ACCC’ crackdown on big supermarkets
Mergers and Acquisitions Control Regime
From 1 January 2026 it will be mandatory for businesses to notify certain mergers and acquisitions to the ACCC. This is an attempt at preventing anti-competitive acquisitions and reducing the risk of monopolies.
Under the Competition and Consumer (Notification of Acquisitions) Determination 2025, targeted notification requirements have been placed on Coles and Woolworths.
For the two supermarket giants, all acquisitions of supermarket businesses and land acquisitions above certain specified land sizes require notification.
Other businesses have general notification thresholds, outside of which there is no need to notify the ACCC. There is also an exemption from notification for acquisition of shares where the acquirer does not obtain control of the target or had already controlled the target before the acquisition.
Neither of these exemptions apply to Coles and Woolworths.
Why is regulation needed?
The need for stronger regulations is clear when looking at the Coles-Woolworths near-duopoly, which was brought to the forefront of our media when it emerged that they were generating enormous profits during a cost-of-living crisis. The ACCC’s March 2025 inquiry found that Coles and Woolworths were among the most profitable supermarkets in the world and had ‘little incentive to compete vigorously’.
Mergers and acquisitions regulation is necessary to ensure competition isn’t eroded by the concentration of multiple businesses under the control of just one or two dominant players. Allowing these monopolistic tendences in the supermarket sector will allow Coles-Woolworths to have extensive market power that allows them to raise prices with little competitive pressure. Essentially, they would be able to act as they wish to the detriment of consumers and the economy as a whole.
Under the old system, the ACCC could only challenge anti‑competitive acquisitions by initiating costly and inefficient court action. This route is optional and generally occurs after the merger or acquisition has already taken place. The ACCC’s new mandatory notification scheme is designed to prevent anti-competitive M&As at the outset.
Price Gouging Ban
Under the Competition and Consumer (Industry Codes-Food and Grocery) Regulations 2024 lies the new Food and Grocery Code of Conduct. On 1 July 2026, the Code of Conduct will include a price gouging ban, whereby retailers with a revenue of more than $30 billion per year will be banned from charging prices that are excessive when compared to the cost of supply plus a reasonable margin.
Currently, Coles and Woolworths are the only two supermarkets with a revenue high enough to be affected by this ban.
Breach of the ban will result in fines of either $10 million per breach, three times the value of the benefit derived, or 10% of the company’s turnover during the preceding 12 months.
However, many economists have argued that price regulation goes against the historic Australian approach to competition and consumer protection, which targets the competitive process, seen in the M&A regulations. Price gouging bans instead apply at the checkout, regulating the end price rather than the process. This carries various risks, including weakening incentive to compete, discount or innovate. In the long run, this could weaken price competition.
Together, the new merger controls and the price‑gouging ban signal a decisive shift toward reining in the supermarket duopoly. The success of these reforms will be measured by whether genuine relief is delivered to Australian households.