Competition and Consumer (Price Inquiry—Retail Deposit Products) Direction 2023

The Direction operates through a small set of defined concepts and statutory cross-references. Understanding these is essential because the instrument delegates definitional content to other statutes, and limits the inquiry by cross-reference.

Retail deposit product. The instrument defines "retail deposit product" as a protected account under the Banking Act 1959, held either by an individual whose dealings are for personal or housing purposes, or by the trustee of a self-managed superannuation fund (see s 4). The definition therefore narrows the consumer-facing deposit products under inquiry to accounts that are “protected accounts” under the Banking Act and to specific classes of holders. The Direction does not itself define “protected account”; the Banking Act supplies that meaning.

Authorised deposit-taking institution. The term “authorised deposit-taking institution” is adopted from the Banking Act 1959 (s 4). Therefore the set of suppliers targeted are ADIs as defined under the Banking Act, not the broader set of potential financial services providers.

Cross-referenced Act definitions. Several core technical terms are not defined within the Direction but are explicitly adopted from subsection 95A(1) of the Competition and Consumer Act 2010. Those include "goods", "services", "inquiry", "price", "supply", and "State or Territory authority" (s 4). This means that the statutory construct and the ACCC’s powers relevant to price inquiries are governed by the Act’s definitions and procedural framework.

Scope exclusions. The Direction expressly excludes certain domains from the inquiry (s 5(1)). Notably, it excludes review of the conduct of APRA and ASIC, and only permits review of other Australian laws relating to prudential regulation, banking or the provision of credit insofar as necessary to consider the matters in s 6 (s 5(1)(c)-(e)). This prescribes a bounded inquiry, focused on market outcomes and supplier behaviour rather than on prudential supervisory conduct or broad statutory reform questions.

Matters to be considered. Section 6 lists the substantive lenses the ACCC must apply. These are detailed and specific: interest rates paid and their differentials (s 6(a)); terms and conditions other than interest rates, including fees and access restrictions (s 6(b)); supplier pricing strategies (s 6(c)); supplier decisions in light of changes to the RBA cash rate, and timing of rate announcements and their implementation (s 6(d)); market structure and competition frictions including barriers to entry, innovation and switching costs (s 6(e)); and the role of retail deposits as funding for suppliers’ credit provision, including comparative cost and differences by size and model of supplier (s 6(f)).

Temporal constraint. The inquiry is time-limited and must conclude with a report to the Treasurer by 1 December 2023 (s 7). The Direction’s commencement mechanics place its operative start the day after registration (s 2).

Taken together, these concepts mean the Direction is a targeted Ministerial instruction to the ACCC to investigate narrowly defined retail deposit markets supplied by ADIs, using the statutory definitional framework of the Act, limited in scope with particular exclusions, and guided by a specific set of economic and behavioural considerations, to be completed within a defined timeframe.

The Direction directly affects three institutional groups and indirectly affects others.

The ACCC. The immediate obligor is the Australian Competition and Consumer Commission. The Direction mandates that the Commission hold an inquiry (s 5(1)), to take into consideration the listed matters in s 6, and to complete and report the inquiry to the Treasurer by 1 December 2023 (s 7). The Commission must therefore allocate the staff time, investigative resources, and reporting capacity required to meet those statutory directions within the timeframe specified.

Authorised deposit-taking institutions (ADIs). The inquiry is expressly directed to retail deposit products supplied by ADIs (s 5(2)(a)). ADIs will be the primary industry cohort examined. The Direction’s itemised matters to be considered,interest rate differentials, terms and conditions, supplier pricing strategies, responses to RBA cash rate changes, competition frictions, and the use of retail deposits as funding for credit,relate directly to ADI pricing and funding decisions (s 6). ADIs should expect scrutiny of published and paid interest rates, fee schedules, access provisions and funding mixes.

Retail deposit holders as defined. The focus is on retail deposit products held by individuals whose dealings are for personal or housing purposes, and trustees of self-managed superannuation funds (s 4). Those depositor cohorts are therefore the consumer population whose outcomes and switching behaviour the ACCC is instructed to examine, including advertised versus paid rates, access restrictions, fees and switching frictions (s 6(a), (b), (e)).

