Amidst uncertainty from FTC, states zero in on dynamic and algorithmic pricing
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By Lauren N. Lerman
Published on March 4, 2026.
The Federal Trade Commission (FTC) is focusing on dynamic and algorithmic pricing, also known as "surveillance pricing," which uses customers' personal data to set individualized prices. These types of pricing raises concerns about the collection and use of personal data, which also raises concerns for privacy regulators and consumer protection regulators. While the grocery industry has been the primary focus of this discussion, it is also used by a wide range of online retailers, the financial services and travel industries, and many other types of businesses. The California Department of Justice (CA DOJ), and NY AG have initiated regulatory scrutiny and investigations regarding these practices. The CA DOJ has sent letters to online retailers and grocery stores, and hotels seeking information about how they use consumers' shopping and internet browsing history, location data, demographics, and other data to calculate prices. The law requires clear and conspicuous disclosure that companies using "personalized algorithmic Pricing" must comply with certain laws. The New York law, which took effect in November 2025, gives the Attorney General (AG) sole enforcement authority under the Act, allows for civil penalties up to $1,000 per violation and requires companies to provide companies with notice of suspected violations and an opportunity to cure violations. Companies using these tools should take note of compliance requirements, as the broad scope of compliance may complicate implementation.
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