The European Commission, the executive body of the European Union (EU), on Wednesday unveiled plans to slash mobile phone roaming charges within the bloc.

Roaming charges are extra fees paid when using the phone abroad.

The industry would be given six months to reduce roaming charges voluntarily. If the operators fail to do so, a cap on retail prices would be introduced, European Commission President Jose Manuel Barroso told a press conference on Wednesday.

EU Information Society and Media Commissioner Viviane Reding said roaming charges are still unreasonably high despite her warnings in October 2005 and March 2006.

"For years, mobile roaming charges have remained at unjustifiably high levels, in spite of repeated warnings to the industry," she told the same press conference.

According to the commission's proposal, retail prices would be 30 percent higher than the wholesale prices -- prices negotiated by network operators and endorsed by national regulators.

The new proposal, however, is watered down compared to Reding's plans unveiled in March, when she said a "home pricing principle" would be introduced.

The "home pricing principle" meant a local call would cost the same whether at home or abroad, and would be charged at the rate imposed by the customer's domestic operator. Roaming charges for receiving a call would also have been scrapped.

The commission lowered it ambition obviously as a result of pressure from the industry.

The commission hopes the proposal can become law by the summer of 2007.

Mobile roaming within the EU is a business of 8.5 billion euros (10.8 billion U.S. dollars) a year, accounting for 5.7 percent of the industry's revenues, according to Reding.

If introduced, the bill would save consumers 5 billion euros (6. 4 billion dollars) a year.

Source: Xinhua