The Jaluit Company was founded on December 21, 1887, shortly after the announcement of the Anglo-German Agreement of 1886, as a stock corporation (Aktiengesellschaft) in Hamburg, Germany.

[2] The company took on all costs incurred on the administration, in exchange for the right to take possession of any "unclaimed" land, engage in pearl fishing and exploit the guano deposits.

In particular, the Jaluit Company was noted for its role in the early phosphate mining in Banaba and Nauru.

At its peak, the company ran shipping lines from Sydney to Hong Kong, connecting the various German colonies in the Western Pacific.

[6][7] From then on, the company acted solely as a trade enterprise and continued its operations until the Japanese occupation of the islands during World War I in 1914.