Commerce Clause

The Commerce Clause 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 will enact legislation that must have some real and rational relation to the subject of regulation. Congress may constitutionally provide for the point at which subjects of interstate commerce become subjects of state law and, therefore, state regulation.

Although the U.S. Constitution places some limits on state power, the states enjoy guaranteed rights by virtue of their reserved powers pursuant to the TENTH AMENDMENT. A state has the inherent and reserved right to regulate its domestic commerce. However, that right must be exercised in a manner that does not interfere with, or place a burden on, interstate commerce, or else Congress may regulate that area of domestic commerce in order to protect interstate commerce from the unreasonable burden. Although a state may not directly regulate, prohibit, or burden interstate or foreign commerce, it may incidentally and indirectly affect it by a bona fide, legitimate, and reasonable exercise of its POLICE POWERS. States are powerless to regulate commerce with Indian tribes.

Although Congress has the exclusive power to regulate foreign and interstate commerce, the presence or absence of congressional action determines whether a state may act in a particular field. The nature of the subject of commerce must be examined in order to decide whether Congress has exclusive control over it. If the subject is national in character and importance, thereby requiring uniform regulation, the power of Congress to regulate it is plenary, or exclusive.

It is for the courts to decide the national or local character of the subject of regulation, by BALANCING the national interest against the STATE INTEREST in the subject. If the state interest is slight compared with the national interest, the courts will declare the state statute unconstitutional as an unreasonable burden on interstate commerce.

The U.S. Supreme Court, in the case of Southern Pacific Co. v. Arizona, 325 U.S. 761, 65 S. Ct. 1515, 89 L. Ed. 1915 (1945), held that an Arizona statute that prohibited railroads within the state from having more than 70 cars in a freight train, or 14 cars in a passenger train, was unconstitutional. The purpose of the legislation, deemed a safety measure, was to minimize accidents by reducing the lengths of trains passing through the state. Practically speaking, however, the statute created an unreasonable burden on interstate commerce, as trains entering and leaving the state had to stop at the borders to break up a 100-car freight train into two trains and to put on additional crews, thus increasing their operating costs. The Court held that the means used to achieve safety was unrealistic and that the increase in the number of trains and train operators actually enhanced the likelihood of accidents. It balanced the national interest in the free flow of interstate commerce by a national railway system, against the state interest of a dubious safety measure. It decided that the value of the operation of a uniform, efficient railway system significantly outweighed that of a state law that has minimal effect.

However, where there is an obvious compelling state interest to protect, state regulations are constitutional. Restrictions on the width and weight of trucks passing through a state on its highways are valid, because the state, pursuant to its police power, has a legitimate interest in protecting its roads.

Where the subject is one in which Congress or the state may act, a state may legislate unless Congress does so. Thereafter, a valid federal regulation of the subject supersedes conflicting state legislative enactments and decisions and actions of state judicial or administrative bodies.

If Congress has clearly demonstrated its intent to regulate the entire field, then the state is powerless to enact subsequent legislation even if no conflict exists between state and federal law. This type of congressional action is known as federal PREEMPTION of the field. Extensive federal regulation in a particular area does not necessarily result in federal preemption of the field. In determining whether a state may regulate a given field, a court evaluates the purpose of the federal regulations and the obligations imposed, the history of state regulation in the field, and the LEGISLATIVE HISTORY of the state statute. If Congress has not preempted the field, then state law is valid, provided that it is consistent with, or supplements, the federal law.

State health, sanitary, and quarantine laws that interfere with foreign and interstate commerce no more than is necessary in the proper exercise of the state's police power are also valid as long as they do not conflict with federal regulations on the subject. Such laws must have some real relation to the objects named in them, in order to be upheld as valid exercises of the police power of the state. A state may not go beyond what is essential for self-protection by interfering with interstate transportation into or through its territory.

A state may not burden interstate commerce by discriminating against it or persons engaged in it or the citizens or property originating in another state. However, the regulation of interstate commerce need not be uniform throughout the United States. Congress may devise a national policy with due regard for varying and fluctuating interests of different regions.