What are Australia’s two largest supermarket chains accused of indictment?
The Australian Consumer Commission has filed a lawsuit against the country’s two largest supermarket chains, accusing them of misleading the public by claiming to reduce the prices of hundreds of Products permanently.
The Australian Competition and Consumer Commission alleges that Coles and Woolworths breached consumer law by raising prices for a short period and then lowering them to a level equal to or higher than the original price.
Coles has said it will defend itself, while Woolworths has pledged to review the allegations. The two companies, which control two-thirds of the market, have been hit by Australianhas come under intense scrutiny in the past year over allegations of price-gouging and anti-competitive practices.
Prime Minister Anthony Albanese said the behaviour, if proven, would be “unacceptable”.
“This is not in keeping with Australian values,” he said at a news conference on a new “code of conduct” for supermarkets. “Customers do not deserve to be treated like fools.”
Gina Cass-Gottlieb, chair of the Australian Competition and Consumer Commission, said the companies had used campaigns such as “price drop” and “sharp drop” to give the impression that prices had fallen sustainably. But she said the discounts were often “illusory.”
The investigation, based on complaints and oversight by the Australian Competition and Consumer Commission, found that Woolworths misled customers about 266 products over 20 months, while Coles did the same with 245 products over 15 months.
These products included pet food, bandages, and mouthwash, as well as favorites like Tim Tam cookies, Bega cheese, and Kellogg’s cereal. The committee estimates that the two companies sold tens of millions of these products, generating huge profits.
“Many consumers rely on discounts to ease cost-of-living pressures,” added Cass Gottlieb, who stressed that transparency in pricing is critical.
The Australian Competition and Consumer Commission is seeking large fines for the two companies and is also seeking to force them to provide more charitable food assistance.
In response, Coles said its rising costs were the reason for the price increases, and that it was trying to balance this with offering promotions to customers.
She added that the company takes consumer law seriously and seeks to build trust with stakeholders. Woolworths confirmed that it will engage with the Commission on these allegations, noting the importance of building trust with customers.
With supermarkets under increasing scrutiny, the government has commissioned a review of the Food Code of Conduct. The review recommends a stronger mandatory code of conduct, designed to protect suppliers and consumers alike, with hefty fines for breaches.
