A Senate inquiry in Australia has proposed that supermarket price gouging should be declared illegal, and has advocated for divestiture laws to dismantle the country’s supermarket duopoly.

The inquiry, led by the environmentalist Greens party, published its final report on 7 May, featuring 14 recommendations. These include the introduction of measures to dismantle large supermarket chains and an enhancement of the food and grocery code of conduct.

Senator Nick McKim, Greens Economic Justice spokesperson and chair of the committee, described the report as “landmark”, aimed at addressing “so much harm” done to the Australian populace.

He stated, “The committee has produced concrete steps that would tackle these problems head on.”

A primary recommendation is the criminalisation of price gouging, defined as significantly increasing prices beyond the costs of production and investment.

McKim explained, “This would mean that corporations couldn’t just arbitrarily increase prices without facing consequences from the courts. This would be a significant new power to stop unreasonable pricing that has been rampant for years because of a lack of competition.”

The investigation, initiated in December, focused primarily on the dominance of Coles and Woolworths, which together hold about two-thirds of the market, with German retailer Aldi possessing just over 10%.

Earlier in the month, a preliminary review by Dr Craig Emerson, former Minister for Small Businesses, advocated for the Food and Grocery Code of Conduct to become mandatory, a stance further supported by the inquiry.

Additionally, the inquiry led by the Greens has suggested “divestiture powers for the supermarket sector, which would give the Federal Court the power to break up corporations when they abuse their market power or act unconscionably”, as noted by McKim.

However, these suggestions for breaking up the market have not found favour with the incumbent Labor government.

McKim further remarked, “The Greens established this inquiry to bring food prices down and that is exactly what our recommendations will do. We’ve heard from farmers and suppliers about how the massive market power of Coles and Woolworths is allowing them to act unconscionably.

“Without the ability to break up the duopoly, our market will remain skewed towards the interests of a few powerful players and nothing will change.”

The report also recommends mandatory unit pricing standards in supermarkets to combat shrinkflation and standardisation of discount and promotional terms to prevent misleading discounts.


Sam Allcock, a seasoned entrepreneur with over two decades of expertise in Food & Drink Editorial.

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