Courier Mail: Store sell-off threat

First published in the Courier Mail.

Coles and Woolworths would be forced to sell off stores or land to smaller supermarkets if instant fines of $2m and potential multimillion-dollar penalties fail to stop the duopoly’s anti-competitive behaviour, under a Coalition plan to give farmers and customers a better deal.

The controversial proposal to give the Australian Competition and Consumer Com- mission (ACCC) and courts the “last resort” power of forced divestiture has been criticised by Labor as a risk to jobs, but the Coalition says there will be “appropriate public interest safeguards”.

As the pre-federal election fight on cost-of-living intensifies, the opposition will introduce a private member’s bill targeting supermarkets with an annual turnover of at least $5bn to parliament on Monday in a bid to go further than the federal government’s proposed grocery crackdown.

The Coalition will not ultimately stand in the way of Labor’s plan, which also increases penalties and makes the Food and Grocery Code of Conduct mandatory for the big supermarkets, but is hoping to push the government to toughen its stance.

Nationals Leader David Littleproud said the “big stick” of divestiture would be a last resort.

Under the Coalition’s plan, the supermarkets could be instantly hit with infringement notices of a flat $2m by the ACCC if caught wrongdoing.

“If you want to change culture, you’ve got to have fines the ACCC can hand out straight away, and not small ones,” Mr Littleproud said.

Major breaches taken to court could result in the supermarkets being hit with whatever is largest out of $10m, three times the value of the benefit gained from the breach, or, if that can't be determined, 10 per cent of annual turnover.

Mr Littleproud said divestiture would be the final option to ensure supermarkets dealt with farmers and consumers in a “conscionable way”. He said there would be safeguards to prevent Coles or Woolworths simply selling to each other, with the goal to allow smaller players like Aldi or IGA to buy up.

“This will ensure the jobs aren’t lost and competition is maintained,” he said.
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The Coalition is also proposing the creation of a Supermarket Commissioner to allow farmers to come forward confidentially with complaints about how the supermarkets are dealing with them.