Summary as Introduced
Creates the Algorithmic Pricing Transparency Act. Provides that any person or entity that sells or offers to sell goods or services through an online platform to consumers in this State shall provide a clear and conspicuous disclosure if the price displayed to a consumer is generated using surveillance pricing. Provides that a consumer may opt out of surveillance pricing and a covered entity shall provide the consumer with a non-personalized baseline price for the goods or services. Prohibits a covered entity from using specified personal information to generate algorithmic pricing. Provides that a violation of the Act is an unlawful practice under the Consumer Fraud and Deceptive Business Practices Act. Amends the Consumer Fraud and Deceptive Business Practices Act to make a conforming change. Effective one year after becoming law.
Staff Analysis
Bill as Introduced
Creates the Algorithmic Pricing Transparency Act. Provides that any person or entity that sells or offers to sell goods or services through an online platform to consumers in this State shall provide a clear and conspicuous disclosure if the price displayed to a consumer is generated using surveillance pricing. Provides that a consumer may opt out of surveillance pricing and a covered entity shall provide the consumer with a non-personalized baseline price for the goods or services. Prohibits a covered entity from using specified personal information to generate algorithmic pricing. Provides that a violation of the Act is an unlawful practice under the Consumer Fraud and Deceptive Business Practices Act. Amends the Consumer Fraud and Deceptive Business Practices Act to make a conforming change. Effective one year after becoming law.
House Floor Amendment 2
The amendment creates the Algorithmic Pricing Prohibition Act to prohibit businesses from using a consumer’s personal data to set individualized prices for goods or services through surveillance pricing practices. The legislation excludes certain pricing activities, including general market-based price changes, algorithmic pricing models that do not rely on personal data, and the use of personal data for creditworthiness or underwriting determinations. The Illinois Attorney General would be authorized to investigate violations, seek injunctive relief, pursue restitution, and recover enforcement costs, with civil penalties of up to $50,000 per violation. The bill also includes home rule preemption language and clarifies that the Act does not limit existing federal or State law.
Potential County Impacts
While the legislation is primarily directed at private-sector business practices and consumer protection, counties could experience indirect impacts related to procurement, technology oversight, and consumer-facing services. Counties that utilize third-party vendors employing dynamic pricing tools or artificial intelligence systems for public-facing transactions may need to monitor vendor compliance and review contractual practices to ensure pricing models do not rely on prohibited uses of personal data.
The bill’s home rule preemption provision is noteworthy because it would prohibit home rule units of local government, including Cook County, from adopting separate or conflicting local regulations governing surveillance pricing practices.