Sea, sun and SMS

New EU ‘roaming’ rules take effect on 1 July, slashing the costs of using mobile phones abroad by at least 60%.

Just in time for the summer holidays, the rules reduce the price telecom companies can charge European customers for using their mobile phones in another EU country – also known as roaming.

It’s the first time the EU has imposed price limits on text messages and data services. The rules also lower the existing ceilings on mobile roaming calls.

Sending a text from abroad in the EU will cost 11 euro cents maximum (or equivalent in national currency), less than half the previous average of 29 cents (far more than texters pay at home). Receiving a text in another EU country remains free.

Charges for other roaming services - like sending an email or photo or surfing the internet – were capped at the wholesale level. That is, the ceilings will apply to rates one operator charges another.

The wholesale price cap is €1 per megabyte downloaded, compared with the previous average EU wholesale price of €1.68. The cap will fall to 80 cents in 2010 and to 50 cents in 2011. All prices are per minute and exclude VAT.

Customers can choose a cut-off mechanism once the bill reaches €50, or can opt for a higher limit. This will protect people from “bill shocks” like that experienced by a German customer who downloaded a TV programme while n France - and received a bill of €46 000.

Under the new rules, mobile operators must also bill their customers for roaming calls by the second after the first 30 seconds, instead of on a per minute basis. This is expected to cut phone bills by more than 20%.

The EU first capped cross-border mobile calls in 2007 after finding they were on average four times more expensive than domestic calls and that prices varied widely from country to country.