WHAT THIS BILL REGULATES · 3 REQUIREMENT TYPES
How Is This Bill Enforced
Verbatim statutory text on the left; plain-language analysis and a per-section checklist on the right. Numbered markers cross-link to the matching checklist row.
This chapter shall be known, and may be cited, as the "California Preventing Algorithmic Collusion Act of 2025."
This section establishes the short title of the chapter as the "California Preventing Algorithmic Collusion Act of 2025." It creates no compliance obligations.
(a)–(g) For purposes of this chapter, the following definitions apply: (a) "Antitrust lawsAntitrust laws"Antitrust laws" has the same meaning as defined in the Clayton Act (15 U.S.C. Sec. 12), and includes Section 45 of Title 15 of the United States Code, and this part, including provisions commonly known as the Cartwright Act (Chapter 2 (commencing with Section 16700)).Bus. & Prof. Code § 17371(a)" has the same meaning as defined in the Clayton Act (15 U.S.C. Sec. 12), and includes Section 45 of Title 15 of the United States Code, and this part, including provisions commonly known as the Cartwright Act (Chapter 2 (commencing with Section 16700)). (b) "Commercial termCommercial term"Commercial term" means any of the following: (1) Level of service. (2) Availability. (3) Output, including quantities of products produced or distributed or the amount or level of service provided. (4) Rebates or discounts made available.Bus. & Prof. Code § 17371(b)" means any of the following: (1) Level of service. (2) Availability. (3) Output, including quantities of products produced or distributed or the amount or level of service provided. (4) Rebates or discounts made available. (c) "Competitor dataCompetitor data"Competitor data" includes nonpublic and public information, when the public information, through aggregation and algorithmic processing becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data. For purposes of this subdivision, public information becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data if it enables an inference or prediction of a competitor's pricing, output, or strategic behavior in a way that facilitates tacit or explicit coordination.Bus. & Prof. Code § 17371(c)" includes nonpublic and public information, when the public information, through aggregation and algorithmic processing becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data. For purposes of this subdivision, public information becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data if it enables an inference or prediction of a competitor's pricing, output, or strategic behavior in a way that facilitates tacit or explicit coordination. (d) "DistributeDistribute"Distribute," "distribution," and "distributing" include selling, licensing, providing access to, or otherwise making available by any means, including through a subscription or the sale of a service.Bus. & Prof. Code § 17371(d)," "distribution," and "distributing" include selling, licensing, providing access to, or otherwise making available by any means, including through a subscription or the sale of a service. (e) "PersonPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e)" has the same meaning as defined in Section 16702. (f) "PricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f)" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided. (g) "Pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g)" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a pricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) or commercial termCommercial term"Commercial term" means any of the following: (1) Level of service. (2) Availability. (3) Output, including quantities of products produced or distributed or the amount or level of service provided. (4) Rebates or discounts made available.Bus. & Prof. Code § 17371(b) within the jurisdiction of this state.
This section defines the key terms used throughout the chapter. Most notable is the definition of competitor data, which extends beyond nonpublic information to capture public information that, through aggregation and algorithmic processing, becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data — specifically where it enables inferences about a competitor's pricing, output, or strategic behavior in a way that facilitates coordination. The definition of pricing algorithm is also broad, encompassing any computational process — including machine learning and AI — that recommends or sets prices or commercial terms. The definition of price explicitly includes employee and independent contractor compensation.
(a) 1 Upon written request by the Attorney General, pursuant to the investigatory authority granted under Section 11180 of the Government Code, a personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) shall, no later than 30 days after the date of the written request or any later date approved by the Attorney General, provide to the Attorney General information related to pricing algorithmsPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g).
(b) Nothing in this section shall be construed to limit or impair the Attorney General's authority under existing law, including, but not limited to, the Government Code and the antitrust lawsAntitrust laws"Antitrust laws" has the same meaning as defined in the Clayton Act (15 U.S.C. Sec. 12), and includes Section 45 of Title 15 of the United States Code, and this part, including provisions commonly known as the Cartwright Act (Chapter 2 (commencing with Section 16700)).Bus. & Prof. Code § 17371(a) described in Section 17371.
(c)(1)–(2) 2 The chief executive officer, chief economist, chief technology officer, or a corporate officer of similar authority of a personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) shall certify the accuracy of a report under subdivision (a). (2) Knowingly certifying the accuracy of false information under subdivision (a) shall be subject to a civil penalty of not more than one thousand five hundred dollars ($1,500), in addition to any other civil remedies at law or equity that might be available.
