Under the system of international intercourse prevailing in the fifteenth and sixteenth centuries, it was found necessary to provide some sort of government and authority for the groups of English merchants, and their clerks, residing in foreign countries. The problem was met, in 1404, by Henry IV, who granted a charter to those resident in the Teutonic countries of northern Europe, permitting them to meet together to elect their own governors, and to make their own laws, the king ratifying and requiring obedience to such legislation in advance.[65] In 1462, Edward IV, in a charter to those resident in the Netherlands, appointed the governor, but allowed the merchants to elect twelve “Justiciers,” who were to sit with him as a court. The merchants were also to make their own laws, which, however, had to be approved by the royal governor. When it was no longer a question of trading in a civilized country, but of discovering new ones, unoccupied, or occupied only by heathen, the discoverer was naturally allowed to take possession in the name of the king, and was enfeoffed with the new land, the condition of tenure usually being a fifth of the precious metals found. Footnote 65: _Ibid._, vol. II, p. 108; _cf._ also the earlier charter of Richard II (1391), cited by C. T. Carr, _Select Charters of Trading Companies_ (Selden Society, London, 1913), pp. xi _ff._ In these commercial charters, we thus find the germs of the commonwealth, royal, and proprietary colonies of the seventeenth century. There was no break at the beginning of American history. Nor was there any conscious intention upon England's part of founding an empire. The English colonies were by-products of British commercial activity, and English “colonial policy” was but a mere phase of her commercial policy. It is only by that light that the development of events can be rightly understood.