HB 5307 — AN ACT CONCERNING PRICE GOUGING.

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5307697 General Assembly January Session, 20212021(Reprint ANof ACTFile CONCERNINGNos. PRICE GOUGING.

3 and 628) Substitute House Bill No.

5307 As Amended by House Amendment Schedule "A" Approved by the Legislative Commissioner May 20, 2021 AN ACT CONCERNING PRICE GOUGING.

and (3) "Unconscionably excessive price" means (A) the amount charged by the seller represents a gross disparity between (i) the price for which anitemwassold,rentedsHB5307 or/ leasedimmediatelyFile prior totheprecipitating event and when the precipitating event was reasonably anticipated, and (ii) the price for which such item is being sold, rented or leased during the period in which such precipitating event is in effect, and (B) the amount charged by the seller is not attributable to additional costs LCO \\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-05307-R031 of 2 HB.docx Substitute Bill No.

5307697 incurredsHB5307 byFile theNo. seller in connection with the sale, rental or lease of an item.

697 anitemwassold,rented or leasedimmediately prior totheprecipitating event or when the precipitating event was reasonably anticipated, and (ii) the price for which such item is being sold, rented or leased during the period in which such precipitating event is in effect, and (B) the amount charged by the seller is not attributable to additional costs incurred by the seller in connection with the sale, rental or lease of an item.

The Attorney General shall have exclusive authority to enforce any violation of the provisions of this section.

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697 The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose.

In general, fiscal impacts are based upon a variety of informational sources, including the analyst’s professional knowledge.

Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note State Impact:

Agency Affected Fund-Effect FY 22 $ FY 23 $ Resources of the General Fund GF - Potential See Below See Below Revenue Gain Note:

GF=General Fund Municipal Impact:

None Explanation The bill defines price gouging during declared emergencies and expands the price gouging law resulting in a potential revenue gain to the state described below.

The bill may result in a revenue gain to the resources of the General Fund, to the extent the Office of Attorney General brings actions in Court for violations of the bill’s provisions.

The extent of any revenue gain would depend on the number of cases brought by the Attorney General subject to the $99 fine.

House "A" specifies that the Attorney General shall have the exclusive authority to enforce any violation in the bill which eliminates the potential cost to the Department of Consumer Protection and the State Comptroller.

The Out Years The annualized ongoing fiscal impact identified above would continue into the future subject to the number of violations.

sHB5307 / File No.

697 3 sHB5307 File No.

697 OLR Bill Analysis sHB 5307 (as amended by House "A")* AN ACT CONCERNING PRICE GOUGING.

SUMMARY Thisbilldefinesprice gouging during specifieddeclared emergencies ascharginganunconscionablyexcessiveprice (i.e.,apricethatisgrossly different from the price before the emergency and that is not the result of additional acquisition costs).

It also expands the price gouging law’s application beyond the retail sale of consumer goods to other supply chain transactions (e.g., wholesale) and to rental and lease transactions.

The bill correspondingly extends existing law’s price gouging enforcement provisions to the expanded definition.

By law, price gouging law violators are subject to a fine of up to $99 and deemed to have committed an unfair trade or deceptive practice (see BACKGROUND).

The bill specifies that the attorney general has exclusive authority to enforce the bill’s provisions.

EFFECTIVE DATE:

October 1, 2021 *House Amendment “A” adds the provision making the attorney general responsible for enforcement and clarifies the definition of “unconscionably excessive price.” APPLICABILITY TO ADDITIONAL TRANSACTIONS Under current law, the price gouging law only applies to retail sales;

it does not cover wholesale or supply chain transactions.

The bill extends the prohibition on price gouging to manufacturers, suppliers, wholesalers, and distributors (referred to as “sellers”).

The bill also extends the prohibition on price gouging to rental or sHB5307 / File No.

697 4 sHB5307 File No.

697 lease transactions;

currently, it applies only to sales.

PRICE GOUGING DEFINITION Current law prohibits sellers from increasing the price of any item sold at retail in a location subject to certain emergency declarations while the declaration is in effect, except if the seller can justify doing so as a price fluctuation that occurs during the normal course of business.

The bill replaces this general provision with more specific provisions defining what constitutes prohibited price gouging behavior.

The bill’s prohibition applies during the same emergency declarations as current law (which the bill calls “precipitating events,” see BACKGROUND).