Inflated mobile prices prompt EU to legislate 

The EU executive is seeking to "bring mobile prices to their effective costs," the spokesperson said. 

Recently, the Bulgarian national regulator for telecommunications disappointed the Commission by only proposing minimal reductions of the country's mobile termination rates. The EU executive is working on a Community law instrument on the issue, according to which regulators will have three years to bring down prices for termination in Europe to the level of their effective cost. 

Martin Selmayr, Commission spokesperson for information society and media, told EurActiv that Bulgaria is still the country with the highest mobile termination charges in the EU. 

"They are more than ten times higher than in the country with the lowest charges. So we asked the Bulgarian regulator to speed up its work, and to see what regulators in other countries with similar characteristics are doing. If you make a market analysis, you will see there is a lot of room for lower prices in Bulgaria," said Selmayr. 

The Commission spokesperson said that the latest response from the CRC, Bulgaria's communication regulation commission, which proposed a minimal reduction of rates, "was not swift enough and not in line with what other European countries are doing". 

A letter by Fabio Colassanti, director-general of the Commission's information society directorate, to CRC Chairman Veselin Bozhkov, which was recently published on the EU executive's website, strongly calls on Bulgaria's regulator to reduce mobile termination rates significantly. 

The former Bulgarian telecoms monopoly BTC, which dominates the fixed line telephone market, is also set to face lower prices. But Andreas Geiger from Alber & Geiger, a lobbyist for BTC, told EurActiv that "the mobile operators in Bulgaria, Mtel, Globul and others" were keeping up the rates for mobile-mobile and mobile-fixed communications. 

Geiger also disclosed that CRC had circulated a first draft reducing connection prices by about 40%, "and then after they had a discussion, within Bulgaria, they (CRC) reversed their decision 180 degrees and decided to keep the status quo". 

Asked by EurActiv if BTC suspects the CRC of fraternising with mobile operators, Geiger said: "Some people say that strong lobbying in Bulgaria by mobile phone operators made CRC revise their initial decision." 

Invited to respond to the indirect accusation that it is being lobbied by mobile phone operators, a PR company working for CRC told EurActiv that the regulator would not comment on accusations by lobbying companies working for one operator or another.

The PR firm representing CRC also explained that the regulator has a new chairman, and had recently been revamped. Before that, mobile rates were completely frozen. However, since the beginning of 2008 following measures taken by CRC, they were reduced for the first time, by 18%. 

Asked to explain what instruments the Commission will use to bring down prices of mobile calls, European Commission spokesperson Martin Selmayr said: "The Commission has two instruments. When a national regulator wants to determine the termination price of mobile phone calls, in Bulgaria for example, they make a regulatory decision. This needs to be notified to the European Commission, and the Commission then comment and can say whether this is in line or not. We have done this with Bulgaria this month" 

"In addition, the Commission is preparing a Community law instrument on the issue of termination rates, which will be published and adopted in the next two months. Because we see that in Bulgaria they are above 15 cents, while in Cyprus it is possible to get them down to two cents, and a number of other countries are going in the direction of two cents." 

"So we say: there is a problem for our internal market. A company gets 15 cents for a minute in one country, and two in another – this is a problem for competition, this is a problem for consumers, and also between fixed and mobile operators, because the fixed operators don't have such high termination rates. In fact, they have low ones. We want to avoid this triple distortion. Regulators must be tough and ensure that not more than the costs of the effective service are charged. This is what the Commission will recommend, and the regulators will have three years to bring down all the prices for termination in Europe to the level of their effective cost," Selmayr explained.