Two of Australia's leading competition experts yesterday warned that mooted laws to ban "price signalling" by banks will be unworkable. Trade practices lawyer and academic Brent Fisse and Stephen King, dean of Monash University's Faculty of Business and Economics, both yesterday raised severe doubts over the proposed new laws. Australian Competition and Consumer Commission chairman Graeme Samuel has asked for powers to move against price signalling, where firms announce beforehand their intention to change prices. Prime Minister Julia Gillard flagged on Sunday that the government would give the ACCC such powers, and shadow treasurer Joe Hockey has promised a private member's bill to deliver them. Both were reacting to weeks on comments by bank CEOs on the need to raise mortgage margins, and a growing media and public backlash against the major banks. Both Fisse and King told Banking Day it will be impossible to draft any sensible law which outlaws price signalling of the type in which the banks are alleged to have engaged. King, a former ACCC commissioner, told Banking Day that "any workable laws on price signalling could not catch the sort of communication the banks have been involved in". King favours toughening some laws on private dealings between firms. But he said that once a business was communicating openly with its customers - such as in media releases and statements to journalists - "then the risks in trying to restrict communication clearly outweigh the benefits". And King argued that price signalling laws could actually harm competition and raise prices by making it harder for consumers to shop around. King warned that any new proposed law must go through a process of public consultation before it was enacted. "I have no confidence in the ability of Treasury to come up with sensible competition laws or amendments to the Trade Practices Act," he said. Fisse told Banking Day that price signalling laws have "quite fundamental problems". "There's a lot of simplistic views tossed out by Graeme Samuel and other people about what the laws should be," he said. Fisse told Banking Day that talk about prices could be ascribed to many different motives. 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. And a law which required the ACCC to prove there was no legitimate commercial purpose in the statements - the normal practice - would make it effectively impossible for the ACCC to prove a case. Fisse said that statements about future prices could be anti-competitive, but they could also be pro-competitive and pro-consumer. "Isn't it a good thing for consumers with mortgages to be given advance notices about what their commitments will be?" he said. Fisse and King both also endorsed the