Concerns that artificial intelligence could enable retailers to collude on prices without ever communicating were quietly circulating behind closed doors at CES 2026, sparking fresh scrutiny from competition regulators worldwide including in Australia.

ChannelNews has learned that regulators and industry experts are increasingly alarmed by the rapid deployment of AI-driven pricing systems that can dynamically adjust prices in real time — potentially leading to higher costs for consumers without any explicit agreement between competing retailers.

Australian Competition and Consumer Commission (ACCC) chair Gina Cass-Gottlieb has confirmed she is closely monitoring the risk that AI pricing bots could drive price fixing or collusion-like outcomes, even in the absence of human coordination.

“There is also growing concern — in Australia that AI systems used in online retail may undermine competition,” Cass-Gottlieb said, warning that autonomous pricing algorithms could learn to avoid price wars and maintain higher prices.

Investigations by competition authorities in Australia, Europe, the UK and the United States have revealed that major online retailers are increasingly relying on AI to set prices automatically. These systems analyse vast amounts of data, including competitor pricing, consumer demand, inventory levels and purchasing behaviour to determine actions.

Companies such as Amazon, Temu and Shein are understood to be well advanced in their use of automated pricing technologies.

While the systems are not directly communicating with one another, experts warn they can behave like independent economic agents — reacting to market signals in ways that ultimately reduce competition.

One of the most troubling risks is so-called “tacit collusion,” where pricing algorithms independently learn that maintaining higher prices is more profitable than competing aggressively. Academic research has shown that AI agents can develop collusive pricing patterns simply by optimising profit over repeated interactions, without any explicit agreement or communication.

This marks a significant departure from traditional cartel behaviour, which typically relies on direct coordination and is clearly illegal under existing competition laws.

Legal experts say algorithmic pricing could produce outcomes that are functionally indistinguishable from price fixing — even if no human ever agrees to it.

Recent research suggests that the interaction of multiple AI systems — such as pricing bots operating alongside recommendation engines — can reshape markets, elevate prices and weaken competitive pressure.

As a result, antitrust scrutiny of AI-powered retail pricing is intensifying.

At CES, it was revealed that the U.S. Department of Justice and the Federal Trade Commission are examining whether algorithmic pricing breaches antitrust laws. Litigation has already emerged in other sectors, including the U.S. rental property market, where pricing software has been accused of inflating rents.

Cass-Gottlieb has also warned that AI could “supercharge” consumer harm in other ways, including scams and so-called “AI washing,” where companies exaggerate the role of machine learning in their products to justify higher prices.

She said the rapid rise of AI agents — increasingly autonomous systems capable of acting on behalf of businesses — will be a major regulatory concern in 2026.

Experts told ChannelNews that if pricing algorithms converge on higher prices across competing sellers, consumers could face reduced choice, fewer discounts and systematically higher costs.

Australian suppliers are already expressing concern about extreme discounting by retailers, with some abandoning bricks-and-mortar distribution in favour of direct-to-consumer models. These businesses can deploy their own AI tools while avoiding traditional retail margins.

AI specialists caution that the technology is not inherently collusive, but agree there is a legitimate economic and legal debate over whether autonomous pricing systems can unintentionally produce anti-competitive outcomes.

Universities are now working with regulators to model how pricing algorithms behave when left to operate independently in competitive markets.

The ACCC continues to investigate pricing practices across retail and other sectors, while legal teams are reportedly examining whether new laws are needed to explicitly outlaw algorithmic collusion.

Cass-Gottlieb has warned that consumers comparing prices online may be misled into believing they are seeing genuine competition, when in fact AI systems may have already aligned pricing.

“It’s essential that the law keeps pace with AI development so Australians aren’t worse off,” she said.

A Federal Treasury review released in October found existing consumer laws were broadly adequate, but Cass-Gottlieb warned enforcement may evolve.

Future ACCC action may not require proof of deliberate human coordination. Legal sources say algorithmic coordination alone could be sufficient to trigger enforcement.

For now, regulators agree AI is not colluding by design — but its ability to reshape markets is forcing competition law into uncharted territory.