Last updated: July 5, 2026
Australia’s competition watchdog has stopped Coles from opening a second supermarket in Kalgoorlie-Boulder, Western Australia, in a landmark decision under the country’s new supermarket merger laws. The Australian Competition and Consumer Commission (ACCC) concluded the proposal could reduce long-term competition by placing greater pressure on independent grocery businesses already serving the regional city.
Coles had planned to develop a full-line supermarket and Liquorland store on a vacant site in Somerville, near Kalgoorlie Airport. While the project promised extra convenience and local jobs, the ACCC found that protecting competition in the Kalgoorlie grocery market carried greater long-term importance.
Updated: July 5, 2026
ACCC Rejects Coles’ Kalgoorlie Expansion
The proposal involved Coles acquiring a leasehold interest over Lots 95-106 Great Eastern Highway in Somerville. The retailer wanted to build a supermarket of about 2,800 square metres, along with a Liquorland outlet, as part of a new neighbourhood retail development.
If approved, the site would have given Coles a second full-line supermarket in Kalgoorlie-Boulder, one of Western Australia’s key regional mining centres.
The ACCC published details of the case on its official acquisitions register, where it explained why the proposal raised competition concerns.
Why the Proposal Was Blocked
The ACCC accepted that another supermarket could make shopping easier for some residents and create new employment opportunities. However, the regulator focused on what could happen to the local market after the new store opened.
Its concern was that another Coles outlet could place heavy pressure on independent supermarkets already operating in the city. If one of those businesses eventually closed, shoppers could be left with fewer genuine alternatives, less variety and weaker competition.
ACCC Deputy Chair Mick Keogh said independent supermarkets play an important role by competing with major chains on service, fresh food, local products and selected grocery prices. The regulator also found that a new competitor was unlikely to enter the Kalgoorlie market quickly enough if an independent operator exited.
Why Kalgoorlie Matters
Kalgoorlie-Boulder has about 30,000 residents, but its economy reaches well beyond that number because of nearby mining operations, surrounding communities and fly-in, fly-out workers.
The city already has one Coles supermarket, Woolworths, Spudshed, O’Connor Fresh IGA, Lionel Street IGA and smaller independent grocery stores. The ACCC noted that several grocery options are already located within a short drive of the proposed Somerville site.
If the Somerville store had gone ahead, Coles would have controlled two of the city’s four full-line supermarkets. The ACCC found that could increase the influence of major chains in a market where independent grocers remain important.
First Major Test Under New Supermarket Rules
The decision is significant because it is the first supermarket proposal blocked under Australia’s mandatory merger notification framework, which began on January 1, 2026.
Under the rules, major supermarket chains must notify the ACCC before certain acquisitions, including buying another supermarket, taking control of some vacant supermarket sites or developing qualifying new supermarket locations.
The Kalgoorlie decision shows that the ACCC will not automatically treat a new supermarket as positive for competition. The regulator will also consider whether the development could weaken smaller rivals over time.
Coles Disagrees With the Decision
Coles has said it is reviewing the ACCC’s decision and considering its options, including a possible appeal to the Australian Competition Tribunal.
The company argues the proposed supermarket would have created construction and retail jobs, improved convenience and offered a wider grocery range for local shoppers. Coles has also said its business case did not rely on any existing supermarket leaving the market.
The retailer believes the ACCC placed too little weight on Kalgoorlie’s future growth, including mining activity, residential development and demand from the region’s FIFO workforce.
Independent Grocers Welcome the Ruling
Independent supermarket operators supported the ACCC’s position, arguing that regional grocers face pressures that large national chains can absorb more easily.
Those pressures include freight costs, staffing shortages, smaller buying scale and the challenge of competing with major supermarket groups that have larger supply networks.
Lionel Street IGA owner Nitendra Raj said Kalgoorlie already has enough supermarkets and warned that another Coles could make it harder for smaller stores to compete for customers and workers.
Coles’ History in Kalgoorlie
Coles has operated two supermarkets in Kalgoorlie-Boulder before. Until 2021, it had stores on Brookman Street and at Hannans Boulevard before consolidating its presence into the current Egan Street supermarket.
The former Brookman Street site was later linked to a proposed Aldi supermarket and residential redevelopment. Aldi withdrew from that project in 2023 after construction costs rose, and the City of Kalgoorlie-Boulder later acquired the vacant site.
What Could Happen Next
If Coles appeals, the Australian Competition Tribunal could review whether the ACCC correctly balanced local investment, future growth, jobs and long-term competition risks.
The case may become an important reference point for future supermarket developments in regional Australia, especially where a major chain wants to expand in a market already served by independent grocers.
The decision also comes as grocery competition remains a major policy issue across Australia, with regulators paying closer attention to how large retailers expand in regional markets. For more related updates, visit our Australia business and consumer news coverage.
Why the Decision Matters Beyond Western Australia
The Kalgoorlie ruling shows how Australia’s updated merger rules may reshape supermarket expansion. A new store may offer short-term convenience, but the ACCC will examine whether it could reduce consumer choice in the years ahead.
Developers, landlords, supermarket chains and independent retailers are likely to watch future ACCC decisions closely as more proposals move through the new notification system.
What It Means for Local Shoppers
Unless Coles successfully challenges the decision or submits a revised proposal, the planned Somerville supermarket and Liquorland will not proceed.
Kalgoorlie shoppers will continue to rely on the existing mix of Coles, Woolworths, Spudshed, IGA supermarkets and smaller independent grocers. The ACCC’s view is that preserving that balance is better for long-term competition than allowing further concentration by one of Australia’s largest supermarket chains.
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