally, courts allowed the trustees to sue for
the company.

2. Lack of limited liability - a partner is personally liable for all the debts
of the partnership. This was ameliorated by providing in contracts entered
into by the company that recourse could only be had to partnersip assets - and,
of course, by the difficulty of suing such companies.

Both these can, at least partially, be overcome in psuedonymous digital
commerce - the first by the use of arbitration, and by more flexible modern
procedural rules (although, depending on the jurisdiction, this may not be a
complete answer); the second by the inherent limited liability of an
untraceable digital pseudonym.

Now, with a corporation in a tax haven jurisdiction acting as trustee (to
more than one company, potentially), someone/something acting as a registry
(attending to the transfer of shares in the company, and potentially many
other companies), an account at Mark Twain (held by the trustee company), and
an appropriate deed of settlement (or partnership agreement)  - oh, and some
object for the company - and now you've got something to do with your digicash!

;-)

As an historical aside, the reason unincorporated companies died out in Britain
was that they were outlawed when the general incorporation acts were
introduced - or, rather, existing companies were encouraged to incorporate
(where their deeds became their articles of association, and the objects of
the trust became the memorandum of association) and new ones were outlawed as
oversize (somewhere between 10 and 25, at various times) partnerships. In
England and Australia, at least, the prohibition on outsize partnerships still
continues, and special exceptions have to be made for Chartered Accountants,
Solicitors and architects.

Unincorporated companies were not so popular in the US (although Alexander
Hamilton (?) originally organized the Bank of New York as one) because, after
the revolution, general incorporation statutes were quick to be passed. (Which,
incidentally, is why the Commonwealth has companies and shares and articles,
and the US has corporations and constitutions and stocks. [Canada is the
exception that proves the influence of geography over history.]) On the other
hand, the Massechusetts (?) Business Trust can be seen as the ultimate devel-
opment of the concept (or, at least, that's what I read somewhere).

Dm.


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[Palmtop News Reader - Beta Version 3]

On Sat, 18 Nov 1995, David Murray wrote:

> To pick up on a couple of Professor Post's ideas - limited liability of
> untraceable pseudonyms, and choice of rule sets in cyberspace (see Post,
> "Anarchy, State, and the Internet: An Essay on Law-Making in Cyberspace"
> 1995 J Online Law art 3), I suggest that arbitration is well suited to
Great! Where? (damn I should keep my older posts for a bit longer)

> pseudonymous commerce, and  propose the use of an old device - the 
> unincorporated, or deed of settlement, company.

Interesting. I just read that Liechtenstein allows anonymous corporations
(as in you register for it anonymously). I'm curious to know how this 
works (if I've got it right). It might also become rather interesting 
when one enterprising tax haven permits registration for these things 
online (and hopefully automatically, for the proper anon fee).

Barring escrow services, I don't see how contracts (or a lot of 
other laws) could be enforced against these entities when they can simply pop 
in and out of existence (unless they have some physical counterpart, like 
a storefront and merchandise. But then these are easily linkable to True 
Names, unlike software companies, financial services or any other part of 
the info economy.)

The value of a reputation is not particularly high in lots of cases or is 
occasionally worth throwing over for a big one-time scam. (Pyramid scams
for "reputable" banks)
While I'd love to set one up, I would never do any risky commerce with one.

Besides, if companies in general can set up other companies, in a 
trustworthy and non-anon jurisdiction, couldn't these foreign anon companies 
do the same in the present system and therefore make it very hard to know 
if any company in any country is non-anon? Are there any present legal 
barriers against this? 

I don't know much about the requirements of incorporation or the natures
of various types of corporations, so please feel free to correct me.
I'm not completely sure I understood your explanation of a 
deed-of-settlement corp. and the idea of an "unincorporated" company. 
(Unincorporated in what way, and what were the registration and ID 
requirements?)

Any references? Thanks.

