The Coalition yesterday introduced its promised bill to outlaw "price signalling", giving regulators new powers while appearing unlikely to allow successful action against banks. The Australian Bankers Association argues that the main effect of the bill would be to chill public discussion of bank interest rates.The bill is unlikely to pass, given a lack of enthusiasm from key independents Tony Windsor and Bob Katter. But the federal government has said it is working with the Australian Competition and Consumer Commission on price signalling, ahead of its scheduled December package of banking law changes.The Coalition is suggesting its bill would crack down on banks making statements such as those that preceded recent home loan rate rises. Coalition competition spokesman Bruce Billson spent almost half of his parliamentary speech on the bill yesterday discussing banks.Billson targeted recent comments by ANZ CEO Mike Smith that he would be "reluctant" to increase home loan rates over and above the RBA's rate increases, and later comments that if other banks moved their rates outside moves by the RBA he would not be "stuck on my own". He claimed that such comments "may well be unlawful in the future if this bill is passed".However, Billson said a week ago that the bill is unlikely to catch statements like those made by bank chief executives in recent weeks. And the Coalition's media release yesterday made no mention of banks, saying instead that the bill addressed "a gap in the competition policy tool kit".The bill itself contains what appears to be a high bar for the Australian Competition and Consumer Commission to prove that a statement is "price signalling":* First, the offending company must make the statement "for the purpose of" encouraging another company to change its price. The purpose can be one of several purposes behind a statement, and a court can infer purpose from conduct. But the ACCC must always show that the offending statement was designed to encourage a price change.* Second, the statement must "substantially lessen" competition in a market.And competition law expert Brent Fisse told Banking Day earlier this month that in the case of pricing comments such as those made recently by bank executives, a court would find it impossible to determine what effect particular words were intended to have, and impossible to to determine what effect they actually did have.The ABA, meanwhile, argues that while the law itself may not outlaw the types of statements made by banks recently, it will have a chilling effect on public discussion of pricing."Individual banks and the ABA are constantly facing inquiries from journalists, politicians and bank customers seeking a response to comments, allegations or analysis regarding banks' funding costs and other pricing-related issues," said ABA CEO Steven Münchenberg."Many of these inquiries stem from comments or analysis from parties other than the banks themselves such as Reserve Bank Board minutes, comments from politicians as to whether banks' interest rate increases are justified, investment bank analysts, journalists and academics.""Constraining commentary from corporations will misinform the debate