Australia’s consumer watchdog is taking legal action against the nation’s two largest supermarkets chains, accusing them of misleadingly claiming to have permanently reduced prices on hundreds of products. The Australian Competition and Consumer Commission (ACCC) alleges that Coles and Woolworths violated consumer laws by briefly raising prices before lowering them to the same or higher than their original cost.
Coles has vowed to contest the accusations, while Woolworths said it would review the claims. Together, these supermarkets control two-thirds of the Australian market and have faced increasing scrutiny and legal action over alleged price gouging and anti-competitive behavior in the past year.
Prime Minister Anthony Albanese condemned the reported conduct as “completely unacceptable,” stressing that Australian consumers deserve better. He also introduced draft legislation for a new “code of conduct” aimed at regulating supermarket practices.
ACCC chair Gina Cass-Gottlieb noted that Coles and Woolworths have long promoted their ‘Prices Dropped’ and ‘Down Down’ campaigns, which consumers associate with long-term price cuts. However, the watchdog found that many of these discounts were deceptive. Investigations revealed that Woolworths had misled customers on 266 products over 20 months, while Coles did so for 245 products across 15 months, covering items ranging from pet food to iconic Australian brands like Tim Tam biscuits and Bega Cheese.
The ACCC estimates the two chains sold tens of millions of these products, generating significant revenue. Cass-Gottlieb emphasized the importance of accurate pricing claims, particularly as consumers face cost-of-living pressures. The watchdog is seeking hefty penalties and an order for the companies to expand their charitable meal programs.
In response, Coles said rising operational costs had led to price increases but emphasized its commitment to balancing this with offering customer value. Woolworths expressed its intention to cooperate with the ACCC, acknowledging the need to maintain consumer trust in their pricing.
The government is also reviewing the existing Food and Grocery Code of Conduct, with plans to introduce a tougher, mandatory code to protect both consumers and suppliers from unfair practices.