This section empowers the Attorney General to compel production of information related to pricing algorithms through written requests issued under existing investigatory authority (Government Code § 11180). Persons must respond within 30 days or a later approved date. Subdivision (b) is a savings clause preserving the Attorney General's existing investigatory powers. Subdivision (c) requires a senior corporate officer to certify the accuracy of any report, with a civil penalty of up to $1,500 for knowingly certifying false information — in addition to any other available civil remedies.
(a) 3 A personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) shall not use or distributeDistribute"Distribute," "distribution," and "distributing" include selling, licensing, providing access to, or otherwise making available by any means, including through a subscription or the sale of a service.Bus. & Prof. Code § 17371(d) any pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) that uses, incorporates, or was trained with competitor dataCompetitor data"Competitor data" includes nonpublic and public information, when the public information, through aggregation and algorithmic processing becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data. For purposes of this subdivision, public information becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data if it enables an inference or prediction of a competitor's pricing, output, or strategic behavior in a way that facilitates tacit or explicit coordination.Bus. & Prof. Code § 17371(c).
(b) 4 A personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) shall not distributeDistribute"Distribute," "distribution," and "distributing" include selling, licensing, providing access to, or otherwise making available by any means, including through a subscription or the sale of a service.Bus. & Prof. Code § 17371(d) a pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g), or make recommendations based on the use of a pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) that uses, incorporates, or was trained with competitor dataCompetitor data"Competitor data" includes nonpublic and public information, when the public information, through aggregation and algorithmic processing becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data. For purposes of this subdivision, public information becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data if it enables an inference or prediction of a competitor's pricing, output, or strategic behavior in a way that facilitates tacit or explicit coordination.Bus. & Prof. Code § 17371(c), to two or more personsPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) with the intent or reasonable expectation that the pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) or its recommendations be used to set the pricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) or commercial term of a product or service in the same market or a related market.
(c) 5 A personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) shall not use a pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) or the recommendation of a pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) that uses, incorporates, or was trained with competitor dataCompetitor data"Competitor data" includes nonpublic and public information, when the public information, through aggregation and algorithmic processing becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data. For purposes of this subdivision, public information becomes functionally equivalent to nonpublic, proprietary, or competitively sensitive data if it enables an inference or prediction of a competitor's pricing, output, or strategic behavior in a way that facilitates tacit or explicit coordination.Bus. & Prof. Code § 17371(c) to set a pricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) or commercial term of a product or service if the pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) or the recommendation of the pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) was used by another personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) to set or recommend a pricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) or commercial term of a product or service in the same market or a related market.
This section establishes the bill's core prohibitions. Subdivision (a) is the broadest: no person may use or distribute any pricing algorithm that uses, incorporates, or was trained with competitor data. Subdivision (b) targets distributors who make competitor-data-tainted algorithms or recommendations available to two or more persons with the intent or reasonable expectation that they will be used to set prices in the same or related market — the classic hub-and-spoke coordination pattern. Subdivision (c) targets downstream users who knowingly set prices using an algorithm or recommendation that another person in the same or related market also used — the parallel-use coordination pattern. Together, these three subdivisions cover the developer/distributor, the intermediary coordinator, and the downstream user across the algorithmic collusion chain.
(a)(1)–(5) The Attorney General or a district attorney may bring a civil action for a violation of Section 17373 in any court of competent jurisdiction to seek to recover, as applicable, one or more of the following: (1) A civil penalty of one of the following: (A) Not less than ten thousand dollars ($10,000), adjusted for inflation on the basis of the California Consumer PricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) Index, for each day during which the violation occurred or continues to occur. (B) The sum of the price of each product or service sold using the pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) in violation of subdivision (a). (2) Forfeiture of charter rights, franchises, or privileges and powers exercised by a defendant corporation or association, and for the dissolution of the corporation or association. (3) Revocation of the powers, franchises, or functions of a defendant foreign corporation or association. Upon the revocation, the foreign corporation or association shall be prohibited from doing any business in this state. Upon receipt of a certified copy of the judgment and decree of any court of competent jurisdiction finding any foreign corporation or association guilty of violating this chapter and ordering a revocation of its powers, franchises, or functions of a corporation in this state, the Secretary of State shall revoke the license of any such corporation or association heretofore authorized to do business in this state. (4) Reasonable attorney's fees and costs. (5) Other appropriate relief, including an injunction or other equitable relief.
(b) Any injunction against a violation of this chapter, whether interim or final, shall cover every article, product, or service, and not merely the particular article, product, or service involved in the action. For purposes of this subdivision, "article, product, or service" includes, among other things, a pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g).
(c) Any personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e), who, either as a director, officer, or agent of any firm or corporation or as an agent of any personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e), violating the provisions of this chapter, assists or aids, directly or indirectly, in that violation is responsible therefor equally with the personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e), firm, or corporation for which they act.
