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The "Commerce Clause," Article I, Section 8, Clause 3, of the United States Constitution arguably is important because it is the means by which Congress is able to legislate in areas that would otherwise be left to the States to decide.
In the U.S. federal system, any powers not granted to the federal government are reserved by the States. For example, there is no Constitutional grant of power to Congress to regulate the issuance and registration of securities. Regulating the securities industry, therefore, was left to the various States to determine. Where, then, does the authority lie for the Securities and Exchange Commission to regulate the public markets?
The answer lies in the Commerce Clause. It allows Congress to "regulate commerce... among the several states." Accordingly, as soon as a company in Virginia offers shares of its stock for sale to a person in North Carolina, "interstate commerce" has occurred and Congress is empowered to regulate that commerce. Congress thus passed the Securities Act of 1933 and the Securities Exchange Act of 1934 on the authority that it was regulating interstate commerce.
Note that, in general, those laws do not apply to offerings of securities made wholly within a single state. For example, a company in Roanoke, VA, selling its shares of stock to a person in Stafford, VA, would not be subject to the federal securities laws if no one outside of Virginia purchased those share.
An internet search of this topic will uncover a laundry-list of instances by which Congress has invoked the Commerce Clause to regulate in areas in which it was not explicitly granted authority.
What else can I help you with?
Why is the commerce clause important?
ram you in the tail pipe
The necessary and proper clause was especially important when it came to?
Regulating commerce
Where can one find Commerce Clause online?
A Commerce Clause definition can be found at Wikipedia or at a legal dictionary. A Commerce Clause gives Congress the right to regulate commerce between states.
What are two ways the constitution protects economicfreedom?
The Contracts Clause and the Dormant Commerce Clause (i.e., the negative implications of the Commerce Clause).
Can the federal government regulate activity unter the interstate commerce clause?
Yes the federal government can regulate commerce under the Commerce clause. The Commerce Clause is found in Article I, Section 8 of the US Constitution.
Do you capitalize commerce clause in a sentence?
Yes, the term "Commerce Clause" should be capitalized in a sentence as it refers to a specific clause in the United States Constitution.
What clause of the Constitution regulates businesses?
The commerce clause
Which clause of the Constitution involve the relationships among various states?
Commerce Clause
Which of the following regarding the commerce clause of the us constitution is true?
The Commerce Clause can apply to a business that only does business in one state.
What clause of the constitution is the source of all congress implied powers?
The commerce clause
What power does the commerce clause give congress?
"The Commerce Clause refers to Article 1, Section 8, Clause 3 of the U.S. Constitution, which gives Congress the power "to regulate commerce with foreign nations, and among the several states, and with the Indian tribes.'"
Where is the commerce clause located in the constitution?
To regulate commerce with foreign nations, and among the several states, and with the Indian tribes this commerce clause is in Article one section 8 addressing the legislature's powers.
