On July 23, 2026, New Jersey Governor Mikie Sherrill signed the Fair Price Protection Act into law, making New Jersey the third state, following Maryland and Connecticut, to impose restrictions on so-called “surveillance pricing.” The legislation reflects an accelerating trend among state lawmakers to regulate the use of consumer data in pricing decisions and signals growing scrutiny of algorithmic pricing practices more broadly.
For retailers, e-commerce platforms, grocery chains, delivery services, and technology providers, the statute underscores the need to evaluate how personal data is collected, analyzed, and incorporated into pricing models.
What Is Surveillance Pricing?
“Surveillance pricing” generally refers to the practice of using an individual’s personal data, such as purchasing history, online activity, location information, biometric data, or other identifying information, to determine or adjust the price offered for goods or services. Unlike traditional dynamic pricing, which responds to market-wide factors such as supply, demand, inventory levels, or time of day, surveillance pricing is designed to tailor prices to a particular consumer based on predictions regarding that individual’s willingness to pay.
Critics contend that surveillance pricing lacks transparency and may result in similarly situated consumers paying different prices for the same product. The Fair Price Protection Act reflects policymakers’ growing concern over the use of personal data to influence pricing decisions. As Assemblyman Chigozie U. Onyema (D-Essex, Union) stated, the legislation is intended to “establish clear protections to ensure that pricing is based on the product being sold, not on the data collected about the person buying it.”
Regardless of the policy debate surrounding its merits, surveillance pricing has become an increasingly prominent focus of state legislatures and regulators.
Key Provisions of the Fair Price Protection Act
The Fair Price Protection Act, which becomes effective on February 1, 2027, includes several noteworthy provisions:
- Prohibition on Data-Driven Individualized Pricing
The law, which applies to all sellers of food and grocery products, prohibits the use of surveillance pricing and other practices that determine or vary the price of groceries and other food products based, in whole or in part, on a consumer’s personal data. - Electronic Shelf Label Moratorium
Notably, New Jersey is the first state to impose a temporary moratorium on the installation of new electronic shelf labels (“ESLs”), digital technologies that permit rapid price changes. The one-year moratorium will remain in effect while the New Jersey Innovation Authority studies the technology’s impact on pricing practices. Existing ESLs may continue to be used, maintained, repaired, and replaced during the review period. - Loyalty Program and Discount Exceptions
The Act does not prohibit traditional discounts, promotions, or loyalty programs. Discounts based on publicly disclosed eligibility criteria, such as programs for veterans or teachers, remain permissible. Likewise, discounts offered through opt-in loyalty programs are allowed provided that all program participants have access to the discounts under the same conditions. - Private Right of Action
In a significant departure from the Maryland and Connecticut frameworks, the New Jersey statute creates a private right of action. Beginning February 1, 2027, consumers who have been affected by violations of the Act may bring suit under the New Jersey Consumer Fraud Act. - Enforcement and Remedies
Violations constitute unlawful practices under the New Jersey Consumer Fraud Act. Businesses found liable may face civil penalties of up to $10,000 for a first violation and up to $20,000 for subsequent violations. The Act also permits treble damages for qualifying violations and authorizes the Attorney General to seek injunctive and other relief.
How New Jersey Fits into the Expanding Regulatory Landscape
Although Maryland, Connecticut, and New Jersey share a common goal of regulating surveillance pricing over retail food and grocery items, their approaches differ in important respects. Most notably, New Jersey is the first state to provide consumers with a private right of action, creating potential litigation exposure in addition to regulatory enforcement. Connecticut’s law focuses more heavily on transparency by requiring notice when personal data is used to determine pricing, while Maryland includes a 45-day cure period. New Jersey also stands apart by imposing the nation’s first moratorium on new electronic shelf label installations.
These differences highlight the emergence of an increasingly fragmented regulatory landscape. Several states have introduced similar legislation, including New York, where a comprehensive surveillance pricing bill that would apply broadly to businesses and service providers currently awaits Governor Kathy Hochul’s signature. As more states consider regulating data-driven pricing practices, the issue has drawn growing attention from lawmakers, consumer advocates, privacy regulators, and antitrust enforcers. Businesses that operate across multiple jurisdictions may therefore face an expanding patchwork of compliance obligations and potential litigation risks. These developments could also increase pressure for federal legislation establishing a more uniform nationwide framework.
Antitrust and Competition Considerations
The emergence of surveillance pricing legislation reflects growing scrutiny at the intersection of antitrust, consumer protection, privacy, and artificial intelligence regulation.
- Algorithmic Price Discrimination and Emerging State Regulation
Surveillance pricing is, at its core, a form of individualized price discrimination enabled by data analytics and AI. Unlike the Robinson-Patman Act, which traditionally addresses discriminatory pricing between competing purchasers in the distribution chain, existing federal law does not squarely prohibit a retailer from using personal data to charge different consumers different prices for the same product. State laws such as New Jersey’s Fair Price Protection Act seek to address that perceived gap by restricting the use of personal information in retail pricing decisions. - Increased Scrutiny of Pricing Algorithms
Regulators have shown growing interest in the use of consumer data and algorithmic tools to influence pricing. The FTC has launched inquiries into targeted pricing technologies and has raised concerns regarding transparency, the use of sensitive personal information, and the potential for unfair or discriminatory pricing outcomes. State regulators have likewise begun examining whether businesses are using personal information to generate individualized pricing. - Parallel Concerns Regarding Algorithmic Collusion
Although surveillance pricing differs from algorithmic collusion, both involve the use of algorithms to influence pricing decisions and have attracted increasing attention from lawmakers and antitrust enforcers. Surveillance pricing generally involves a business using its own customer data to determine individualized prices, whereas algorithmic collusion refers to the use of shared competitively sensitive data, common pricing software, or algorithmic tools that may facilitate coordinated pricing among competitors and reduce independent decision-making. Notably, Governor Sherrill signed the Fair Price Protection Act shortly after approving the FAIR Act, which restricts certain algorithmic rent-setting practices. Together, the measures reflect a broader concern over the growing role of algorithms in pricing markets.
Practical Considerations for Businesses
Businesses covered by the Act that utilize data-driven pricing, consumer analytics, or related technologies should consider taking proactive steps before the law takes effect on February 1, 2027.
Among other things, companies should:
- Review pricing practices to determine whether personal data influences pricing decisions in ways that could trigger scrutiny under New Jersey or similar state laws.
- Evaluate data collection, retention, and use practices to confirm that pricing-related uses of consumer information are appropriately disclosed and legally supportable.
- Assess plans involving electronic shelf labels in New Jersey in light of the one-year installation moratorium.
- Review loyalty programs and promotional discount structures to ensure they fit within available statutory exceptions.
- Monitor legislative developments in other jurisdictions, particularly as additional states consider surveillance pricing restrictions and related algorithmic pricing legislation.
Looking Ahead
The Fair Price Protection Act represents another step in the growing effort to regulate the intersection of consumer data, artificial intelligence, and pricing practices. Whether other states follow New Jersey’s model, particularly its private right of action and restrictions on electronic shelf labels, remains to be seen. In the meantime, businesses that rely on data-driven pricing, consumer analytics, or algorithmic decision-making should closely evaluate their pricing practices and compliance programs as state-level regulation in this area continues to evolve.
For more information about the Fair Price Protection Act or other antitrust and competition law developments, please contact Carly Rothstein or another member of Mandelbaum Barrett’s Antitrust Practice Group.