Drive to lower inflation will see retailers and suppliers penalised for overcharging.
The United Arab Emirates economy ministry said on Wednesday it would penalise retailers and suppliers who raised prices of consumer goods by amounts it considers unjustified.
The second-largest Gulf Arab economy is seeking to lower inflation, which reached 9.5% in 2006, said Abdulla bin Ahmed al-Saleh, undersecretary at the UAE ministry of economy.
"The increase in the cost of consumer goods is a factor in inflation and we are trying to manage and control inflation," Saleh said.
Inflation could fall to 7% in 2007, mainly due to rent caps of 7% in Dubai and Abu Dhabi, he said.
The ministry could fine retailers and suppliers between 1,000 and 10,000 dirhams ($2,723) if they raise prices on consumer goods by an unjustified amount, he said.
This could include price increases exceeding the UAE inflation rate or the rise in global prices.
The UAE pegs its dirham currency to the dollar, which has fallen this year to a near record-low against the euro, driving up the cost of some imports.