EU fails to agree limits for mobile phone roaming charges

EU politicians and officials failed on Tuesday to resolve important details of a plan to cut the cost of making and receiving mobile phone calls abroad, a lawmaker said.

Representatives of the European Parliament, the European Commission and European Union countries tried to agree the levels of price caps and whether consumers should be automatically switched to the regulated rates.

‘I think the two main problems are the limits of the caps and the “opt in, opt out” question,’ said Paul Ruebig, one of two lawmakers steering the regulation through the assembly.

‘Both sides definitely say they want to have a compromise. Everybody now is working hard to reach an agreement,’ Ruebig told Reuters.

An EU diplomat said there would be a second round of meetings on 2 May.

The European Commission has promised Europeans the new rates by this summer, but the three EU bodies, heavily lobbied by industry and consumer groups, are split over the details and time is running short.

The European Parliament wants what it calls a more consumer-friendly version of the rules – with caps that would automatically apply to all at 40 euro cents a minute for making phone calls abroad and 15 euro cents for receiving them.

The European Commission supports this approach.

Member states have taken a softer approach, recommending caps of 60 and 30 cents respectively which consumers would have to seek out themselves, a detail critics say would take the bite out of the rules as users may not be aware of the new rate.

Parliament and member states will have to engage in intense wrangling if they are to hammer out a compromise in time to have the regulation in place by the summer.

An EU source said there was room for an agreement on the numbers but that the big stumbling block remained the ‘opt-in, opt-out’ issue of how the regulated rate is given to consumers.

Parliamentarians are due to vote on the regulation in two weeks time, but if the version of the text does not reflect a possible compromise with member states, the rules will have to go to a second parliamentary vote.

That could delay the regulation for months.

Mobile phone companies have opposed the planned rules, saying caps would crush investment in infrastructure and that prices are coming down in any case.

The GSM Association (GSMA), which represents 700 mobile operators in 218 countries, argues that if prices are capped then 25 per cent of roaming traffic in Europe would become loss-making, limiting the hardest-hit operators’ ability to compete.

‘The caps proposed by this influential committee of the European Parliament will not enable operators to cover the costs of connecting calls on many roaming routes, let alone make a contribution towards the cost of running retail outlets, call centres, buying licences, building networks and other capital expenditure,’ said Rob Conway, CEO of the GSMA. ‘In many cases, smaller operators will rack up the biggest losses, limiting their ability to compete and ultimately reducing choice for consumers.’

He said that the proposals will cut operators’ annual retail revenues from roaming services to €2.4 billion, compared with €5 billion in 2005, curbing operators’ ability to innovate and invest in new services and infrastructure. He added that many base stations in tourist areas would no longer be viable; almost eight per cent of the base stations in the ski resorts of Austria, for example, would no longer cover their operational costs.

‘After years of expanding mobile coverage, this regulation could lead to a contraction in coverage, running counter to the European Union’s aim of ensuring all its citizens have ready access to communications,’ Conway said.

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