WRITTEN QUESTION P-0049/99

by Roberta Angelilli (NI) to the Commission

(15 January 1999)

Subject: Increases in the cost of mobile telephone calls and infringement of competition

In the last few days the Italian press has announced the new charges for mobile telephone calls put forward simultaneously by Telecom Italia Mobile and Omnitel. These increases, which are particularly sizeable in certain cases, are totally unjustified, since calls from fixed to mobile telephones would cost up to four times as much as those from mobile phones to fixed telephones and between mobile telephones. Furthermore, the companies are profitable enough for such increases to be unwarranted, and they would above all penalize those who use mobile phones in the course of their work.

In view of this, can the Commission say:

1. whether the announcement of the new charges by TIM can be considered as misleading advertising, since it does not make it sufficiently clear that two units are charged every time a call is answered, and whether the statements made by the firms, who attribute responsibility for the increase to a decision by the telecommunications authority (which in fact has no competence in this sector), can also be considered as misleading;

2. whether the fact that the charges coincide exactly and are being increased at exactly the same time does not give cause to believe that there is an agreement between the two companies to the detriment of the consumer and hence a monopoly which could contravene the rules of competition in the sector;

3. whether, even if the increases are withdrawn as a result of a decision by the telecommunications authority and protests by consumer organizations and users, what has happened makes one suspect that the two companies have entered into agreements which may constitute a dangerous potential infringement of competition;

4. whether it does not deem it appropriate to take action to draw up recommendations to prevent a repetition of such events in future?

Joint answer

to Written Questions P-0027/99, E-0036/99, P-0047/99 and P-0049/99 given by Mr Van Miert on behalf of the Commission

(16 February 1999)

The two GSM operators in Italy have applied identical charges for calls from fixed to mobile telephones since the mobile market was opened up to competition. The tariff structure (two business tariffs and a family tariff, with peak and off-peak rates in each case) was particularly complicated.

The peak-hour rates were among the highest in the Community. In 1998 the Commission launched an investigation into the levels of charges practised in the different Member States for fixed-to-mobile telephone traffic. The investigation concerned TIM and Omnitel among others.

In December 1998 the two operators simultaneously notified the Italian communications authority of a new, simplified tariff structure that included a single charge, instead of four separate charges, for the termination of business calls. Under the new structure, these peak-hour charges were reduced but off-peak charges were increased significantly, particularly for business subscribers. These new tariff bands were introduced simultaneously by both operators at the beginning of 1999. However, this tariff restructuring was heavily criticised. The Italian competition authority launched an investigation under the Competition Law of 10 October 1990, and by 12 January 1999 the two operators had restored their old charges. The Commission is awaiting the results of the investigation and, as a matter of principle, will not intervene in the interim.

The Commission has not started an investigation into the suspended tariff restructuring and is, therefore, unable to say whether the increase in charges results from an agreement between the two competitors on the GSM mobile telecommunications market and whether any such agreement would be in breach of the rules on consumer protection.

As regards publication by TIM of its new charges, the EC Treaty does not empower the Commission to impose penalties for any cases of misleading advertising. Nevertheless, Parliament and Council Directive 98/10/EC of 26 February 1998 on the application of open network provision (ONP) to voice telephony and on universal service for telecommunications in a competitive environment(1) stipulates that the national regulatory authorities are to ensure in particular that tariffs for end-users and the conditions for renewing contracts are presented clearly and accurately.

The Commission will continue to ensure, in close conjunction with the national competition authorities and the national telecommunications regulator, that the competition rules and the relevant Community directives are complied with.

In any event, application by competing mobile operators of identical charges for the termination of fixed-to-mobile telephone traffic reflects the fact that competition is not yet sufficiently developed on the mobile market in Italy. The entry of a third mobile operator will probably increase consumer choice as regards termination charges for calls from fixed to mobile telephones. Authorisation for a fourth operator will add further to the pressure on current call charges.

(1) OJ L 101, 1.4.1998.