UPDATE 2-EU in draft deal on capping phone roaming prices

Tue Mar 24, 2009 12:37pm EDT

Related Topics

* EU states,European Parliament in deal to cut roaming costs

* Cuts in voice calls, data steeper than Commission proposed

* Cuts to start two months earlier than Commission proposed

* Industry disappointed by faster cuts

(Adds confirmation, bill shock mechanism, industry reaction)

By Huw Jones

LONDON, March 24 (Reuters) - The European Union on Tuesday reached a draft deal to slash the price of texting from abroad and capping the wholesale cost of using a laptop to surf the Internet outside a home state.

The deal brings in steeper price cuts than had been planned under a measure drafted by EU Telecoms Commissioner Viviane Reding, and brings forward their introduction by two months.

It widens the scope of an existing regulation that caps the price of roamed voice calls.

"Commissioner Reding left the meeting saying this is a victory for European consumers and for the European single telecoms market," her spokesman said.

The European Parliament and EU states struck a deal on the measure at a meeting in Strasbourg, France, and parliament will endorse the agreement next month so the new rules come into force in time for the summer holidays.

"I am hopeful that all parties will endorse a concrete first-reading agreement so that European consumers can fully benefit from this new regulation by the beginning of this summer," said Adina-Ioana Valean, the Romanian Liberal who steered the measure through parliament.

EU regulators and the European Commission want to end "bill shock", when business travellers or holidaymakers return home to huge charges for checking emails or surfing the Web while away.

The law caps the price to consumers of roamed text messages and extends by three years to June 2012 current EU price limits on roamed voice calls.

The GSM Association, a global industry lobby, was disappointed the start of new caps was brought forward but welcomed flexibility in dealing with bill shock.

"We don't agree with the extension of the existing regulation. It does seem strange they have decided to accelerate the price cap decreases in an arbitrary way in the final stages of negotiations," GSMA European director Martin Whitehead said.

The deal agreed on Tuesday comprised the following elements:

-- retail price of a roamed text within the EU capped at 11 euro cents (15 U.S. cents) from July 1, 2009, compared with up to 49 euro cents at present;

-- wholesale price of data roaming will be capped at 1 euro per megabyte from July 1, 2009, falling to 80 euro cents from July 1, 2010 and to 50 euro cents from July 1, 2011;

-- retail caps on outgoing roamed voice calls extended for three years to 2012, with the price falling to 43 euro cents per minute from July 1, 2009 from 46 cents at present, and then to 39 cents from July 1, 2010 and 35 cents from July 1, 2011.

-- retail caps on incoming roamed calls capped at 19 euro cents from July 1, 2009 from 22 cents at present, falling to 15 euro cents from July 1, 2010 and to 11 cents from July 1, 2011.

-- mandatory billing per second from the 31st second of a roamed voice call.

-- to prevent bill shocks, from March 2010 there would be an automatic cut-off point for data after 50 euros' worth or corresponding volume is used up, unless the customer chooses a different option. (Editing by Dale Hudson and David Cowell)

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