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The public sanctioning of trade monopoly and the private use of force are two defining characteristics of the overseas charter system. An important justification given for monopoly rights deals with the cost that the companies had to incur in developing the infrastructure needed for distant trade, because it involved ‘high and indivisible fixed costs and sizable economies of scale.’ 29 While a monopoly could not be maintained without the use of force,
the expenditure in the maintenance of private armies and navies and the development of overseas military infrastructure served also as a justification for the granting of monopoly rights.