Price Gouging Prevention Act of 2024
Section 1: Title
This Act shall be known as the “Price Gouging Prevention Act of 2024.”
Section 2: Definitions
For the purposes of this Act:
- “Price Gouging” is defined as raising the price of products, commodities, or services without a reasonable basis related to cost increase, particularly during periods of heightened demand due to natural disasters, holidays, or artificially manipulated decreases in supply. Specifically, price gouging occurs when the increase in price exceeds the percentage increase in the cost to produce or acquire the product or service.
- “Reasonable Basis” refers to a cost increase that corresponds directly to the actual increase in production, acquisition, or supply chain costs. Any price increase not substantiated by an equivalent or greater increase in the cost to produce or acquire the item is considered gouging.
Section 3: Prohibition of Price Gouging
- Price Increase Limitation:
- No business or entity shall increase the price of any product, commodity, or service by a percentage greater than the percentage increase in the cost to produce or acquire said product, commodity, or service.
- Exceptions:
- This Act does not apply to price adjustments based on general inflation rates, regular business adjustments not related to specific demand spikes, or pre-approved contractual agreements.
Section 4: Enforcement and Compliance
- Investigation and Reporting:
- The Federal Trade Commission (FTC) shall oversee investigations into suspected price gouging practices. Consumers or businesses can report suspected violations to the FTC.
- Evidence of Violation:
- Evidence of price gouging may include but is not limited to price increase records, production cost changes, supply chain costs, and comparative pricing data before and after significant demand spikes.
Section 5: Penalties for Violation
- Fines:
- Any business or entity found in violation of this Act shall be subject to fines. Fines shall be calculated based on the amount of revenue gained through price gouging and can range up to 50% of the revenue obtained from the inflated prices.
- Business License Revocation:
- In addition to fines, businesses found to be repeatedly or egregiously violating this Act may face the revocation of their business license and be prohibited from operating until compliance is demonstrated.
- Criminal Penalties:
- Severe or repeated violations may result in criminal charges against the responsible individuals, which may include imprisonment of up to five years.
Section 6: Implementation and Review
- Effective Date:
- This Act shall take effect 180 days after its enactment to allow for the establishment of enforcement mechanisms and compliance procedures.
- Review and Amendment:
- The Act shall be reviewed every five years to assess its effectiveness. Amendments may be proposed to address any emerging issues or changes in market dynamics.
Section 7: Public Awareness
- Education Campaign:
- The FTC shall conduct a public education campaign to inform businesses and consumers about price gouging, their rights, and the mechanisms for reporting suspected violations.
- Disclosure Requirements:
- Businesses must provide clear information on pricing structures and cost increases to consumers, demonstrating compliance with this Act.
Section 8: Severability
- Severability Clause:
- If any provision of this Act is found to be invalid or unenforceable, the remaining provisions shall continue in full force and effect.
End of Act
The Price Gouging Prevention Act of 2024 aims to protect consumers from unfair price increases during periods of heightened demand and ensures that any price adjustments are justified by corresponding increases in production or acquisition costs. The Act provides clear definitions, enforcement mechanisms, and penalties for violations to maintain fair market practices and consumer protection.
