Bill Description: House Bill 203 would regulate and limit how service providers determine their prices. 

Rating: -3

Does it give government any new, additional, or expanded power to prohibit, restrict, or regulate activities in the free market? Conversely, does it eliminate or reduce government intervention in the market?

House Bill 203 would create Section 48-119, Idaho Code, to make it "unlawful for a service provider to facilitate an agreement to diminish competition relating to price, volume of supply, or any other commercial term between two (2) or more providers of a similar good or service."

Prohibiting voluntary agreements between or among market participants is government intervention in the market.

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House Bill 203 would also make it "unlawful for a service provider to use or distribute, or cause to be used or distributed, a pricing algorithm that incorporates nonpublic data from two (2) or more sellers or buyers of a similar good or service or to use or distribute a pricing algorithm with the intent that it be used by two (2) or more sellers or buyers of a similar good or service."

It would also be made "unlawful for a seller or buyer of a good or service to set a price, volume of supply, or any other commercial term through the use of a pricing algorithm that incorporates nonpublic data from two (2) or more providers of a similar good or service or to use a pricing algorithm that is used by one (1) or more other sellers or buyers of a similar good or service."

The bill defines "pricing algorithm" as "any analytical or computational process, including a process derived from machine learning, artificial intelligence, or other mathematical function that recommends or sets a price, volume of supply, or any other commercial term related to the sale or purchase of a good or service."

At its core, an algorithm is just a system to effectively analyze and use data. Attempting to ban the creation and use of algorithms that analyze market conditions and help sellers and service providers set prices and adjust supply accordingly is government intervention in the market. It also infringes on free speech because it effectively prohibits sellers and service providers from communicating certain information, based on how it's processed.

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Does it violate the spirit or the letter of either the United States Constitution or the Idaho Constitution? Examples include restrictions on speech, public assembly, the press, privacy, private property, or firearms. conversely, does it restore or uphold the protections guaranteed in the US Constitution or the Idaho Constitution?

House Bill 203 doubles down on its free speech limitations by saying, "It shall be unlawful for any person to publicly represent a price or commercial term of a good or service that is different than the price or commercial term offered by the buyer or seller of the good or service without authorization of the buyer or seller." [Emphasis added]

The violation of free speech contained in this provision is even more explicit because it would apply to any person with no limitation based on purpose or intent. 

While the intention of this subsection may be to prevent a service provider from providing inaccurate information about its competitors, the broad wording of this bill could potentially apply to clients, prospective clients, and others as well. 

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