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Brazil to monitor price hikes during World Cup

The Brazilian government has created a committee to monitor abusive price hikes of hotel rates and plane tickets during next year's World Cup.

The group made up of members of different ministries was created by Brazilian President Dilma Rousseff on Thursday.

The move comes after complaints by consumer advocates and amid reports of outrageous price increases in the tourism sector during the monthlong tournament in 2014.

A study by Brazil's tourism board this year showed that some hotel rates will be up to 500 percent more expensive during the World Cup in some hotels offered by the FIFA-appointed agency MATCH Services. Last week, the Folha de S. Paulo newspaper, Brazil's largest, reported that a 45-minute flight from Rio de Janeiro to Sao Paulo on the day of the World Cup final could cost almost as much as a flight to New York or Paris.

The price of plane tickets is a concern as flying will be the main option for the nearly 600,000 foreigners and the expected 3 million local visitors who will move around the continent-sized country during the tournament that begins next June.

The group's first meeting is scheduled for next week.

"We don't set prices and we won't set prices, but we won't allow abuses," said Gleisi Hoffmann, Rousseff's chief of staff. "We will use all of our available instruments to defend the rights of consumers, whether they are Brazilian consumers or international consumers."

Brazil sports minister Aldo Rebelo this year pledged "zero tolerance" for hotels that charge abusive prices during the World Cup. He said significant price hikes during the showcase event would hurt Brazil's image abroad and threaten to scare tourists away. The minister warned at the time that hotels that raised prices excessively would feel the "heavy hand" of the law, adding that consequences included possible hotel closures.

Pricey hotel rooms became a hot topic last year during the Rio+20 U.N. conference, when the hotel sector took advantage of the spike in demand to charge exorbitant rates. The average cost of a room in Rio during the conference rose to nearly $800 a night, prompting a barrage of criticism from conference delegates. The European Parliament canceled its entire 11-person delegation due to the costs.

Brazil's tourism board, or Embratur, earlier this year officially told FIFA and hotel operators to negotiate lowering prices during the World Cup. It also notified the justice ministry's department responsible for handling consumer rights issues.

"This measure by President Dilma and Minister Gleisi is essential to safeguard the image of Brazilian tourism abroad," Embratur president Flavio Dino said. "Our monitoring of the international media shows that we can't allow this image that the Brazilian government will not act against abuses."

The government also said that it will ask Brazil's antitrust agency to conduct a detailed analysis of the country's hotel and air travel markets "to identify situations" that could hinder fair competition in the sectors. It also said that it will keep close contact with the consumer rights secretariats in the 12 World Cup host cities to monitor the prices and the quality of services of restaurants and other tourist services.