Roaming charges: EU institutions strike deal
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The European Council and MEPs have provisionally agreed a deal for retail and wholesale price caps on voice, data and SMS services.
Price caps currently apply across the EU to (i) wholesale and retail voice calls, (ii) wholesale and retail SMS, and (iii) wholesale mobile data services. However, the EU Regulation that imposes those price caps is due to expire on 30 June 2012.
The European Commission wants to bring the difference between roaming and national tariffs close to zero by 2015, and the deal now agreed by the Council and MEPs will see a lowering of the existing voice and SMS price caps over three years to July 2014, as well as the introduction of a new price cap on retail mobile data services, as detailed below.
Retail ceilings (charged to consumers) excluding VAT
| Current | 1 July 2012 | 1 July 2013 | 1 July 2014 | |
| Data (per megabyte) | None | 70 cents | 45 cents | 20 cents |
| Phone calls made (per minute) | 35 cents | 29 cents | 24 cents | 19 cents |
| Phone calls received (per minute) | 11 cents | 8 cents | 7 cents | 5 cents |
| SMS (per SMS) | 11 cents | 9 cents | 8 cents | 6 cents |
Wholesale ceilings (charged between operators) excluding VAT
| Current | 1 July 2012 | 1 July 2013 | 1 July 2014 | |
| Data (per megabyte) | 50 cents | 25 cents | 15 cents | 5 cents |
| Phone calls (per minute) | 18 cents | 14 cents | 10 cents | 5 cents |
| SMS (per SMS) | 4 cents | 3 cents | 2 cents | 2 cents |
(Source: European Parliament Press Release dated 28.03.12)
In addition, the deal will usher in structural changes aimed at creating a distinct market in roaming services, and increased competition which in turn will lower prices.
- From 1 July 2014, domestic and roaming services will be separated. Consumers will be able to buy roaming services separately, and operators will have to enable consumers to switch to an alternative roaming provider free of charge.
- In order to encourage new entrants to the market in roaming services, wholesale access to networks for the purpose of providing roaming services will be regulated. This will enable Mobile Virtual Network Operators (operators that do not own their own mobile infrastructure) to enter the market and compete with established providers.
The Commission sees price caps as an interim solution until structural changes bring increased competition and therefore lower prices.
It is likely that the deal will be approved by the European Parliament in May 2012, and will come into force in July 2012.
For more information please contact John Worthy, Partner in the Technology and Outsourcing Group at Field Fisher Waterhouse LLP.