Providers of credit products. The Direction includes products for the provision of credit supplied by ADIs to the extent those are relevant to subparagraph 6(d)(ii), which concerns differences in approaches to setting interest rates between deposit products and credit products (s 5(2)(b) and s 6(d)(ii)). Therefore lenders’ pricing behaviour on credit products will be examined only insofar as it sheds light on deposit pricing strategies.

Excluded parties. State and Territory authorities are excluded from the inquiry (s 5(1)(a)). APRA and ASIC conduct is excluded (s 5(1)(c)). Mortgage brokers are excluded (s 5(1)(d)). The inquiry is also not to review the operation of other Australian laws related to prudential regulation, banking or the provision of credit, except as necessary to consider the matters in s 6 (s 5(1)(e)). The Direction further prevents the inquiry being directed at the supply of goods and services by any particular person or persons (s 5(3)). These exclusions reduce the set of directly affected entities.

Other market participants. Indirectly affected parties include consumers, switched or prospective depositors, comparison services, fintechs offering deposit or switching solutions, deposit insurance administrators (by virtue of the Banking Act’s protected account concept), and credit market participants whose pricing practices are compared to deposit pricing. The Direction’s focus on barriers to entry, innovation and switching factors (s 6(e)) means firms involved in account switching or aggregation services may find their products and roles considered.

Treasurer and Government. The Treasurer initiated the Direction (document head, dated 14 February 2023; s 3 authority). The Treasurer is the recipient of the ACCC’s report (s 7). Consequently the executive branch will receive the investigatory findings and may use them for policy decisions, though the Direction itself does not prescribe follow-on policy.

In practical terms, ADIs should anticipate being asked to provide data and explanations relevant to each matter in s 6. The Direction does not itself create obligations on ADIs to provide information, nor specify compulsory information-gathering powers; those will depend on the ACCC’s statutory powers under the Act, which are referenced but not reproduced in the instrument (see s 3 and s 4 cross-references).

The Direction imposes duties on the ACCC and frames the rights of the Treasurer to receive a report. It does not create statutory duties or enforceable private rights against third parties.

Primary duty on the ACCC. The Commission is required to hold an inquiry into the market for supply of retail deposit products, under subsection 95H(1) of the Act as invoked by the Direction (s 5(1)). That is an affirmative obligation to commence and carry out an inquiry within the statutory framework. The Commission must also take into consideration the specific matters set out in s 6 when conducting the inquiry (s 6 opening words).

Scope-limiting duties. The Direction binds the ACCC to exclude certain subjects from the inquiry. The Commission must not extend the inquiry to supplies by State or Territory authorities, exempt supplies, APRA or ASIC conduct, mortgage broker conduct, or the review of other Australian laws relating to prudential regulation, banking or credit except insofar as necessary to consider the matters in s 6 (s 5(1)(a)-(e)). The Commission is also barred from holding the inquiry in relation to the supply of goods and services by a particular person or persons (s 5(3)). These are prescriptive duties constraining the Commission’s investigative reach.

Consideration obligations. Section 6 enumerates the exact matters the Commission is directed to take into consideration. The ACCC must analyse interest rate practices (s 6(a)), non-interest terms and conditions (s 6(b)), supplier strategy (s 6(c)), supplier decisions in light of RBA cash rate movements including timing of announcements and implementation (s 6(d)), competition factors and switching frictions (s 6(e)), and the funding role and cost of retail deposits relative to other funding sources, including differences by supplier size and model (s 6(f)). The ACCC’s report should address these topics because they are specified statutory considerations.

Reporting duty to the Treasurer. The Commission must complete the inquiry and give a report to the Treasurer by no later than 1 December 2023 (s 7). That is a temporal duty to deliver findings and conclusions to the executive by a set date.

Rights and obligations of third parties. The Direction itself does not grant third-party rights nor create enforceable obligations on ADIs or depositors. It instructs the ACCC to investigate and report. The manner in which third parties might be compelled or invited to provide information will depend on the ACCC’s statutory information-gathering powers under the Act, which the Direction references but does not restate (see s 3 and s 4’s cross-references to the Act). The Direction therefore does not, on its face, create private enforcement rights or civil liabilities for non-compliance by third parties.

