The cinema owners’ association has appealed to the government and the political parties to exclude cinemas from the venues at which a price cap on bottled water would be imposed. Cinemas did not qualify as closed markets and should not be included in the maximum price law that is expected to be approved next month, said the head of the association, Marios Herodotou.

Herodotou pointed out that there were no inspections on cinemagoers before they entered the cinema, which meant they could take their own bottled water. This meant the argument of insufficient competition, used as the main justification for the law did not apply to cinemas, he said. He was correct and there was no need to cite the steadily declining tickets, to back the demand that the law did not apply to cinemas.

This is a stupid law that unnecessarily messes with the operation of the free market, more for populist effect than for the practical benefit of the consumer. Why should a bar at a cinema, a theatre and football stadium not be entitled to decide the price of a 500ml bottle of water? In a market economy, the state has no business setting a price ceiling on any product, because it is irrational and could lead to other problems.

Cinemas, theatres and sports grounds could decide, if a price cap is imposed, they would not sell bottled water because the profit margin is too low and therefore not worth selling. They could sell fizzy water and soft drinks on which they could make a healthy profit. Why use up valuable fridge space for a product that has a low profit margin, when they can make more money selling other drinks?

What would the commerce ministry, which came up with the absurd idea of the price cap, do then? Would it draft another law forcing these so-called ‘closed markets’ to sell locally-produced bottles of water, given that the cap could not apply to imported bottles of water? The wholesale price of a bottle of imported water might be higher than the maximum retail price that would be fixed by the law.

Airport and port shops – the main targets of the price legislation – could simply stock their fridges with bottles of imported water which would be more expensive than bottles of local water – pre price cap – to maintain their profit margins. Larnaca airport offers free drinking water – there are water coolers for anyone unwilling to pay the high price for bottled water – so even if there is no price competition there is an alternative on offer.

We do not know if the affected businesses will react with their own tricks, once the law, which will give the commerce minister the right to set the price by decree, is approved. Some deputies have spoken about proposing amendments to the proposed law when it is finally discussed at the plenum, but amendments are not the answer. The bill must be rejected because it is authoritarian and would be setting a dangerous precedent if passed.

No market economy should give the power to an official – the commerce minister – to set a price cap on any product by decree and to designate the venues at which this must apply.