New law allows Lithuanian government to regulate prices

The Lithuanian government will be able to regulate prices of essential goods during quarantine after the parliament passed the law on Tuesday.

Under the new law, the government's Emergency Situation Commission will compile a list of essential goods and services. Their accessibility will then be monitored by the State Consumer Rights Protection Authority. If there are shortages or unwarranted inflation of prices, the government could introduce price controls or rationing.

The amendment must still be signed into law by President Gitanas Nausėda, who previously criticised the initiative. The Bank of Lithuania and the Competition Council have also expressed disapproval of the measure.

Meanwhile Prime Minister Skvernelis says price controls would be an extreme measure and only used to clamp down on speculation. During quarantine, that would primarily concern disinfectants and protective gear.

“The government is surely not intent on regulating prices of products and goods. It's about having this tool available,” Skvernelis said, suggesting that the law alone would prevent speculative pricing.

President Nausėda's economic adviser Simonas Krėpšta previously criticised the measure, saying it could lead to shortages and boost the black market.

“Price controls during emergencies are not compatible either with economic logic or the legal system, especially in the form they've been proposed now, putting all the responsibility on the government,” he was quoted by BNS.

The Lithuanian parliament, Seimas, tried to pass the law last week, but fell short of votes after the opposition walked out.

On Tuesday, the amendment to the Law on Civil Safety was endorsed by 79 MPs, four voted against and six abstained.