Federal Court action has been launched against Australia’s washing powder barons.

Colgate, Cussons and Unilever, which produce popular laundry detergent brands including Cold Power, Radiant and OMO, are accused of operating a cartel to bring in a cheaper product without passing on savings.

The Australian Competition and Consumer Commission (ACCC) has filed civil proceedings in which it alleges the brands colluded to transition the market to ultra-concentrated washing powder, while removing standard concentrates.

The ACCC says the ultra-concentrate washing powder was considerably cheaper for the brands, but was then sold at the same price-per-wash as the standard powder, leaving consumers paying more for less.

The ACCC says that Colgate, Unilever and Cussons arranged to start selling ultra concentrates to major supermarkets simultaneously, while ceasing the supply of standard concentrated laundry detergents.

The watchdog says company directors had some knowledge of the arrangement, and that supermarket chain Woolworths played a key role implementing the simultaneous change.

“Ultra concentrate detergents are cheaper to produce, store and transport,” ACCC chairman Rod Sims said.

“The ACCC alleges that this offered significant cost savings which, by agreement, were not passed onto consumers.

“These alleged arrangements also standardised the ultra-concentrate products offered, denying consumers a variety of choices on pricing, package volumes and the strength of the concentrate product.

“By way of contrast, when similar products were launched in New Zealand there was significant discounting, such as offering a larger pack for the price of a smaller pack.

“The ACCC alleges the benefits of these competitive actions were denied to Australian consumers.”

A statement by Woolworths said it would “vigorously defend the action brought against it by the ACCC”.

Adding: “To be clear, the ACCC has not alleged that Woolworths was party to any cartel.”

Colgate and Cussons are yet to comment on the matter, but a statement from Unilever said it has taken “firm action in response to the regretted past behaviour of a small number of ex-employees discovered in its own investigations.”