Section 1:Constitutional Authority

to Regulate Business

We need to understand the interaction between business and the Constitution

The Constitution not only governs business but protects it

We need to learn the impact of the Constitution on business

Knowing the Constitution helps businesses to know their rights

Today we examine the Constitution, the Bill of Rights, and their application to business

The Constitution permits Congress

to regulate business

The weakness of the Articles of Confederation hampered business

The central government had very limited powers

State laws hindered the free flow of goods across state lines

A compromise: the states and federal government would share powers

The Constitution governs relations between the states

• The Privileges and Immunities Clause

• The Full Faith and Credit Clause

The commerce clause gives Congress the power to regulate interstate commerce

Article I, Section 8, Clause 3:

“The Congress shall have power . . . To regulate commerce with foreign nations, and among the several states, and with the Indian tribes;”

The constitution gives Congress authority over commerce between the states

The commerce clause expanded the powers of the national government

The commerce clause limits the power of the states

The Supreme Court has limited the commerce clause slightly

The Constitution and federal laws are the highest law in the land

The supremacy clause makes federal law control when state laws conflict

Preemption occurs when Congress speaks on an issue

Congress has the power to tax and spend

The Bill of Rights affects businesses

as well as individuals

The Bill of Rights limits government powers

The Bill of Rights originally protected individuals from the federal government

The Fourteenth Amendment provided the same protections from state government

The rights secured by the Bill of Rights are not absolute

The Bill of Rights protects corporate speech

The First Amendment protects symbolic speech

The First Amendment protects political speech by corporations

The First Amendment protects commercial speech (sort of)

The Bill of Rights protects other business interests

The Freedom of Religion clause may affect business

Sunday closing laws do not violate the establishment clause

The free exercise clause requires employers to make reasonable

accommodations

The Fourth Amendment protects businesses against unreasonable searches

Businesses have no right against self-incrimination under the Fifth Amendment

Other Constitutional

guarantees apply to businesses

The Due Process clause protects businesses

"Procedural due process" requires the government to follow the rules

"Substantive due process" requires the government to have a good reason for

what it does

The Equal Protection clause protects businesses

The government must treat similar individuals in a similar manner

A law prohibiting a fundamental right will be subject to strict scrutiny

Other laws are subject to intermediate scrutiny

Businesses also have a right to privacy

Federal law protects privacy (sometimes)

The PATRIOT Act gives the government opportunity to spy on US citizens

States often expressly protect privacy rights

Conclusion