Commerce Clause

The Commerce Clause establishes the Federal Government's authority to regulate business on a federal level and is found in the constitution. It authorizes Congress to regulate commerce in order to ensure that the flow of interstate commerce is free from local restraints imposed by various states. When Congress deems an aspect of interstate commerce to be in need of supervision, it enacts legislation that must have some real and rational relation to the subject of regulation. This clause focuses on four different areas: regulation of foreign commerce, regulation of interstate commerce, limitation of state police power, and limitation of state taxation.

The Commerce Clause and its different areas affect businesses and their changing needs. The first part of the clause gives the federal government the right to regulate business conducted with any foreign entity (such as a foreign corporation or government). In this instance, the power to regulate commerce is the power to dictate conditions and rules for participating in commercial transactions with other countries and regulating of prices and terms of sale. The clause can decide who does with business with whom and can actually restrict the United States from doing business with certain countries. Even if the clause granted only this power, the scope of its jurisdiction would be large and could extend to many other purposes. The Foreign Commerce Clause indicates that Congress has no more and in some respects less power to regulate commerce inside foreign nations. (Colangelo, 2010 )

The second part of the Commerce Clause is the ability to regulate Interstate Commerce. According to this portion of the law Congress can regulate and decide how business is conducted between states. The power that Congress has over how businesses conduct transactions across state lines is highly important; it is analogous to Congress' power over Foreign Commerce. Congress has power, first to “regulate and protect interstate commerce, or...