New Jersey bans surveillance pricing with new law to protect shoppers

New Jersey Governor Mikie Sherrill has signed into law a bill that prohibits businesses from using shoppers' personal information to charge different prices for the same products, making the state the third in the US to ban the practice.

The Fair Price Protection Act, passed by the New Jersey legislature, targets surveillance pricing—where retailers use data such as online activity, location, and purchase history to arbitrarily set individual prices.

In a statement after signing, Sherrill said New Jersey families are already feeling the pressure of higher costs and that the last thing they need is companies secretly using their personal data to charge them more than others for the exact same product. She emphasized that if businesses want to compete, they should do so by offering better prices, not by finding new ways to squeeze shoppers. The law puts New Jersey shoppers first by protecting their privacy and ensuring fairness in pricing.

New Jersey's act follows similar measures in Maryland and Connecticut, both of which have banned surveillance pricing. A similar bill is awaiting a signature from New York Governor Kathy Hochul, which would ban personalized price manipulation.

According to Sherrill's office, the law prohibits businesses from using shoppers' personal data to set individualized prices on groceries and other essential items. However, it does not apply to loyalty programs or other discounts.

Sherrill's office added that the law also pauses the rollout of new electronic shelf labels for one year while the New Jersey Innovation Authority studies their impact. Stores may continue using, repairing, and replacing existing electronic shelf labels.

Ademola Oyefeso, vice-president of the United Food and Commercial Workers International union, praised the pause on electronic shelf labels, calling it an important step to ensure the technology does not harm New Jersey shoppers or workers. She expressed hope that the law would serve as a catalyst for states across the country to protect shoppers from predatory pricing set by artificial intelligence and to protect good, union grocery jobs.