Draft licence modifications have been published today by Oftel to enable it to rollover the current call termination charge controls on BT Cellnet and Vodafone if necessary.

Oftel is currently reviewing the calls to mobile market to decide whether further controls are needed to protect consumers when the current charge controls expire in March 2002.

If Oftel decides that further controls are necessary but BT Cellnet and Vodafone object to the proposals, Oftel may have to refer the matter to the Competition Commission for investigation.

This would mean that Oftel would need to extend the current controls for a further period beyond March 2002 until the Competition Commission completed its investigation and any final proposals implemented.

Commenting on the draft licence modifications, David Edmonds Director General of Telecommunications said today:

"This is a precautionary measure. Oftel is reviewing whether further call termination charge controls are needed and plans to reach conclusions in July.

"If BT Cellnet or Vodafone object to proposals that Oftel might put forward, Oftel may need to refer the matter to the Competition Commission, and this could delay their introduction.

"These measures would enable Oftel to rollover the existing controls for a further period to ensure that consumers are protected from excessive charges for making calls to mobile phones."

Notes to Editors

1. Copies of the draft licence modifications are published on Oftel's website at www.oftel.gov.uk/publications/mobile/limo0501.htm. Hard copies are available to the media from the Press Office on 020-7634 8991 and to the public from the Research and Intelligence Unit on 020-7634 8761.

2. The current call termination charge controls were introduced by Oftel in 1999. Oftel published its consultation document on the review of competition in calls to mobile phones in February 2001. Oftel is also currently reviewing the level of competition in the mobile market and will publish its conclusions on both reviews and plans to publish conclusions in July 2001.

3. When a consumer calls a mobile from another network, around two-thirds of the price they pay for the call is made up of the termination charge – the portion of the price which their operator pays to the terminating mobile network. A call to a mobile is paid for by the caller, not the person who owns the mobile. The mobile network operator's customer is not therefore directly affected by the level of charges for calling him. Thus the mobile operator is potentially in a position where it can set excessive charges for termination since these will be paid by customers of other networks.