Limits on legal review. The Direction does not itself address judicial review or administrative law rights. It is a statutory instrument given under the Competition and Consumer Act 2010 (s 3). The Commission’s decisions or the Direction’s validity could, in principle, be subject to legal challenge under administrative law, but the Direction text does not create or remove such rights.

In sum, the Direction imposes a mandatory investigatory duty on the ACCC with specific substantive and scope-limiting instructions, a reporting duty to the Treasurer by a fixed date, and no direct regulatory duties or private rights against ADIs or depositors within the text of the instrument.

The Direction is silent on civil or criminal penalties and does not itself create enforcement mechanisms against market participants. The instrument is an administrative direction to the ACCC to conduct an inquiry; it does not, in its text, prescribe penalties for any entity that is found to have acted in a particular way, nor does it create new enforcement powers.

No penalties in the Direction. There are no clauses in the Direction that impose fines, sanctions, orders, or compulsory measures on ADIs or other third parties. The Direction focuses on investigatory scope and matters to consider, and on a reporting deadline (s 5, s 6, s 7). It contains no penalty provisions.

ACCC powers not restated. The Direction is made under the Competition and Consumer Act 2010 (s 3), and it invokes the statutory inquiry powers referenced in Pt 5-1 of that Act (see s 5(1) relying on s 95H(1) and s 5(2) referencing s 95J(1) and (2)). Any coercive information-gathering or enforcement powers the ACCC may use in the course of an inquiry (for example, notices to produce or compulsory process) derive from the Act itself, not from this Direction. The Direction does not set out or modify those powers, and therefore does not alter the penalties or sanctions that the Act provides. The text of the Direction does not describe or enlarge the ACCC’s enforcement toolkit.

Compliance consequences for the ACCC. The Direction imposes a duty on the ACCC to hold the inquiry and to report by 1 December 2023 (s 5(1), s 7). The Direction does not specify consequences for failure by the Commission to comply with that duty. Any remedy for a failure by the ACCC would depend on statutory mechanisms in the Act or administrative law principles, which are outside the text of the Direction.

No direct private enforcement triggers. The Direction does not create a private right for consumers, depositors, or competitors to seek remedies based on the Direction’s content. Any private enforcement action against ADIs for conduct would rely on other statutory provisions (for example within the Act or the Banking Act) or on common law causes of action, none of which are created by the Direction itself.

Practical implication. In practice, enforcement outcomes that might follow from an inquiry,such as recommendation of regulatory reform, referral to other agencies, or the ACCC taking enforcement action under existing law,are possible downstream consequences, but they are not prescribed or enabled by this Direction beyond mandating that the ACCC investigate the listed matters and report to the Treasurer.

The Direction explicitly cross-references and interacts with other Commonwealth statutes, and it sets boundaries that limit interaction with certain regulatory institutions and legislation.

Made under the Competition and Consumer Act 2010. The Direction is expressly issued under the Competition and Consumer Act 2010 (s 3). It therefore operates within the statutory framework of that Act and its Pt 5-1 price inquiry machinery. The Direction adopts key definitions from subsection 95A(1) of the Act for terms such as "goods", "services", "inquiry", "price", "supply", and "State or Territory authority" (s 4). Consequently, procedural and definitional questions about the ACCC’s inquiry will be governed by the Act’s language as adopted here.

Reference to the Banking Act 1959. The Direction uses the Banking Act’s concepts for both "authorised deposit-taking institution" and "protected account" (the latter via the definition of retail deposit product in s 4). That means the objects of the inquiry are defined by banking law concepts, which may implicate banking prudential definitions, deposit protection constructs, and statutory distinctions between different account types under the Banking Act.

Interaction with the Superannuation Industry (Supervision) Act 1993. The Direction’s retail depositor definition includes trustees of self-managed superannuation funds as deposit holders for the purposes of the inquiry (s 4). This cross-references the SIS Act for defining SMSF trustees; it thereby brings SMSF trustee deposit behaviour into scope, which has implications for those trustees and for how ADIs manage SMSF account products.

