The CNMC Considers The Plan Of Yolanda Díaz, Who Will Today Ask Supermarkets To Limit Prices, To Be Illegal

DIA supermarkets, in the middle of the process of repositioning of their business model

The Second Vice-President of the Government, Yolanda Díaz, plans to meet this Monday with the distribution sector to ask them to limit the prices of certain products in the shopping basket. Díaz will thus put pressure on the sector to “contribute through its business margins to an affordable and quality basket”.

But on Friday, the National Commission for Markets and Competition (CNMC) advised against this measure, which is “expressly prohibited” by law. The supervisor also warned of “counterproductive effects leading to higher charges”.

CNMC experts have reminded us that both the Competition Act and the Treaty on the Functioning of the EU expressly prohibit agreements or recommendations to fix prices or other commercial conditions that restrict or distort competition. “The fixing of maximum prices between operators, even under the auspices or encouragement of public authorities, is a price agreement prohibited by article 1 of the LDC and article 101 of the TFEU, which the CNMC is obliged to monitor, investigate and sanction”, they explain.

“Even in certain economic contexts similar to the current one, the impossibility for small and medium-sized operators to follow this type of measures could lead to a strengthening of the large operators in the market to the detriment of the rest,” adds the CNMC.

Díaz’s plan to limit prices has divided the government. The Minister for Agriculture, Fisheries and Food, Luis Planas, for example, indicated, when asked about the measure, that “nobody has in their hands, neither from the point of view of common sense nor of the law, the possibility of fixing or indicating prices to distribution operators” and pointed out that reductions in food prices correspond to “autonomous business decisions”.

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The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.