Competition and Consumer (Price Inquiry—Home Loans) Direction 2019 (Cth)

Competition and Consumer (Price Inquiry—Home Loans) Direction 2019

made under the Competition and Consumer Act 2010

Compilation No. 1

Compilation date:   27 May 2020

Includes amendments up to:           F2020L00612

About this compilation

This compilation

This is a compilation of the Competition and Consumer (Price Inquiry—Home Loans) Direction 2019 that shows the text of the law as amended and in force on 27 May 2020 (the compilation date).

The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law.

Uncommenced amendments

The effect of uncommenced amendments is not shown in the text of the compiled law. Any uncommenced amendments affecting the law are accessible on the Legislation Register ( The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. For more information on any uncommenced amendments, see the series page on the Legislation Register for the compiled law.

Application, saving and transitional provisions for provisions and amendments

If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes.

Modifications

If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. For more information on any modifications, see the series page on the Legislation Register for the compiled law.

Self‑repealing provisions

If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.

Contents

Part 1—Preliminary  1

1  Name........................................................................................................................................ 1

3  Authority.................................................................................................................................. 1

4  Definitions................................................................................................................................ 1

Part 2—Price inquiry into the supply of home loans  2

5  Commission to hold an inquiry................................................................................................ 2

6  Directions on matters to be taken into consideration in the inquiry........................................... 2

7  Directions as to holding of the inquiry..................................................................................... 3

8  Period for completing the inquiry............................................................................................. 3

Endnotes   4

Endnote 1—About the endnotes   4

Endnote 2—Abbreviation key   5

Endnote 3—Legislation history   6

Endnote 4—Amendment history   7

Part 1—Preliminary

1  Name

This instrument is the Competition and Consumer (Price Inquiry—Home Loans) Direction 2019.

3  Authority

This instrument is made under the Competition and Consumer Act 2010.

4  Definitions

Note:       Expressions have the same meaning in this instrument as in the Competition and Consumer Act 2010 as in force from time to time—see paragraph 13(1)(b) of the Legislation Act 2003.

In this instrument:

Australian credit licensee has the meaning given by the National Consumer Credit Protection Act 2009.

authorised deposit-taking institution has the meaning given by the Banking Act 1959.

exempt supply has the meaning given by subsection 95A(1) of the Act.

goods has the meaning given by subsection 95A(1) of the Act.

home loan means a loan secured by a mortgage over one or more residential premises.

inquiry has the meaning given by subsection 95A(1) of the Act.

price has the meaning given by subsection 95A(1) of the Act.

residential premises has the same meaning as in the A New Tax System (Goods and Services Tax) Act 1999.

services has the meaning given by subsection 95A(1) of the Act.

State or Territory authority has the meaning given by subsection 95A(1) of the Act.

supply has the meaning given by subsection 95A(1) of the Act.

the Act means the Competition and Consumer Act 2010.

Part 2—Price inquiry into the supply of home loans

5  Commission to hold an inquiry

(1) Under subsection 95H(1) of the Act, the Commission is required to hold an inquiry into the market for the supply of home loans. The inquiry is not to extend to any of the following:

(a)  the supply of a good or service by a State or Territory authority;

(b)  the supply of a good or service that is an exempt supply;

(c)  the conduct of the Australian Prudential Regulation Authority or the Australian Securities and Investments Commission;

(d)  the conduct of a mortgage broker.

Note:          The matters referred to in paragraphs (c) and (d) fall within scope of other inquiries.

(2)  For the purposes of subsection 95J(1), the inquiry is to be held in relation to goods and services of the following descriptions:

(a)  home loans supplied by authorised deposit‑taking institutions;

(b)  home loans supplied by Australian credit licensees;

(c)  home loans supplied by a person who would be covered by paragraph (a) or (b) apart from an exemption in force under the Banking Act 1959 or the National Consumer Credit Protection Act 2009.

(3)  Under subsection 95J(2), the inquiry is not to be held in relation to the supply of goods and services by a particular person or persons.

