Levi Pasikov

Associate Editor

Loyola University Chicago School of Law, JD 2028

Surveillance pricing is an emerging practice whereby companies use highly complex algorithms, rooted in consumer data, to determine individual prices on goods and services. Rather than tailoring prices on market-wide supply and demand conditions, companies engaging in surveillance pricing individualize the cost of goods to consumer-specific behavior and characteristics. With this rampant form of price fixing affecting numerous markets—from rideshare services and hospitality to merchandise retailers—government regulation is necessary to prevent consumer discrimination.

Every click comes at a cost

In 2024, the Federal Trade Commission (FTC) conducted an investigation under section 6(b) of the Federal Trade Commission Act (FTCA) to understand the rise, scope, and potential impacts of surveillance pricing. Through their investigation, the FTC examined how entities use consumer data, artificial intelligence, and algorithmic tools to shape individualized pricing. They found these practices allow companies to exploit individual consumers by using algorithmicvariations to predict a consumer’s willingness to pay. The consumer-centered attributes used in the algorithm include who they are, where they have been, and what they have searched for. This means, for example, a person who purchases an expensive item online and resides in a zip code with a high average median income may be charged a higher price than a similarly situated consumer who makes less expensive online purchases in a zip code with a lower average median income. At times, these price disparities have demonstrated an 8.4% gap.

The limited legislative response to surveillance pricing 

To date, only four states have enacted legislation addressing surveillance pricing: New York, Connecticut, Maryland, and New Jersey. The first state to act was New York, who enacted the Algorithmic Pricing Disclosure Act (APDA) on May 9, 2025. The APDA, rather than opposing an outright ban, requires businesses to disclose the use of algorithms and consumer data when personalizing prices. Next, Connecticut expanded and amended the Connecticut Data Privacy Act(SB4), which was signed into law on May 27, 2026, and will take effect in October 2026 with full implementation by October 2028. SB4 takes a protective approach to personalized pricing practices by restricting the use of consumer data. However, it still allows certain permissible discounting and pricing practices.

In contrast, Maryland, through the Protection from Predatory Pricing Act (PPPA), took the approach of sector-focused restrictions, specifically in the food industry. Effective October 1, 2026, the PPPA prohibits food and grocery retailers from using consumer behavior data to charge different prices for the same product. Similarly, New Jersey has passed the Fair Price Protection Act (FPPA), which targets the food and grocery industry and prevents them from using personal information to charge different prices for identical goods. However, the New Jersey law will not be in effect until August 1, 2027.

The future of price protection legislation

Following the trend, other states have started to discuss introducing surveillance pricing laws. Illinois is pursuing a consumer choice model. Under this approach, businesses would be required to disclose pricing practices, and consumers may opt out of algorithmic pricing altogether. In California, the Surveillance Pricing Protection Act (AB 2564) seeks a complete ban on surveillance pricing, prohibiting the use of personal data in relation to pricing items. Another state, Colorado, pushed a bill that would provide broad protections for consumers; however, Governor Jared Polis vetoed the bill. In total, around thirty states have introduced a bill restricting surveillance pricing.

While little movement has occurred at the federal level, the One Fair Price Act of 2025 (OFPA) has been introduced in the U.S. Senate. This bill would make it unlawful to charge different consumers different prices for substantially similar goods or services when the price difference is based on surveillance data. Since its introduction in 2025, no progress has been made.

The price of inaction

For as long as surveillance pricing remains prevalent, state legislatures will likely continue to experiment with different regulatory approaches, ranging from disclosure requirements to outright prohibitions. While federal action remains slow and uncertain, increased state regulation can pave the way for restricted algorithmic pricing practices. Future litigation may also help define the limits of legislative authority and determine how to balance consumer protection with technological innovation.

Government intervention and regulation is necessary as surveillance pricing practices verge on consumer discrimination. Allowing businesses to use sensitive personal information to determine individual prices creates an uneven marketplace and promotes consumer exploitation. In an act of poetic justice, it is the online patrons, not the old school brick and mortar shoppers, who are (quite literally) paying the price. While algorithmic data collection is not illegal and can provide legitimate benefits to businesses and consumers, those benefits should not come at the expense of consumer autonomy, privacy, and equal treatment. Without regulatory action, the legislatures leave uninformed consumers vulnerable to exploitive practices with no ability to prevent it.