ACCC uses new powers to knock back proposed Coles supermarket in ...
The ACCC has rejected Coles' plan to lease a new site in Kalgoorlie, concluding the store would likely lessen competition and harm independent rivals.
ACCC uses new powers to knock back proposed Coles supermarket in Kalgoorlie
On 1 July 2026 the Australian Competition and Consumer Commission (Accc) exercised the merger‑control powers it received at the start of the year to refuse Coles Group Limited’s plan to lease a vacant site on Great Eastern Highway, Somerville, and turn it into a full‑line supermarket and Liquorland. The decision, issued after a full Phase 2 review, marks the first refusal under the targeted notification regime that began on 1 January 2026.
Coles already runs a $16 million supermarket in Kalgoorlie’s central business district, opened in 2021, and three Liquorland stores in the town. The new proposal would have added a 2,800 square‑metre retail floor and more than 24 000 products, according to the company’s submission. Coles argued the store would create about 120 jobs and help meet the needs of a growing FIFO workforce.
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Regulatory context and precedent
The targeted notification regime requires Coles and Woolworths to list any acquisition of a supermarket business or a land interest above a set size on the ACCC’s Acquisitions Register, irrespective of monetary thresholds. The ACCC must then decide within 15 to 30 business days whether the notification proceeds to a Phase 2 assessment. Coles voluntarily notified the Kalgoorlie lease in November 2025, before the mandatory thresholds kicked in.
After a Phase 1 assessment flagged competition concerns, the ACCC announced in January 2026 that the deal would move to Phase 2. The formal Phase 2 notice was placed on the register on 29 January 2026, starting a 90‑business‑day assessment window. Submissions were invited until 13 February 2026.
This is not the regulator’s first intervention in regional supermarket deals. In 2023 the ACCC blocked Woolworths from acquiring an IGA in Queanbeyan, and earlier this year it secured a Federal Court ruling that Coles misled shoppers through its “Down Down” discount program.
What the ACCC found
Deputy Chair Mick Keogh said the ACCC “considered the acquisition could substantially lessen competition for the retail supply of groceries in Kalgoorlie.” He added that the deal was “likely to provide Coles with a significant market share” in a market where “competitive constraint from rival supermarkets may be limited and timely new entry may be unlikely.”
"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,"
Mick Keogh, ACCC Deputy Chair, via ABC
The regulator’s analysis identified four large, full‑line supermarkets – Coles, Woolworths and two independent stores – plus two smaller independents within a short driving distance of the proposed site. “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,” Keogh said.
He concluded that “new entry would not be timely enough and sufficient to offset the loss of competition likely to result from the acquisition.” The ACCC therefore decided the acquisition must be refused unless the parties can overturn the finding through a tribunal.
Coles’ response
Coles rejected the finding, stating that “blocking the development of a new supermarket on a vacant site does not promote competition.” The company emphasized that Kalgoorlie is “experiencing significant industrial activity, planned residential growth and comprises a substantial FIFO workforce, all of which are increasing demand for supermarket capacity across the region.”
"Even with the proposed Coles store, supermarket capacity in Kalgoorlie would be lower than, or comparable to, similar regional centres such as Albany, Busselton and Geraldton,"
Coles spokesperson, via MediaWeek
Coles also highlighted that the proposed store would deliver “more than 24 000 products,” improve “store amenities” and expand online home‑delivery capability. The chain said it would review the ACCC’s decision and consider next steps, including a possible appeal to the Australian Competition Tribunal, which would be overseen by an economist, a businessperson and a judge.
Local business perspective
Lionel Street IGA owner Nitendra Raj warned that his franchised supermarket “is already struggling to get staff” and that a new Coles “would use up more workers,” adding “our buying will go down.” He backed the ACCC’s ruling, saying the independent store “100 per cent” supports the decision.
"Our buying will go down. We have more issues with freight,"
Nitendra Raj, Lionel Street IGA owner, via ABC
Broader competition climate
The Kalgoorlie decision arrives as the ACCC expands its oversight under the Food and Grocery Code, gaining new powers to monitor pricing by retailers with annual revenue over $30 billion – a bracket that includes only Coles and Woolworths. The regulator’s heightened activity reflects a wider focus on supermarket pricing, supply‑chain issues and cost‑of‑living pressures that have featured in multiple media reports this year.
