Role of the U.S. Constitution in Business Regulation

Role of the U.S. Constitution in Business Regulation

The United States Constitution is a written document that provides the framework for the federal government and is ultimately the supreme law for Americans to abide by. This document “establishes the structure of the federal government, delegates powers to the federal government, and guarantees certain fundamental rights (Cheeseman, 2007, p. 49).” These fundamental rights, laws and freedoms are granted, to all Americans. Despite the ratification of the Constitution in 1788, the laws still pertain to today’s ever-changing economy and culture. The Constitution has been referred to as a “living” document that evolves in unison with our country. The comprehension of the Commerce Clause in relation to business regulation and how it affects a current case in the news, facilitates a better comprehension of the role the U.S. Constitution plays in regard to business regulation.

The Constitution of the United States sets forth the nations fundamental laws for business regulation. The Commerce Clause in particular grants the federal government the authority to regulate commerce between states, Indian tribes, and other nations. “Because this clause authorizes the federal government to regulate commerce, it has a greater impact on business than any other provision in the Constitution (Cheeseman, 2007, p. 52).” The original purpose of this clause was primarily due to the need for a more responsive and effective business regulation. Today, this clause protects businesses and consumers alike. The state and federal government have concurrent power to regulate domestic commerce. The federal and state governments dually regulate the parameters of interstate and intrastate commerce. Interstate commerce consists of business involving two or more states while intrastate commerce occurs solely within the boundaries of a single state. Interstate trade is the very argument Amazon.com is using to fight the constitutionality of recent litigation against the state of New York.

Amazon.com is a popular online retailer of books, CD’s, videos, DVD’s, games, electronics, computers, and more. They are head quartered in Seattle, Washington but their customer base has gone global. Recently, Amazon.com decided to pursue a lawsuit against the State of New York in response to a recently enacted statute that requires all out-of-state internet retailers, with no physical presence in New York, to collect sales and use taxes. Amazon.com is understandably questioning the constitutionality of this new legislation. “The suit argues the change unfairly targets Amazon, is overly broad and vague, and violates the Commerce Clause of the Constitution because it imposes tax-collection obligations on out-of-state entities (Bauman, 2008, May 2).” This case may be ruled unconstitutional, as it could be interpreted as a restriction on interstate trade. “Under federal law, a state can only require a business to collect sales taxes for it if the business has a physical