Until August 2010, no law stipulating direct imposition of price on goods and services did exist in Ethiopia. However, a new law passed by parliament, has changed the system of price regulation. The Trade Practice and Consumers’ Protection Proclamation No. 685/2010, which became a law on 16th August, 2010, gives a conditional discretion to the Ministry of Trade and Industry to impose a ceiling on the price of goods and services. The said proclamation contains 58 articles most of them drafted broadly and exhaustively regulating unfair trade practices. Only one provision mentions about the possibility of fixing the price of goods by the Ministry. This article, titled, regulating the price of basic goods and services, reads
"The Ministry, when deemed necessary, submits to the Council of Ministers its study on basic goods and services that shall be subject to price regulation and upon approval publish their list and prices in public notices."Apart from the grammatical mistake, one can easily notice vagueness and lack of clarity in formulating the content of the article. The provision grants wider discretion to the Ministry, though subject to the conditions of preparation of a study and approval by the Council of Ministry. It is not clear as to the necessary preconditions or circumstances leading to initiating research by the Ministry. It is simply a matter of discretion to the Ministry. In other words, the price of goods may be fixed 'when deemed necessary' by the Ministry. Given the exceptional nature the need for direct government interference in fixing price, one will wonder why such wider power was given to the Ministry. There is also a reference to a 'study' on basic goods and services. The content, method and effect of the study is also not clearly provided in the provision. what is to be studied? what is its scope? is it limited to collecting data on the price on the market? Does it mean price fixation is subject to the results of the study? The failure to incorporate mechanisms which ensure transparency and public participation in the process of conducting a study aiming at the need for price fixation, could be a ground for potential misappropriate use of such power . It could also lead to diminishing public acceptance of similar measures in the future.There is another unsettled issue. Who actually determines or fixes the price of basic goods and services after a study is conducted to this effect? is it the Ministry or the Council of Ministers? One way to interpret the provision is that the Ministry only submits the list of goods to be subjected to price fixation, without indicating the proposed prices. Secondly, the provision could also mean that the study to submitted shall include the specific prices and hence the power of approval of Council of Ministers extends to the specific prices.