Limits on reviewing prudential or regulatory conduct. The Direction explicitly prevents the inquiry from extending to the conduct of APRA or ASIC (s 5(1)(c)), and it restricts review of other Australian laws relating to prudential regulation, banking or the provision of credit, except where necessary to consider the matters in s 6 (s 5(1)(e)). This sets a separation between the ACCC’s market-focused inquiry and the prudential supervision and regulation performed by APRA and ASIC, except where examination of laws is necessary to address competition or price-related matters enumerated in s 6.

Exclusions for State or Territory authority supplies and exempt supplies. The Direction excludes supplies by State or Territory authorities and exempt supplies from the inquiry (s 5(1)(a)-(b)). The Act’s definitions of those terms (adopted via s 4) will determine the boundary between Commonwealth-regulated ADIs and state-run entities or exempt activities, potentially affecting the set of entities and products within the inquiry.

Relation to ACCC’s statutory powers. Because the Direction is issued under the Act, it leverages the ACCC’s inquiry powers under that statute. The Direction does not alter existing law, but by invoking the Act and by specifying questions for consideration, it channels the ACCC’s exercise of its legal powers toward the particular market and issues listed.

No express modification of other laws. The Direction does not amend or modify the Banking Act, SIS Act, the Act, APRA or ASIC instruments, or other federal or state legislation. It is an administrative direction that sets investigatory terms; any legal changes that might arise from the inquiry will depend on subsequent recommendations or legislative proposals, not on the Direction itself.

In short, the Direction sits at the intersection of competition law and banking law: it uses Competition and Consumer Act processes while borrowing banking and superannuation statutory definitions to identify the market and consumer groups under review, and it carves out prudential regulatory conduct and regulatory bodies from direct review.

The Direction contains its own commencement clause and records, but it does not record any amendments within the text provided. The instrument’s metadata and the internal commencement table are the only historical drafting items contained in the text.

Commencement details in the instrument. Section 2 sets out commencement mechanics: each provision commences, or is taken to have commenced, in accordance with the table that follows s 2. The table states that "The whole of this instrument" commences "The day after this instrument is registered" (s 2, commencement table). The instrument is dated 14 February 2023 at the head. The text also includes a note that the commencement table relates only to the instrument as originally made and will not be amended to deal with later amendments (s 2 note). There are no further entries in the commencement table indicating staged or partial commencements.

No recorded amendments within the document. The Direction as provided does not include any amending provisions, transitional arrangements, or sunset clauses apart from the reporting deadline in s 7. There are no footnotes or amendment schedules inserted into the text.

No historical regime notes. The instrument includes the standard administrative note that the information in column 3 of its commencement table is not part of the instrument and may be edited in any published version (s 2(2)). There are no indications of prior or subsequent versions in the provided text.

Practical implication. From the text alone, the Direction appears to be a single-use, time-limited instrument specifying an ACCC inquiry, with commencement the day after registration and a completion deadline of 1 December 2023 (s 2 and s 7). If amendments were later made to the Direction, they would not be reflected in this document; those would appear in a separate amending instrument or in the consolidated register of instruments.

Because the Direction does not itself amend underlying legislation, its amendment history will be limited to the instrument itself. Any legislative changes arising from the ACCC’s report would be recorded in the amending instruments or bills that may follow, but none are present in this text.

The Direction contains no record of litigation, judicial consideration, or case references. The instrument does not cite any judicial decisions, nor does it record any legal challenges or proceedings in its text.

No cases named or referenced. The Direction’s content is strictly administrative and procedural: it directs the ACCC to hold an inquiry and identifies matters to consider (s 5, s 6), but it does not recount any litigation history or list prior legal determinations relevant to the Direction.

Implication of silence. The absence of litigation references in the instrument means that any legal disputes arising from the Direction,whether about the validity of the Direction, the ACCC’s conduct of the inquiry, or the consequences of the inquiry,are not recorded here. If litigation were to arise, the relevant legal bases would likely be administrative law doctrines, statutory interpretation of the Act, and procedural fairness principles as applied to the ACCC’s inquiry processes. None of those legal events are within the Direction’s text.

