New York State Law Takes Aim at Personalized Pricing

New York’s newly approved state budget introduces fresh disclosure rules for companies that adjust prices based on customers’ personal data, such as increasing prices for shoppers who frequently spend more.

Under the new requirements, any business using personalised pricing must inform consumers with a clear notice stating: “This price was set by an algorithm using your personal data,” The New York Times reported.

The accurate scale of personalised pricing among online retailers remains unclear. Uber, for instance, confirmed to the NYT that it is now displaying this disclosure to New York users, though the company described the legislation as “poorly drafted and ambiguous.” Uber maintains that its pricing model relies solely on location and rider demand, not personal data.

The National Retail Federation attempted to block the law by filing a lawsuit, but a federal judge ruled that the legislation can proceed.

Lina Khan — former chair of the Federal Trade Commission and currently co-chairing Zohran Mamdani’s mayoral transition team — told the NYT that the law will serve as an “absolutely vital” tool for regulators. However, she also emphasised that a “ton more work” remains to ensure adequate oversight of personalised pricing practices.