Press Release
The House of Lords European Union Committee have today backed EU plans for European Regulation on mobile phone roaming charges the EU.The Committee, in their report Mobile Phone Charges in the EU: Curbing the Excesses, point out that around 140 million EU citizens are affected by roaming charges for using their phones abroad; they argue that roaming services currently lack transparency and may not be sufficiently competitive. This presents a significant challenge to the single market as excessive roaming charges impact not only directly on roaming customers but also create barriers to small and medium enterprises operating effectively across the EU. They also argue that due to the fundamentally cross border nature of roaming services action on regulation is best taken at the European Community level.
The Committee state that at this stage a Regulation is best focused on the wholesale market. They argue that a limit of 30 eurocents per minute on charges mobile phone networks can levy on each other should ensure savings are passed on to consumers. The Committee also support a ‘sunset clause’ for new regulation, this would mean the Regulation could be examined again at a later stage and removed if the market were found to be operating more effectively.
The report makes clear that regulation of retail charges is, at this stage, undesirable. The Committee argue that effective wholesale Regulation combined with increased competition at the retail level should be given a chance to reduce the cost of roaming charges. They also point out that prescriptive retail regulation could harm competition from the market, lead to market rigidities and create unintended consequences for other related markets.
One proposal for a form of retail regulation the Committee do support is the Consumer Protection Tariff. This would set an upper safety net rate for charges to retail customers. This would have the effect of protecting the customers most vulnerable to excessive roaming charges, those who travel infrequently. This should be based on an opt-in model for existing customers and an opt-out model for new ones.
Commenting Lord Freeman, Chairman of the House of Lords EU Sub-Committee on the Internal Market, said:
“We support the Commission’s attempts to protect consumers from excessive roaming charges. Up to 140 million EU citizens use roaming facilities and it is only right they are not over-charged for doing so.
“This is an important area for EU action as excessive roaming charges have an impact beyond that felt by consumers. The prohibitive costs of making and receiving calls abroad have a real impact on small businesses wanting to trade within the EU. This is a threat to effectiveness of the single market and the EU is right to take a firm approach to it.
“At this stage we would not support regulation on retail charges, other than the Consumer Protection Tariff. We feel a strong cap on wholesale roaming charges, set at 30 eurocents per minute, combined greater competition at the retail level will ensure savings are passed on to customers.”
