The Australian Competition and Consumer Commission (ACCC) has instituted proceedings in the federal court over claims made by Coles regarding par baked bread sold at its in-house bakeries.
The ACCC alleges that Coles ‘Baked Today, Sold Today’ and in some cases ‘Freshly Baked In-Store’ bread promotions were false, misleading and deceptive as these products were partially baked and frozen off site.
These promotions, as well as nearby prominent signs stating ‘Freshly Baked’ or ‘Baked Fresh’, were likely to mislead consumers into thinking that the bread was prepared from scratch in Coles’ in-house bakeries on the day it was offered for sale and that it was entirely baked on the day it was offered for sale, according to the ACCC.
The legal action covers various ‘Cuisine Royale’ and ‘Coles Bakery’ branded bread products. According to the ACCC, Coles also uses the same representations to promote bread that has been made from scratch in its in-store bakeries.
The ACCC said it was concerned that Coles’ lack of distinction in its promotional representations between bread products that are freshly prepared from scratch and par baked products is misleading to consumers and places competing bakeries that do freshly bake from scratch at a competitive disadvantage.
“There are two important issues at stake. First, consumers must be able to make informed purchasing decisions. Bread is an important grocery basket staple and customers need to be confident in claims made about food they buy.” said ACCC chairman Rod Sims.
“We believe consumers are likely to have been misled by Coles that the entire baking process, including preparation, occurred in-store, when in fact the bakery products were prepared and partially baked off site, frozen, transported and then ‘finished’ in store. Indeed, the Cuisine Royale products were partially baked overseas,” he said.
Sims said secondly, and just as importantly, misleading credence claims can undermine the level playing field and disadvantage other suppliers, in this case those suppliers are the smaller, often franchised bakeries that compete with Coles.
The ACCC noted that over the past few years, Coles has heavily promoted its in-store bakeries and introduced a number of ‘rustic’ bread lines. Many of these ‘artisan-like’ breads have been par baked and frozen before being ‘finished off’ before sale, whereas many independent bakeries make their bread from scratch in the bakery on the day of sale.
The ACCC said this latest action was part of its publicly declared enforcement priority of investigating credence claims, particularly in the food industry, with the potential to significantly impact consumers and competitors.
The ACCC is seeking declarations, injunctions, pecuniary penalties, orders that Coles review its compliance program, orders that Coles publish corrective notices on its website and in Coles supermarkets that have in-store bakeries, and costs.
