On March 13, 2020, the department issued a press release that provided information to consumers about Wis. Stat. § 100.305, Wisconsin’s “price gouging law,” and how to seek relief through the agency. After three weeks of experience, the department hopes to use collected data to determine if any modifications to the rule must or should be made at this time. 4. Detailed explanation of statutory authority for the rule (including the statutory citation and language):
Wis. Stat. § 100.305 (2) prohibits selling, or offering to sell, consumer goods or services at unreasonably excessive prices during a period of abnormal economic disruption, the existence of which the governor has certified by executive order. Subsection (3) of the statute directs the department to promulgate rules “to establish formulas and other standards to be used in determining whether a wholesale or retail price is unreasonably excessive.” The statute, in subsection (4m), also provides enforcement and penalties for violations of the law. (2) Prohibition. No seller may sell, or offer to sell, in this state at wholesale or at retail, consumer goods or services at unreasonably excessive prices if the governor, by executive order, has certified that the state or a part of the state is in a period of abnormal economic disruption.
100.305(3) (3) Rules. The department shall promulgate rules to establish formulas or other standards to be used in determining whether a wholesale or retail price is unreasonably excessive. 100.305(4m) (4m) Enforcement; penalty. If a seller violates sub. (2), the department or, after consulting with the department, the department of justice, may do any of the following: 100.305(4m)(a) (a) Issue to the seller a warning notice specifying the action that the seller is required to take in order not to be in violation of sub. (2). 100.305(4m)(b) (b) Commence an action against the seller in the name of the state to recover a civil forfeiture of not more $10,000 or to temporarily or permanently restrain or enjoin the seller from violating sub. (2), or both. Wis. Stat. § 227.24 (1) (a) allows the department to promulgate a rule as an emergency rule without complying with the notice, hearing, and publication requirements under Wis. Stat. ch. 227. Wis. Adm. Code § ATCP ch. 106, Price Gouging during an Emergency, resulted from the rulemaking the Legislature authorized in 2005 Wisconsin Act 450. 5. Estimate of amount of time that state employees will spend developing the rule and of other resources necessary to develop the rule:
The department estimates that it will take approximately 160 staff hours to develop this emergency rule. That calculation includes time required for investigation and analysis, drafting the emergency rule, preparing related documents, coordinating meetings, holding public hearings, and communicating with affected persons and groups. The department will use existing staff to develop this rule.
6. List with description of all entities that may be affected by the proposed rule:
This rule will affect Wisconsin consumers, as well as sellers of consumer goods or services both inside and outside the state of Wisconsin. The effect on out-of-state sellers, however, may be largely dependent on the extent to which this rule encompasses their online sales.
7. Summary and preliminary comparison with any existing or proposed federal regulation that is intended to address the activities to be regulated by the proposed rule:
Due to evolving federal responses to the COVID-19 crisis, it is not yet clear what federal regulations may affect DATCP enforcement of ATCP 106.
8. Anticipated economic impact of implementing the rule (note if the rule is likely to have a significant economic impact on small businesses):
Indeterminate. The economic impact depends on how many complaints about excessive prices the department receives and changes that may be made by temporary, emergency amendments to the current rule. As enforcing the prohibition of price gouging is the reason for the rule, one would expect more costs for investigation and prosecution and additional forfeitures imposed on those violating the law.
Contact Person:
David A. Woldseth
Policy Analyst, Division of Trade and Consumer Protection
Phone: (608) 224-5164
