Key Takeaways

  • Connecticut Governor Ned Lamont signed a bill last Thursday prohibiting retailers from using personal identifying information to customize prices for shoppers.
  • Also last Thursday, New York state lawmakers approved legislation that would bar retailers from using personal identifying information to customize prices for shoppers. The bill now awaits a decision from Governor Kathy Hochul.
  • Last Tuesday, Colorado Governor Jared Polis vetoed a bill passed by state lawmakers that would have banned businesses from using consumer data to generate personalized prices.

Deep Dive

The legislative actions in Connecticut and New York reflect growing efforts by politicians and advocacy groups to crack down on practices they say are unfair to consumers.

Connecticut is the second state to enact a law restricting how retailers can use customer information to set prices. In April, Maryland Governor Wes Moore signed a bill making his state the first in the nation to ban "price gouging based on surveillance data that causes immediate price spikes." Maryland's law is set to take effect on October 1.

Consumer Reports, which has advocated for restrictions on using data tied to individual shoppers to set prices, welcomed the progress in Connecticut and New York last week. The organization noted that data such as people's browsing history, health status, and income are examples of information it believes retailers should not be allowed to use to determine personalized prices.

Consumer Reports praised Connecticut's law—which takes effect on July 1, 2027—but urged the state to strengthen it, in part by making clear to consumers that they can take legal action on their own.

New York Attorney General Letitia James praised state lawmakers for approving the bill, known as the Fair Pricing Act. "This is a major victory in our fight to ban surveillance pricing and help lower the cost of living in New York," she said in a Friday statement on her office's Facebook page.

If Hochul signs the bill, it would take effect six months later.

New York lawmakers are also considering legislation that would prevent food retailers and pharmacies from using electronic shelf labels. James, along with a coalition including United Food and Commercial Workers International Union Local 1500, AARP New York, and the Retail, Wholesale and Department Store Union, has called for the bill's passage.

However, the failure of Colorado's dynamic pricing legislation to advance serves as a reminder of the challenges these efforts face. In a letter to the state House, Colorado's governor said he vetoed the legislation because its scope was too broad.

"I support policies that protect consumers from unethical price gouging and save Coloradans money. However, I am troubled by the broad approach the bill takes, fearing it would hinder the use of completely acceptable technology to set appropriate prices or wages, or to use technology to save consumers money through discounts that may not fully align with the bill's definition of acceptable discounts," Polis wrote.