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EU Consumers Support Mobile Roaming Charge Cap

by Ulrika Lomas, for LawAndTax-News.com, Brussels

08 November 2006


High roaming charges are deterring Europeans from using their mobile phones abroad, according to a new EU survey published on Tuesday.

The Europe-wide survey, published by Eurobarometer, has shown that an overwhelming majority of EU citizens support the European Commission's plans to step in to make sure that prices for making and receiving calls on mobile phones when travelling in other EU countries are not substantially higher than those at home.

European mobile phone users continue to pay between EUR4 and EUR6 for a four minute roamed call abroad. In some cases, roaming prices for such a call can exceed EUR12.

"Excessively high prices restrict mobile usage while abroad. This hurts consumers, it hurts European industry, and it hurts Europe," observed Information Society and Media Commissioner Viviane Reding. She continued:

"Reducing roaming prices is not only a political responsibility of the European Commission, but can also be an interesting business model, as demonstrated by some operators who have started to move in this direction in recent months with the introduction of special roaming packages."

"I call on all mobile operators to help tear down this last visible border in Europe’s internal market. It is not acceptable that the burden of international mobile roaming continues to be shouldered by ordinary citizens who pay standard tariffs."

According to Eurobarometer, 70% of respondents to the survey supported the need for EU intervention to lower roaming costs across the EU, for the benefit of ordinary citizens. 68% would even support EU intervention to bring down roaming charges for SMS, a view shared by 78% of mobile phone users aged 15-24.

24,565 people from across the EU’s 25 Member States responded to the survey, which was conducted in September, following the summer holiday period.

In July, an EU regulation that would cut the cost of using mobile phones abroad by up to 70% was tabled by the European Commission, and could come into force in mid-2007.

The proposed regulation advocates the 'European Home Market Approach', and would work by capping, first of all, the wholesale charges that mobile phone operators charge each other for carrying calls from foreign networks. The method used by the Commission for this cap – which takes as its starting point the tariffs for connecting mobile phone calls from other domestic networks – would ensure that operators can recover at any rate the cost of providing roaming services.

As it is crucial for the Commission to guarantee that the benefits of the new EU regulation reach the level of consumers, it also proposed a price cap at retail level. Operators would be allowed to add to their wholesale cost a retail mark-up of up to 30%, which is the margin that operators can normally make with domestic phone calls.

This retail mark-up would apply to calls made and received while roaming. For calls received, this retail cap would become effective on the day of the entry into force of the new EU regulation. For calls made, the retail cap would take effect automatically after a final transition phase of 6 months.

The Commission additionally proposed enhancing the transparency of roaming charges for consumers. Mobile operators would be required to provide customers with full information on applicable roaming charges when subscriptions are taken out, and to update consumers regularly about these charges.

National regulators would also be required to monitor closely the development of roaming charges for SMS and multi-media message services (MMS).


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