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yahang 牙行

Feb 26, 2021 © Ulrich Theobald

Broker guilds (yahang 牙行) were professional organisations mediating between vendors and purchasers of all types of products. Qing-period 清 (1644-1911) broker guilds organized sales contracts, determined the price, quality and quantitative characters of objects on the markets, assessed the purity or fineness (chengse 成色) of monetary silver, prevented fraud, and took over responsibility for the success and the duly and correct process of transactions.

The term yahang appeared during the Ming period 明 (1368-1644), but similar expressions are found during the Han period 漢 (206 BCE-220 CE), namely zang 駔, or zangkuai 駔儈, and the Tang period 唐 (618-907), namely ya 牙, yalang 牙郎 or yakuai 牙儈. From the Song period 宋 (960-1279) on, the expressions yinling baixing 引領百姓, jingji 經紀 or hanglao 行老 were used. Other expressions are yashang 牙商, xingji 行紀, yaji 牙紀, da wuzi 大屋子, faxingjia 發行家, jiubahang 九八行, pingmaguan 評碼館 or nanbeihang 南北行.

The early Ming dynasty attempted to replace private brokers by official ones altogether, but to no avail. Brokers were divided into official (lingtie yahang 領帖牙行, guanya 官牙) and private broker guilds (wutie yahang 無帖牙行). This custom is first attested in the local gazetteer Yangzhou fu zhi 揚州府志 from the late Ming period.

When applying for admission, brokers had to submit an affidavit (ganjie 甘結) declaring they and their families were financially well off (shenjia yinshi 身家殷實) because one individual had to stand and guarantee for the firm. The broker license (yatie 牙帖) for the business – and a kind of official seal as well - were then handed over by the provincial administration commission (buzhengsi 布政司, fansi 藩司) after the requester had paid a certain license fee (tiefei 帖費, yashui 牙稅, yatieshiu 牙帖稅). A copy was sent to the Ministry of Revenue (hubu 戶部). Prefectures or districts were not allowed to hand out licenses. In the mid-Qing period, district administrations (see yamen 衙門) ignored this rule and distributed licenses in order to increase the local revenue.

Licensed or official brokers had to pay a broker tax (yashui 牙稅) each year. This tax differed from region to region. The province of Jiangxi, for instance, discerned between three tax classes, fixing the payment at 3 tael/liang, 2 liang, and 1 liang annually. In Hubei, fees were lower, that of the lowest class in some regions even down to 0.3 liang (Huang 1992). The license fee was fix and did not take into account which type of commodity brokers were specialized in. The criterion for classification were the assets or capital stock of the company. Licenses were renewable every five years, but in that instance, the license was considerably more expensive. The height was realigned to the capital and the financial situation of the broker, and cost between 150 and 1,000 liang (Huang 1992). According to another regulation, brokers paid such "contributions" (juanna 捐納) twice a year, ranging between 50 and 1,000 liang (Wang 1991: 838).

The number of licenses per province was restricted but might be extended in case of need. The total number of licenses empire-wide was about 180,000, as fixed in 1733 (Ouyang 1988). New licenses were only issued if another broker withdrew from the market (tui tie ding bu 退帖頂補). Licensed brokers used the instrument of sub-brokering (pengbi 朋比) by cooperating with non-licensed broker firms, often founded by members of the same family. This was actually not legal but was barely punished because it helped to expand market transactions, and thus also increase tax revenue.

Official brokers were obliged to compile a detailed register of the transactions they had brokered, referring to clients (keshang 客商), freight conditions, and commodities. In this way, licensed brokers supported the financial institutions of the local government to gain a better overview of large-scale business transactions and tax merchandise correctly. Some brokers even took over the duty to collect sales taxes. Brokers lived from a procuration fee or brokerage (yayong 牙傭, yaqian 牙錢 or yongjin 傭金) of about one percent of the commodity value. If a broker provided additional services like storage or transport of goods or accommodation, the brokerage might be as much as 3 per cent. Brokers also offered purchaser credits (diankuan 墊款) or advance credits to producers (yumai 預買), collected debts (shou zhang 收帳), organised the landing of goods (qixie 起卸) and the declaring of goods at local customs (baoguan 報關), and thus were able to increase their income substantially.

Brokers often served as wholesalers for cattle, agricultural produce, salt, fish or manufactured products like silks or other fabric. Over time, many specialized brokers emerged, mediating the sales of rice, beans, cloth or silks. Others arranged transport facilities, like the "pier brokers" (butou 埠頭) organising shipment of commodities, while broker organisation of transport by carts and mules was also common. Brokers were familiar with local market conditions and could thus support foreign wholesale purchasers (pifashang 批發商) to buy goods on the local markets or foreign vendors (fanyunshang 販運商) to distribute their wares to local retailers. Brokers might also arrange for board and lodging (shansu 膳宿), the storage of goods, or the safekeeping of money. On the other hand, the licenses provided brokers with a kind of monopoly on local markets which allowed them to determine prices or exploit small-scale producers.

From the mid-18th century on, the monopolies of brokers came under stress because an increasing number of brokers intensified competition in the business. Licensed brokers therefore started to found official bureaus (gongsuo 公所) which helped to exclude newcomers and non-licensed brokers from the market by making private brokerage (sanbang 散幫, siya 私牙) practically illegal.

Yet this development led to a new tendency among merchants. More and more producers, sellers and vendors united in trade guilds (huiguan 會館). These associations helped to circumvent the brokerage process by supporting producers in founding their own shops and distribution channels. Many brokers accepted this new development and transformed into wholesale purchasers and vendors, while others focused on the accommodation business. In the second half of the 19th century, the large, licensed brokers disappeared.

In 1934, the brokerage tax was officially abolished, but remained a separate fee until 1941, when it was merged with the sales tax (yingyeshui 營業稅).

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