Prohibits the use of electronic shelving labels, digital shelf display technology, and surveillance pricing in food retail establishments and drug retail establishments; provides injunctive relief and civil penalties.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A9396B
SPONSOR: Solages TITLE OF BILL:
An act to amend the general business law, in relation to establishing
the protecting consumers and jobs from discriminatory pricing act
PURPOSE:
The purpose of this bill is to make it unlawful for food retail estab-
lishments and drug retail establishments to engage in surveillance pric-
ing or to use electronic shelf labels.
SUMMARY OF PROVISIONS:
Section one provides the short title "Protecting Consumers and Jobs from
Discriminatory Pricing Act"
Section two provides the legislative findings.
Section three prohibits any food retail establishment or drug retail
establishment from using electronic shelf labeling or engaging in
surveillance pricing.
Section four clarifies that this section shall not be construed to limit
any other criminal or civil liability such entity may be subject to
under law.
Section five provides the severability clause. Section six establishes
the effective date.
JUSTIFICATION:
Advancements in algorithms, artificial intelligence, and electronic
shelving technology have made it possible for companies to set prices
based on personal or protected data. If left unchecked, companies could
potentially use this technology to engage in discriminatory pricing and
violate consumer privacy rights. This technology also poses a threat to
numerous jobs across New York State, thus stifling economic growth and
putting the livelihoods of many citizens at risk.
Despite the dangers posed by this emerging technology, there are
currently no prohibitions in place to protect New Yorkers in a meaning-
ful way. While offering goods at different prices due to customer demand
is not new, there are subtle and important differences between price
optimization and discriminatory pricing schemes, such as personalized
algorithmic pricing and surveillance pricing, which exploit consumers'
personal and protected data to maximize profits.
This technology presents significant equity concerns and risks reinforc-
ing historic inequalities. Studies show that algorithmic pricing systems
in digitally mediated markets impose higher costs on communities of
color, low income households and underserved communities. This emerging
form of digital redlining has been shown to reproduce existing struc-
tural disparities across neighborhoods and demographic groups. Algorith-
mic and surveillance pricing risks exacerbating financial burdens for
all New Yorkers, but particularly for marginalized communities who are
already disproportionately impacted by rising costs of essential goods.
New Yorkers are already feeling squeezed by the high price of every-
thing, especially groceries and over-the-counter drugs. This state
should not stand idly by while companies develop new and innovative ways
to monetize our personal information. This bill would, thus, make it
unlawful for grocery stores and drug stores to engage in personalized
algorithmic pricing and surveillance pricing. These stores would also
be barred from using electronic shelving technology in order to ensure
compliance with these new pricing rules.
LEGISLATIVE HISTORY:
New bill.
FISCAL IMPLICATIONS:
None.
EFFECTIVE DATE:
This bill shall take effect immediately.
