Australian supermarket giant Coles’ latest store opening has been rejected on the basis of blocking out smaller competitors.The Australian Competition and Consumer Commission (ACCC) has blocked Coles’ application for a second supermarket and Liquorland in the West Australian mining town of Kalgoorlie.The ACCC has been assessing Coles’ acquisition of a site near Kalgoorlie airport since November and says the new development would be devastating for competition. The town already has a Coles, Woolworths, two IGA supermarkets, and two independent grocers.ACCC deputy chair Mick Keogh while the Coles supermarket would offer benefits to some consumers, there was a real prospect it would lead to the demise of an independent competitor.“Independent supermarkets are an important competitive constraint on the major supermarket chain,” he said. “They provide consumers with meaningful choice, competition on service, quality and range, and competition on price for some products.”The ACCC was able to block Coles’ new store as part of its oversight powers into potential price gouging from the big two supermarket giants.“Based on our assessment of all of the material before us, we are satisfied that there is a real commercial likelihood that Coles’ proposed acquisition would substantially lessen competition in Kalgoorlie in the longer term to the overall detriment of consumers,” Mr Keogh said.Coles has hit out against the decision, saying the store would have supported local jobs and an ever growing number of FIFO workers. “Blocking the development of a new supermarket on a vacant site does not promote competition. It denies Kalgoorlie shoppers greater choice and convenience,” Coles said in a statement to NewsWire.“This proposal would have delivered clear benefits for South Kalgoorlie customers, including easier access to more than 24,000 products, improved store amenities, and increased online home delivery capacity at a time when more customers are choosing to shop online.”Coles said the consumer watchdog had underestimated Kalgoorlie’s growth and residents’ demand for supermarket supplies. “Kalgoorlie is experiencing significant industrial activity, planned residential growth and comprises a substantial FIFO workforce, all of which are increasing demand for supermarket capacity across the region,” a Coles spokesman said.“Even with the proposed Coles store, supermarket capacity in Kalgoorlie would be lower than, or comparable to, similar regional centres such as Albany, Busselton and Geraldton.”Read related topics:Coles