State Regulation of Interstate Commerce

Question 1

What is the effect on state’s attempt to regulate commerce if congress has regulated already?

What is Congress’s power to permit/prohibit state regulation?

(Dormant Commerce Clause)

Answer 1

1. CONFLICTING state laws are SUPERSEDED
2. Even if state law is NOT conflicting, state or local laws may be PREEMPTED

CONGRESS MAY:

1. permit state regs that would otherwise violate commerce clause
2. prohibit state regs that would otherwise be upheld under commerce clause

NOTE –> congress MAY NOT permit states to violate civil liberties

Question 2

If congress HAS NOT already regulated an area relating to interstate commerce, what is the rule for state/local governments?

(Dormant Commerce Clause)

Answer 2

If no conflict/preemption:

State/local government MAY regulate LOCAL aspects of interstate commerce if:
1. they do not DISCRIMINATE against interstate commerce; or
EXCEPTIONS:
- Important State Interest
- Market Participant
- Traditional Government Function

2. UNDULY BURDENS interstate commerce
   - balancing test

NOTE –> discriminatory laws may also implicate privileges and immunities of Art 4 & equal protection

Question 3

When is a state/local law that DISCRIMINATES against interstate commerce allowed (3) ?

(Dormant Commerce Clause)

Answer 3

1. Furthers an:
   (i) IMPORTANT, NON-ECONOMIC state interest; AND
   (ii) there is NO REASONABLE non-discriminatory alternative

EXAMPLE –> state MAY ban importation of fish bc it might destroy lake, but not export if no state interest is involved

2. “Market Participant Exception” - state may prefer its own citizens when . acting as purchaser, seller, subsidizer
3. “Traditional Gov Function” - regulation is of a traditional gov function (such as waste disposal)

Question 4

What rule applies when a state/local law is NON-DISCRIMINATORY, but BURDENS interstate commerce?

(Dormant Commerce Clause)

Answer 4

If state/local law is NON-DISCRIMINATORY (treats local/out-of-state interests alike) —> it will valid UNLESS:

• burden OUTWEIGHS
• promotion of LEGITIMATE local interest

NOTE –> this is a balancing test.

• Court will consider whether less restrictive alternatives are available
• Reg is more likely to be upheld if it relates to internal governing of corp incorporated in that state

EXAMPLE –> Iowa statute banning trucks over 60 fee was invalid bc the state showed no significant evidence of increased safety and burden on commerce was substantial

Question 5

Does dormant commerce clause protect corporations and/or aliens?

Answer 5

Yes (unlike priv and immunities of art 4)

Question 6

Compare Dormant Commerce Clause and Priv and Immunities of Art 4

Answer 6

Priv and Immunities of Art 4

• stronger but narrower
• no market participant exception
• does NOT protect corporations/aliens
• requires INTENTIONALLY PROTECTIONISM (applies to discrimination against economic interests/civil liberties only)