Potential challenges, not recorded here. Although not in the document, typical grounds for legal challenge to Ministerial directions could include procedural validity, absence of power to give a direction, or breach of statutory limits; however the Direction does not address those matters. Any record of litigation would appear in court records or subsequent legal instruments, not in the Direction itself.

For practitioners seeking a litigation history, the Direction provides no in-text leads. Any authoritative litigation history would need to be obtained from court databases, administrative law records, or official registers external to this document. The Direction itself remains a standalone administrative instrument with no litigation annotations.

The Direction contains several features that can create practical pitfalls or misinterpretation risks if read without careful attention to cross-references and exclusions.

Definitions are external. Key terms are defined by reference to other statutes. "Authorised deposit-taking institution" and "protected account" are defined by the Banking Act 1959, and "goods", "services", "inquiry", "price", "State or Territory authority" and "supply" are defined by subsection 95A(1) of the Competition and Consumer Act 2010 (s 4). This means the scope of the inquiry is materially dependent on external statutory meanings. A reader who assumes ordinary language definitions may misidentify the set of products or suppliers covered.

Retail depositor cohort is narrow. "Retail deposit product" is a protected account held by an individual for personal or housing purposes or by an SMSF trustee (s 4). That excludes corporate accounts and other non-personal depositors. The focus on protected accounts narrows the market under review. If a deposit product does not meet the Banking Act’s "protected account" test, it falls outside the Direction even if it is economically similar.

Exclusions limit inquiry subjects. The Direction bars the inquiry extending to the conduct of APRA and ASIC, mortgage brokers, State or Territory authorities, and exempt supplies (s 5(1)(a)-(d)). It also restricts reviewing other Australian laws on prudential regulation except where necessary to consider the matters in s 6 (s 5(1)(e)). Practitioners should not assume the ACCC will address prudential regulatory design or supervisory conduct, except as narrowly necessary to the competition and pricing issues listed.

No targeting of particular persons. The Direction prohibits holding the inquiry in relation to the supply of goods and services by a particular person or persons (s 5(3)). This is an important constraint: the Commission cannot lawfully structure the inquiry as an investigation into named institutions alone. Any enforcement or follow-up targeted at specific firms would therefore require other statutory processes.

Timeline is compressed. The inquiry must be completed and reported to the Treasurer by 1 December 2023 (s 7). Given the breadth of matters listed in s 6, that is a finite timeframe to gather data and produce a report. Practitioners should account for compressed timetables for submissions and data requests.

Credit-products inclusion is limited and conditional. The Direction brings credit products into the inquiry only to the extent they are relevant to supplier approaches to setting interest rates on deposit products versus credit products (s 5(2)(b); s 6(d)(ii)). Readers should not infer a comprehensive credit-market review; comparisons are limited to the specific contrast in pricing approaches.

No enforcement or penalty mechanisms in the Direction. The Direction itself does not create statutory penalties or compliance obligations for ADIs; it instructs the ACCC to investigate (s 5(1)). Any compulsion to produce information will derive from the ACCC’s statutory powers under the Act, not from this Direction, and those powers are not described in the instrument.

Potential confusion over commencement. The instrument is dated 14 February 2023 but s 2 specifies commencement as "the day after this instrument is registered." The operative start date therefore depends on registration, not on the dated signature. That timing detail could affect relevant statutory timelines and stakeholders’ readiness.

Expectations on information not defined. Section 6 lists detailed matters the ACCC must consider, many of which imply access to granular interest rate data, timing of rate announcements, and funding-cost comparisons. The Direction does not specify how such data should be produced, what confidentiality protections apply, or whether information will be public. Those procedural issues are likely to be determined by the ACCC under its standard inquiry processes, but they are not resolved in this instrument.

In short, careful attention to cross-references, the narrow depositor definition, the express exclusions, the prohibition on targeting particular persons, and the tight timetable will be necessary to navigate the Direction without misapprehending its reach.

