ACCC Sanctioned Supermarket Cartel, Good Idea or Rort?

wannagrababargain on 24/03/2020 - 10:46

ACCC has interim approved a measure to effectively suspend legally going after the big Supermarkets for cartel conduct and other contracts/understandings that would otherwise lessen competition.

https://www.accc.gov.au/media-release/supermarkets-to-work-t…

While I understand that activity local supermarket stores are putting a huge strain on the logistics of everything and that in these unprecedented times there MAY be an argument of increased public benefit in overlooking cartel/collusion behaviour I can't help to see at this application as a legal a$$ saving exercise rather than the altruistic measure it is put forward as.

The supermarket chains have been making an absolute killing lately. Both my local Coles and Woolworths have removed every special in the store and, although we are told that fresh fruit/veg supply is unaffected, some fresh fruit/veg has almost doubled in price in the last 2 weeks.

In relation to prices the undertaking explicitly forbids Retail Price fixing however the way that it is worded seems to open the door to tacit collusion. For example, agreeing the removal of specials, monopoly of supply in geographical regions.

Nothing in the application talks about any specific beneficial measures that are being undertaken to increase supply or to resume a massively ramped up delivery service (which would be a much safer option for social distancing purposes).

What do you think. Altruistic measure, legal butt covering or an outright supermarket power grab?

Food & Grocery

Comments

  • HighAndDry on 24/03/2020 - 10:51
    +5

    Cartel behavior involves things such as pricing things much lower than market value (based on demand and supply) by agreement.

    Surely you can see why suspending penalties for that might be relevant right now.

    The supermarkets don't need to collude at all right now to make a killing. They do need to agree if they want to under-price products without conceding a market/revenue advantage to the other major supermarkets.

    Edit: also,

    Nothing in the application talks about any specific beneficial measures that are being undertaken to increase supply or to resume a massively ramped up delivery service

    That's because the ACCC doesn't regulate supply chain management or… deliveries…

    Edit2: the authorisation also now allows supermarkets to agree to co-operate in sourcing and sharing wholesale stock, so that their cost price isn't bid up through the roof.

  • kipps on 24/03/2020 - 10:56
    +5

    Altruistic measure, legal butt covering or an outright supermarket power grab?

    This is a decision of the ACCC, not the supermarkets. You're being paranoid. The anti-collusion laws were preventing the supermarkets from together working on ways to limit those ridiculous panic buyers. I'm sick of fighting for stock. This interim measure will be revoked once things settle down.

  • Baysew on 24/03/2020 - 10:58
    +3

    From the media release

    Broadly, the ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.

  • ronnknee on 24/03/2020 - 11:40
    +1

    The authorisation allows a range of coordinated activities but does not allow supermarkets to agree on retail prices for products.

  • lunchbox99 on 24/03/2020 - 12:21
    +2

    The majors clearly stated (several times now) that advertising specials is likely to exacerbate panic buying, so they are being suspended until further notice.

  • Jade81 on 25/03/2020 - 09:52

    I think whether or not it's legal it's more than fair to avoid trusting supermarket (and online retailers) PR
    .
    To be fair supermarkets are out to make money, they always are and that's the nature of any profit driven business.

    However I question how tomatoes, for example have gone from a few dollars to $17.90/kg (prices vary store store, that's my store).

    At first I assumed it was a demand issue and simply bought different products to manage my grocery bill. Then I went to the Asian grocery up the road where all all fruit veg and meat etc is still the same prices as before, and no out of stocks. Hmmm.

    When Coles claimed to be ceasing click and collect and delivery, to better service the elderly and nursing homes, however the drivers told me they were being stood down to stock shelves to protect the drivers.i would have understood protecting the staff but the first story has better PR.

    Coles and WW are still claiming people people with disability cards, the elderly etc can register on a database for access outside of the 7am-8amhour (which not everyone can get to) however WW isn't responding yet to registrations (within the group's I know of) and the coles register isn't up

    Bottom line I don't blame them for putting the best spin on what they're doing, or for struggling, but it's not paranoid to look beyond the PR and buy alternative products or shop elsewhere, rather going to legal means.

    Nobody can blame any family for looking after financial positions but I doubt legal means are going to occur against supermarkets, regardless of the exact possible breach, agencies are just too overwhelmed. I think your question is probably moot, sorry.

    *Please note this is my own experiences and may be different elsewhere or later)

    • Yola on 26/03/2020 - 11:39

      I registered for the special deliveries from Woolworths on the 24th and received a text on 25th saying I was approved and could see delivery availability on the website Quite impressed other than the $15 delivery fee which I am pretty sure is more than usual. Since this is for the elderly or disabled and maybe those tested positive many may be struggling financially. Have not ordered so do not know availability, would not like to pay the fee and then not receive many items, although do not expect to get pasta or TP. Certainly it's suspicions that Coles has not had got their act together when Woolworths started it about 1 week ago.

  • popsiee on 25/03/2020 - 09:56

    Didn't they even before that suspension do as they please with minor fines ?
    So nothing new !

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