The ACCC will begin monitoring supermarket pricing from 1 July when the new ‘excessive pricing prohibition’ comes into force.

The prohibition applies to retailers that have an annual revenue of more than $30 billion, which currently captures only Coles and Woolworths.

New guidelines outline how the ACCC will monitor compliance with the prohibition and how it will assess whether Coles or Woolworths have engaged in excessive pricing.

Under the prohibition, there’s no fixed threshold for what’s an excessive price for a grocery product. Instead, the ACCC will monitor supermarket pricing information and consider all relevant circumstances, including the cost to supply the product to consumers and what is a reasonable margin for the supermarket, to determine if a grocery product was excessively priced.  

“We know that grocery prices continue to be a key concern for households. The excessive pricing prohibition provides us with another tool within our broader toolkit to protect consumers and promote competition in the supermarket sector,” says ACCC Acting Chair Catriona Lowe.

“Our initial focus for the prohibition will be on monitoring Coles and Woolworths’ pricing information to ensure they comply with their obligations.”

The ACCC will prioritise its monitoring on a select group of products, which will be chosen based on consumer and supplier reportsas well as information obtained from supermarkets, including on prices, margins and sales revenue.

“We will focus our attention on products where excessive pricing is likely to cause the most harm to consumers,” says Ms Lowe.

“We encourage consumers and suppliers to make a report to the ACCC if they have concerns that a supermarket may have excessively priced a grocery product. These reports will help us identify products that may warrant further investigation.”

Over the coming months, the ACCC will select and publish the initial focus products that it will examine more closely. The regulator will provide regular updates on its compliance monitoring under the prohibition to help strengthen public transparency around supermarket pricing.

“We recognise that there’s significant public interest in the ACCC’s ongoing work to ensure supermarkets act in accordance with the law,” says Ms Lowe.