Maryland is set to become the first US state to ban surveillance pricing in grocery stores and selected grocery delivery services, targeting algorithm-driven systems that can charge different shoppers different prices for identical goods.
Governor Wes Moore is expected to sign the Protection from Predatory Pricing Act into law after approval by state lawmakers, with enforcement beginning on 1 October 2026. The law addresses concerns over the use of personal data, including shopping behaviour and location, to influence the prices of essential goods.
What Is Surveillance Pricing?
Surveillance pricing, also referred to as dynamic pricing or personalised pricing, is a system where retailers use customer data and algorithms to determine what individuals are charged for products. This data can include browsing history, shopping frequency, location, and inferred characteristics such as income level or household size.
The result is that two shoppers may pay different prices for the same item at the same store on the same day. While retailers argue that such systems improve pricing efficiency and reflect demand patterns, critics say the approach relies on opaque data profiling and can produce inconsistent and unfair outcomes, particularly in essential sectors such as food retail.
Maryland Bans Grocery Surveillance Pricing
Under the Protection from Predatory Pricing Act, large grocery retailers in Maryland will be prohibited from using surveillance data to set individualised prices. The law also requires shelf prices to remain fixed for at least one full business day, limiting the ability of stores to adjust prices rapidly using automated systems.
The measures apply to physical supermarkets as well as certain grocery delivery platforms. State officials have framed the legislation as a consumer protection response to growing concerns about algorithmic pricing and the increasing use of digital tools in retail environments.
How the Law Works
The law introduces several restrictions. Retailers are banned from using surveillance data, including shopping history, inferred income, ethnicity, or behavioural tracking, to set different prices for individual customers. Shelf prices must remain consistent for all shoppers for a full day.
However, loyalty programmes and promotional discounts are still allowed, following concessions to the retail industry. Enforcement will be carried out by the Maryland Attorney General, who must issue a written notice and allow a 45-day correction period before action. Fines can reach $10,000 (around £7,400) for first offences and $25,000 (roughly £18,500) for repeat violations.
Industry Reaction and Exemptions
Consumer advocacy groups, including Consumer Reports, supported the ban but said the final law is narrower than initially proposed. Retail industry representatives opposed it, citing concerns over pricing flexibility.
Critics have highlighted the exemption for loyalty programmes, warning it could still enable indirect price differentiation. The debate highlights tensions between consumer protection and data-driven retail pricing strategies.
Wider US Trend in Algorithmic Pricing
Maryland is the first state to enact such a ban, but others are considering similar laws, including California, Colorado, Illinois, and New Jersey. New York has introduced transparency rules. The developments reflect growing scrutiny of algorithmic pricing across retail and concerns over its use in essential goods like groceries.
Regulators and consumer groups are increasingly questioning how far personalised pricing should be allowed to go, especially as digital tools become more common in supermarkets. The issue is now becoming part of a broader policy debate over data use and fairness in everyday retail pricing.
