Even before the Constitutional Convention, James Madison had long argued that exclusive power over foreign commerce should be vested in the national government. Under the Articles of Confederation, the states had the power to raise tariffs against goods from others states and from foreign nations, creating, as Madison put it, "rival, conflicting and angry regulations." Thus, Great Britain had been able to use its power over duties and tariffs to monopolize trade in its favor without the United States government having the ability to respond.

At Philadelphia, there was unanimity that one of the general powers of the new government should be to regulate foreign commerce. Even Anti-Federalist Luther Martin, who later left the Convention to oppose the Constitution, had no doubts about it. In fact, in The Federalist No. 42, one of Madison's arguments for lodging the power to regulate commerce among the states with Congress was that "without this supplemental provision, the great and essential power of regulating foreign commerce, would have been incompleat, and ineffectual."

Some delegates, particularly from the South, wanted any regulation of foreign commerce to be effective only through a supermajority vote in Congress, but Madison successfully countered that a supermajority would cripple the government if it were necessary to retaliate against discriminatory tariffs from a foreign country.

Although Madison undoubtedly believed that the power to regulate foreign commerce was exclusive to the federal government, the proposition is not obvious from the text. Elsewhere, the Constitution denies the states certain powers over foreign commerce (no treaties or other agreements and no tariffs except under very limited circumstances). The text of the Commerce Clause does not differentiate between Congress's power "to regulate" foreign commerce from its power over interstate commerce, and some Justices on the Supreme Court have opined that Congress's power to regulate interstate commerce is coextensive with its power over foreign commerce. Nonetheless, a number of other opinions have held that Congress's power over foreign commerce is qualitatively greater than its power to regulate commerce among the states, because it is part of the federal government's complete sovereign power over foreign relations, in which the states have no standing. Brolan v. United States (1915). In Board of Trustees of University of Illinois v. United States (1933), the Court stated: "In international relations and with respect to foreign intercourse and trade the people of the United States act through a single government with unified and adequate national power." And in Japan Line, Ltd. v. County of Los Angeles (1979), the Court declared that "[f]oreign commerce is preeminently a matter of national concern." As early as 1827 in Brown v. Maryland, Chief Justice John Marshall held that both the Import-Export Clause and the Commerce with Foreign Nations Clause precluded a state from burdening an imported good with a tax or license so long as the good remained in the ownership of the importer and "in the original form or package," though, later, the Court permitted states to prohibit dangerous or noxious foreign goods. Compagnie Francaise de Navigation a Vapeur v. Louisiana Board of Health (1902).

The courts have affirmed Congress’ extensive power over foreign commerce. According to Professor Louis Henkin, the foreign commerce clause was originally the “basis for Congressional regulation of maritime and admiralty affairs and its control of immigration.” Subsequently, the clause has been the basis for extending American criminal jurisdiction abroad. Foreign commerce “includes both goods and services,” United States v. Clark (2006), and the regulation of foreign commerce “includes the entrance of ships, the importation of goods, and the bringing of persons into the ports of the United States.” United States ex rel. Turner v. Williams (1904). There must always be some nexus between the United States and the foreign commercial activity, but the nexus need not be extensive. For example, Congress’s power over foreign commerce does not turn on whether Americans are transporting American goods or even whether the voyage includes an American port, so long as the goods are being transported in American flag ships. Pacific Seafarers, Inc. v. Pacific Far East Line, Inc. (1968).

Unlike Congress’s power over commerce “among the several states,” federalism concerns are not as present in its control over foreign commerce. Today, the Court allows the states less power to tax foreign commerce than they have to tax interstate commerce. In Complete Auto Transit, Inc. v. Brady (1977), the Supreme Court declared that a state tax affecting interstate commerce would be valid only if it were: (1) nondiscriminatory, (2) applied to an interstate activity that had a "substantial nexus" with the state, (3) apportioned fairly, and (4) connected to services that the state provided. Later, in Japan Line, the Court added two further considerations to taxation of a foreign instrumentality: (1) the danger of multiple taxation and (2) the danger that the tax may damage the need for federal uniformity. Even though the Court has been somewhat more generous in recent years in permitting state taxation that involves foreign commerce, the rules continue to suggest a greater federal constitutional interest in foreign commerce than in commerce among the states, where the background principles of federalism still have some presence.