Justice Goldberg of the Federal Court, Melbourne has imposed a fine of $8.9M on Safeway, a division of Woolworths for fixing the price of bread and misusing its market power. The allegations of misuse of market power concerned the supply of bread by Tip Top, Buttercup and Sunicrust Bakeries to other retailers who discounted the price of bread. The Australian Competition and Consumer Commission alleged that Safeway took action against each of the bread manufacturers to induce them, or attempt to induce them, to take action to have the discounting cease.
It was alleged that Safeway refused to accept further supplies of bread from a baker where the baker was supplying retailers who were discounting the price of bread. The space normally occupied by the affected baker being filled with another baker’s product. The ACCC alleged that Safeway recommenced purchasing bread from the manufacturer concerned once the discounter ceased discounting. Five other similar allegations under trade practices legislation were dismissed.