Cabinet to Consider Kedmi Committee Recommendations on Reducing Food Prices

Presentation to cabinet follows recent announcements by food manufacturers that they would be raising the prices they charge supermarkets.

Finance Minister Yuval Steinitz and Industry, Trade and Labor Minister Shalom Simhon will jointly present the recommendations of an inter-ministerial panel on food prices to the cabinet at its meeting next Sunday, the two decided yesterday.

The presentation to the cabinet follows a number of recent announcements by food manufacturers that they would be raising the prices they charge supermarkets.

The cabinet is expected to approve the recommendations of the panel, which was headed by Industry, Commerce and Labor Ministry Director General Sharon Kedmi.

Despite the resolution passed this week to disband the Knesset and hold elections in January, the government is expected to try to expedite implementation of the Kedmi committee's recommendations, at least to the extent that they do not require the passage of legislation. Some of the panel's suggestions have already been put into practice.

The committee's recommendations include passing legislation to regulate the relationship between wholesale food producers and supermarket retailers. Such legislation, which would ultimately require Knesset approval, would bar producers from restricting retailers' business relationships with other wholesale suppliers. It would also bar major producers from buying space on supermarket shelves for their own products and would put an end to the practice of food manufacturers sending their own staff to stock supermarket shelves.

The law would also contain provisions designed to encourage competition among supermarket retailers themselves - for example, by empowering the antitrust commissioner to prohibit a major retailer with more than a 30% market share in an area from opening another store there. The proposed legislation would also require supermarket retailers to publish price lists making it easier for consumers to compare food prices.

The committee also recommended reducing barriers to the importation of food from abroad, including customs duties, in an effort to enhance competition with similar locally produced items.