RELATING TO ANTITRUST.

HB2611

HOUSE OF REPRESENTATIVES

H.B. NO.

2611

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

A BILL FOR AN ACT

RELATING
TO ANTITRUST
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

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SECTION 1.
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The legislature finds and declares that the
State is experiencing a severe affordable housing crisis, with the highest
median residential rents in the nation.
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More than half of Hawaii's renter households
are housing cost burdened, meaning they spend more than thirty per cent of
their income on rent, leaving many families economically vulnerable and at risk
of displacement.

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The legislature further finds that
recent national data and enforcement actions indicate that the use of
algorithmic property management and pricing software in the residential rental
market has contributed to artificially inflated rents.
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A 2024 White House Council of Economic
Advisers study titled "The Cost of Anticompetitive Pricing Algorithms in
Rental Housing" estimated that, in 2023, coordinated rents from
algorithmic pricing cost renters in algorithm-utilizing units $70 per month, or
four per cent of rent, on average nationwide.
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In six major metropolitan areas, the cost
exceeded $100 per month.
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The total cost
to renters across the country was approximately $3,800,000,000.

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The legislature also finds that
these software platforms aggregate and analyze competitively sensitive data
from multiple competing landlords � including real-time effective
rents, lease terms, occupancy rates, and other non-public information � and
use shared algorithms to generate pricing recommendations that are widely
adopted across the market.
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This practice
undermines independent pricing decisions and facilitates price-fixing among
competitors.

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The legislature additionally finds
that, according to a 2024 complaint filed by the United States Department of
Justice, certain property management software platforms include coercive
features that discourage deviation from algorithmically recommended prices,
limit rent reductions, and penalize landlords who attempt to price units below
algorithmically suggested levels, thereby reinforcing upward pressure on rents.

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The legislature further finds that
one dominant provider of algorithmic property management and pricing software
serves clients that collectively control approximately ninety per cent of the
investment-grade multifamily rental housing market in the United States.
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Such market concentration magnifies the
anticompetitive effects of shared pricing algorithms and enables rent increases
to spread rapidly and uniformly across large segments of the rental housing
market.
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In a geographically isolated
market such as Hawaii, the impacts of market consolidation have the potential
to dramatically intensify housing insecurity.

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The legislature also finds that
these outcomes exacerbate Hawaii's housing affordability crisis, harm tenants,
and threaten fair competition in the residential rental market.

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Therefore, the purpose of this Act
is to prevent artificially inflated rental prices by prohibiting the use of
algorithmic price-fixing in Hawaii's rental market.

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SECTION 2.
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Chapter 480, Hawaii Revised Statutes, is
amended by adding a new section to be appropriately designated and to read as
follows:

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"
�480-
�
Rent
price-fixing; declared unlawful; civil actions; public education program.
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(a)
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It shall be unlawful and a
violation of this chapter for:

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(1)
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A coordinator
to perform a coordinating function;

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(2)
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A coordinator
to facilitate an agreement among rental property owners that restricts
competition with respect to the pricing, lease terms, or ideal occupancy levels
for residential dwelling units; or

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(3)
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Two or more
rental property owners to engage in consciously parallel pricing coordination.

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(b)
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In
a civil action filed pursuant to this section, a complaint:

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(1)
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Plausibly
pleads a violation of section 480-4(a) if the complaint contains factual
allegations demonstrating that the existence of a contract, combination in the
form of trust or otherwise, or conspiracy in restraint of trade or commerce is
among the realm of plausible possibilities; and

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(2)
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Need not allege
facts tending to exclude the possibility of independent action.

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(c)
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The department of the attorney general shall develop and implement a
public education program to inform the citizens of the State about this
section.
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A component of the public
education program shall include information posted on the website of the
department of the attorney general and the steps a consumer may take if the
consumer suspects a violation of this section.

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(d)
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The department of the attorney general shall adopt rules pursuant to
chapter 91 for the purposes of this section.

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(e)
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For the purposes of this section:

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"Consciously parallel pricing
coordination" means a tacit agreement between two or more rental property
owners to raise, lower, change, maintain, or manipulate pricing for the
purchase or sale of reasonably interchangeable products or services.

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"Coordinating function" means:

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(1)
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Collecting
historical or contemporaneous prices, supply levels, or lease or rental
contract termination and renewal dates of residential dwelling units from two
or more rental property owners;

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(2)
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Analyzing or
processing of the information described in paragraph (1) through use of a
system, software, or process that uses computation, including by using the
information to train an algorithm; and

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(3)
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Recommending
rental prices, lease renewal terms, or ideal occupancy levels to a rental
property owner.

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"Coordinator" means any person who
operates a software or data analytics service that performs a coordinating
function for any rental property owner, including a rental property owner
performing a coordinating function for their own benefit.

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"Residential dwelling unit" means
any house, apartment, accessory unit, or other unit intended to be used as a
primary residence in the State.
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"Residential
dwelling unit" does not include inpatient medical care, licensed long-term
care, or detention or correctional facilities.
"

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SECTION
3
.
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Section 480-16,
Hawaii Revised Statutes, is amended by amending subsection (a) to read as
follows:

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"(a)
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Any person who violates section 480-4, 480-6,
480-9, [
or
] 480-17,
or 480- ,
including any
principal, manager, director, officer, agent, servant, or employee, who had
engaged in or has participated in the determination to engage in an activity
that has been engaged in by any association, firm, partnership, trust
,

or corporation, which activity is a violation of section 480-4, 480-6, 480-9, [
or
]
480-17, [
is punishable if
]
or 480- , shall be
punished as follows in the discretion of the court:

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(1)
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If the person
is
a natural person
,
by a fine not exceeding $100,000 or [
by
]
imprisonment not exceeding three years, or [
by
] both [
such fine and
imprisonment, in the discretion of the court; if
]
; or

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(2)
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If
the
person is not a natural person [
then
]
,
by a fine not exceeding
$1,000,000."

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SECTION 4.
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This Act does not affect rights and duties
that matured, penalties that were incurred, and proceedings that were begun
before its effective date.

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SECTION 5.
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Statutory material to be repealed is
bracketed and stricken.
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New statutory
material is underscored.

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SECTION 6.
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This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

Report Title:

AG;
Antitrust; Rental Housing; Price-fixing; Public Education Program; Penalties

Description:

Prohibits
the use of algorithmic price-setting in Hawaii's rental market.
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Requires the Department of the Attorney
General to develop and undertake a public education program regarding the
prohibition.
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Establishes fines and
penalties.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.