First, US Federal system of government grants component states a certain degree of autonomy, sovereignty and self-government. Furthermore, each state has its own laws and each State Supreme Court has the power to create the judicial determination of issues of law on their own, subject only to the limitations imposed by the Constitution and the US Supreme Court.
Thus, there exist differences in state laws that hinder and impair business transactions when dealing with out-of-state entities or persons. There was a need to standardize the laws that acted as the legal foundation in interstate commercial transactions, and would clear up conflicting views on contract law.
Second, the burdensome legal requirements in business engagements also had a tendency to hamper efficient commercial activities, and arguments were raised as to how laws on contracts in some jurisdictions conflicted with another's. The UCC was introduced in this manner also to design a consistent basis for contract law. Also, each state continued its autonomy, and had the option on whether or not to adopt the UCC in whole or in part and this also served as sufficient warning to businessmen of the legal ramifications of any business transactions in a state that may or may not have the UCC in place.
Trade between countries is an integral element of the international economy. ...