Pricing gouging protections advance in Louisiana

| 6/2/2006

The Louisiana Senate has unanimously approved a bill that is intended to protect consumers from being gouged at the fuel pump. It now heads to the House for further consideration.

The National Conference of State Legislatures reports nearly 30 states have some type of price gouging ban with many others pursuing their own rules. The laws in many of those states are triggered by emergency declarations.

Louisiana currently imposes civil fines on merchants who overcharge for goods and services, including fuel, during or in the wake of a declared emergency.

Sponsored by Sen. Francis Heitmeier, D-New Orleans, the bill would criminalize price gouging and make it punishable by up to two years in jail and/or up to a $2,000 fine.

Merchants would be permitted to increase prices if the mark up is consistent with similar goods and services outside the state. They would also be allowed to cover the cost of getting items in preparation for or after a disaster.

Merchants would not be able to charge a price that “grossly exceeds the prices ordinarily charged for comparable goods and services” during or before the disaster.

The rule would take effect during an emergency declared by the governor or a local official. It also would take effect when a named tropical storm or hurricane enters the Gulf of Mexico.

The bill – SB502 – is in the House Criminal Justice Committee.