The Australian Competition and Consumer Commission (ACCC) will officially begin monitoring supermarket pricing on 1 July 2026, marking the commencement of the new excessive pricing prohibition. Implemented as an amendment to the mandatory Food and Grocery Code, this regulation aims to promote workably competitive outcomes and protect consumer welfare amid ongoing concerns over the cost of living.
The new prohibition strictly targets ultra-large supermarket retailers, applying only to corporations that generated an annual revenue exceeding $30 billion in the previous financial year. Currently, this threshold isolates Coles and Woolworths as the only entities subject to the law. To support the rollout, the ACCC has published compliance and enforcement guidelines detailing how the regulator intends to assess pricing behaviors and monitor industry compliance.
Unlike rigid price-control frameworks, the Australian prohibition does not establish a fixed monetary threshold for what constitutes an excessive price. Instead, the ACCC will evaluate pricing by examining all surrounding circumstances, heavily weighing the actual direct and indirect costs incurred to supply a product against what constitutes a reasonable profit margin. According to ACCC Acting Chair Catriona Lowe, the prohibition offers a critical tool to protect households, with the regulator’s immediate focus centering on monitoring the pricing information of Coles and Woolworths to ensure strict adherence to their new obligations.
To optimize its regulatory resources, the ACCC will prioritize its monitoring on a select group of focus products. These initial priority products, to be published in the coming months, will be determined using consumer and supplier intelligence alongside data requested from the supermarkets regarding prices, sales revenue, and margins. The ACCC emphasizes that passing on genuine cost increases from suppliers will not be treated as excessive pricing, as the law is not intended to force supermarkets to reject reasonable supplier cost adjustments.
Integral to this new regime are strict record-keeping rules requiring very large retailers to retain relevant pricing information for at least three years. The ACCC plans to conduct proactive compliance checks, including issuing information requests on a biannual basis.
The stakes for non-compliance are remarkably high. Corporate breaches of the excessive pricing prohibition or its record-keeping mandates carry severe maximum pecuniary penalties. Courts can impose fines reaching the greater of $10 million, three times the value of the benefit obtained, or 10% of the retailer’s adjusted annual turnover, ensuring a powerful deterrent against price gouging.
