According to the Egyptian press, Egypt's Ministry of Trade and Industry has started to implement a new set of rules this week aiming to rapidly chill increasing steel prices by making sellers follow the price limits set by producers.
The new rules decided by the Ministry let producers set a ceiling resale price to their retailers and to sever relations with them if they do not comply. Under the new rules, producers must report their maximum rates to the Ministry of Trade and Industry within the first week of each month so that the Ministry will be able to determine where price speculation is occurring. Those who do not comply will be reported to the Ministry.
Senior researcher at the Egyptian Competition Authority (ECA), Mr. Haytham Gammal, said that while overcharging can hinder competition, it is not explicitly illegal in Egypt as it is in the United States. He added that charging too much in itself is not a violation and, thereby, it is not possible to declare any person or any economic operator in breach of the law without an express provision in competition law.
Mr. Gammal went on to say that the ECA will wait to see if the new measures help lessen speculation before they consider taking further action. If the rules are not effective, an amendment to outlaw excessive pricing may be considered. However, this would be a controversial step, the ECA official said, as it is not always clear whether such limits are ultimately in consumers' interests.