Ps. I know I could probably look this up, but exactly what are bearer bonds?
I frequently hear them mentioned when market anonymity and money laundering 
come up.

s1113645@tesla.cc.uottawa.ca writes:
> Barring escrow services, I don't see how contracts (or a lot of
> other laws) could be enforced against these entities when they can simply pop
> in and out of existence (unless they have some physical counterpart, like
> a storefront and merchandise. But then these are easily linkable to True
> Names, unlike software companies, financial services or any other part of
> the info economy.)
>
> The value of a reputation is not particularly high in lots of cases or is
> occasionally worth throwing over for a big one-time scam. (Pyramid scams
> for "reputable" banks)

I think this setup would be totally appropriate for the kinds of services or
merchandize where the buyer may determine at the time of payment whether the
product is what it's billed to be; and needs no warranty or service. In other
words, forger any implied warranty of merchantability and go back to Roman
Law's "caveat emptor".

E.g., if you buy an office chair with a 90-day money back guarantee, you have
90 days to discover defects and return it; you want to be able to get hold of
the seller if you have to. On the other hand, if you buy some shares of IBM,
once you're satisfied that these really are IBM shares and the other party can
sell them, I don't think you need to know anything more about the seller. In
fact, in the real stock market most investors go through 2 brokers and usually
have no idea who you're buying these shares from.

> Ps. I know I could probably look this up, but exactly what are bearer bonds?
> I frequently hear them mentioned when market anonymity and money laundering
> come up.

I haven't seen anyone respond, so I'll ramble on.

A bond is general is an instrument that you buy from an organization that's
trying to raise capital (e.g., a company or a municipality). For example, you
might buy for $600 a bond issued by some, who promises to pay you $50 twice a
year for the next 20 years, and then pay you another $1000 in 20 years (at
maturity). Thus, the organization that issues the bond is borrowing money from
the investor and then pays interest on it. There are slight variations, like
zero-coupon bonds, which don't make a periodic payments, but pay the lump sum
at maturity. I heard that in Europe they have perpetual bonds, which never
mature. (When you buy bonds, you take certain risks: the issuer may default and
not make the promised payments; the interest rates may go up, so you would have
gotten better return in a CD; etc; but that's besides the point.)

Obviously, there's an aftermarket in bonds. An investor may want a $700 now,
rather than $1000 in 20 years, so s/he sells the bond to another investor
(generally, the less time is left to maturity, the smaller the discount from
the par value). How does the organization that issued the bonds know who is
supposed to receive the periodic coupon payments?

In the past, many bonds were "bearer instruments". The owner of the bond had in
his or her physical posession a piece of paper entitling him to the periodic
payments, and transferred the piece of paper to the new owner when the bond was
sold. To collect the payments due the owner, someone had to present the piece
of paper to the bond issuer's agent. The agent would remove a physical coupon
from the piece of paper and give the bearer some money.

(Think of a movie ticket -- its bearer is admitted to see a movie and doesn't
have to identify himself beyond presenting the ticker.)

The problem with this system, from the point of view of the Internal Revenue
Service and other U.S.Gov't agencies, was that the bearer could be anonymous
and did not have to identify his/herself beyond presenting the piece of paper
entitling him/her to the payment. This, they could in principle not declare
these payments on their income tax return and the IRS would have a tough time
tracking them down.

So, about 20 or so years ago, the U.S.Congress required bond issuers to tell
the IRS who received their bond payments. No more anonymity, no more bearer
bonds. (My papers are in the office, so this could in fact be more draconian --
U.S. people prohibited from owning bearer bonds issued by European companies.)

In comparison, if you own stock in a company, your stock certificate is never a
bearer instrument. The corporation knows its shareholders of record, sends them
their dividends, and tells the IRS whom it sent the dividends. When you have an
interest-bearing account at a bank, a SS# is associated with it (or else you
pay penalties) and the IRS is informed about any interest you've earned.

The fact that bearer bonds were outlawed suggests that if and when new ways are
invented to conduct financial transactions that are conductive to tax evasion
(e.g., using anonymous electronic payments), they too may become outlawed.

---

Dr. Dimitri Vulis
Brighton Beach Boardwalk BBS, Forest Hills, N.Y.: +1-718-261-2013, 14.4Kbps

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In message <Pine.3.89.9511182108.B25524-0100000@tesla.cc.uottawa.ca>, s1113645@tesla.cc.uottawa.ca said:
> On Sat, 18 Nov 1995, David Murray wrote:
> 
> > unincorporated, or deed of settlement, company.
> 
...
 
> Barring escrow services, I don't see how contracts (or a lot of 
> other laws) could be enforced against these entities when they can simply pop
> in and out of existence (unless they have some physical counterpart, like 
> a storefront and merchandise. But then these are easily linkable to True 
> Names, unlike software companies, financial services or any other part of 
> the info economy.)

