Australian Federal Court Rules Coles Supermarket Falsely Advertised Product Discounts

Australian supermarket giant Coles has been found by the Federal Court to have engaged in misleading conduct through its "Down Down" promotions. The court's decision, which could lead to substantial penalties, sided with the Australian Competition and Consumer Commission (ACCC), which argued that Coles was not offering genuine discounts.

Justice Michael O'Bryan ruled that hundreds of items advertised as discounted were not, as Coles had first raised their prices before implementing the promotional offers. The ACCC's case highlighted 245 products, from toothpaste to biscuits, over a 15-month period between February 2022 and May 2023.

Of the 14 sample products examined, 13 were deemed by the judge to have misleading "was" prices, failing to represent a true saving for the ordinary consumer. Justice O'Bryan stipulated that products required at least 12 weeks of sale at the higher price for a subsequent discount to be considered genuine. Coles stated it is reviewing the judgement, asserting its commitment to "delivering value to our customers."

This ruling comes amidst heightened scrutiny of Coles and Woolworths, which collectively dominate two-thirds of the Australian grocery market, regarding alleged price gouging and anti-competitive practices. The ACCC is pursuing a similar case against Woolworths, with a decision anticipated later this year. The penalties for Coles will be determined in subsequent hearings.