Australia’s consumer watchdog, the Australian Competition and Consumer Commission (ACCC), has initiated legal proceedings against the nation’s two largest supermarket chains, Coles and Woolworths, alleging deceptive discounting practices on hundreds of everyday products between 2021 and 2023.
The ACCC claims that both retailers engaged in “illusory” discounting by temporarily increasing product prices before promoting them as discounted, misleading consumers about the actual savings. For instance, Woolworths reportedly sold a 370g Oreo Family Pack at a regular price of A$3.50 for nearly two years. In November 2022, the price was raised to A$5.00 for 22 days, after which it was advertised as “Prices Dropped” at A$4.50—still 29% higher than the original price.
Similarly, Coles is accused of increasing the price of a six-pack of Strepsils lozenges from A$5.50 to A$7.00 for 28 days before promoting it as discounted at A$6.00.
The ACCC alleges that such practices violate Australian Consumer Law by presenting misleading price comparisons, thereby impairing consumers’ ability to make informed purchasing decisions. The watchdog is seeking significant penalties, which could amount to up to 30% of the companies’ turnover if the allegations are proven.
In response, Coles stated that the price adjustments were due to significant cost increases from suppliers amid rising global commodity prices and inflation. The company maintains that the subsequent discounts were genuine reductions from these elevated prices. Woolworths has indicated it is reviewing the allegations.
The legal action comes amid broader scrutiny of supermarket pricing practices in Australia, with the government considering reforms to enhance transparency and protect consumers from deceptive pricing strategies.
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