EU MPs back deal cutting mobile roaming fees

STRASBOURG, France, May 23 (Reuters) European Union lawmakers backed a plan on Wednesday to slash the cost of using mobile phones abroad in the 27-member bloc, part of a drive to win back support for the EU by addressing voters' concerns.

The executive European Commission said the mandatory caps on so-called roaming fees will cut prices to a quarter or a fifth of what citizens pay now for making and receiving calls in other member states.

''It's a great day for consumers, whether they are tourists or business travellers ... their telephone bills will melt away,'' EU Telecoms Commissioner Viviane Reding told lawmakers.

''The regulation will protect the vast majority of ordinary customers who up to now have been heavily overcharged when travelling abroad,'' she said.

The measure was passed by an overwhelming majority.

Mobile phone operators said they had already begun reducing prices, and complained the EU regulation would curb competition.

Consumer associations had wanted lower caps and said prices had started to fall only because of the prospect of legislation.

Joachim Wuermeling, speaking for the German EU presidency, said he expected member states to give the final green light on June 29. That would give operators until the end of July to offer price caps and until the end of August to enforce them.

The legislation is part of a push by the EU to show it can bring real benefits to its 490 million citizens, many of whom complain Brussels is too remote from their daily lives.

Reding said the EU could also regulate the price of mobile phone data -- such as text and audiovisual messages (SMS and MMS) -- if prices did not fall, stressing that national regulators would watch prices closely in the next 18 months.

TIMING In the first year, the EU-wide maximum roaming tariff will be 49 euro cents ( STRASBOURG, France, May 23 (Reuters) European Union lawmakers backed a plan on Wednesday to slash the cost of using mobile phones abroad in the 27-member bloc, part of a drive to win back support for the EU by addressing voters' concerns.

The executive European Commission said the mandatory caps on so-called roaming fees will cut prices to a quarter or a fifth of what citizens pay now for making and receiving calls in other member states.

''It's a great day for consumers, whether they are tourists or business travellers ... their telephone bills will melt away,'' EU Telecoms Commissioner Viviane Reding told lawmakers.

''The regulation will protect the vast majority of ordinary customers who up to now have been heavily overcharged when travelling abroad,'' she said.

The measure was passed by an overwhelming majority.

Mobile phone operators said they had already begun reducing prices, and complained the EU regulation would curb competition.

Consumer associations had wanted lower caps and said prices had started to fall only because of the prospect of legislation.

Joachim Wuermeling, speaking for the German EU presidency, said he expected member states to give the final green light on June 29. That would give operators until the end of July to offer price caps and until the end of August to enforce them.

The legislation is part of a push by the EU to show it can bring real benefits to its 490 million citizens, many of whom complain Brussels is too remote from their daily lives.

Reding said the EU could also regulate the price of mobile phone data -- such as text and audiovisual messages (SMS and MMS) -- if prices did not fall, stressing that national regulators would watch prices closely in the next 18 months.

TIMING In the first year, the EU-wide maximum roaming tariff will be 49 euro cents ($0.67) a minute for making calls abroad and 24 cents for receiving them. It will fall to 46 and 22 cents in the second year and 43 and 19 cents in the third, respectively.

The caps would then lapse unless reaffirmed by EU states and the bloc's assembly.

The timing of the measure means many of the EU's 150 million mobile phone users will miss out on the benefit if they take their summer holidays in July. The price cap will only become automatic for all customers two months after the offer is made.

Users already benefiting from specific roaming tariffs or packages will not be switched automatically.

The price limits will apply only to cross-border calls made or received in the 27 EU states, not in other countries.

Big operators argued the deal would curb competition in roaming, a sector worth 8.5 billion euros in 2005, but their competitors said they could live with the price caps.

''The proposed EU regulation ... is unnecessary, will curb competition and risks long-term harm to consumers,'' said the GSM Association (GSMA), the global trade body for mobile phone operators, saying the average cost of making and receiving calls while travelling in Europe was 29 percent lower than in 2005.

The GSMA said it did not rule out a legal challenge.

Many operators cut roaming fees ahead of the new rules.

Britain's Vodafone said its average cost per minute for making and receiving calls was lower than the new EU tariff.

According to the EU regulation, customers would be free to switch to or from the EU tariff plan at any time.

Lawmakers also backed a requirement for operators to inform users on the price of roaming.

''Just as when you go into a restaurant the price is on the menu, so when you cross a border your mobile phone should show you the price of a phone call,'' said Paul Ruebig, the Austrian conservative who led tough negotiations with EU states.

REUTERS PBB GC2029 .67) a minute for making calls abroad and 24 cents for receiving them. It will fall to 46 and 22 cents in the second year and 43 and 19 cents in the third, respectively.

The caps would then lapse unless reaffirmed by EU states and the bloc's assembly.

The timing of the measure means many of the EU's 150 million mobile phone users will miss out on the benefit if they take their summer holidays in July. The price cap will only become automatic for all customers two months after the offer is made.

Users already benefiting from specific roaming tariffs or packages will not be switched automatically.

The price limits will apply only to cross-border calls made or received in the 27 EU states, not in other countries.

Big operators argued the deal would curb competition in roaming, a sector worth 8.5 billion euros in 2005, but their competitors said they could live with the price caps.

''The proposed EU regulation ... is unnecessary, will curb competition and risks long-term harm to consumers,'' said the GSM Association (GSMA), the global trade body for mobile phone operators, saying the average cost of making and receiving calls while travelling in Europe was 29 percent lower than in 2005.

The GSMA said it did not rule out a legal challenge.

Many operators cut roaming fees ahead of the new rules.

Britain's Vodafone said its average cost per minute for making and receiving calls was lower than the new EU tariff.

According to the EU regulation, customers would be free to switch to or from the EU tariff plan at any time.

Lawmakers also backed a requirement for operators to inform users on the price of roaming.

''Just as when you go into a restaurant the price is on the menu, so when you cross a border your mobile phone should show you the price of a phone call,'' said Paul Ruebig, the Austrian conservative who led tough negotiations with EU states.

REUTERS PBB GC2029