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New Jersey bans 'surveillance pricing,' protecting consumers from data-driven price discrimination

From Republika · () Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

At a glance

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  • New Jersey has banned "surveillance pricing," where companies use personal data to charge different prices for the same goods.
  • The law prohibits using online activity, location, and purchase history to personalize prices, aiming to protect consumer privacy and ensure fair pricing.
  • While personalized pricing is banned, discounts based on supply costs or for specific, publicly defined groups remain permissible.

New Jersey is taking a stand against personalized pricing tactics, enacting a law that prohibits companies from using consumers' personal data to charge different prices for identical goods. The legislation targets "surveillance pricing," where algorithms analyze online activity, location, and purchase history to determine an individual's willingness to pay.

Governor Phil Murphy signed the "Fair Price Protection Act" on August 23, making New Jersey the third U.S. state to regulate price discrimination based on personal information, following Maryland and Connecticut. The law defines surveillance pricing as the use of algorithms or automated systems to set, adjust, or recommend prices based on personal data. This data can be collected through online behavior, purchase history, sensors, cameras, device tracking, and even inferred information.

Companies should compete by offering better prices, not by finding new ways to squeeze consumers. This law is about protecting personal information and ensuring price fairness.

— Phil MurphyThe Governor of New Jersey explains the rationale behind the new 'Fair Price Protection Act'.

The ban covers a wide range of products, including groceries, paper products, household cleaning supplies, health and beauty items, and pet food. However, it excludes establishments primarily selling food or beverages for immediate consumption, such as restaurants. The core price discrimination ban will take effect on August 1, 2027.

Normal discounts are still allowed. These include price differences reflecting supply costs or uniform discounts for clearly defined groups like teachers or veterans. Loyalty programs that consumers voluntarily join, with consistent terms and clear disclosure of pricing and data usage, are also permitted. Governor Murphy stated, "Companies should compete by offering better prices, not by finding new ways to squeeze consumers." The law aims to protect personal information and ensure price fairness.

We hope this law becomes a catalyst for states across the country to protect consumers from AI-driven predatory pricing.

— Ademola OyeyipoInternational Vice President of the UFCW (United Food and Commercial Workers) praises the law as a protective measure for consumers and workers.
DistantNews Editorial

Originally published by Republika in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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