Coles blocked from opening second Kalgoorlie supermarket by ACCC

The Australian Competition and Consumer Commission has blocked Coles’ plan to open a second full-line supermarket and liquor store in Kalgoorlie-Boulder, Western Australia, in a case being watched as an early test of the regulator’s newer merger powers.

The ACCC said the proposed lease acquisition would likely substantially lessen competition in the retail supply of groceries in Kalgoorlie. It said there was a real prospect the new store would push an effective independent competitor out of the market and leave local shoppers with less competitive pressure on major supermarket chains.

Coles said it disagreed with the ruling. The company argued the regulator had underestimated Kalgoorlie’s population growth, planned residential development and FIFO workforce, and said the store would have improved convenience and choice for local customers.

Why the ACCC intervened

According to the regulator’s assessment, the site Coles wanted to secure would have supported a second Coles supermarket and liquor store in a market already served by Coles, Woolworths and several independent operators.

The ACCC’s concern was not just that Coles would be adding another store. It was that the deal could remove an independent rival that currently helps keep prices and service competitive in a regional market with a limited number of operators.

That makes the decision significant beyond Kalgoorlie-Boulder. The case is being framed as an early example of how the ACCC may use its newer merger controls in supermarket and retail property deals.

How the dispute developed

Coverage of the matter says Coles first notified the ACCC of its proposal around November 2025, when it sought to acquire the lease for a vacant site in Kalgoorlie-Boulder.

By early 2026, the ACCC had moved the matter into a deeper review process under the new merger framework. That expanded scrutiny signalled that the regulator was looking closely at the local competitive effects, not just whether the store would add capacity.

On July 1, 2026, the ACCC announced its final decision to block the proposal. The move was reported as the first use of the regulator’s new merger powers against a supermarket store proposal.

Coles’ response

Coles said the proposed store would have improved access to more than 24,000 products, store amenities and online home delivery capacity.

The company also said the ACCC had overlooked the growth profile of the town, including planned housing expansion and the presence of a sizeable FIFO workforce linked to the local mining economy.

Coles has not yet said whether it will challenge the decision or abandon the plan, but it said it would review next steps.

Local and wider stakes

Kalgoorlie-Boulder is already an important regional market, with a mix of major chains and independents serving residents and workers in the mining hub.

The ACCC’s decision suggests it is willing to look beyond the immediate benefits of another large supermarket and assess whether a new entrant or expansion might weaken smaller rivals enough to reduce choice over time.

That could matter for future retail property deals in regional Australia, where a single vacant site can become strategically important for both national chains and independent operators.

It also adds to the broader regulatory pressure on Coles and Woolworths over grocery competition and prices. In this case, the ACCC has drawn a line around what it sees as acceptable expansion in a concentrated local market.

What happens next

The main immediate question is whether Coles seeks to appeal, refile or walk away from the site.

Another question is how much detail the ACCC will publish about its reasoning and whether future cases will reference this one as a precedent for regional supermarket competition.

For now, the blocked Kalgoorlie plan stands as a sharp reminder that the regulator’s new merger scrutiny is not limited to big headline corporate deals. It can also reshape where and how the biggest supermarket groups expand in smaller markets.