The European Commission has announced plans to cut the cost of using mobile phones while abroad by up to 70%.

The EC President, Jose Manuel Barroso, said these so-called roaming charges were currently up to five times higher than the actual cost to telecom companies of providing the service.

He insisted, however, that it was still not too late for firms to make further reductions in their charges voluntarily and avoid being regulated by Brussels.

The commission is determined to act to narrow the gap between domestic call costs on mobiles and much higher international charges for phoning home.

However, plans to ban the extra cost of receiving mobile phone calls while abroad altogether were ditched because of concerns about the economic impact on the sector.

Roaming charges are estimated to earn the operators about €8.6 billion annually, which translates to between 10% and 15% of profits.