The Direction imposes obligations on the ACCC and sets an investigative agenda that market participants should prepare to engage with. The instrument does not itself compel third-party disclosure, but the following actions are consistent with the Direction’s terms and will facilitate compliance with ACCC inquiry processes.

For the ACCC (institutional compliance). The Commission must initiate the inquiry, structure it to address each matter listed in s 6, ensure the inquiry excludes the prohibited subjects in s 5(1), avoid targeting the supply of goods or services by particular persons (s 5(3)), and complete and report the inquiry by 1 December 2023 (s 7). Operationally, the ACCC should establish a project plan that maps evidence collection to the specific subparagraphs in s 6, allocate resources to analyse interest rate differentials, fee and access structures, supplier strategies, RBA cash rate response timing, barriers to entry and switching frictions, and funding-cost comparisons by supplier size and model. The ACCC must also ensure its procedural approach aligns with the Act’s inquiry powers and protections, given the Direction’s reliance on the Act (s 3 and s 4 cross-references).

For ADIs and other potential respondents. Anticipate requests from the ACCC that relate directly to s 6. To prepare:

• Assemble contemporaneous data on interest rates offered and paid across account cohorts, including advertised rates, promotional offers for new customers, rates for existing customers, and differences by deposit size (s 6(a)(i)-(iii), (iv)).

• Compile fee schedules and records of restrictions on customer access to deposited funds, including contractual terms, transactional limits, notice periods, and exceptions (s 6(b)(i)-(ii)).

• Document supplier pricing strategies and governance, including internal decision-making processes for setting deposit interest rates, pricing models, and business considerations that drive rate choices (s 6(c)).

• Maintain records showing timing of interest rate announcements and implementation relative to RBA cash rate changes, including internal communications and calendars that demonstrate the lag between policy rate movements and customer-facing changes (s 6(d)(i)).

• If relevant, document differences in pricing approaches for deposit products versus credit products, and the rationale for any asymmetry (s 6(d)(ii)).

• Prepare funding-mix analyses showing the proportion of funding sourced from retail deposits, the cost of retail deposit funding relative to wholesale or other funding sources, and how funding costs and reliance vary by entity size and business model (s 6(f)).

• Collate information relevant to barriers to entry, innovation, and switching frictions, including onboarding processes, technical or contractual frictions to switching, product bundling practices, and any market innovations introduced or delayed (s 6(e)).

Operational suggestions for ADIs. Given the Direction’s scope and likely ACCC interest, ADIs should ensure internal records are indexed, that privilege and confidentiality concerns are identified early, and that legal advisors are prepared to engage with the ACCC about production processes. Because the Direction does not itself specify compulsion, ADIs should be ready to respond to whatever information requests the ACCC issues under its statutory powers, and to apply protected or confidential treatment where legally appropriate.

For consumer groups, fintechs, and third parties. Those stakeholders should consider preparing submissions that address the enumerated s 6 matters from the consumer or innovation viewpoint: experiences of switching frictions, examples of access restrictions or fee burden, evidence of advertised vs paid rate gaps, and impacts of supplier pricing responses to RBA cash rate movements. Organise empirical evidence, representative data and case studies that map to the subparagraphs in s 6.

Timing and engagement. The tight reporting deadline in s 7 means participants should monitor the ACCC’s inquiry timetable and engagement mechanisms closely. Early engagement is useful to shape the inquiry’s evidence base. Parties should prepare succinct, evidence-focused submissions that align with the precise matters the Direction mandates.

Legal and confidentiality considerations. The Direction does not address confidentiality or legal privilege. Parties should seek contemporaneous legal advice about disclosure obligations under the Act and the ACCC’s notice powers, and about asserting appropriate claims over commercially sensitive materials. The Direction’s silence on procedural protections means these issues will be handled via the ACCC’s standard practices and statutory framework.

In short, compliance for the ACCC means conducting an inquiry that tracks s 6 and respects s 5 exclusions and s 7 time limits. For industry and stakeholders, compliance means being ready to supply targeted, well-documented evidence on the discrete topics listed in s 6, and to engage promptly with the ACCC’s established inquiry mechanisms.