European Commission moots cap on roaming charges
BRUSSELS: The European Commission unveiled a plan Wednesday to put a cap on the wholesale and retail roaming charges levied by telecom operators in Europe. The intention is to allow the industry a six-month period to bring in self-regulation.
While the commission’s intention is to cut down on the rates, which it feels is excessive, the operators felt it is going too far.
Commission president Jose Manuel Barros said the commission’s analysis shows that very high international mobile roaming charges currently affect at least 147 million European Union citizens. He told a news conference that the commission has no alternative but to intervene to protect the interest of consumers. “This intervention tackles excessive prices … not justified by the market condition.”
The proposal is aimed to cut costs of using a mobile phone abroad by as much as 70 percent, he said.
The EU’s 25 member-states and the European Parliament will have the final say on the cap. If the plan is approved, mobile phone companies will have a six-month grace period before implementing a mandatory cap on retail tariffs.
The commission intends to put the rule in place by the summer of 2007 in order to help people visiting countries during the holiday season.
The commission has set a maximum price of 11 pence a minute for receiving calls, 34 pence a minute for calling home and 23 pence a minute for calls within a country. It estimates that the 147 million EU citizens pay roaming fees of nearly 6 billion pounds. The new rules will save consumers about 3.4 billion pounds a year.
The GSM Association, which represents mobile companies, said most operators have already cut roaming tariffs in 2006. It felt the new proposals would damage the European roaming market and are not in the interests of consumers.
Vodafone’s German unit said the measure is completely unnecessary adding some of the existing offers from operators are cheaper than the rates prescribed by the commission.
The European Regulators Group of national EU telecoms watchdogs, which opposes regulatory intervention at the retail level, said the rules could remove flexibility for operators. It said in some cases customers may end up paying higher rates.
The commission is also coming out with a proposal to cap the wholesale prices — the price operators charge each other for handling calls.
People in Britain pay an average of 42 pence a minute to receive calls while on the Continent and up to 1.20 pounds a minute to make calls, depending on the service providers.





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