Toronto City Council intends to fight surveillance pricing of groceries – whether or not it has the right to do it.
Councillors on Thursday morning endorsed a proposal, spearheaded by Mayor Olivia Chow, to “identify all possible mechanisms for the City of Toronto to ban and regulate surveillance pricing that increases prices on groceries.”
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Despite some clear concerns about jurisdiction, the vote was a unanimous 26-0 .
While the practice, also called algorithmic personalized pricing, doesn’t appear to be common in Canada, it is becoming a hot political topic amid the rise of AI.
In a letter written with Councillor Alejandra Bravo, Chow defined it as the use of “personal data to change the price of groceries and other items … to charge the customer as much as possible using personal data to determine what each individual will pay.”
Gord Perks, a veteran city councillor, said during the meeting that City Hall has a record of success in drafting bylaws that cross into the scope of a higher jurisdiction.
“Get in front of this freight train,” Perks said.
But Jake Okechukwu Effoduh, an assistant professor at Toronto Metropolitan University’s Lincoln Alexander School of Law, said the big problem is it’s not practical for City Hall to get involved with online grocery pricing.
‘Emerging risk,’ for now
“There’s only so much the city can do,” Effoduh told the Toronto Sun .
It can “set rules” for its properties and official plans, and pick and choose its own vendors, he said.
“It can even do things like require disclosure from licensed businesses, but that’s it,” Effoduh said. “It can’t do any more than that.”
Since surveillance pricing takes place online, that puts it very clearly outside of Toronto’s jurisdiction, he added.
“The city can’t set up a citywide ban to reach every grocer,” Effoduh said. “It’s just not possible.”
City Council didn’t deny that it might not be Toronto’s problem to solve.
“Some of you have asked, do we have the power to do so? I believe so,” Chow said Thursday.
Councillor Dianne Saxe, a lawyer by trade, was more measured, at least from a legal standpoint.
“I do recognize it’s a stretch for the city in terms of our legal authority,” she said, “but I think that’s okay.”
Ultimately, it seems councillors decided the issue was too serious to ignore. Perks and his colleague Mike Colle both brought up the spectre of Canada’s bread fixing scandal as evidence of the potential for abuse.
Effoduh agreed the potential is there but said surveillance grocery pricing is more of an “emerging risk” in Canada.
Effoduh, who wrote an article on the practice published on the news website The Conversation , said there’s “no hard proof about a widespread deployment of surveillance pricing in Canadian grocery – yet.”
“I can’t say it’s not happening, we just don’t have proof that it is happening,” he said. “However, what we know is that the technology does exist … and we also know it’s being used elsewhere,” such as the U.S.
Food as political football
City Council’s vote follows a failed attempt by Don Davies of the federal NDP, with which Chow once served as an MP, to bring in a similar ban through Parliament. At roughly the same time, a similar move by the provincial NDP was rejected at Queen’s Park.
The fact that both upper governments have rejected a ban isn’t good for Chow’s cause, and Effoduh said City Hall would have a tough time convincing a court that this is a battle for a municipality to fight.
Effoduh said Perks wasn’t wrong when he said the city can argue in court that it has jurisdiction over the general welfare of its citizens. However, Effoduh said that interest would likely be found to be “bounded by a genuine local concern, except the city can’t prove that this is genuinely within the ambit of a local issue – which we know it’s not.”
While other jurisdictions, including Manitoba, have drafted rules for surveillance pricing, Effoduh said he’s not aware of a city that has.
An interesting wrinkle is that City Hall intends to run its own grocery stores , possibly opening up a conflict of interest. Effoduh called that an “interesting” thought, although the city appears to only be in the very early stages of its grocery store project.
Even if the city fails to ban surveillance pricing of groceries, Effoduh said, it might make enough noise to discourage it.
“Even just the motion itself, promoting more knowledge about this issue of surveillance pricing, or even to deter grocers who might want to deploy algorithms that will surveillance price, that’s more than enough,” he said. “But in terms of the law, it really can’t do much because it just doesn’t have that power.”
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WHAT CAN YOU DO?
Surveillance pricing of groceries doesn’t appear to be widespread in Canada, but the practice exists. If you’re worried about getting ripped off by the algorithm when shopping online, what can you do?
“There’s not much folks can do,” said Jake Okechukwu Effoduh, of TMU’s Lincoln Alexander School of Law, but “general privacy controls” are a good first step. Be aware of what apps you’re logged into and check the settings to see what they might be tracking.
“I tell people, if you see a price (and) you’re kind of like, hmm, this doesn’t add up or this doesn’t look like what I purchased last time, use a different device. Use your kid’s phone,” Effoduh said. “Just check the price to see if it’s different.”
Another idea: Try logging out of your account, if you’re signed into one, and check if the price changes.
One of the surest ways to avoid surveillance pricing is one of the oldest, Effoduh said: Just shop offline.
“There’s a lot the algorithms can do,” Effoduh said. “There’s a lot the algorithms can track.”
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