Colonial nations and subjects/protectorates dont count.
Also at 100 provinces you have to pay like 2.5 mil a month to keep it at 100. thats much better than mil policies that give roughly the same.
Unfortunately I've heard provinces that aren't a state still do so will have to expand very carefully into Africa and Asia for only key ports. Will wait and see if it's worth it to make a trade company or not, probably not because it'll require a lot of land in order to get that bonus merchant.