(The Center Square) – An ordinance passed by the Seattle City Council will ban large grocery store chains from using customer data and AI to calculate individual pricing.
Seattle Mayor Katie Wilson backs the plan and is expected to sign legislation approved by the council on Tuesday in the next several days.
Grocery store chains, however, warn the legislation could actually result in higher prices.
The ordinance stems from the findings of a 2025 Consumer Reports investigation. The media and consumer advocacy organization said it found that algorithmic pricing at major retailers resulted in price differences of up to 23% for the same groceries.
CR said it had nearly 400 consumers shop for the same basket of goods at the same time using Instacart.
It said its analysis of the shopping data found that consumers were quoted different prices for the same products from the same store at the same time.
CR served as a technical advisor to the city in developing the ordinance.
The new Seattle policy requires grocery stores and online shopping services to post prices clearly and make them equally available, while restricting AI-driven “surveillance pricing.”
The measure is scheduled to go into effect on September 1, 2027.
“Food is an essential good that’s getting more expensive all the time,” Wilson said in a press release after the City Council passed the law. “People have been clear: they don’t want their data fed into algorithms that decide how much they pay at the grocery store. Everyone deserves transparent pricing and equal treatment, not hidden systems that charge some shoppers more than others.”
Seattle would be the first city in the United States to pass a ban on algorithm-based grocery pricing, but the measure follows state-level legislation addressing surveillance pricing in Maryland, Connecticut, and New Jersey.
Supermarket chains have heavily lobbied against the legislation.
Safeway stores across Seattle posted in-store warning signs directing customers to an industry-backed campaign website. The campaign said Seattle families could lose an average of $100 a month in discounts if the ordinance moved forward by eliminating targeted promotions aimed at saving shoppers money.
Safeway spokeswoman Sara Osborne said Wednesday that the law will have a negative effect on Seattle consumers.
“We strongly disagree with the Seattle City Council’s decision to pass this legislation,’ she said. “Safeway does not engage in the pricing practices this ordinance claims to address, yet the measure will restrict personalized deals that help customers save on groceries.”
Osborne said the problem with the new policy is that it fails to distinguish between raising prices and using customer information to deliver discounts.
“We will, of course, comply with all applicable laws and regulations, but we do not support legislation that makes it harder for customers to save,” she said.
City Councilmember Alexis Mercedes Rinck, who sponsored the legislation, said grocery corporations should not use personal information to boost profits.
“Groceries are getting more expensive for everyday Seattleites, while the buying, selling and leveraging our private information to manipulate prices is making big national grocery corporations millions in profits,” Rinck said.
The council passed the resolution Tuesday by a 7-2 margin with Councilmembers Maritza Rivera and Bob Kettle voting no.
Rivera said in a statement that she voted no because she feared some supermarket savings programs would be eliminated.
“It’s now very possible those programs will go away, and groceries could become even more expensive,” she said. “I have heard from consumers in my district and across the City who don’t want this and think that the Council is meddling in a way that could hurt rather than help them. This is an overly broad ordinance that has the potential to backfire. This is why I cannot and do not support it.”