The Federal Trade Commission voted 2-0 on Aug. 19 to open a 30-day comment window on a proposed enforcement policy statement warning retailers that undisclosed use of consumer data to set individualized prices may violate Section 5 of the F.T.C. Act. Comments close Sept. 18, and the announcement lands into a landscape in which four states have already moved without waiting for Washington.

Chairman Andrew Ferguson conceded that the agency lacks authority to prohibit personalized pricing outright. What it can do, he said, is police the disclosures around it. “businesses that fail to tell consumers how their personal data is being used to set a price may be in violation of the F.T.C. Act and other laws we enforce,” Ferguson said. The commission signaled it “intends to enforce the law aggressively.”

The framing is more revealing than the framework itself. In the press release, the commission argued that consumers expect prices to move with supply and demand, “not their web surfing habits or buying history.” That gap, between what shoppers assume is happening and what pricing algorithms are actually doing, is where the agency has planted its jurisdictional flag.

The proposed statement would require three “clearly and conspicuously” disclosed elements, according to Holland & Knight’s summary. Vague marketing formulations such as “specially selected” would be treated as insufficient. WilmerHale’s analysis notes a second theory sitting inside the statement: collecting or using personal data for pricing without adequate disclosure or consent can itself be an unfair or deceptive practice under Section 5, independent of what price a shopper eventually sees.

Holland & Knight is telling clients to audit pricing algorithms, including tools operated by outside vendors, and to check whether existing consent language actually covers pricing use rather than generic personalization.

The federal action is arriving after the states, not ahead of them. Maryland’s ban on surveillance pricing by food retailers and Connecticut’s disclosure requirement both take effect in October 2026, per Holland & Knight. New Jersey’s Fair Price Protection Act was signed July 23. New York’s One Fair Price Act has cleared the legislature and awaits the governor’s signature.

That sequencing echoes the state-first pattern that shaped consumer privacy after California’s 2018 C.C.P.A., when Washington spent years catching up to rules already binding on national retailers. The F.T.C. isn’t banning the practice. It’s insisting the practice be legible to the people subject to it, which in commercial history is often the harder ask.

Sources