View Comments
The ACCC is taking the supermarket giants to court for allegedly breaching a deal on fuel discounts.
AAP The ACCC is taking the supermarket giants to court for allegedly breaching a deal on fuel discounts.

The competition watchdog is taking Federal Court action against the supermarket giants for allegedly breaching an agreement to cap fuel discounts.

Coles and Woolworths agreed to limit their fuel discounts for shoppers to four cents per litre in a deal struck with the Australian Competition and Consumer Commission (ACCC) in December.

But the ACCC has begun court proceedings against both retailers, as it says they are still offering larger discounts to shoppers who also spend money on groceries in their service stations.

"The ACCC takes alleged breaches of undertakings extremely seriously," ACCC chairman Rod Sims said.

"Such undertakings are generally accepted by the ACCC as an alternative to the ACCC taking court enforcement action."

However Coles suggested the ACCC may have a differing perception of the agreement than the retailers.

"Coles vigorously defends our ability to offer our customer great value on both groceries and fuel," Coles said in a statement.

"We welcome the opportunity to clarify conflicting interpretations of the voluntary undertaking on fuel discount dockets in court."

The watchdog says Coles is offering a 10 cent per litre discount to customers who spend at least $20 on groceries in a service station, plus a further four cent discount if they present a docket obtained by spending at least $30 in a Coles supermarket.

Woolworths is offering a discount of four cents per litre to customers who buy at least $30 of groceries in a supermarket.

Customers qualify for a further four cents if they spend an additional $5 worth of items in a Woolworths petrol station.

Woolworths said in a statement it did not believe it had breached the agreement with the ACCC by bundling the two discounts together.

"We remain disappointed that we have been curtailed from offering greater petrol discounts to our customers," Woolworths said.

"We have discussed with the ACCC making these discounts independent of each other, and this change is underway."

Woolworths said it had written to the court on Monday to make a declaration that allowing customers to redeem the two discounts at the same time is in accordance with the agreement.

The ACCC's court action is seeking declarations, costs and other orders, and is set to begin in the Federal Court in Sydney on April 3.

The ACCC sought a cap on fuel discounts as it was concerned they would have long term effects on the structure of the retail fuel market, and increase pump prices in the short term.