Summary — HB 970 (2025): Preventing Algorithmic Rent Fixing (North Carolina)
Status & Timeline
- Short title: “Preventing Algorithmic Rent Fixing.”
- Sponsor(s): Representatives Longest, Lopez, Morey, Prather (primary).
- Filed: 2025; Read first time and referred to Rules, Calendar, and Operations of the House (1st Reading: April 14, 2025).
- Effective date (if enacted): October 1, 2025. Applies to acts or omissions occurring on or after that date.
Purpose
- To prohibit the use of certain data-driven pricing coordination tools and services that enable tacit or explicit collusion among residential landlords (real estate lessors) by collecting nonpublic competitor data, analyzing it, and recommending or setting rental prices and other commercial lease terms.
Key provisions
- New Article added to Chapter 42 (Article 8 — Prevention of Algorithmic Rent Fixing).
- Definitions (highlights):
- “Coordinating function”: collecting price/occupancy/lease data from two or more lessors or public databases; computational analysis of that information; recommending rents, lease terms, or occupancy levels; or using pricing algorithms trained with nonpublic competitor data to set rents or other terms.
- “Nonpublic competitor data” and “nonpublic data”: information not widely available or easily accessible, including competitively sensitive pricing or lease-term data provided by another market participant.
- “Pricing algorithm”: any computational process (including machine learning/AI) used to recommend or set prices/terms.
- “Real estate lessor,” “residential dwelling unit,” and “service provider” are defined for scope clarity.
- Prohibitions:
- It is unlawful for any real estate lessor (or their agent/subcontractor) in North Carolina to subscribe to, contract for, or accept anything of value in return for providing or obtaining coordinating functions as defined.
- It is unlawful for any service provider to facilitate agreements among lessors to not compete with respect to residential rentals.
- Enforcement and remedies:
- Violations constitute an unfair or deceptive trade practice under G.S. 75‑1.1.
- Aggrieved parties may bring private causes of action and seek the remedies available under Chapter 75 (civil enforcement mechanisms provided there).
- The North Carolina Attorney General is authorized to enforce the Article.
- At a plaintiff’s election, pre‑dispute arbitration agreements or pre‑dispute waivers of joint/class actions are not valid or enforceable for claims relating to violations of this Article (protects access to class/collective litigation).
Who is affected
- Real estate lessors and their agents (landlords, property managers).
- Third‑party service providers and software vendors offering pricing or analytics tools that collect competitor data or recommend/set rents (including platforms using AI/machine learning).
- Tenants and prospective tenants (indirectly) — intended beneficiary group, through protection from algorithmically coordinated rent increases or rent-fixing.
- Courts and the Attorney General (enforcement actors).
Potential impact and considerations
- Seeks to address “algorithmic tacit collusion” by making certain data‑sharing and algorithmic price‑setting practices unlawful in the residential rental market.
- Could curtail use of pricing products that incorporate nonpublic competitor data or offer coordinated pricing recommendations, prompting compliance adjustments by landlords and software vendors.
- Empowers private suits and AG enforcement; preserves class-action pathways by invalidating pre‑dispute arbitration/joint‑action waivers for these claims.
- Implementation may raise questions about what constitutes “nonpublic” data, acceptable product design for pricing tools, and how courts interpret “coordination” when algorithms operate autonomously.
For readers: This summary focuses on the North Carolina HB 970 entitled “Preventing Algorithmic Rent Fixing.” Documents with the same bill number from other states and on unrelated topics (e.g., insulin step‑therapy laws, chiropractic licensing, toll bridge technical edits) are separate measures and are not part of this North Carolina proposal.
