Coronavirus: Gov. Newsom issues executive order to thwart price gouging

Gov. Gavin Newsom issued an executive order Friday that prohibits price gouging of certain items in the state of California for the next five months.

The order will restrict businesses and people from raising the price of goods including food items, medical or emergency supplies and materials designated as “scarce” or “threatened” in the Defense Production Act by more than 10 percent based on the prices those items were offered at on Feb. 4, 2020.

Some of the items labeled as “scarce” or “threatened” include personal protective equipment (PPE) such as N-95 facemaks, coveralls, surgical gowns and ventilators.

Businesses are only permitted to raise the prices of goods such as hand sanitizer or cloth facemasks by more than 10 percent through Sept. 4 for two reasons.

The first is if a business can prove the increase is directly attributable to additional costs imposed on the seller by the supplier of an item. The second is if a business was offering an item at a reduced price on Feb. 4, 2020 and can prove the item will not be sold for a price that is greater than 10 percent of its ordinary price.

Under the order, businesses that did not offer items that are prohibited from price gouging on Feb. 4 that are now selling those items are restricted from offering them at an “unconscionably excessive price.”

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