New York lawmakers have approved legislation that would ban companies from using consumers’ personal data to charge different prices for the same product, a practice supporters call “surveillance pricing.” If signed into law, the measure would make New York one of the first states in the nation to prohibit the practice outright.
The legislation, known as the One Fair Price Act, was championed by Attorney General Letitia James and sponsored by Sen. Rachel May and Assemblymember Emérita Torres. Supporters argue that advances in data collection and artificial intelligence have allowed companies to use information about individual consumers to determine how much they are willing to pay, then adjust prices accordingly.
What is surveillance pricing?
The bill defines surveillance pricing as the use of algorithms and personal data to offer different prices to different consumers for the same goods or services. Under the legislation, personal data can include information that identifies or can reasonably be linked to a specific consumer or device.
Supporters say companies increasingly collect information such as browsing history, purchase behavior, income indicators, location data, device information, and other digital signals to predict how much a customer may be willing to spend. According to the attorney general’s office, two consumers visiting the same website at the same time could potentially see different prices for the exact same product because of information collected about them.
The legislation would prohibit businesses from setting or adjusting prices using those personal data profiles. It would also prohibit companies from collecting, sharing, retaining, or selling personal data for the purpose of facilitating surveillance pricing.
What the bill does not ban
One of the most significant aspects of the legislation is what it leaves untouched.
The measure specifically allows traditional discounts, promotions, coupons, sales, loyalty programs, membership programs, veteran discounts, senior discounts, teacher discounts, early-bird sales, flash sales, inventory-based pricing, and subscription discounts. Businesses would still be allowed to offer lower prices based on those programs, provided they are disclosed and available under clearly defined criteria.
The bill also permits companies to use prior purchase history within loyalty and rewards programs under specific limitations. However, those programs generally cannot combine purchase history with broader personal data profiles to create individualized prices.
Dynamic pricing itself is not banned. Prices may still fluctuate based on inventory levels, demand conditions, seasonal promotions, or other non-personal factors. What the legislation targets is the use of personal data to determine what a specific individual should be charged.
How enforcement would work
The legislation grants enforcement authority to the New York Attorney General’s Office. If violations are found, the attorney general could seek court orders, restitution for consumers, damages, and civil penalties.
The bill establishes penalties of up to $5,000 for a first violation and up to $20,000 for subsequent violations. Money collected through those penalties would be dedicated to consumer protection enforcement.
The law would apply to businesses operating in New York, though certain sectors receive exemptions. Insurance companies and some credit-related pricing decisions are excluded, as are pricing practices specifically authorized by federal or state law.
What it means for consumers and businesses
For consumers, supporters say the bill would create greater certainty that everyone is seeing the same baseline price for the same product, regardless of income level, browsing habits, race, ZIP code, or other personal characteristics. Attorney General James argued the measure would ensure prices are based on the product being sold rather than a company’s assessment of how much it can extract from an individual shopper.
For businesses, the legislation could require significant changes to pricing algorithms and data practices. Retailers and online marketplaces that use consumer data to influence individualized pricing strategies would need to eliminate those practices or risk enforcement action. At the same time, businesses would retain the ability to offer loyalty rewards, targeted promotions, and traditional discounts that comply with the law’s requirements.
If signed by Gov. Kathy Hochul, the law would take effect 180 days after enactment, giving businesses six months to adjust their pricing systems and compliance practices.
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