National consumer affairs reporter Michael Atkin takes us through the ACCC’s claim.
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00:00These very serious allegations are that Coles and Woolworths both did the same thing, essentially,
00:10that over a significant period for both of them, they had sold products at a particular
00:16price and then suddenly that product had increased sharply by, say, at least 15%, and that was
00:23only for a brief period before the price was cut and then was part of this discounting
00:30promotion that we've all seen in the supermarkets.
00:33And what the ACCC says is actually, when they had a look at the details, consumers were
00:39paying higher prices than the original price or substantially the same, and so they were
00:45misled by the supermarkets.
00:47The allegations cover household items, everyday products, from cat food to chocolates, the
00:54sorts of things that everybody would have in their trolley regularly.
00:58Let's hear from the ACCC chair herself.
01:02There is always a potential of class actions to take action in relation to consumers who've
01:09been harmed.
01:10We are seeking through the community service order in order to give to the community in
01:16the most needy members of our community redress.
01:20We will put to the court that there should be a substantial additional donation to charities
01:28that are providing food relief and meals in aid to needy families and that each of Coles
01:35and Woolworths are ordered to pay additional donations to support that.
01:40Still under consumer law, so in relation to just one breach, and as I've mentioned,
01:48this relates to hundreds of examples potentially, there's a penalty under consumer law, a maximum
01:55penalty of $50 million, and there's also new variations on that where the court can find
02:03that the companies have to pay three times the benefit they've obtained, or if they can't
02:08determine that, it can be 30% of the company's turnover during the relevant period.
02:15So substantial fines, and as we heard from the chair of the ACCC, she's saying those
02:21are necessary to make sure that it doesn't happen again with these companies, but also
02:26that it deters the other companies operating in Australia.
02:31And I should add that these are untested allegations, they need to be put before the court, and
02:37at this stage they are just allegations.
02:39They've had different responses, Coles has said that this occurred during a period where
02:45they were experiencing significant increases in pricing from suppliers and that they intend
02:51to defend the allegations, whereas Woolworths has said that it's reviewing what the ACCC
02:58is putting and that it's very concerned about the cost of living impact on shoppers at its
03:04supermarkets, and it will have more to say as part of the proceedings as they get across
03:10them.
03:11And the chair of the ACCC did say during her press conference that both supermarkets have
03:16said that they've stopped this practice, but she hasn't been able, she hasn't got information
03:23to ascertain as to whether that's true.
03:25So there's a lot to play out here and much of it will be in the court.