Canada Moves to Restrict 'Surveillance Pricing' in Major Privacy Law Update

The era of the internet knowing exactly how much you are willing to pay for a product—and charging you precisely that amount—may soon face a strict legal boundary in Canada. On Monday, Prime Minister Mark Carney and Artificial Intelligence Minister Evan Solomon introduced sweeping legislation to update the country's privacy laws.[1]

At the heart of the new framework is a crackdown on "surveillance pricing," a practice where companies use vast troves of personal consumer data to algorithmically generate custom, often higher, prices for individual shoppers.[1]

The proposed rules aim to fundamentally shift the balance of power in digital commerce. By establishing the Digital Safety and Data Protection Commission of Canada, the government intends to prevent corporations from weaponizing user data for localized price gouging.

To understand the stakes, it is necessary to unpack how surveillance pricing—also known as algorithmic pricing—actually functions in the modern retail ecosystem.

Unlike traditional dynamic pricing, which changes based on broad supply and demand (like an airline ticket getting more expensive as the flight fills up), surveillance pricing is deeply personal.

Algorithms ingest thousands of data points about an individual user. This can include their browsing history, precise geolocation, the type of device they are using, their past purchase behavior, and even inferred income levels.

By synthesizing this digital footprint, companies can estimate a consumer's maximum willingness to pay. If the algorithm detects that a user is shopping from an affluent neighborhood or urgently searching for a specific item, it may quietly inflate the price displayed on their screen compared to what another user might see.[1]

"Companies should not have the ability to use your behavior, your location, your profile, your vulnerabilities, or your personal information to charge unfair prices," Solomon told reporters during the announcement.

Public sentiment strongly backs intervention. A recent poll conducted by Abacus Data revealed that roughly half of all Canadians believe surveillance pricing should be entirely banned, while nearly a third argue it should be allowed but subjected to strict regulations.

However, the federal government opted against a blanket prohibition, choosing instead to introduce a "principle-based bill."

The legislation grants the newly proposed regulator the authority to define specific rules and intervene specifically when the harms of algorithmic pricing outweigh the benefits.

This nuanced approach is designed to protect a staple of Canadian retail: loyalty programs. Solomon explicitly noted that the government does not want to penalize companies for rewarding consumers with lower prices through opt-in points systems or member discounts.

The Canadian initiative is part of a broader, emerging global pushback against data-driven price discrimination.[1]

Within North America, smaller jurisdictions have already taken the lead. Manitoba's provincial government recently introduced legislation to outlaw surveillance pricing entirely.

South of the border, a new law in Maryland makes it explicitly illegal for grocers and third-party delivery applications to leverage personal data to charge higher prices to specific users.

Tech and cybersecurity analysts note that these legislative updates are long overdue. As AI systems become more sophisticated, the capacity to exploit consumer data scales exponentially, leaving older regulatory frameworks obsolete.

"Right now, we're dealing with 21st-century problems with 20th-century frameworks," noted tech analyst Ritesh Kotak, emphasizing the need for robust modernization.

The new Digital Safety and Data Protection Commission is expected to take up to 18 months to become fully operational, though the government retains the power to enforce specific provisions sooner. As the digital economy braces for these new guardrails, the legislation marks a critical step toward ensuring that the algorithms powering modern commerce serve consumers rather than exploit them.