The Australian Competition and Consumer Commission (ACCC) has barred Coles Group from acquiring a leasehold interest over a new supermarket and liquor site in Western Australia, under the reformed merger regime that became mandatory from 1 January.
In November 2025, Coles notified the ACCC of a proposal to acquire the lease for a vacant site in Kalgoorlie-Boulder, proposing to develop the site to operate a full-line supermarket with a selling floor area of 2800 square metres, and a Liquorland store at the property.
After an initial Phase 1 review, the ACCC determined in January 2026 that the acquisition required an in-depth Phase 2 assessment, and determined on 1 July that the proposed acquisition would likely have the effect of substantially lessening competition in the retail supply of groceries by supermarkets in Kalgoorlie.
Consumers in Kalgoorlie are served by four large, full-line supermarkets – Coles, Woolworths and two independent stores (plus two smaller independent supermarkets). The ACCC considers it is likely the acquisition would lead to the exit of an effective independent full-line competitor, and its assets, from Kalgoorlie and result in a reduction in the competitive constraints on the major supermarket chains.
ACCC deputy chair, Mick Keogh, said the organisation conducted extensive inquiries and analysis of material provided by Coles and third parties, and assessed the likely competitive effects of the acquisition on competition in the retail supply of groceries in Kalgoorlie.
“Independent supermarkets are an important competitive constraint on the major supermarket chains. They provide consumers with meaningful choice, competition on service, quality and range, and competition on price for some products,” said Keogh.
“We found that while a new Coles supermarket will offer benefits to some consumers, there is a real prospect that the acquisition would lead to the exit of an effective independent competitor, and its assets leaving the market. New entry would not be timely enough and sufficient to offset the loss of competition likely to result from the acquisition.
“Based on our assessment of all of the material before us, we are satisfied that there is a real commercial likelihood that Coles’ proposed acquisition would substantially lessen competition in Kalgoorlie in the longer-term, to the overall detriment of consumers,” he said.
The ACCC has been calling for merger reform for the past five years, first releasing a proposal at the Law Council in 2021. After a significant campaign, the Treasury Laws Amendment (Mergers and Acquisitions Reform) Bill was introduced to Parliament in October 2024 and was approved in November, aiming to provide fit for purpose tools targeted at identifying and preventing anti-competitive mergers for the ACCC. The new merger regime came into effect from 1 January 2026, but allowed for merger parties to start using the new regime on a voluntary basis from 1 July 2025.
Following last year's ACCC supermarket inquiry and federal government response to the Senate Select Committee on Supermarket Prices, it was determined that Coles and Woolworths must also notify acquisitions of any supermarket business and any legal or equitable interest in land above a certain size, regardless of the monetary notification thresholds.
This is the first instance of the ACCC using its new powers to deny a proposed acquisition of this type.
The organisation has also begun monitoring supermarket pricing, after the Federal Court determined in May that Coles had made false or misleading representations in its ‘Down Down’ promotional program.
