Master Grocers Australia calls for an end to anti-competitive behaviour of the “big two”

Posted by AFN Staff Writers on 13th June 2012

Master Grocers Australia, the body representing smaller supermarket operators under groupings such as IGA and Foodworks, claim to have evidence that will compel the Federal Government and the Australian Competition and Consumer Commission (ACCC) to take action against anti-competitive conduct by Woolworths and Coles locking out competitors.

Next month, Master Grocers Australia intends to produce a report that will call on the ACCC to curb what Master Grocers says is anti-competitive behaviour.

Master Grocers accused the “big two” supermarket majors of opening unnecessarily large stores to run at a loss in remote areas such as West Dubbo in New South Wales and Seville in Victoria, with the objective of destroy local businesses in these regions. A Commonwealth Bank report, stating that Coles and Woolworths intend to increase floor space by more than 5% in the next few years, is said to reinforce these accusations.

Master Grocers are not alone in their call for government regulation of the “big two”. According to a survey undertaken by international law firm Baker & McKenzie, more than 60% of senior executives in Australia believe the Australian Government should intervene in, and regulate, the activities of Woolworths and Coles.

Australian Food News reported last month that the Australian Food and Grocery Council (AFGC) has been finalising proposed draft legislation for the establishment of a supermarket ombudsman. In opposition is the Australian National Retailers Association (ANRA), which represents the two major supermarket groups.

The Senate Select Committee on Australia’s Food Processing Sector committee report is due on 30 June 2012. The report will assess, amongst other issues, the impact of Australia’s competition regime and the food retail sector on the food processing sector, including the effectiveness of the Competition and Consumer Act 2010 in this sector.