Albanese says ACCC inquiry into Coles, Woolworths is 'serious'
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More news: Prime Minister Anthony Albanese has described the competition regulator's inquiry into Coles and Woolworths as “serious” and said charging more for products “of course has an inflationary impact”.
Albanese also announced the Government's exposure draft of its new mandatory food and grocery code and said major supermarket chains could face multi-million dollar fines for breaches of the code.
The mandatory code will be put to Parliament by the end of the year.
What they said: “These are serious allegations .... If this is found to be true, it's completely unacceptable. This is not the Australian spirit. Customers don't deserve to be treated as fools by the supermarkets. They deserve much, much better than that,” Albanese told reporters in Parliament.
Woolworths and Coles shares dive after ACCC legal claims
More news: Shares in Coles and Woolworths both lowered at market open on the ASX after the competition regulator announced that it had commenced civil proceedings against the two supermarket groups.
Woolworths shares were down 3.4% to $33.80 by 10:40am AEST while Coles shares fell 2.8% to $18.68.
The Australian Competition and Consumer Commission (ACCC) allege the companies misled consumers through discount pricing claims on hundreds of common supermarket products.
Coles to defend ACCC proceedings
More news: Coles said it intends to defend the civil proceedings commenced by the competition regulator, that allege the supermarket giant misled customers through its 'Down Down' promotion.
What they said: In an ASX release, Coles said: "The allegations relate to a period of significant cost inflation when Coles was receiving a large number of cost price increases from our suppliers and, in addition, Coles' own costs were rising, which led to an increase in the retail price of many products.
"Coles sought to strike an appropriate balance between managing the impact of cost price increases on retail prices and offering value to customers through the recommencement of promotional activity as soon as possible after the establishment of the new non-promotional price.
"In line with our values, Coles takes compliance with the Australian Consumer Law extremely seriously, and places great emphasis on building trust with all stakeholders, especially our customers."
Woolworths to 'carefully review' ACCC claims that it misled customers
More news: Woolworths said it will "carefully review" claims made by the competition regulator that the supermarket group's 'Prices Dropped' promotion between 2021 and 2023 misled customers.
What they said: Woolworths CEO Amanda Bardwell said: "Our Prices Dropped program was introduced to provide our customers with great everyday value on their favourite products".
"We remain committed to offering many ways for customers to save at the checkout, including thousands of weekly specials, everyday low prices on household essentials, a great value own brand range and through our Everyday Rewards program."
ACCC sues Woolworths, Coles over misleading discount claims
The news: The competition regulator is suing supermarket giant Woolworths and Coles for allegedly breaching the Australian Consumer Law by misleading consumers through discount pricing claims on hundreds of common supermarket products.
The numbers: The ACCC has alleged that Woolworths and Coles each sold products at regular long-term prices which remained the same, excluding short-term specials, for at least six months and in many cases for at least a year.
The products were then subject to price rises of at least 15% for brief periods, before being placed in Woolworths’ ‘Prices Dropped’ promotion and Coles’ ‘Down Down’ promotion, at prices lower than during the price spike but higher than, or the same as, the regular price that applied before the price spike.
The ACCC alleged the conduct involved 266 products for Woolworths at different times across 20 months, and 245 products for Coles at different times across 15 months.
The context: The regulator has commenced separate proceedings in the Federal Court against Woolworths and Coles.
ACCC chair Gina Cass-Gottlieb said while Australian consumers believed that the ‘Prices Dropped’ and ‘Down Down’ promotions involved a sustained reduction in the regular prices of supermarket products, in the case of these products, it is alleging the new promotional prices were actually higher than, or the same as, the previous regular price.
What they said: "We allege that each of Woolworths and Coles breached the Australian Consumer Law by making misleading claims about discounts, when the discounts were, in fact, illusory," Cass-Gottlieb said.
“We also allege that in many cases both Woolworths and Coles had already planned to later place the products on a ‘Prices Dropped’ or ‘Down Down’ promotion before the price spike, and implemented the temporary price spike for the purpose of establishing a higher 'was' price.”
The source: ACCC media release
