Free «Unit 4 Individual Project» Essay Sample

Prior to UCC and UCITA, commercial clause found in the US constitution under "Article 1, Section 8, Clause 3" was the initial and most important efforts made by the federal government to support equality in business regulations from state to state (The United States Constitution, 2004). The clause gave the congress mandate to control overseas business, business among the various states and that with businessmen of Indian tribes.

The most significant difference between UCITA and Article 2 of UCC is the former covers agreements regarding to licensing and selling of computer products while the latter covers only agreements related to selling of goods.

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Another main difference is that the article does not regulate agreements related to manufacture of the goods while UCITA covers agreements related to creation and modification of computer products. In addition, Article 2 of UCC controls transactions of all types of goods where transfer of ownership does not require security while UCITA controls only computer products' transactions.

Legally, licensing refers to the process of purchasing or selling goods or services to make products using particular patented resources such as computer software.

In other words, in licensing, the owner allows the consumer to use the licensed product but the rights of ownership remains with the owner. On the other hand, selling refers to the act of passing the rights of ownership and use of products to the consumers. As such, after the sale, consumers can do anything with the product (Unlu, 2005, p.114).

Even though most of requirements of UCITA were proposed as revisions of Article 2 of UCC, drafters concluded to have it as a distinct and separate law to regulate transactions of computer products separately from other products. The nature of computer products differ significantly with other products in that they are susceptible to be illegally duplicated or transacted in areas away from where the patent was granted. As such, a separate act to unify all states in their effort to regulate business of computer products without infringing rights of both the owner and consumer was required.


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