The Government's planned price signalling legislation may have relatively little impact on the banking industry - even though that industry is supposed to be its first target.The new law, announced by Wayne Swan yesterday, will target public disclosures on pricing made for the "purpose of substantially lessening competition". The law is already available in draft form."The law designed as proposed would prohibit any bank executive from purposefully signalling to its competitors through the media or investment community that if other banks raise their mortgage rates it will follow them."Unlike the Opposition's price-signalling bill, the new law would require only broad anti-competitive intent, and would not require proof that a statement actually did lessen competition. Like the Opposition's bill, the Government proposal would allow a court to infer anti-competitive purpose from actions; there would be no need for, say, an internal memo stating that the company planned a public statement to help raise prices.Swan said related laws prohibiting 'facilitating' or 'concerted' practices already existed in the US, the UK and Europe.But, as far as Banking Day is aware, these laws have never been successfully used for attacking the alleged price signalling which concerns Swan.And competition law expert Brent Fisse said yesterday that the new Australian law was unlikely to greatly impact on the banking industry here. A court was unlikely to find that a banker making statements on pricing intended to substantially lessen competition, he said."Banks already have compliance programs," said Fisse. They might have to rejig them a bit, to ensure that when they make public statements about products there's a legitimate commercial reason and it's documented. But I think it will be fairly easy for banks to protect themselves."Asked Fisse: "Is this really going to do much to improve competition in the banking system? I don't think so. It seems like a bit of tokenism."Proposals for price signalling bans have been criticised by other competition experts. Professor Stephen King, a former ACCC commissioner, told Banking Day last month that "any workable laws on price signalling could not catch the sort of communication the banks have been involved in".Australian Bankers Association chief executive Steven Münchenberg yesterday again rejected "unfounded claims that there is any price signalling in banking". He also repeated that price signalling laws "will make it more difficult for banks to explain to their customers what may happen with the direction of interest rates on mortgages and savings".Fisse did call the Government proposal a "substantial improvement" over the Opposition's bill, in part because it separates price signalling rules from other new laws targeting private disclosures. Those new laws appear targeted at petrol retailers who communicate prices to each other.An unusual feature of the Government's proposal is that it applies only to goods, services and industries prescribed by government regulation. The Government named banking as a specific sector to which the new law would apply.