Commerce Clause

The provision of the U.S. Constitution that gives Congress exclusive power over trade activities among the states and with foreign countries and Indian tribes.

Article 1, Section 8, Clause 3, of the Constitution empowers Congress "to regulate Commerce with foreign Nations, and among several States, and with the Indian Tribes." The term commerce as used in the Constitution means business or commercial exchanges in any and all of its forms between citizens of different states, including purely social communications between citizens of different states by telegraph, telephone, or radio, and the mere passage of persons from one state to another for either business or pleasure.

Intrastate, or domestic, commerce is trade that occurs solely within the geographic borders of one state. As it does not move across state lines, intrastate commerce is subject to the exclusive control of the state.

Interstate commerce, or commerce among the several states, is the free exchange of commodities between citizens of different states across state lines. Commerce with foreign nations occurs between citizens of the United States and citizens or subjects of foreign governments and, either immediately or at some stage of its progress, is extraterritorial. Commerce with Indian tribes refers to traffic or commercial exchanges involving both the United States and American Indians.

The Commerce Clause was designed to eliminate an intense rivalry between the groups of those states that had tremendous commercial advantage as a result of their proximity to a major harbor, and those states that were not near a harbor. That disparity was the source of constant economic battles among the states. The exercise by Congress of its regulatory power has increased steadily with the growth and expansion of industry and means of transportation.