Collusion in Australia: The Hidden Cost to Consumers and Markets

Collusion may sound like something out of a political thriller, but in Australia’s markets, it’s a very real issue with tangible impacts on everyday Australians. When businesses secretly cooperate instead of competing, prices rise, innovation stalls, and consumers foot the bill. As Australian regulators intensify their scrutiny in 2025, understanding collusion’s mechanics and consequences has never been more important for both investors and consumers.

What Is Collusion? Breaking Down the Basics

At its core, collusion happens when two or more businesses make secret agreements to manipulate market outcomes. This could mean fixing prices, rigging bids, or dividing up markets. The aim? To maximise profits at the expense of competition and, ultimately, consumers.

• Price fixing: Competitors agree to charge the same price instead of letting market forces decide.

• Bid rigging: Companies predetermine who will win a contract, often rotating the winner among themselves.

• Market sharing: Businesses carve up customers, territories, or product lines to avoid competing head-to-head.

The result? Higher costs for households and businesses, reduced choice, and less incentive for companies to innovate or improve service.

Collusion in the Australian Context: 2025 Policy and Enforcement Trends

Collusion has made headlines in Australia, especially in sectors like construction, banking, and retail. The Australian Competition and Consumer Commission (ACCC) continues to make anti-collusion enforcement a priority. In 2025, several new measures have come into play:

• Increased penalties: Fines for proven collusion have doubled since July 2024, with the maximum corporate penalty now exceeding $100 million per breach.

• Leniency programs: Companies that self-report collusion and cooperate with investigations can receive reduced penalties, encouraging whistleblowing.

• Expanded surveillance: The ACCC is deploying AI tools to monitor suspicious pricing patterns, especially in energy, supermarkets, and construction.

Recent cases include a major supermarket chain fined for coordinating with suppliers to keep grocery prices high, and several construction firms facing legal action for bid rigging on public infrastructure projects.

How Collusion Hurts Consumers and Investors

Collusion rarely makes the front page, but its impact is felt by almost every Australian. Here’s how:

• Higher prices: When competitors collude, prices for everyday items—like groceries, petrol, or electricity—can rise well above fair market value.

• Lower quality and choice: With no pressure to compete, businesses may cut corners or limit options for consumers.

• Distorted investment signals: Investors rely on competition to gauge which companies are truly efficient and innovative. Collusion masks underperformance and can inflate share prices artificially.

For example, the 2024 supermarket price-fixing case led to a 12% increase in average grocery bills for affected regions, according to data from the Australian Bureau of Statistics. Investors in the implicated companies saw share values initially hold steady, only to drop sharply once the collusion was exposed and fines imposed.

Spotting and Responding to Collusion: What You Can Do

While regulators are stepping up, consumers and investors also play a role:

• Compare prices regularly: Don’t assume price rises are always justified. Persistent similarities in pricing between competitors can be a red flag.

• Report suspicious behaviour: The ACCC maintains a confidential hotline for tips on anti-competitive conduct.

• Be wary of market darlings: If a sector’s profit margins are suspiciously high and stable, it might be worth a closer look before investing.