Europeans could see a sharp drop in international phone costs in time for their summer holidays next year as a result of planned laws being rushed through by the European Commission.

Viviane Reding, EU telecoms commissioner, made the claim as she launched sweeping plans to force companies to remove the extra costs consumers pay to use their regular telephones while in other European countries.

The Commission said customers’ costs could on average fall by between 40-60 per cent but would depend on the type of foreign usage.

The legal action could deal a heavy blow to the mobile phone industry. Analysts estimate operator companies make 10-15 per cent of profits from such add-on “roaming” fees for international phone use.

The hard line taken by the Commission is a sign of its attempts to use the planned consumer-friendly legislation to rebuild citizens’ faith in the European project and the internal market in the face of growing scepticism.

Ms Reding said: “The EU has a responsibility to ensure that the benefits of the internal market also arrive at the level of the consumer. It is unacceptable that consumers are punished on their telephone bill simply for crossing a border.”

Customers would be charged the same costs for local and international calls while abroad as they would pay for such calls in their home country.

Mobile phone companies argue competition alone will spur price cuts. The GSM Association, the industry trade body, said the planned legislation was unnecessary and heavy-handed.

It added: “Price regulation of the kind proposed by the European Commission would be damaging to growth and innovation in the mobile industry.”

Many people speculate the industry could seek to recoup its losses through higher charges for mobile phone handsets and other services, although fierce competition in many markets could stymie these attempts.

Data released by the Brussels regulator on Tuesday showed a German holidaying in Spain would pay about €4 to make a four-minute call home. A Briton in Portugal would be charged between €1.75 and €5.50 to receive a call of that length.

The planned legislation could be formally tabled in June and would be subject to the approval of the European parliament and EU member states.

Get alerts on Telecoms when a new story is published

Copyright The Financial Times Limited 2022. All rights reserved.
Reuse this content (opens in new window) CommentsJump to comments section

Comments have not been enabled for this article.

Follow the topics in this article