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Mobile data price caps approved by EU Telecoms Council

EU citizens travelling in other EU countries must be charged no more than €0.11 plus VAT per text message compared to the current EU average of €0.29 if the European Parliament backs a proposal that was approved by telecoms ministers yesterday.28 Nov 2008

Data downloads will also be capped at €1 per megabyte for wholesale fees under proposals designed to protect travellers against "bill shocks".

The EU Telecoms Council voted in favour of the European Commission's Roaming II Agreement yesterday. If approved by Parliament, the price caps will come into force on 1st July 2009.

The plan also extends the duration of a current cap on voice roaming charges from 2010 to 2013. That price cap was introduced through an EU Regulation last summer. It limits the amount operators can charge customers for roaming calls in other EU countries to €0.46 per minute for calls made abroad and to €0.22 per minute for calls received abroad (excluding VAT). In 2005 – before the EU intervened – the average charge for a roaming call was €1.10 per minute.

The new proposal addresses Commission concerns that roaming texts can be 10 times more expensive than domestic texts. A British tourist pays up to 40 pence (€0.63) to send an SMS from abroad, according to Commission findings.

The plan proposes a retail cap of €0.11 on roaming text messages (excluding VAT), combined with a €0.04 cap at wholesale level. Wholesale prices are charged by one operator to another for a customer to send a message between their networks.

Data costs can be significantly higher than SMS prices. In June 2008, a study found that typical prices ranged from €5 to €10 per megabyte. In one case cited by the Commission, a consumer returned home to a bill of €40,000 for downloading a TV show over a roaming mobile line. Such high prices and a lack of transparency were slowing the take-up of data roaming services in the EU, it said.

The agreement must be approved by the European Parliament before it can become law.