ACCC and Coles seek consent orders to resolve unconscionable conduct proceedings

15 December 2014

The ACCC and Coles will today make joint submissions to the Federal Court of Australia seeking orders from the Court, after agreeing to resolve the two separate proceedings instituted by the ACCC alleging unconscionable conduct by Coles when dealing with certain suppliers in 2011.

The parties will seek consent orders from Justice Gordon, including:

  • declarations, based on admissions by Coles, that Coles engaged in unconscionable conduct with respect to a number of suppliers in 2011, in contravention of the Australian Consumer Law (ACL); and
  • pecuniary penalties.

The parties will also advise the Court that, as part of the resolution of the proceedings, Coles will give an enforceable undertaking to the ACCC which provides for an independent review of the eligibility of suppliers referred to in both proceedings for possible refund of certain payments made to Coles by those suppliers.

It is a matter for the Court as to whether it is prepared to make the consent orders sought by the parties.

As the matter is before the Court, the ACCC will not be making further comment until the Court hands down its decision.

Background

The ACCC commenced proceedings on 5 May 2014 (first proceedings) and 16 October 2014 (second proceedings) against Coles Supermarkets Australia Pty Ltd and Grocery Holdings Pty Ltd (together, Coles).

The first proceedings alleged that Coles had engaged in unconscionable conduct by the way it sought rebates from suppliers under its “Active Retail Collaboration” (ARC) program.

The second proceedings alleged that Coles had engaged in unconscionable conduct against certain suppliers in relation to claims for various payments, including payments for purported profit gaps, waste and markdowns, and late and short deliveries.

Release number: 
MR 308/14
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