Special Case Review Series – Consumer & Human Rights Authorities Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2026] FCA 598

When "Down Down" Wasn't Really Down – Misleading Discounts and Consumer Trust

By BAJN – Employment & Human Rights Advocate

Consumer protection is often overlooked as a human rights issue.

Yet every Australian relies upon honest pricing when purchasing food, medicine, household goods and other essentials.

The Federal Court's decision in Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2026] FCA 598 is one of the most significant Australian Consumer Law decisions in recent years because it reinforces a simple but fundamental principle:

Consumers are entitled to rely upon promotional pricing being genuine.

The case demonstrates that businesses cannot create the illusion of savings by temporarily increasing prices before advertising a "discount."

For Australia's largest supermarket chains, the judgment represents a watershed moment in pricing transparency.

Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2026] FCA 598

The Background

The proceedings were commenced by the Australian Competition and Consumer Commission (ACCC) against Coles in September 2024.

The ACCC alleged that Coles had engaged in misleading conduct through its well-known "Down Down" promotional campaign.

The regulator alleged that, in relation to 245 supermarket products, Coles had:

• temporarily increased the selling price;

• maintained that higher price for only a relatively short period;

• then advertised a "Down Down" promotion; and

• represented that consumers were receiving a genuine discount when, in many cases, the promotional price remained equal to or higher than the earlier ordinary selling price.

The proceedings were brought under the Australian Consumer Law (ACL).

The Legal Issue

The central issue was deceptively simple.

When an ordinary consumer sees a ticket stating:

Was $8.00 Now $6.50

what does that representation convey?

The Court held that consumers understand far more than basic arithmetic.

They understand that:

• the higher price was a genuine previous selling price;

• it existed for a reasonable period;

• the reduction represents a real saving; and

• the promotion reflects genuine value rather than marketing manipulation.

The Federal Court's Decision

Justice O'Bryan found that 13 of the 14 sample "Down Down" pricing tickets examined during the liability hearing were misleading.

The Court concluded that the promotional tickets conveyed to ordinary consumers that the advertised reduction represented a genuine discount from a previous ordinary selling price.

That representation was misleading because the products had not been sold at the higher "Was" price for a sufficiently reasonable period before being placed on promotion.

One sample product was found not to be misleading because its ticket did not contain a comparative "Was" price.

What Made the Conduct Misleading?

An important feature of the decision is that the Court did not find Coles had fabricated prices.

The higher prices had genuinely existed.

The problem lay elsewhere.

The Court held that the comparative pricing created the misleading impression that consumers were receiving a genuine reduction from an established ordinary selling price.

In reality, many products had only been sold at the higher price for approximately four weeks before being promoted.

That was insufficient to support the impression conveyed to consumers.

Consumer Perception Matters

The judgment reinforces a longstanding principle of Australian Consumer Law.

Courts assess representations from the perspective of the ordinary reasonable consumer.

Businesses cannot defend misleading advertising by arguing that:

• every numerical statement is technically correct;

• consumers could investigate further;

• or internal pricing decisions were commercially justified.

Instead, courts ask:

What impression would an ordinary shopper take away?

That objective assessment lies at the heart of sections 18 and 29 of the Australian Consumer Law.

Inflation Was Not a Defence

Coles argued that supplier cost increases during the inflationary period justified the price rises.

Justice O'Bryan accepted that many price increases reflected genuine commercial pressures.

However, that did not answer the legal question.

The issue was not why prices increased.

The issue was whether the subsequent promotional representations accurately conveyed a genuine discount to consumers.

The Court concluded that they did not.

Why This Case Matters

The decision has implications extending well beyond supermarkets.

Any retailer using:

• "Was/Now" pricing;

• comparative pricing;

• percentage discounts;

• clearance promotions;

• introductory offers;

• online price reductions; or

• automated pricing systems

must ensure that the promotional representation reflects a genuine consumer saving.

The focus is the message conveyed—not merely the mathematical accuracy of the ticket.

Human Rights Dimension

Although primarily a consumer law decision, the case has a broader human rights significance.

Consumer protection promotes:

• fairness;

• transparency;

• informed decision-making;

• dignity in commercial transactions; and

• confidence in the marketplace.

These values become particularly important during periods of economic hardship, when households rely heavily upon promotional pricing to manage essential living expenses.

The Court recognised that misleading discounting practices make it harder for consumers to identify genuine value.

Lessons for Businesses

The decision provides practical guidance.

Businesses should:

• ensure comparison prices are genuine;

• retain evidence of pricing history;

• avoid artificial short-term price increases;

• review promotional approval processes;

• regularly audit automated pricing systems; and

• assess promotions from the perspective of ordinary consumers rather than internal marketing teams.

Internal compliance policies alone are insufficient if the customer-facing representation remains misleading.

Lessons for Consumer Advocates

For advocates representing consumers, the case demonstrates that:

• promotional language will be examined objectively;

• consumer impressions matter more than internal pricing logic;

• technical compliance is not always legal compliance;

• evidence of pricing history is critical; and

• misleading conduct may arise even where individual statements are literally true.

Why This Case Belongs in a Human Rights Library

Human rights are not confined to constitutional freedoms.

They also include protection from unfair commercial practices that undermine informed consumer choice.

Every Australian purchases food.

Every Australian depends upon truthful pricing.

Every Australian benefits when courts insist that businesses communicate honestly.

The Federal Court reaffirmed that trust is a valuable commercial asset—and one protected by law.

Final Assessment

Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd is likely to become the leading Australian authority on comparative supermarket pricing.

The decision makes clear that businesses cannot manufacture discounts by briefly increasing prices before advertising promotional reductions.

More broadly, it reinforces a foundational principle of Australian Consumer Law:

Consumers are entitled to honest representations—not merely technically accurate ones.

At a time when cost-of-living pressures dominate household budgets, that principle has never been more important.

Human Rights & Consumer Law Authority Review

Case: Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2026] FCA 598

Court: Federal Court of Australia

Judge: O'Bryan J

Area of Law: Australian Consumer Law, Misleading or Deceptive Conduct, Retail Pricing

Human Rights Relevance: ★★★★☆

Key Principles

• Comparative pricing must represent a genuine discount.

• The ordinary consumer's impression determines whether conduct is misleading.

• Technically correct pricing can still breach the Australian Consumer Law if it creates a false impression.

• Internal commercial justifications do not excuse misleading consumer representations.

• Honest pricing promotes consumer confidence and market integrity.

Why It Matters Today

The decision establishes an important benchmark for retailers using "Was/Now" pricing and other promotional discounts. Its reasoning extends beyond supermarkets to online retailers, pharmacies, department stores and e-commerce platforms. The judgment underscores that consumer trust is protected by law and that transparency in pricing is essential to fair competition and informed consumer choice.