H.R.2427 - Stop Disaster Price Gouging Act (119th Congress)
Summary
H.R. 2427, the Stop Disaster Price Gouging Act, aims to prevent unfair price increases of essential goods and services during major disasters or emergencies. It prohibits price increases exceeding 10% for essential consumer goods, hotel lodging, and residential rental properties for 30 days, and for repair or reconstruction services for 180 days after a disaster declaration. The bill also prevents charging prices more than 50% greater than the person's cost if that price was not charged before the disaster.
Expected Effects
The bill empowers the Federal Trade Commission (FTC) to enforce these provisions, treating violations as unfair or deceptive acts. States can also bring civil actions on behalf of their residents. A private right of action is created, allowing individuals harmed by price gouging to sue for damages.
Potential Benefits
- Protects consumers from exploitation during vulnerable times.
- Provides legal recourse for victims of price gouging.
- Encourages fair pricing practices during emergencies.
- Empowers states and the FTC to take action against price gougers.
- Deters businesses from engaging in unethical pricing behavior.
Potential Disadvantages
- May create administrative burdens for businesses to track and justify price changes.
- Could lead to disputes over what constitutes a 'reasonable' price increase.
- Potential for unintended consequences if businesses reduce supply in anticipation of price controls.
- Possible challenges in enforcing the law across different states and jurisdictions.
- Risk of chilling legitimate business activity during disaster recovery.
Most Disadvantaged Areas:
Constitutional Alignment
The bill aligns with the Commerce Clause (Article I, Section 8) by regulating economic activity that affects interstate commerce during national emergencies. It does not appear to infringe upon individual liberties protected by the Bill of Rights. The Tenth Amendment is also relevant, as the bill allows states to bring actions, but also provides a role for the Federal Trade Commission, creating a balance between federal and state power.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).