Draft Mobile Roaming (EU Exit) Regulations 2019

(Limited Text - Ministerial Extracts only)

Tuesday 26th February 2019 General Committees

[The Minister for Digital and the Creative Industries (Margot James)]

I beg to move,

That the Committee has considered the draft Mobile Roaming (EU Exit) Regulations 2019.

It is a pleasure to serve under your chairmanship, Mr Gray.

I am aware of the level of interest in this statutory instrument and by laying it under the affirmative procedure, the Government welcome full scrutiny of the measures. The draft regulations were laid before the House on 4 February.

Leaving the EU with a deal remains the Government’s top priority. Nothing has changed about that. However, the Government must plan for every eventuality, including a no-deal scenario. If the UK were to leave the EU without an agreement in place, this instrument would provide legal clarity for mobile operators and their customers on the regulations for the use of mobile services when travelling in the EU.

The draft regulations were introduced under section 8 of the European Union (Withdrawal) Act 2018 to correct deficiencies in the statute book that will result from the UK exiting the European Union. They will amend EU retained law on roaming by removing obligations that will no longer be enforceable once the UK leaves the EU’s single market. They also retain important consumer protections. A technical notice was published on 13 September and has subsequently been updated. It provides clear information to mobile operators, consumers and businesses on what the UK’s exit from the EU means for mobile roaming regulations. It also outlines what this instrument aims to do.

Before outlining the details of the draft instrument, it may be helpful if I give Members some context about mobile roaming services and the European law that currently applies. Mobile roaming is a service that enables consumers to use their mobile devices to make calls, send texts and use data services outside the UK. Roaming offers are underpinned by commercial agreements between UK operators and operators in other countries, which allow customers to use their networks at an agreed price. The EU roaming regulation reinforces the EU’s single market by capping the amounts operators can charge each other when customers use their networks. Only by limiting those wholesale rates can operators guarantee surcharge-free roaming to their customers.

Once we leave the EU, the UK will not be part of the single market, and that means it will not be possible to limit the charges that European operators place on UK mobile companies. If British operators were forced to offer surcharge-free roaming regardless of how much they themselves were charged, it could have damaging consequences for UK mobile operators and consumers. The result of that one-sided regulation would be either price rises for consumers across all mobile services or the removal of roaming altogether from some packages. Neither of those outcomes is fair or in the interests of UK companies or consumers.

However, the Government want to keep consumer protections in place. There are many consumer protections that are not dependent on our membership of the EU and that can be retained, such as the requirement of a financial limit on data usage, transparency obligations and support for customers at risk of inadvertent roaming.

The Government are legislating to make sure that the requirement on mobile operators to apply a financial limit on mobile data usage while abroad is retained in UK law. The limit will be set at £45 per monthly billing period, which is the same limit that is currently in place. After reaching the limit, the customer is not able to consume more data unless they make an active choice to do so. That will apply worldwide, not just in the EU and the European economic area.

We are also legislating to ensure that customers continue to receive alerts at 80% and 100% of their data usage. Again, that will benefit customers travelling anywhere in the world.

In addition, the EU roaming regulation requires operators to take reasonable steps to protect customers from paying roaming charges for inadvertently accessing roaming services, such as when a phone used in a border region of one country picks up the mobile signal from a network based in another. We know that that affects some people in Northern Ireland, so we will keep obligations on mobile companies to protect customers from paying charges for inadvertently accessing roaming services.

Those measures mean clarity and certainty for consumers and businesses. They make sure that mobile users are able to manage their spending and data usage. They are working well for consumers at present and can work well after the UK leaves the EU. The draft instrument will therefore retain those provisions. The retained provisions will continue to be enforceable after we leave the EU by the regulator, Ofcom.

Leaving without a deal would not prevent UK mobile operators from making and honouring commercial arrangements with mobile operators in the EU and beyond to deliver their services as customers expect, including roaming arrangements. The availability and pricing of mobile roaming in the EU after a no-deal exit would be a commercial question for mobile operators. Many mobile operators, including Three, EE, O2 and Vodafone, which together cover more than 85% of mobile subscribers, have said that they have no current plans to change their approach to mobile roaming after the UK leaves the EU.

We are committed to ensuring that the law on mobile roaming continues to function after we leave the EU. The draft regulations will help that to happen by correcting deficiencies in existing legislation. I commend the draft regulations to the Committee.

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[Margot James]

I thank Members for their remarks. We are supportive of the regulations because we believe, given that the country has decided to leave the European Union, that we are at least protecting consumers against bill shocks and inadvertent roaming.

The right hon. Member for Birmingham, Hodge Hill asked why we cannot impose a price control. If we were to try to do that, it would result in either the company’s entire user base having to accept higher prices or individual users who partake in roaming having to pay higher prices. For the benefit of consumers, we have put in place the monthly cap of £45, at which point they are notified that they are running towards a higher bill. They then have to exercise choice as to whether they want to use more data or use their phone further during their travels.

[Liam Byrne]

The Government are prepared to accept caps on energy prices, yet they are not bringing that principle to mobile phone policy. If we have energy caps, why can we not have mobile phone caps?

[Margot James]

I recall that an argument against energy caps was that they would establish a precedent. The Competition and Markets Authority found a vast amount of consumer detriment in energy. Many things were tried to get energy companies to be fairer in their billing practices. In the end, a price cap was agreed. It is too soon to assess the outcome of that decision, and it is certainly too soon to apply it at random in other markets.

We have introduced safeguards and the Regulatory Policy Committee assessed the impact assessment and made a conclusion on whether prices may rise in the future. I appreciate the comment by the hon. Member for Linlithgow and East Falkirk that the fact that companies have no plans to introduce price rises is no guarantee, but those companies have made that statement of good intent. They do not want to raise prices for their consumers. We must not force operators so that they are not effective in the future.

I have explained why we have not introduced price controls. It is a commercial matter—this is a market. We have sought to provide as much protection as possible, but the ultimate protection against roaming charges lies with the country staying in the single market, which it has taken the decision not to do. In those circumstances, the regulations are the best possible outcome for consumers, and I commend them to the Committee.

Question put.

Division 1

Ayes: 9

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Conservative: 9

Noes: 7

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Labour: 5
Scottish National Party: 2