The Australian Competition and Consumer Commission on Monday sensationally alleged the companies broke consumer law, duping customers with misleading discount pricing claims on hundreds of products.

The ACCC, which launched legal action in the Federal Court, said it would seek a significant penalty for the alleged breaches, which relate to the Woolworths’ Prices Dropped and Coles’ Down Down promotions across 15 months.

Both supermarket giants were hit hard after the ACCC announcement, with Woolworths and Coles shares falling more than three per cent in trade for a combined loss of $2.29 billion.

Consumer group Choice said increased public scrutiny of the supermarkets’ historical pricing was needed in the wake of the lawsuit.

“We’re calling for greater transparency of historical supermarket pricing data,” Choice campaign director Rosie Thomas said.

“Easier access to data on supermarket price changes over time would have made it much harder for the supermarkets to get away with this kind of behaviour for so long.”

She said Coles’ and Woolworths’ pricing practice “urgently needs to be addressed – particularly during a cost-of-living crisis when people are doing it tough”.

RMIT economics expert Meg Elkins said the regulator’s case underscores the need for greater transparency in grocery pricing.

“The ACCC’s case could confirm what many consumers have long suspected about deceptive discount pricing,” Dr Elkins said.

Prime Minister Anthony Albanese on Monday said the allegations, if proven true, would be “completely unacceptable”.

“Customers don’t deserve to be treated as fools by the supermarkets,” Mr Albanese said.

Coles said it would defend the court proceedings, while Woolworths said its Our Prices Dropped program was introduced to give shoppers “great everyday value” on products.