December 2, 2016 / 3:40 PM / 9 months ago

EU ministers back caps on wholesale mobile phone roaming fees

A visitor looks on her mobile phone in front of an illuminated object during the Christmas Garden event at botanic garden in Berlin, Germany November 18, 2016.Stefanie Loos

BRUSSELS (Reuters) - European Union ministers on Friday backed lowering the caps for how much mobile telecoms operators can charge each other to keep their customers connected while abroad, although they are likely to be cut further in subsequent negotiations.

Ministers gave Slovakia, which holds the rotating EU presidency, a mandate to start negotiations with the European Parliament on a series of wholesale price caps for handling voice, SMS and data traffic between different EU countries.

Key to ensuring that Europeans will no longer pay extra for using their phones abroad as of June next year, the EU has been racing to lower the cap on the wholesale charges operators impose on each other to make the roaming system work, fearing that a failure to do so would derail the flagship EU policy.

States agreed to cap wholesale data roaming fees at 1 euro cent per megabyte, or 10 euros per gigabyte, from June, declining to half that in 2021.

The European Commission had proposed a cap of 8.5 euros per gigabyte while the European Parliament on Tuesday pushed for an initial cap of 4 euros, declining to just 1 euro.

Member states and EU lawmakers will now embark on negotiations to find a compromise by March next year so that the new rules can come into force by June.

"Who does not wish to remain connected and to communicate when traveling or on holiday? Abolition of roaming charges is in the eyes of many the most concrete achievement of the Union," said Arpad Ersek, Slovak Minister for Transport, Construction and Regional Development, who chaired the meeting on Friday.

Member states have been split on the roaming issues due to different domestic phone prices and consumption habits.

Countries in northern and eastern Europe with low domestic prices and generous packages favor lower wholesale caps to avoid companies raising prices in their home markets, effectively making poorer customers subsidize frequent travelers.

However countries in the tourist-magnet south say lowering the caps too much will deter investment in networks and may force their operators to raise domestic prices to accommodate all the extra tourist traffic.

"We're asking those who aren't lucky enough to travel in Europe to pay just for the tourists and business people," said Axelle Lemaire, French Secretary of State for Digital and Innovation.

In parallel EU member states are trying to reach an agreement on a "fair use" policy to avoid permanent roaming whereby customers buy a SIM card in a cheap country while living elsewhere.

Reporting by Julia Fioretti; editing by Susan Thomas

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