6  Directions on matters to be taken into consideration in the inquiry

Under subsection 95J(6) of the Act, the Commission is directed to take into consideration all of the following matters in holding the inquiry:

(a)  the prices charged, since 1 January 2019, by suppliers covered by subsection 5(2) for providing home loans, including:

(i)  differences between the prices advertised and the prices actually charged or paid, with particular regard to interest rates published by suppliers and the interest rates paid by customers; and

(ii)  differences between the prices charged to, or paid by, existing customers as compared to new customers; and

(iii)  supplier pricing decisions following changes in the Reserve Bank of Australia’s target for the cash rate (which is the overnight money market interest rate), including:

(A)  the extent to which any resulting price changes were due to changes in suppliers’ access to, and costs of, finance; and

(B)  the timing of suppliers’ announcements of price changes and their implementation of those changes; and

(b)  the extent and existence of supplier practices and strategies that create an impediment to existing home loan customers refinancing to an alternative supplier (commonly referred to as ‘switching’), including impediments resulting from product features and the effect of product bundling; and

(c)  other impediments to existing home loan customers refinancing to an alternative supplier, with particular regard to:

(i)  consumer behaviour, including consumer decision‑making, biases and choices; and

(ii)  the availability to the public of information about prices actually being charged, or paid, for home loans.

7  Directions as to holding of the inquiry

Under subsection 95J(6) of the Act, the Commission is directed to do the following in holding the inquiry:

(a)  have particular regard to the activities of those with the largest shares of outstanding home loans by market value; and

(b)  give to the Treasurer an interim report on the inquiry by 30 March 2020.

8  Period for completing the inquiry

For the purposes of subsection 95K(1) of the Act, the inquiry is to be completed, and a report on the matter of inquiry given to the Treasurer, by no later than 30 November 2020.

Endnotes

Endnote 1—About the endnotes

The endnotes provide information about this compilation and the compiled law.

The following endnotes are included in every compilation:

Endnote 1—About the endnotes

Endnote 2—Abbreviation key

Endnote 3—Legislation history

Endnote 4—Amendment history

Abbreviation key—Endnote 2

The abbreviation key sets out abbreviations that may be used in the endnotes.

Legislation history and amendment history—Endnotes 3 and 4

Amending laws are annotated in the legislation history and amendment history.

The legislation history in endnote 3 provides information about each law that has amended (or will amend) the compiled law. The information includes commencement details for amending laws and details of any application, saving or transitional provisions that are not included in this compilation.

The amendment history in endnote 4 provides information about amendments at the provision (generally section or equivalent) level. It also includes information about any provision of the compiled law that has been repealed in accordance with a provision of the law.

Misdescribed amendments

A misdescribed amendment is an amendment that does not accurately describe the amendment to be made. If, despite the misdescription, the amendment can be given effect as intended, the amendment is incorporated into the compiled law and the abbreviation “(md)” added to the details of the amendment included in the amendment history.

If a misdescribed amendment cannot be given effect as intended, the abbreviation “(md not incorp)” is added to the details of the amendment included in the amendment history. 

Endnote 2—Abbreviation key

o = order(s)
ad = added or inserted	Ord = Ordinance
am = amended	orig = original
amdt = amendment	par = paragraph(s)/subparagraph(s)
c = clause(s)	/sub‑subparagraph(s)
C[x] = Compilation No. x	pres = present
Ch = Chapter(s)	prev = previous
def = definition(s)	(prev…) = previously
Dict = Dictionary	Pt = Part(s)
disallowed = disallowed by Parliament	r = regulation(s)/rule(s)
Div = Division(s)
exp = expires/expired or ceases/ceased to have	reloc = relocated
effect	renum = renumbered
F = Federal Register of Legislation	rep = repealed
gaz = gazette	rs = repealed and substituted
LA = Legislation Act 2003	s = section(s)/subsection(s)
LIA = Legislative Instruments Act 2003	Sch = Schedule(s)
(md) = misdescribed amendment can be given	Sdiv = Subdivision(s)
effect	SLI = Select Legislative Instrument
(md not incorp) = misdescribed amendment	SR = Statutory Rules
cannot be given effect	Sub‑Ch = Sub‑Chapter(s)
mod = modified/modification	SubPt = Subpart(s)
No. = Number(s)	underlining = whole or part not
commenced or to be commenced

Endnote 3—Legislation history

Name	Registration	Commencement	Application, saving and transitional provisions
Competition and Consumer (Price Inquiry—Home Loans) Direction 2019	15 October 2019 (F2019L01328)	16 October 2019	—
Competition and Consumer (Price Inquiries) Amendment Direction 2020	26 May 2020 (F2020L00612)	27 May 2020	—

Endnote 4—Amendment history

Provision affected	How affected
section 2	rep LA s 48D
section 8	am F2020L00612