Businesses would be prohibited from using personal data to tailor prices to individual customers in New York under a newly passed bill meant to crack down on a practice critics have called \u201csurveillance pricing.\u201d<\/p>\n
The state Assembly, however, declined to vote on companion legislation that would\u2019ve also banned electronic price labels<\/a> from the shelves of grocery stores and pharmacies, a measure pushed by labor unions who contend the technology can be used to instantly hike prices and reduce the stores\u2019 workforce.<\/p>\n Grocery stores, business groups and delivery services including Instacart lobbied hard against the measures, arguing they will lead to price increases and could complicate customer loyalty programs. The stores dismissed concerns about the digital price tags, insisting they\u2019re used only as a matter of technological convenience over the traditional method of changing shelf labels by hand.<\/p>\n But lawmakers decided to proceed with the ban on pricing using algorithms that use personal data to set different prices for different customers, with supporters arguing it can be used to squeeze more money out of consumers without them even realizing it.<\/p>\n The Legislature approved the bill<\/a> late Thursday before ending their annual session. It will be up to Gov. Kathy Hochul whether to sign it into law.<\/p>\n \u201cWe’re not trying to capture loyalty programs and legitimate discounts, etc.,\u201d said state Senate Majority Leader Andrea Stewart-Cousins, a Yonkers Democrat. \u201cBut we are concerned about a practice that would just give different prices to different people based on \u2014 what? We’re not sure.\u201d<\/p>\n The bill banning \u201csurveillance pricing\u201d would apply to most businesses and service providers in New York, with some exceptions. It would not apply to insurance companies, while banks would still be able to assess a customer\u2019s credit before offering terms for a loan or similar financial service.<\/p>\n \u201cA price should be set based on supply, demand, what the market can bear \u2014 not your personal data,\u201d said Assemblymember Emerita Torres, a Bronx Democrat who sponsored one of the bills. \u201cThat’s what this bill is all about.\u201d<\/p>\n The bill includes language meant to protect loyalty programs, such as a grocery store that offers rewards for returning customers. The protections apply when customers affirmatively enroll in the program and allow for discounts based on their past purchase history \u2014 provided no other personal data is used.<\/p>\n