EC unveils international roaming regulation

13 Jul 2006

The European Commission has outlined rules regarding the fees mobile operators charge their customers for making calls when abroad, but has had to reduce its demands under mounting industry pressure, and still faces an uphill struggle to get governments to adopt its recommendations. The Commission has long argued that roaming charges are disproportionately high, estimating their worth at EUR8.5 billion (USD11 billion) annually, and accounting for 5.7% of the mobile industry’s revenue and 15% of profits. The current rates generate profit margins of up to 400% for network operators and the EC’s proposed price caps have outraged cellcos across the continent. It wants to cut international roaming fees by up to 70% and has stated that customers making local calls with their phones abroad should pay no more than EUR0.33 per minute(plus VAT), whilst international calls should be a maximum EUR0.49 (plus VAT). The Commission wants the rules to take effect from mid-2007, but for that to happen, both the European Parliament and the 25 EU governments must approve. As a concession, it has agreed to a six-month phase-in period, but EC President Jose Manuel Barroso fears this might not be enough to convince governments of member countries: ‘Let’s see if all the governments are as ambitious as the Commission,’ he told journalists. ‘I’m afraid that not all of them will be.’