This bill aims to expand consumer protection laws related to price gouging, particularly during disasters, by broadening the scope of what constitutes an unfair practice. Here's a breakdown of the key provisions:
Price Gouging as an Unfair Act:
The bill adds price gouging in the sale of necessities to the list of unfair and unconscionable acts in violation of consumer protection laws. This aligns with existing laws that already cover price gouging during declared disasters.
Price Gouging Presumption:
The bill establishes a presumption that price gouging occurs when the price of a necessity increases by 10% or more above the average price of that necessity in the 90 days prior to the price hike.
If a business raises the price by this amount, it is presumed to be price gouging unless they can demonstrate otherwise.
Definition of Necessities:
The bill defines "necessities" as goods or services that are essential for the health, safety, and welfare of consumers or the general public. This could include things like food, water, medicine, or fuel during emergencies.
Summary
Under current law, a person engages in an unfair and
unconscionable act or practice in violation of consumer protection laws (unfair act) if the person engages in price gouging during a declared disaster. The bill adds engaging in price gouging in the sale of necessities as an unfair act and creates a presumption that, if the price of a necessity is increased by 10% or more above the average price that the necessity cost during the 90 days preceding the price increase, the price increase amounts to price gouging. The bill also defines necessities as goods or services that are
necessary for the health, safety, and welfare of consumers or of the general public.
