Coles and Woolworths are officially banned from price gouging, and the fines are eye-watering

As of yesterday, it is technically illegal for Coles and Woolworths to rip you off at the checkout. Whether anyone can actually prove it happened is a different story entirely.

The supermarkets excessive pricing prohibition kicked in on 1 July, banning "very large retailers" (translation: any grocery chain earning more than $30 billion a year in Australia, which right now means only Coles and Woolworths) from charging prices that are "significantly excessive" compared to the cost of supply plus a reasonable margin.

Break the rule and the ACCC can hit you with the greater of three penalties: $10 million, three times whatever profit you made from the dodgy pricing or 10 per cent of your annual turnover. That last one alone could run into the billions.

Here's the catch nobody's shouting about. There is no fixed number, formula or percentage that defines "excessive". The ACCC will assess it case by case, watching a select group of products and relying on tip offs from shoppers and suppliers to decide what gets investigated. Even the regulator's own recent supermarkets inquiry found no clear evidence of price gouging in the first place.

Unsurprisingly, both supermarkets are not thrilled. Coles says it makes just $2.43 profit for every $100 spent in store and blames higher prices on energy, fuel, insurance and freight costs, not greed. Woolworths has pointed out that no other country in the world has a law like this, that the rules do not clearly define what counts as excessive and that it conveniently only applies to Australian owned supermarkets while global players with growing market share here get a free pass.

That last point is not nothing. If you are going to build a world-first law around cost-of-living anger, at least make the definition airtight enough that shoppers see the difference in their trolley, not just a headline about fines nobody ends up paying.

For now this is a big, symbolic swing at supermarket power with a vague rulebook attached. Keep your dockets, keep comparing prices, and keep reporting anything that looks off to the ACCC, because right now shoppers flagging suspicious pricing might do more than the law itself.