Australia hits price hikes with multi-million dollar fines

Supermarket giants could face fines of up to $10 million for breaching the Food and Nutrition Code of Conduct in new laws aimed at holding the supermarket sector accountable.

Set to be introduced into parliament on Wednesday, the statutory fines will be the highest corporate penalties under any industry code, which navigates how supermarkets conduct business with their suppliers.

Penalties for breaching the code will be imposed at the higher of the calculated amount or three times the amount of the benefit derived from the offending conduct, 10 percent of business turnover in the 12 months preceding the conduct, or a flat fine of $10 million.

The penalties were previously recommended in a review of the code led by economist and former Labor minister Craig Emerson.

The proposed laws would also give the ACCC powers to hit supermarkets with infringement notices if the consumer watchdog believes there are reasonable grounds that the business has breached the code.

Separately, the government will also replace the current code of conduct with a mandatory code from April 1 next year, which will affect grocers with annual Australian revenues of more than $5 billion, which include Woolworths, Coles , Aldi and Metcash. which own IGA.

Anthony Albanese said supermarkets had been put “on notice”.

“Dodgy behavior that costs Australians will not be tolerated,” he said.

“We want to see a fair deal for Australian families at the till and a fair deal for our farmers.”

In September, the Prime Minister blasted Coles and Woolworths and said they needed to do better after the ACCC launched legal proceedings against the big grocer following allegations they misled consumers about price discounts on hundreds of products.

It is alleged that both companies raised prices by at least 15 percent before advertising the same products at discounted rates, which were higher than the original prices.

A Coles spokeswoman previously told NewsWire Coles would defend the ACCC case. Woolworths previously said it would look into the claims.

Jim Chalmers said the government was serious about banning supermarkets from negatively impacting households and suppliers.

“We know that cost of living pressures are hitting Australians hardest at the coffers,” the Treasurer said.

“Our new binding code has strong penalties that show supermarkets we are serious about behaving fairly for families and farmers.”

Assistant Minister for Competition, Charities and the Treasury Andrew Leigh added that enforcement measures would benefit shoppers as well as farmers and suppliers.

“We are cracking down on supermarket misconduct because it will help shoppers at the register and help farmers and suppliers at the negotiating table,” he said.

“Labour’s broad competitiveness policy agenda is good for families and farmers. More competition means a more dynamic and competitive economy.”