Australia’s consumer watchdog is suing the country’s two biggest supermarket chains, alleging they falsely claimed to have permanently dropped the prices of hundreds of items.
The Australian Competition and Consumer Commission (ACCC) claims Coles and Woolworths broke consumer law by temporarily raising prices before lowering them to a value either the same as or higher than the original cost.
Coles said it would defend itself against the allegations, while Woolworths said it would review the claims.
The grocery giants, which account for two thirds of the Australian market, have come under increasing scrutiny in the past year over alleged price gouging and anti-competitive practices.
“This is not in the Australian spirit. Customers don’t deserve to be treated as fools,” he said at a press conference, at which he also revealed draft legislation for a previously promised “code of conduct” for supermarkets.
ACCC chair Gina Cass-Gottlieb said Coles and Woolworths have spent years marketing their ‘Prices Dropped’ and ‘Down Down’ promotions, which Australian shoppers now understand to represent a sustained reduction in the regular prices of products.
But in many cases “the discounts were, in fact, illusory”, she added.
