The Australian Competition and Consumer Commission (ACCC) is going after Volkswagen over cars that were programmed to provide false reading on emissions tests.

The government's consumer watchdog says it has begun proceedings in the Federal Court of Australia against the German car maker and its Australian subsidiary.  The ACCC is seeking a public declaration of misconduct, financial penalties and corrective advertising.  The action covers more than 57,000 such vehicles over a five-year period, including Volkswagen's biggest selling models: the Golf, Passat, Polo and Amarok.

Officials allege Volkswagen installed and secret software that caused diesel vehicles to produce lower nitrogen oxide emissions under test conditions, but switched to a different mode under normal driving conditions.  The company began recalling vehicles in February.

In June, Volkswagen admitted to US regulators that its cars indeed used a defeat device, and agreed to pay US$14.7 Billion to settle emissions-cheating claims with US consumers and regulators.  But Australia's emission regulations are almost identical to those in the European Union.  There is some speculation that a ruling against Volkswagen in an Australian court could be used as precedent in Europe, resulting in the company getting slammed with billions of Euros in claims.