BILL NUMBER: S7033
SPONSOR: MAY
 
TITLE OF BILL:
An act to amend the general business law, in relation to requiring
disclosure of algorithmically set prices
 
PURPOSE OR GENERAL IDEA OF BILL:
Establishes the Preventing Algorithmic Pricing Discrimination Act. This
bill prohibits the use of surveillance pricing practices that adjust the
cost of goods and services based on consumer data in a discriminatory
manner. It ensures that businesses cannot use consumer data to infer
personal characteristics such as race, gender, or disability status to
alter prices unfairly. Additionally, the bill mandates that businesses
utilizing surveillance pricing must notify consumers when prices are
determined algorithmically based on their personal data.
 
SUMMARY OF PROVISIONS:
Section 1. This act shall be known as the Preventing Algorithmic Pricing
Discrimination Act.
Section 2. will make it a deceptive act if businesses knowingly use
personalized algorithmic pricing without providing notice to consumers.
Section 3. provides the definition of protected class data for this
section and prohibits sellers from using protected class data to engage
in price discrimination.
Section 4. amends a part of the General Business Law to clarify that
anyone harmed by a violation of subdivision 3 can file a legal action
under Section 297 of the Executive Law. It also states that this
provision does not limit other legal rights or remedies available to the
Attorney General or others authorized to take legal action under this
law.
Section 5. establishes the effective date.
 
JUSTIFICATION:
Corporations are using mass surveillance and hidden algorithms to
inflate prices. In early 2025, the Federal Trade Commission (FTC)
released a report detailing how companies use personal data such as
location or browser history to set individualized prices. The report
confirmed that consumers can be charged different prices for the same
product or service based on this data. Over the past decade, companies
like Staples and Princeton Review were found to vary prices by zip code,
with patterns suggesting racial and ethnic discrimination. Rideshare
companies have also been suspected of using similar pricing tactics tied
to neighborhood demographics.
Algorithmic pricing is deceptive and unfair. Consumers should not be
charged differently for the same product without knowing why. This prac-
tice benefits retailers at the expense of consumers. Despite the FTC's
findings, no federal action has been taken. States must act. This bill
aims to protect New York consumers by requiring disclosure when prices
are based on personal data, banning price differences based on location,
and prohibiting the use of protected class data in setting prices. These
measures will increase transparency, promote fairness, and help consum-
ers make informed decisions.
 
PRIOR LEGISLATIVE HISTORY:
New Bill.
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
None
 
EFFECTIVE DATE:
On the sixtieth day after it shall have become a law.