Is it really possible to limit the prices of products in the shopping cart as Yolanda Díaz proposes?

Is it really possible to limit the prices of products in the shopping cart as Yolanda Díaz proposes?

The Consumer Price Index (CPI) for August gave a slight respite, but continues to post stratospheric figures. Last month's inflation left a year-on-year rate of 10.4%, and according to estimates it is not expected to fall below two digits in the short term. The high prices of the shopping basket, along with fuel and energy, are behind these data that are suffocating the Spanish. A complicated situation that is forcing institutions to look for measures to try to give a little oxygen.

Initially, the Spanish Government approved a bonus of 20 cents per liter of fuel, although the constant increases in gasoline and diesel have made this aid very slightly noticeable. Later, the European Union recognized the status of 'Iberian exception' to Spain and Portugal, allowing these countries to put a cap on the price of gas. Now the Minister of Labour, Yolanda Diazhas proposed the intervention of the price of «20 or 30 basic products that we guarantee to the citizens».

«There is nothing that stresses people's lives more than not being able to make the shopping basket, and this is happening in our country. The oligopolies in our country are not only in the banking or energy sectors, we have five large food distributors that concentrate 50%«, assured the minister.

Not even a few moments passed when Diaz's proposal was criticized from numerous sectors, even from the same government of which she is a part. "We are in a free market and the Government's measures to combat inflation are going in another direction," assured the spokesperson for the Executive and Minister for Territorial Policy, Isabel Rodríguez.

Is it legal to cap food prices?

Beyond controversies and internal discussions within Moncloa about this idea, the most repeated question at the moment is one: is it legal to put a cap on food prices?

In the first place, said measure is not the sole responsibility of the Ministry of Labour, which is the one chaired by Yolanda Díaz, but would encompass different portfolios with which an agreement would have to be reached, such as Consumption, in the hands of Alberto Garzon (Podemos), and Agriculture, Fisheries and Food, a ministry headed by louis planes (PSOE).

That said, and in line with what Isabel Rodríguez said, capping food prices is contrary to the free market system that governs Spain. And in the event that this idea is finally put into practice, it would be necessary to distinguish between the two ways in which it would be consolidated: if it is done in the form of a law or not.

If it takes the form of a law, putting a limit on the food bill may violate article 38 of the Spanish Constitution. In that section, the freedom of enterprise is reflected in the framework of the market economy.

“Free enterprise is recognized within the framework of the market economy. The public powers guarantee and protect their exercise and the defense of productivity, in accordance with the demands of the general economy and, where appropriate, of planning”, explains article 38.

On the other hand, if it is not done with the force of law, it may contravene Community competition law, which seeks to protect companies and citizens against practices that prevent or restrict free competition in the national and European market.

Thus, the decision to cap the prices of certain products can be approved, whether in the form of a law or not, but said action could be appealed to the competent courts and be overturned in accordance with the arguments set forth above.

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