Updated 6pm with Peter Agius reaction
Labour MEP Alex Agius Saliba has asked the European Commission to investigate Maltese food importers for antitrust violations.
Malta's size and geographical limitations, he said, led to the formation of de facto monopolies where a handful of importers dominate the market.
The lack of competition removed the market-driven downward pressure on prices and led to the formation of informal, artificially high, price benchmarks.
These benchmarks enabled the few large operators to exploit the high inflation rate to increase their already hefty profits, he argued.
In a statement, the MEP said he has been closely following the development of the various factors that cause inflation, focusing particularly on food prices.
He noted that although high Inflation is generally attributed to a mix of global factors such as COVID-19, the Russian invasion of Ukraine, supply-chain bottlenecks, and labour shortages, three country-specific factors were leading to an even higher inflation rate in Malta.
Malta, he said, suffered from the natural disadvantage of being a small island on the periphery of Europe and so could not enjoy the benefits of economies of scale.
It was also not entitled to preferential treatment or assistance which could allow it to mitigate its susceptibility to external shocks in the global market.
Moreover, its size and geographical limitations led to the formation of de facto monopolies where a handful of importers dominated entire markets.
It is about this third aspect that MEP Agius Saliba has requested the President of the European Commission, Ursula von der Leyen, to take action.
Excessive pricing, he said, is an antitrust violation in terms of EU competition law which specifically prohibits the abuse of a dominant market position to impose unfair prices on consumers.
He said: “If we truly believe that the single market should work for the benefit of our consumers, we must ensure that the market works correctly in every member state.
“During this particular juncture, we must fight even further so that the single market addresses the priorities of our citizens and the worries of our consumers.”
He promised to do “whatever it takes” to ensure that socially disadvantaged consumers do not suffer disproportionately from high inflation.
Back in June, Agius Saliba had also complained that Maltese consumers are being forced to pay a “Brexit tax” due to the EU’s complex import rules. He had asked the European Commission to investigate.
Casa: Agius Saliba is blaming business owners
Nationalist MEP David Casa accused his counterpart of targeting Maltese business owners for problems he said were caused by the Labour government Agius Saliba represents.
"To blame importers for the rising cost of living shows how cut off from reality Robert Abela's government is," he said in a statement issued by the Nationalist Party. "It is blaming others for its failure to act."
Casa argued that the government should be looking for ways to help business owners, rather than pointing fingers at them, and highlighted a Nationalist Party plan to set up a national fund to help importers and exporters as a possible solution.
Peter Agius: Letter was addressed to wrong person
PN MEP candidate Peter Agius noted that EU competition law was, at least on paper, part and parcel of Maltese law and regulated by the Malta Competition and Consumer Affairs Authority.
"Agius Saliba sent his letter to the wrong person. Instead of writing to von der Leyen, he should have written to Julia Farrugia Portelli," he said on Facebook.
Farrugia Portelli is politically responsible for the MCCAA.
"If we are to solve issues, we should first ensure that authorities are doing their job," Agius said, "instead of knocking on Europe's doors to get some clicks online."