Surveillance pricing — the practice where corporations use vast troves of personal data including search history, past purchases, location information and more to tailor prices to individual customers —  has become inescapable. This is despite the fact that recent polling shows most people — across party lines — don’t like it. Among the major retailers facing public scrutiny and, in some cases, legal challenges, are Instacart, Delta, JetBlue, The Washington Post, Uber, Lyft, Amazon, and Google.

In response, lawmakers across federal, state, and local jurisdictions have introduced a growing number of surveillance pricing bills aimed at banning the discriminatory practice. Yet, across these jurisdictions, the same opposition arguments and industry-motivated carveouts keep popping up, leading to laws that purport to solve a problem when in fact they grant permission for pricing abuses. 

Banning surveillance pricing relies on a simple premise: Companies should not be able to weaponize granular consumer data to make inferences and profiles, for the purpose of setting targeted prices for the same products. They include carefully considered exemptions aimed at preserving, for instance, benign and accepted forms of discounting based on personal information, like senior or student discounts. Unless narrowly defined, the exemptions become the rule by which ubiquitous price discrimination continues. Maryland’s recently signed law presents a cautionary tale. The final version included gaping loopholes for discriminatory loyalty programs, individually-targeted “promotional offers,” and undefined “temporary discounts,” among other provisions that grant sweeping permission for surveillance pricing to continue. The biggest threat to effective surveillance pricing legislation is this quiet flourishing of carveouts and exceptions, which can weaken and undermine true reform. 

This memo aims to build upon a prior analysis, showing the most common problematic carveouts for surveillance pricing legislation. The goal is to help lawmakers and regulators anticipate and avoid such loopholes, which risk neutering a prohibition and allowing surveillance pricing legislation to become a permission slip rather than a restriction on ubiquitous price discrimination. Below are some of the most common loopholes that weaken and derail reform.