What Is a Chamber of Commerce?

A chamber of commerce is an association or network of businesspeople designed to promote and protect the interests of its members. A chamber of commerce is often made up of a group of business owners that share a locale or interests, but can also be international in scope. They will choose leadership, name representatives, and debate which policies to espouse and promote.

Chambers of commerce exist all over the world. They do not have a direct role in creating laws or regulations, though they may be effective in influencing regulators and legislators with their organized lobbying efforts.

Key Takeaways

  • A chamber of commerce is an association or network of businesspeople designed to promote and protect the interests of its members.
  • Chambers of commerce exist all over the world.
  • While chambers of commerce do not directly influence political outcomes, they may try to influence or lobby local community leaders to pro-business stances.
  • Many chambers of commerce rely on membership dues as their primary source of revenue.
  • The International Chamber of Commerce (ICC) is one of the largest, most diverse business organizations in the world.

How a Chamber of Commerce Works

The first chamber of commerce was founded in France in 1599. The first one in the United States started in New York in 1768. The United States Chamber of Commerce was founded in 1912 and promotes pro-business issues via lobbying efforts at the national level. At the state, city, regional, and local levels, chambers focus on issues and advocacy relevant to their individual membership.

Such chambers may or may not be affiliated with the U.S. Chamber of Commerce through a Federation Partnership Program. The national chamber tends to support conservative politicians and is the largest lobbying group in the U.S. Chambers of commerce differ from trade groups or trade associations, which promote a specific industry.

Among the benefits chamber members receive are deals and discounts from other chamber members, listing in a member directory, and a variety of other programs and services designed to promote business activity in a region.

Chambers of commerce also play an important role in local municipalities in promoting business activity and representing chamber members. At least at the local level, chamber of commerce members often meet to discuss and attempt to shape policy that relates to the business and overall economic environment. Members also receive the distinction of being a preferred local vendor, as well as listing on various municipal websites and literature.

How a Chamber of Commerce Makes Money

Many chambers of commerce rely on membership dues as their primary source of revenue. Most chapters offer various levels of membership at different prices with different benefits for their members.

Every member is required to pay dues, which help cover the organization's overall operating costs. Chambers may also hold fundraising events in order to raise additional funds or require the special purchase of tickets to attend their events.

Typically, chambers of commerce are designated as 501(c)(6) corporations for federal tax purposes. This classification allows chambers of commerce to operate as nonprofit entities, while also giving them the authority to represent their members in policy matters.

Types of Chambers of Commerce

Chambers of commerce may follow several different formats.

Regional, City, and Community Chambers

Regional, city, and community chambers are focused on regional or local issues featuring cooperation with local government, but may also promote broader pro-business initiatives that cross borders, such as promoting trade between immigrant groups and their home country.

City Chambers

City chambers aim to promote a city's economic interest locally and possibly globally.

State Chambers

In the U.S., state chambers focus on statewide and sometimes national advocacy, and therefore have greater influence over regulations and legislation.

National or International Chambers

National or international chambers focus on advocacy or lobbying for national or broader issues.

Compulsory Chambers

In some countries, businesses of a certain size are required to join a chamber of commerce, which provides a degree of self-regulation, as well as promotes member businesses, supports economic development, and oversees worker training. Such chambers are popular in Europe and Japan.

In some countries, chambers of commerce provide key economic data by surveying their membership. For example, the British Chambers of Commerce Quarterly Economic Survey is used by the government to gauge the health of the economy.

International Chamber of Commerce and Incoterms

The International Chamber of Commerce (ICC) is one of the largest, most diverse business organizations in the world. The ICC was founded in Paris, France in 1919.

The ICC represents more than 45 million companies in over 100 countries. The organization has a vast network of committees and experts working on behalf of its members in all sectors in order to ensure that they are fully informed about issues that may impact their respective industries.

The International Chamber of Commerce (ICC) supports the work of the United Nations, the World Trade Organization, and other intergovernmental bodies.

One of the most important contributions of the ICC is their publication of international commercial terms, also known as Incoterms. Incoterms are intended to facilitate global commerce by providing parties involved in domestic and international trade with a kind of shorthand to help understand the exact terms of their business arrangements. The ICC developed the Incoterms in 1936. Incoterms are globally recognized and used in foreign trade contracts to clarify the obligations of both buyers and sellers.

Some commonly used Incoterms are EXW (Ex Works), FCA (Free Carrier), and FOB (Free on Board). The term EXW places the maximum obligation on the buyer and minimum obligations on the seller. The seller must make the goods available at their premises, or at another named place, and the buyer incurs the risks of bringing the goods to their final destination. 

The term FCA refers to a situation where the seller delivers the goods, cleared for export, at a named place (possibly including the seller's own premises). The goods can be delivered to a carrier nominated by the buyer, or to another party nominated by the buyer.

The FOB refers specifically to rules for sea and inland waterway transport. Under the terms of FOB, the seller bears all costs and risks up to the point the goods are loaded onboard the ship.

Chamber of Commerce FAQs

How Does a Chamber of Commerce Influence Public Opinion and Policy?

Chambers of Commerce will act to promote public policies that are in the best interest of business, in general. Specific Chambers of Commerce may also attempt to promote policies that serve specific industries or geographic locations. Some tactics that Chambers of Commerce might use include lobbying, expressing their positions publicly, attempting to educate its members, and mobilizing other business groups or factions on a particular issue. 

How Can I Make My Chamber of Commerce Successful?

Chambers of Commerce can act as a bridge between governments, small businesses, corporations, schools, religious organizations, and the general public. Usually, they rely on volunteers to make sure they are successful. Plus, getting involved with a Chamber of Commerce in your community can offer significant benefits to you, including making new friends, contacts, and potentially gaining new customers.

What Are ICC Rules of Arbitration?

The ICC offers dispute resolution procedures through the International Court of Arbitration. The ICC Rules of Arbitration are used all around the world to resolve cross-border disputes.

The ICC International Court of Arbitration was started in 1923. It provides individuals, businesses, and governments with services for every stage of a dispute. Although the name has the word "court" in it, the International Court of Arbitration is not actually a court. Rather, it exercises judicial supervision of arbitration proceedings. Its duties range from monitoring the arbitral process to adjusting fees and advances and confirming and appointing arbitrators.