Below is a peek into what New Yorkers are seeing now that New York's new Algorithmic Pricing Disclosure Act is in effect.
ICYMI: Effective July 8, 2025, the act requires companies that use algorithmic pricing based on personal data to display the following consumer-facing disclosure near any advertised price:
"THIS PRICE WAS SET BY AN ALGORITHM USING YOUR PERSONAL DATA."
Key elements of the law:
✅ Covered entities: Any business doing business in New York state that uses a computational process (an "algorithm") to dynamically set prices based on personal data that could be linked to a specific consumer or device.
✅ Obligations: Any company that publishes or displays a price that is based on personalized algorithmic pricing (dynamic pricing set by an algorithm that uses consumer data) has to present the clear and conspicuous disclosure above. The act also regulates price discrimination by prohibiting the use of personal information that identifies someone as a member of a protected class to set a price for a good or service if: 1) the use of that data has the effect of withholding or denying accommodations, advantages and privileges offered to others, or 2) the price is different from the price offered to other groups.
📌 The law is currently being challenged by the National Retail Federation (NRF), which alleges that the law is unconstitutional and violates the First and Fourteenth Amendments by compelling NRF members to convey misleading messages they oppose. The NRF argues the mandated disclosure mischaracterizes lawful and pro-consumer practices, such as loyalty discounts and cart-based promotions. The complaint also alleges that the act fails the Zauderer test for commercial disclosures as it is not "purely factual and uncontroversial" and is not justified by any real effort to prevent consumer deception.
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