But the assets of the company are held by (known) trustees and exposed to
judgment - the pseudonymous part just means that _only_ those assets are
exposed.

For instance, an enterprising cypherpunk decides it would be a good thing
to run a restaurant with a crypto-anarchy theme (cajun style Blacknet burgers,
anonymous avocado salad, Phil Zimmerman celebrity cocktail...). Unaccountably,
a thousand other cypherpunks decide to invest $100 each. More understandably,
they don't want it to be known that they invested. By buying shares in an
unincorporated company pseudonymously (including anonymously) they can risk
$100, but $100 only. The money is (initially) held in the trustee's bank
account (having been subscribed in ecash), so the cheques for the tables and
chairs won't bounce. The chairs, tables, kitchen equipment, lease etc will
also be held by the trustee on trust for the partnership/company, and will
be available for creditors should the partnership not meet its obligations.

So doing business with an unincorporated company is very much like doing
business with an incorporated company/corporation. (I can see that audited
accounts, for instance, could be useful in attracting investors/reassuring
creditors.)

Note that the argument works just as well for intangible assets - even digital
assets - as for tangible ones like tables. So our enterprising cypherpunk
might well have started a bank, insurance company or mutual fund (except for
all the other regulatory hassles :-)
  
> Besides, if companies in general can set up other companies, in a 
> trustworthy and non-anon jurisdiction, couldn't these foreign anon companies 
> do the same in the present system and therefore make it very hard to know 
> if any company in any country is non-anon?

Yes. But you have to have your base anon corporation to be the penultimate
stockholder of the other corporations. And it can be expensive - perhaps too
expensive to be worth the gain in anonymity. There is also the matter of having
to have human directors with revealed True Names in most non-anon and
"trustworthy" jurisdictions.

There are other ways to anonymise corporations - I presented a proposal to the
list about a year ago that simply interposed a unit-like trust as sole (legal)
shareholder of the corporation, the "units" in the trust mirroring the shares
but being held anonymously.

Any of these structures can/might be useful. What I like about unincorporated
companies, however, is the way they rely only on the common law and equity,
and bypass statute - enabling, perhaps, less reliance upon the law of any
particular State.

> I'm not completely sure I understood your explanation of a 
> deed-of-settlement corp. and the idea of an "unincorporated" company. 
                     ^^^^^
Not "corporation", "company", as in collective noun :-) An incorported company
is a corporation, but in general, company ~= corporation. It is just that for
well over a hundred years there have not been any companies that have _not_
been incorporated, except dance companies, infantry companies etc.
   
> (Unincorporated in what way, and what were the registration and ID 
> requirements?)

Unincorporated in every way :-) Which is to say, not a seperate legal entity
but a partnership (of shareholders) coupled with a trust of the partnership
assets.

And because it relies only on partnership/agency/contract law and the law of
trusts, there were no registration or ID requirements, just as there are no
registration or ID requirements for forming a partnership or trust now.
 
(Compare, for instance, the requirement on NZ incorporated companies to keep
public records of the name and [in the case of natural persons, residential]
address of everyone who has been a shareholder in the last ten years.)

> Any references? Thanks.

A lot of Corporate/Company law books have some coverage of this stuff in their
historical chapters - try English or Australian texts (Gower is quite good).
Legal history texts also often have something. Du Bois published a book (in
the 1940's ?) that seems to be cited for all manner of minutiae - it has
something about the Bubble Act in its (long) title. [If you find this book,
how about sending me a summary :-) Chapter III is probably most useful.] And
J. Reeder "Corporate Loan Financing in the 17th and 18th Centuries" (1973) 2 Anglo-American Law Review 487 is supposed to have something about bond issues
by unincorporated companies (or is it bank lending?).

Cheers,

Dm.


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For an earlier treatment of a related subject, see my:
Anonymity and Its Enmities 
http://www.law.cornell.edu/jol/froomkin.htm

A. Michael Froomkin        | +1 (305) 284-4285; +1 (305) 284-6506 (fax)
Associate Professor of Law | 
U. Miami School of Law     | froomkin@law.miami.edu
P.O. Box 248087            | http://www.law.miami.edu/~froomkin
Coral Gables, FL 33124 USA | It's warm here.