(d) Nothing in this section shall impair or limit the applicability of antitrust lawsAntitrust laws"Antitrust laws" has the same meaning as defined in the Clayton Act (15 U.S.C. Sec. 12), and includes Section 45 of Title 15 of the United States Code, and this part, including provisions commonly known as the Cartwright Act (Chapter 2 (commencing with Section 16700)).Bus. & Prof. Code § 17371(a).
This section provides the enforcement framework for violations of the competitor-data prohibitions in Section 17373. The Attorney General or a district attorney may bring civil actions seeking per-day civil penalties (not less than $10,000/day, CPI-adjusted) or the aggregate price of all products or services sold using the violating algorithm. Equitable remedies include corporate charter forfeiture and dissolution, revocation of foreign corporation privileges, injunctive relief, and reasonable attorney's fees and costs. Subdivision (c) extends personal liability to directors, officers, and agents who assist in violations. The savings clause in subdivision (d) preserves existing antitrust law applicability.
(a)(1)–(2) 6 A personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) that has five million dollars ($5,000,000) or more in annual revenue that uses a pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) to recommend or set a pricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) or commercial termCommercial term"Commercial term" means any of the following: (1) Level of service. (2) Availability. (3) Output, including quantities of products produced or distributed or the amount or level of service provided. (4) Rebates or discounts made available.Bus. & Prof. Code § 17371(b) shall make, in a clear manner, the following disclosures: (1) To a customer, before the customer purchases the relevant product or service, that the pricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) or a commercial termCommercial term"Commercial term" means any of the following: (1) Level of service. (2) Availability. (3) Output, including quantities of products produced or distributed or the amount or level of service provided. (4) Rebates or discounts made available.Bus. & Prof. Code § 17371(b), as applicable, is set or recommended by a pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g). (2) To a current or prospective employee or independent contractor that the pricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) or commercial termCommercial term"Commercial term" means any of the following: (1) Level of service. (2) Availability. (3) Output, including quantities of products produced or distributed or the amount or level of service provided. (4) Rebates or discounts made available.Bus. & Prof. Code § 17371(b) for services rendered as an employee or independent contractor is set or recommended by a pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g).
(b)(1)–(2) 7 If applicable, a disclosure under subdivision (a) shall state that the pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) sets or recommends different pricesPrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) for the following: (A) Different customers seeking identical or nearly identical products or services. (B) Employees or independent contractors providing substantially similar services. (2) If applicable, a disclosure under subdivision (a) shall do both of the following: (A) State that the pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g) was developed or distributed by a personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) other than the personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) making the disclosure. (B) Provide the identity of the personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) that developed or distributed the pricing algorithmPricing algorithm"Pricing algorithm" means any computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price or commercial term within the jurisdiction of this state.Bus. & Prof. Code § 17371(g).
(c)(1)–(2) If the Attorney General has reason to believe that a personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) has violated subdivision (a) or (b), the Attorney General may bring a civil action against the personPerson"Person" has the same meaning as defined in Section 16702.Bus. & Prof. Code § 17371(e) in any court of competent jurisdiction in this state to seek to recover one or both of the following: (1) A civil penalty of not less than five thousand dollars ($5,000), adjusted for inflation on the basis of the California Consumer PricePrice"Price" means the amount of money or other thing of value, whether tangible or not, expected, required, or given in payment for any product or service, including compensation paid to an employee or independent contractor for services provided.Bus. & Prof. Code § 17371(f) Index, for each day during which the violation occurs or continues to occur. (2) Other appropriate relief, including an injunction or other equitable relief.
(d) Nothing in this section shall impair or limit the applicability of antitrust lawsAntitrust laws"Antitrust laws" has the same meaning as defined in the Clayton Act (15 U.S.C. Sec. 12), and includes Section 45 of Title 15 of the United States Code, and this part, including provisions commonly known as the Cartwright Act (Chapter 2 (commencing with Section 16700)).Bus. & Prof. Code § 17371(a).
This section imposes disclosure obligations on persons with $5,000,000 or more in annual revenue who use pricing algorithms to recommend or set prices or commercial terms. Two core disclosures are required: customers must be told before purchase that the price or commercial term is set or recommended by a pricing algorithm, and current or prospective employees or independent contractors must be told the same regarding their compensation. Additional conditional disclosures apply when the algorithm sets differential prices for similar customers or similar workers, and when the algorithm was developed or distributed by a third party. Enforcement is through the Attorney General only, with civil penalties of not less than $5,000/day (CPI-adjusted).
A contract that violates a provision of this chapter is to that extent void.
This section provides that any contract violating a provision of this chapter is void to the extent of the violation. This is a standard contract-voiding provision that operates as a consequence of the substantive prohibitions rather than creating an independent compliance obligation.