Regulation Of Roaming Charges In The European Union

International roaming refers to the ability to use your mobile phone when abroad on holiday or on business. Because your home network operator does not provide service in the country in which you are travelling, when you make or receive a call abroad, you are using the network of an operator in that country, i.e. you are 'roaming' on the foreign network. For providing this service, the foreign network operator will charge a wholesale rate to your home operator who will, in turn, charge you a retail rate.

In many cases, international roaming charges are very high and - as recently noted by the European Regulators Group (ERG), a body established by the Commission to advise on the regulation of markets for electronic communications - often without clear justification.

In general, international roaming charges are much more expensive than normal domestic charges. There can also be significant variations in the retail charges. The European Commission acknowledges that some operators also offer special international roaming packages and that this was a signal of first movements in the markets.

There is no doubt that high roaming charges are a great problem for all European Union (EU), as nowadays we cannot imagine our lives without a mobile phone. In this work I will show how the Commission made influence to the changes of high roaming charges in EU, what steps were made for that and how this problem was solved.

1. First steps to regulation of roaming charges in EU

In 2004 it was decided to start investigating roaming charges in EU. Mobile telephone network operators across the EU have been sent a questionnaire as part of an investigation into wholesale prices for "international roaming", which resulted in high charges for people who use their mobile phones in other Member States. This initiative, supported by the Commission, was announced by the European Regulators Group (ERG), which brings together national regulatory authorities responsible for electronic communication markets on the 10 of December, 2004.

Information Society and Media Commissioner Viviane Reding admitted that she was fully aware of the impact that high roaming charges have on EU citizens and on the competitiveness of our industry. Whether we travel on business or for leisure, many of us have had an unpleasant surprise when the next bill arrived. The initiative of the European Regulators Group helped to identify remaining competition problems in the 25 Member States and to resolve them as soon as possible."

"International roaming" is the ability of mobile phone subscribers to use their phones whilst travelling abroad. Thus, users can make and receive calls using the same number as they do at home. For this, a mobile network operator needs to conclude international roaming agreements with operators in other countries.

The expense and complexity of international roaming charges have long been an issue of concern for the Commission. When the Commission adopted the Recommendation on "relevant markets" as part of the EU regulatory framework for electronic communications, the wholesale international roaming market was identified as one where ex ante regulation may be warranted. This placed an obligation on national regulatory authorities to examine this market. As consumers of this wholesale service are located outside the home market of a national regulatory authority, this could only be done efficiently if national regulatory authorities, through the ERG, act in concert to protect effective competition.

The harmonised ERG questionnaire which was issued on the 10th of December, 2004 provides information that resulted in regulation being imposed. The questionnaire aimed to establish how mobile network operators behave both as purchasers and providers of wholesale international roaming services. Replies to the questionnaire helped national regulatory authorities to define the "relevant market" within their own Member State, and hence whether any operators have "significant market power". Where such significant market power is identified, remedies should be imposed. These could include direct controls on wholesale international roaming rates, which should, in turn, lower prices for consumers.

ERG initiative is complementary to ongoing anti-trust investigations during which the Commission had sent statements of objections to two UK mobile network operators in relation to an abuse of dominance in wholesale roaming rates. Commissioner Reding and her services closely followed the results of these investigations and of ERG initiative and discussed them with the ERG in early spring 2005.

2. Roaming charges in EU in 2005

International roaming charges have been for some time already a concern both to the Commission and national regulators. In spite of first signs of movement in the markets, the Commission was not satisfied that the prices to be paid by consumers already reflect the result of effective competition. The Commission therefore decided to take measures to enhance the transparency of international mobile roaming charges to allow consumers the choice of the best offer.

In 2005 using your mobile phone while on holiday abroad could still lead to very unpleasant surprises. Substantially more progress from the industry was both necessary and possible. The EU had to get to a stage where consumers could benefit from better deals than they were getting.

The prices for calling your home country from abroad varied greatly in the European Union, starting from 58 eurocent per minute (from Cyprus to Finland with a Finnish subscription) and reaching Ђ5.01 per minute (from Malta to Poland with a Polish subscription). This was particularly felt by tourists and business travellers.

To enhance competition on the international mobile roaming markets and increase price transparency for consumers, the Commission started publishing, from autumn 2005 onwards, a special website listing samples of international roaming retail tariffs of operators in the 25 EU Member States.

This Commission initiative was supported by the national telecom regulators which coordinated action on tariff transparency for international roaming under the auspices of the European Regulators Group (ERG). The Commission expected such transparency measures to encourage operators to offer better and fairer prices to their customers.

3. Roaming charges in EU in 2006

An EU regulation that would cut the cost of using mobile phones abroad by up to 70% was tabled by the Commission on the 7th