Until 1867, the Hudson's Bay Company controlled most of the area of modern Canada west of Ontario.

A flag much used in this territory was the British Red Ensign (a red flag with the Union Flag on the canton) with the capital letters H B C in white on the fly: the letters H and B are joined together in a monogram arrangement.

One of these flags is displayed in Christ Church Cathedral, in Victoria, British Columbia.

This flag was probably the prototype for the Canadian Red Ensign and several provincial flags.