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Coles fined $11.25 million

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Supermarket giant Coles will pay $11.25 million in fines after it was found guilty of supplier mistreatment in the Federal Court of Australia on Monday.

The action was brought against Coles by the Australian Competition and Consumer Commission after it demanded payments from suppliers it was not entitled to.

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Suppliers such as Oates were told by Coles there would be risks to the promotion of their products and Coles would not order any more products unless suppliers agreed to sign a retail collaboration program.

Federal Court judge Michelle Gordon said Coles had engaged in unconscionable conduct and had demanded payments it was not entitled to to fill profit gaps.

“Coles’ misconduct was serious, deliberate and repeated. Coles misused its bargaining power,” Justice Gordon said.

“Its conduct was not done in good conscience.  It was contrary to conscience.”

“Coles’ practices, demands and threats were deliberate, orchestrated and relentless.”

ACCC Chairman Rod Sims said the decision made appropriate business conduct clear.

“This should send a clear signal to larger businesses generally about appropriate business conduct in commercial dealings with smaller suppliers,” Mr Sims said.

In a previous statement, Coles Managing Director John Durkan said the supermarket “unconditionally apologises and accepts full responsibility for its actions”.

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