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Three bills that put the social market economy at risk

The executive branch and the In recent weeks, they have presented bills that could threaten legal stability and the social market economy.

One case is the initiative of the Executive that seeks to prohibit monopolies and oligopolies. About, Guillermo Ferrero, partner of Philippi Prietocarrizosa Ferrero DU & Uríaexplained that a constitutional reform is sought that prohibits them and gives constitutional status to three behaviors: hoarding, speculation and price concentration, which are already prohibited by the Penal Code, but do not have constitutional status.

Prohibiting monopolies and oligopolies would go against the principle of. Prohibiting oligopolies, in particular, is ill-advised because the more you can focus at the business group level, the greater the synergies that are generated within and the more beneficial it is for the final consumer”, he added.

He explained that it would be preventing the existence of economic groups that can, through participation in oligopolistic markets, lower their costs and prices.

Alfred Bullardan expert lawyer in regulation, described the initiative as absurd, since the monopoly is an economic reality that arises as a consequence of a series of factors and the law does not control them.

“It is part of the competitive process and what is proposed shows a profound ignorance of how the economy works,” he said.

BUSINESS ACTIVITY

Another project presented is the constitutional reform proposal for Peru Libre so that the State can carry out business activities. On this, Bullard pointed out that it is contradictory since it would end up generating a state monopoly that competes with an advantage over the private one.

“Even if the company is poorly managed, it would never go bankrupt, they just use more tax money and put it into business activity,” he explained.

LAW CONTRACTS

A third proposal is, which proposes to repeal the law contracts. On this, Ferrero pointed out that, if approved, uncertainty will be generated for private investors based on this type of contract.

Bullard noted that from the explanatory statement of the project it is not possible to understand what it wants to achieve.

“The State has to respect certain basic guarantees of stability and the signs they are giving is that they can kick the contracts and nothing happens”I note.

The concern, he added, is that with the approval of these projects the foundations that have allowed much of the economic development of recent decades would collapse.

Data

-The Executive presented the project N° 1705 to prohibit monopolies and oligopolies.

-Congressman Waldemar Cerrón presented a constitutional reform project, No. 1682, which proposes that the State be able to carry out business activities.

-Congressman Pedro Martínez (AP) presented bill No. 1627 that seeks to repeal law contracts.

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