COLES has been ordered to pay a $10 million fine for “serious, deliberate and repeated” misconduct towards suppliers.
The Australian Competition and Consumer Commission took action against the supermarket giant following reports of dodgy dealings between the supermarket and its suppliers.
Federal Court judge Michelle Gordon said Coles had engaged in illegal and unconscionable conduct in its dealings with suppliers.
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“Coles’ misconduct was serious, deliberate and repeated. Coles misused its bargaining power. Its conduct was ‘not done in good conscience’. It was contrary to conscience. Coles treated its suppliers in a manner not consistent with acceptable business and social standards which apply to commercial dealings,” she wrote in her judgment.
“Coles demanded payments from suppliers to which it was not entitled by threatening harm to the suppliers that did not comply with the demand. Coles withheld money from suppliers it had no right to withhold. Coles’ practices, demands and threats were deliberate, orchestrated and relentless.”
Choice reports the judgment is significant not only because of the magnitude of the fine, but also because it is one of the first findings of unconscionable conduct in a business-to-business context under the Australian Consumer Law.