The Competition Authority has issued harsh criticism of a new controversial bill on milk production quotas submitted by Minister of Fisheries and Agriculture Jón Bjarnason, saying it can harm competition.
Icelandic cows. Photo by Páll Stefánsson.
Minister of Economic Affairs Gylfi Magnússon, who was chairman of the Competition Authority for five years, supports the authority’s criticism, Fréttabladid reports.
According to ruv.is, the bill stipulates that those who produce milk without having a milk quota will have to pay a fine.
The Competition Authority believes this system contributes to oligopoly, as it will be difficult for new producers to enter the market.
However, Minister of Finance Steingrímur J. Sigfússon disagrees with the Competition Authority. “It has to do with production control […] and government support, making sure that funds are used in an efficient manner,” the minister told Fréttabladid of the bill.
The Consumers’ Association of Iceland issued a statement in relation to the bill yesterday, encouraging MPs to vote against it as it works against the interest of farmers and consumers.
The Federation of Trade and Services had already issued a similar statement, saying the bill is likely to encourage monopolization on the dairy market.