HR 4720
Cracking Down on Price Gouging Act
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Bill overview
This bill, the Cracking Down on Price Gouging Act, amends the Defense Production Act of 1950 to specifically prohibit price gouging during times of national emergency, such as disease outbreaks, natural disasters, or military conflicts. It defines ‘price gouging’ as selling materials or critical goods at prices grossly exceeding prevailing market prices and establishes a presumption of an unfairly excessive price if the price increases by 10% relative to the pre-emergency price. The bill also expands the definition of ‘critical good’ to include essential medical supplies, energy resources, and other goods vital to public health and safety.
Key provisions
- Expands the definition of ‘critical good’ to include food, medical supplies, energy, and other essential goods.
- Creates a prohibition against selling materials or critical goods at prices grossly exceeding prevailing market prices during emergencies.
- Establishes a 10% price increase presumption as evidence of price gouging.
- Defines ‘acute shortage’ to encompass a wide range of emergencies, including disease, natural disasters, and military conflicts.
- Increases penalties for violating price gouging provisions to a fine of $20,000 or 300% of revenue generated in violation.
Who is affected
- Businesses and individuals selling essential goods and services
- Consumers during times of national emergency
- Government agencies responsible for managing critical resources
Notable changes
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119th CONGRESS — 1st Session
H. R. 4720
IN THE HOUSE OF REPRESENTATIVES
A BILL
To amend the Defense Production Act of 1950 to provide for stricter prohibitions on price gouging of certain materials, and for other purposes.
This Act may be cited as the Cracking Down on Price Gouging Act
.
The Defense Production Act of 1950 (50 U.S.C. 4512) is amended—
in section 102—
by striking In
and inserting the following:
by inserting and price gouging
after prevent hoarding
;
by striking accumulate (1)
and inserting (1) accumulate
;
by striking for the purpose of resale at prices in excess of prevailing market prices
and inserting sell or offer to sell at prices that grossly exceed prevailing market prices for the same or similar materials or critical goods in the trade area or at an unfairly excessive price
;
by striking accumulation.
and inserting accumulation, or any critical good under an acute shortage.
;
by inserting scarce
after designation of
; and
by adding at the end the following:
A price is an unfairly excessive price if there is a gross disparity in the price of a material or critical good at the time of the transaction and the price of the material or critical good immediately prior to—
the effective date of the President designating the material as a scarce material; or
the date on which an acute shortage of the critical good begins.
A presumptive gross disparity includes a 10 percent increase of price relative to—
the effective date of the President designating the material as a scarce material; or
the date on which an acute shortage of the critical good begins.
Notwithstanding paragraphs (1) and (2), a price is not an unfairly excessive price if it is the result of—
a legitimate business need of the seller; or
additional costs outside the control of the seller.
The term acute shortage
means any negative supply impact that is caused by—
a disease;
a pathogen;
a natural disaster;
a military conflict;
terrorism;
supply-chain disruptions;
extreme industry consolidation; or
any other similar exigent constraint.
The term critical good
means—
any consumer food item, good, or service that is used, bought, or rendered primarily for personal, family, or household purposes;
any essential medical or emergency supply or service;
any energy resource, including—
fuel;
electricity; or
home heating oil; or
any other essential good or service used to promote the health, safety, or welfare of the public.
in section 103—
by striking Any
and inserting the following: