ACCC sues Woolworths over alleged fake discounts in 'Prices Dropped' promotions
Consensus Summary
The Australian Competition and Consumer Commission (ACCC) is suing Woolworths in federal court for allegedly misleading customers with fake discounts in its 'Prices Dropped' promotions. The case, which began on April 20, 2026, focuses on 266 products, with 12 representative items like Tim Tams, Oreos, and Lucky Dog Bones being examined. The ACCC claims Woolworths temporarily increased prices before placing them on promotions at higher-than-previous levels, deceiving shoppers into believing they were getting genuine discounts. Woolworths denies the allegations, arguing that price hikes were due to supplier cost pressures and inflation, and that the discounts were real. The case mirrors a similar lawsuit against Coles, which is still awaiting judgment. Both supermarkets dominate over 60% of Australiaâs grocery market, and the outcome could have significant financial and reputational consequences, including potential fines, class-action payouts, or reputational damage to the ACCC if it loses.
â Verified by 2+ sources
Key details reported by multiple sources:
- The ACCC is suing Woolworths for allegedly misleading customers with fake discounts in its 'Prices Dropped' program between September 2021 and May 2023
- The case involves 266 products, with 12 representative items (including Arnottâs Tim Tams, Oreos, Lucky Dog Bones, and Stayfree Ultra Thin pads) being scrutinized in court
- Woolworths denies misleading customers, stating that price increases were driven by supplier costs and inflation, and that discounts were real
- The ACCC alleges Woolworths temporarily increased prices before placing products on 'Prices Dropped' promotions at prices higher than their pre-spike regular prices
- The case is similar to the ACCCâs ongoing lawsuit against Coles, which also involves allegations of misleading 'Down Down' promotions
- The trial began in Sydneyâs federal court on April 20, 2026, with hearings expected to last a fortnight
- Woolworths posted a $1.4 billion net profit in the last financial year and dominates over 60% of the grocery market alongside Coles
Points of Difference
Details reported by only one source:
- Former ACCC boss Allan Fels called the case 'episode two' of a series titled 'Bogus Business Discounts' and suggested more cases may follow against non-supermarket businesses
- The ACCC plans to heavily scrutinize the pricing of the Oreo Family Pack, which spiked from $3.50 to $5.00 before being placed on 'Prices Dropped' at $4.50, allegedly misleading shoppers into thinking it was cheaper than before
- Woolworths shopper Stella Kelly, 26, expressed support for the ACCCâs case, saying 'Everybody's feeling the pinch' and that it's good to have someone looking out for everyday people
- Another Woolworths shopper, Carol, said she would be 'furious' if the court found Woolworths misled customers, as she has cut back on groceries due to rising inflation
- The 'Prices Dropped' promotion has been a fixture since 2015, and Woolworths operates over 1,100 supermarkets and Metro stores nationally
- The ACCC alleges Woolworths used 'was/is' comparative pricing, a strategy where prices were temporarily increased before being placed on promotions
- Woolworths cited extraordinary inflation post-COVID and supplier cost pressures as reasons for price adjustments, stating it worked to reduce inflationary impacts on customers
- The case comes amid economic upheaval, with supermarkets facing supplier requests for price hikes due to inflated fuel and fertilizer costs linked to the US-Israel war on Iran
- Coles conceded during its own case that it had planned the 'Down Down' prices before raising the spiked price, but denied misleading shoppers
Contradictions
Conflicting information between sources:
- The ABC states Woolworths claims the Oreo Family Pack's previous regular price was $5.00, while the ACCC argues it was $3.50 for 696 days before the spike
- The Guardian notes Woolworths said it 'fundamentally disagrees' with the ACCCâs claims, while the ABC quotes Woolworths as arguing the first price of $3.50 was a 'pre-inflationary dropped price'
- The ABC reports Woolworths shoppers like Carol are 'furious' at the prospect of misleading discounts, but the Guardian does not mention specific shopper reactions beyond the ACCCâs allegations
Source Articles
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Vinegar, Tim Tams and baby rice are among the products to be scrutinised in the Australian Competition and Consumer Commissionâs case Get our breaking news email , free app or daily news podcast The consumer watchdog is back in court and taking on Australiaâs largest supermarket chain, alleging Woolworths deliberately misled shoppers with fake discounts. The Australian Competition and Consumer Commissionâs (ACCC) case against Woolworths begins in the federal court in Sydney on Tuesday, almost tw