Before UCC and UCITA, the United States concern in harmonizing commercial law was determining the areas that would benefit from the uniformity of the law. After that, the NCCUSL drafts and recommends the uniform laws to various states. The state legislatures will then enact the laws. Another idea was also to come up with rules to govern the newly emerging changes in business of its expanding economy. According to the United States constitution, Congress has powers to regulate trade with the other member states, foreign nations and the Indian tribes (Terry, 2008). Uniformity of the law would therefore make it easy for commerce to be regulated within the states, with foreign nations and Indian tribes as well. In the case of computer soft ware, contracts would be uniformly available in all the states. Computer information would now be valid in all the states and other foreign countries as well. Places where computer information had not been 1enforced would therefore be enforced. The purpose of this is to achieve a regular trade within the United States and its trading partners (Perrit, 2001).
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Differences between UCC and UCITA
1. UCC laws regulate commercial transactions that include sales. Sales being the total amount in dollars of goods and services provided. Concerning UCITA, Computer transactions do not involve sales but licenses instead. UCC regulates transactions by the use of sales whereas UCITA uses licenses.
2. UCC laws apply to sales of large organizations and industries. Here large volume of sales is significant while in UCITA, small companies play an important role in the computer industry.
3. In UCC, a contract for the sale of goods is not enforceable by defense or action unless there is a necessary record that shows a sale has been done. Practical context in commercial is not necessary while UCITA advocates for a freedom to contract and practical knowledge on transactions is important
4. UCC does not recommend an expansion in the sale of goods and services while UCITA recommends a technological expansion in e-commerce.
5. UCITA allows software vendors to avoid liability. They can sell software material that does not work and can avoid being liable to it. UCC involves the sale of goods. If the goods are in bad condition, the seller is fully liable to it.
Difference between selling and leasing
Selling is the last step in commerce. It involves exchange of goods and services for cash. The seller gives out the goods and receives cash in form of money. In business, nothing happens until one makes a sale. This process happens through a marketing process. Marketing is a management activity whereby goods and services move from an advertiser to the customer. It is based on business thinking in relation to the customer. It consists of identification, product development, price determination, distribution channel selection, implementing a promotional strategy. The aspect of marketing aids selling to a greater extends. Before one engages in selling, marketing is the best idea since it attracts customers. Once a product has met public eyes, it is possible that some people will buy (Sepinuk, 2008).
This is a process whereby a firm gets ownership of an asset and pays for it through periodic payments that are deductible. The lessee receives the asset or the service and the lessor owns the asset. Relationship between landlord and tenant is termed as tenancy and the fixed period of time that the contract exists is called a lease term. Money paid for the leased property is called rent. In normal circumstance, when one owns property, he can utilize it the way he feels like. But if he has leased out the property, he relinquishes ownership of the property to the tenant (Raysman, 1999). Any interference with the property will be unlawful. The legal distinction between selling ad leasing is that in leasing, one does not fully relinquish his property to the tenant. The ownership is transferred for an agreed period of time only. In selling, ownership of property is completely ceded to the buyer. The buyer enjoys full ownership of the property. Also in leasing, there must be a written agreement involving the landlord and the renter. The agreement confirms that the two have entered into a contract of which if anyone amongst them breaches; he is liable and can face the law.
Selling agreement just exists for a short time. It is only for that time when the buyer is purchasing property.
Why UCITA was made into an independent document
UCITA was made into an independent document since all the states did not approve it. The states that voted against it were: Nebraska, Iowa, Minnesota, Alaska, Utah and North Carolina. Others that opposed it were; Consumers union, Consumer Project on Technology, Software Engineering Institute (SEI), Institute of Electrical and Electronics Engineers (IEEE) and The Federal Trade Commission staff among others. The disapproval of UCITA was due to the following weaknesses it had (Ward, 2007).
1.The duration of the acquirer's right to use software was not certain.
2.It allowed software vendors to prohibit movement of software material from one organization to another. Even from person to person was prohibited.
3.UCITA makes companies license software terms acquired by employees without permission.
4.It gave software vendors powers to prohibit anyone from talking ill of their products.
5.Vendors were given much power to exercise rights over the software products they developed.
It is these powers that made it hard for the states to adopt UCITA in place of the Uniform Commercial Code.