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Commission adjusts recommended prices for telecoms services

Interconnection charges relate to the cost of linking networks to allow calls to be passed from one network to another and the Commission, in order to ensure competitive prices, set recommended prices for these in October 1997. These have recently been updated for 1999 and aim...
Interconnection charges relate to the cost of linking networks to allow calls to be passed from one network to another and the Commission, in order to ensure competitive prices, set recommended prices for these in October 1997. These have recently been updated for 1999 and aim to provide guidance to network operators and national regulatory authorities. These "best current practice" figures are derived from the lowest cost interconnection charges across the EU and are on average 8% lower than the corresponding figures for 1998.

The recommended prices (in EU cents) set by the Commission cover the cost of terminating a call on fixed networks at peak rates are as follows:

- Local interconnection (giving access to a local exchange for a few thousand subscribers) between ECU/100 0.5 and 1.0 per minute;
- Single transit interconnection (giving access to all subscribers in a city or metropolitan area) between ECU/100 0.8 and 1.6 per minute;
- Double transit interconnection (which gives access to all the subscribers in a country) between ECU/100 1.5 and 2.3 per minute.

The rules for interconnection are laid down in Directive 97/33/EC and under these rules these charges should be cost oriented based on the long run average incremental cost methodology which has yet to be fully developed. Until these are available the Commission will continue to use "best current practice" figures for interconnection. According to European Commissioner for telecommunications, Mr. Martin Bangemann, these figures show that the effects of competition are beginning to show and that the national telecommunications regulatory authorities are acting effectively to monitor the interconnection charges of incumbent fixed network operators.

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