Australia: cost of living in focus as ACCC targets supermarkets, essential services, and misleading pricing in 2025-26 enforcement priorities

On 20 February 2025, the Australian Competition and Consumer Commission (“ACCC”) Chair, Gina Cass-Gottlieb, announced the regulator’s annual enforcement and compliance priorities for 2025-26 at a Committee for Economic Development of Australia (“CEDA”) event.

Major challenges facing Australia’s economy, including the increased cost of living for consumers, the ubiquity of large tech platforms, and the transition to a sustainable economy, forms the broader context to the ACCC’s priorities, with the regulator prioritising areas such as essential services, the supermarket and retail sector, the digital economy, and sustainability in 2025-26.

While the compliance and enforcement priorities are broadly consistent with previous years, the ACCC has introduced a new priority on misleading surcharging practices and other add-on costs, and the regulator will also focus on ensuring compliance with Australia’s new mandatory and suspensory merger regime (although this is not listed as a specific enforcement priority).

The ACCC also continues to focus on its “enduring priorities” (i.e. long-term priorities that it considers to be extremely damaging to competition and consumer welfare), including cartel conduct, anti-competitive conduct, and product safety issues.

Some of ACCC’s key priorities for 2025-26 include:

1. Supermarkets and retail: competition, consumer and fair-trading concerns in the supermarket and retail sector.
2. Essential services: competition issues and misleading claims in essential services with a focus on telecommunications, electricity, and gas.
3. Aviation: competition and consumer issues in the aviation sector.
4. The digital economy: competition, product safety, consumer and fair-trading issues in the digital economy, in particular misleading or deceptive advertising.
5. Misleading surcharging practices and other add-on costs.
6. Environment and sustainability: competition and consumer issues in relation to environmental claims (including greenwashing).
7. Unfair contract terms in consumer and small business contracts, with a focus on harmful cancellation terms, including those associated with automatic renewals, early termination fees and non-cancellation clauses.

Ms Cass-Gottlieb also referred to the Commission’s successful use of non-litigated interventions to address both competition and Australian Consumer Law issues that have arisen. These have included the use of court-enforceable undertakings against suppliers of essential services (including against energy and telecommunications service providers).

Supermarket, retail, and aviation sectors in the ACCC’s crosshairs

The ACCC has continued to prioritise competition issues in the supermarket and retail sector, with a focus on businesses with market power, behaviour that affects small businesses, and misleading pricing practices. This is unsurprising given both the highly concentrated nature of this market (with Coles and Woolworths alone accounting for nearly 70% of national supermarket retail sales) and the barriers to entry for new retailers, such as planning and zoning laws, as well as the investment and time needed to expand. It is also unsurprising given the $30 million funding given to the Commission for investigations and enforcement in the supermarket and retail sector.

The regulator is also due to provide its report into Australia’s supermarket sector by 28 February 2025. Its interim report outlined concerns from both grocery suppliers and consumers, such as the unfavourable terms imposed by supermarkets on grocery suppliers, and consumers loss of trust in supermarket pricing.

Another key priority for the ACCC in 2025-26 is competition and consumer issues in the aviation sector. In her speech, Ms Cass-Gottlieb points to the recent record of entry and exit in the aviation sector (the collapse of Bonza and the shutdown of Rex’s inter-capital city network) as a good example of the importance of competition for consumers, business, and the economy. Even though the Government is taking steps to ensure that Rex’s regional services will continue, the events surrounding Bonza and Rex demonstrate the challenges of competing against an entrenched duopoly, as well as the need for improved competition and regulation.

Environment and sustainability

Of particular interest is the ACCC’s continued focus on environmental claims and sustainability. In relation to consumer law, it is clear that greenwashing and misleading environmental claims will continue to be in the ACCC’s crosshairs.

In relation to competition law, the ACCC has recently released a final guide on sustainability collaborations and competition law (“Guide”). The Guide is designed to help businesses that are considering collaborating with other businesses to reduce their impact on the environment. It provides guidance on the circumstances where collaboration may breach Australian competition law (e.g. if the collaboration involves cartel conduct), and, if there a risk, the options that are available to seek an exemption. One such option is the authorisation process which allows the regulator to take into account the benefits of environmental sustainability (e.g. biodiversity conservation) in considering whether to grant authorisation. We expect that more businesses that are considering sustainability collaborations will look towards the exemptions in Australia’s competition laws.

Misleading surcharging practices

As part of the current Government’s broader initiatives to crack down on unfair and excessive payment surcharges, the Government allocated an additional $2.1M to the ACCC to help combat misleading surcharging. Ms Cass-Gottlieb confirmed that the Commission will focus on improving business compliance with the excessive card payment surcharging prohibition and ensuring that all add on costs are properly disclosed. This largely serves as an interim measure pending the outcome of a broader review of merchant card payment costs and surcharging which is being undertaken by the Reserve Bank of Australia.

New merger regime

Although not listed as a specific enforcement priority, Ms Cass-Gottlieb noted in the speech that compliance with the ACCC’s new merger regime will be prioritised.

As Bird & Bird has previously reported, the reforms will see Australia’s merger regime move from a voluntary, judicial enforcement model to a mandatory, administrative regime, with the ACCC as the first instance decision maker on each notified acquisition. The ACCC will commence consultation on draft process guidelines and draft analytical guidelines before the end of March 2025. Compulsory notifications will come into effect on 1 January 2026, but voluntary notifications can be made starting from 1 July 2025. 

The ACCC has put merger parties on notice, particularly those that try to avoid notification of mergers or otherwise fail to comply with the regime, with Ms Cass-Gottlieb flagging that the Commission will be closely monitoring the new regime when it comes into effect. In particular, the ACCC Chair stated that the Commission will not hesitate ‘to take enforcement action against mergers that fail to be notified, including notifiable serial acquisitions, that are the subject of attempts to evade obligations under the new regime’ and that ‘we have dedicated significant resources to ensure that our people and systems will be ready’.

Businesses should take note of the ACCC’s priorities for the year ahead and ensure continued compliance with the Competition and Consumer Act 2010 (Cth).

For more information, please contact Thomas Jones, Matthew Bovaird, Patrick Cordwell or Dylan McGirr. This article was written with the assistance of Julian Ferguson.