Woolies and Coles have for ages offered their customers 4c a
litre petrol discounts at Caltex and Shell respectively.
Then they started upping the discount to 8c or more if you also
bought stuff at the petrol station.
The ACCC got worried about this, and coerced undertakings out
of Woolies and Coles that they'd limit the discounts to 4c.
Everyone went back to sleep. But...
The bigger discounts continued, up to 14c at Shell stations. To
the punters, it looked like the undertakings were being
As the Federal Court found when the ACCC complained, in
Woolies' case that was true. By continuing to offer an extra 4c
discount to its own shoppers who also made additional purchases at
Caltex, Woolies was in blatant breach of its undertaking. But as
Coles was not so stupid. Or more sneaky. Shell was offering an
extra 10c discount to anyone who spent $20 or more at the Coles
Express outlet in the Shell servo. As this was on offer to anyone,
not just the Coles shoppers brandishing their 4c discount card, it
was technically within the terms of Coles' undertaking.
In the meantime, after getting busted but before the Court
smacked it, Woolies had seen the light and modified its offer to
look very much like Coles'.
The Federal Court says yep, that's all A - OK. Woolies and
Coles both have the green tick of approval to go on discounting,
provided the extra discount above the first 4c is available to
anyone, not just their own shoppers.
Does this strike you as something only lawyers could dream up
and then approve with a self - satisfied and somewhat cynical
smirk? If so, you'd be right.
Because, in reality, for all the ACCC - investigating,
undertaking - giving and Federal Court - prosecuting, in real
practical terms nothing has changed at all. Woolies and Coles are
still leveraging their market position to savagely undercut the
petrol prices charged by anyone other than their captive fuel
Not that what they're doing is illegal, by the way, and we
don't expect the next wave of changes to the Competition and
Consumer Act will change that. It's just interesting to watch
oligopolists in action and the inability of regulators to rein them
We do not disclaim anything about this article. We're
quite proud of it really.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
In some cases these fees or surcharges are higher than what a bank charges to these merchants for use of the system.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).