Regulatory Actions Targeting Algorithmic Pricing and Data Broker Practices

New York has begun enforcing the Algorithmic Pricing Disclosure Act, requiring companies to disclose when they use algorithms and personal data to adjust prices for consumers. This legislation aims to increase transparency around 'surveillance pricing,' where businesses leverage customer data such as location, browsing history, and online behavior to set individualized prices. The Federal Trade Commission (FTC) has also highlighted concerns about these practices, warning that companies could use a wide range of personal data to influence pricing decisions, potentially leading to unfair or discriminatory outcomes for consumers.

Separately, the data broker Kochava has agreed to significant changes in its business operations as part of a legal settlement, including ceasing the sale or sharing of sensitive geolocation data and implementing an opt-out mechanism for consumers. The settlement, which awaits final judicial approval, follows FTC allegations that Kochava's sale of precise location data violated rules against unfair and deceptive practices. These developments reflect a broader regulatory push in the United States to address privacy risks and increase accountability for companies that collect, use, and monetize consumer data for pricing and marketing purposes.