[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7825 Introduced in House (IH)]
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118th CONGRESS
2d Session
H. R. 7825
To direct the Federal Trade Commission to issue regulations to
establish shrinkflation as an unfair or deceptive act or practice, and
for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 26, 2024
Ms. Perez (for herself and Mr. Deluzio) introduced the following bill;
which was referred to the Committee on Energy and Commerce
_______________________________________________________________________
A BILL
To direct the Federal Trade Commission to issue regulations to
establish shrinkflation as an unfair or deceptive act or practice, and
for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Shrinkflation Prevention Act of
2024''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) According to the Bureau of Economic Analysis, from the
third quarter of 2020 to the second quarter of 2022, corporate
profits rose by 75 percent, and Federal Reserve research found
that 42 percent of inflation over that same time period went
toward greater corporate profits.
(2) Shrinkflation, or product downsizing, occurs when a
company decreases the amount or size of a consumer product and
charges the same price, or a higher price, for such smaller
product.
(3) Companies seek to deceive consumers when they practice
shrinkflation without clearly disclosing the size change and
per unit price increase of a product.
(4) According to the Bureau of Labor Statistics, roughly 10
percent of inflation in some consumer product categories is
driven by shrinkflation.
(5) Deceptive shrinkflation tactics allow companies to
profit off unaware consumers, as academic research shows that
consumers are less sensitive to changes in product size than to
changes in price.
(6) Shrinkflation is disrupting the ability of families in
the United States to save money.
SEC. 3. PROHIBITION OF SHRINKFLATION.
(a) Definition of Shrinkflation.--
(1) In general.--In this Act, the term ``shrinkflation''
means the practice of downsizing, or reducing the amount or
size of a consumer product (as defined in section 101 of the
Magnuson-Moss Warranty--Federal Trade Commission Improvement
Act (15 U.S.C. 2301)) while not decreasing the price of such
product by a commensurate amount.
(2) Modifications.--The Federal Trade Commission (in this
section referred to as the ``Commission'') may promulgate
regulations under section 553 of title 5, United States Code,
to modify the definition in paragraph (1) as the Commission
considers appropriate.
(b) Prohibition.--Not later than 18 months after the date of
enactment of this Act, the Commission shall promulgate regulations
under section 553 of title 5, United States Code, to prohibit any
manufacturer from engaging in shrinkflation.
SEC. 4. ENFORCEMENT.
(a) Enforcement by the Commission.--
(1) Unfair or deceptive acts or practices.--A violation of
a regulation promulgated under section 3(b) shall be treated as
a violation of a rule defining an unfair or deceptive act or
practice under section 18(a)(1)(B) of the Federal Trade
Commission Act (15 U.S.C. 57a(a)(1)(B)).
(2) Powers of the commission.--
(A) In general.--The Commission shall enforce the
regulations promulgated under section 3(b) in the same
manner, by the same means, and with the same
jurisdiction, powers, and duties as though all
applicable terms and provisions of the Federal Trade
Commission Act (15 U.S.C. 41 et seq.) were incorporated
into and made a part of this Act.
(B) Privileges and immunities.--Any person who
violates a regulation promulgated under section 3(b)
shall be subject to the penalties and entitled to the
privileges and immunities provided in the Federal Trade
Commission Act (15 U.S.C. 41 et seq.).
(C) Authority preserved.--Nothing in this Act shall
be construed to limit the authority of the Commission
under any other provision of law.
(D) Rulemaking.--The Commission shall promulgate in
accordance with section 553 of title 5, United States
Code, such rules as may be necessary to carry out this
Act.
(b) Enforcement by States.--
(1) In general.--In any case in which the attorney general
of a State has reason to believe that an interest of the
residents of the State has been or is threatened or adversely
affected by the engagement of any person in a practice that
violates a regulation promulgated under section 3(b), the
attorney general of the State may, as parens patriae, bring a
civil action on behalf of the residents of the State in an
appropriate district court of the United States--
(A) to enjoin further violation of such regulation
by such person;
(B) to compel compliance with such regulation;
(C) to obtain a permanent, temporary, or
preliminary injunction;
(D) to obtain civil penalties;
(E) to obtain damages, restitution, or other
compensation on behalf of such residents; or
(F) to obtain any other equitable relief deemed
appropriate by the court.
(2) Rights of the commission.--
(A) Notice to the commission.--
(i) In general.--Except as provided in
clause (iii), the attorney general of a State
shall notify the Commission in writing that the
attorney general intends to bring a civil
action under paragraph (1) not later than 10
days before initiating the civil action.
(ii) Contents.--The notification required
by clause (i) with respect to a civil action
shall include a copy of the complaint to be
filed to initiate the civil action.
(iii) Exception.--If it is not feasible for
the attorney general of a State to provide the
notification required by clause (i) before
initiating a civil action under paragraph (1),
the attorney general shall notify the
Commission immediately upon instituting the
civil action.
(B) Intervention by the commission.--The Commission
may--
(i) intervene in any civil action brought
by the attorney general of a State under
paragraph (1); and
(ii) upon intervening--
(I) be heard on all matters arising
in the civil action; and
(II) file petitions for appeal of a
decision in the civil action.
(3) Investigatory powers.--Nothing in this subsection may
be construed to prevent the attorney general of a State from
exercising the powers conferred on the attorney general by the
laws of the State to conduct investigations, to administer
oaths or affirmations, or to compel the attendance of witnesses
or the production of documentary or other evidence.
(4) Action by the commission.--If the Commission institutes
a civil action or an administrative action with respect to a
violation of a regulation promulgated under section 3(b), the
attorney general of a State may not, during the pendency of
such action, bring a civil action under paragraph (1) against
any defendant named in the complaint of the Commission for the
violation with respect to which the Commission instituted such
action.
(5) Venue; service of process.--
(A) Venue.--Any action brought under paragraph (1)
may be brought in--
(i) the district court of the United States
that meets applicable requirements relating to
venue under section 1391 of title 28, United
States Code; or
(ii) another court of competent
jurisdiction.
(B) Service of process.--In an action brought under
paragraph (1), process may be served in any district in
which the defendant--
(i) is an inhabitant; or
(ii) may be found.
(6) Actions by other state officials.--
(A) In general.--In addition to civil actions
brought by attorneys general under paragraph (1), any
other official of a State who is authorized by the
State to do so may bring a civil action under paragraph
(1), subject to the same requirements and limitations
that apply under this subsection to civil actions
brought by attorneys general.
(B) Savings provision.--Nothing in this subsection
may be construed to prohibit an authorized official of
a State from initiating or continuing any proceeding in
a court of the State for a violation of any civil or
criminal law of the State.
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