The European Commission yesterday called for a huge cut in mobile termination rates, a move that saw Vodafone’s stock experience its sharpest fall in six months. An AFP report notes that the European Union’s executive arm urged national regulators to ensure that such rates are based on the real costs an efficient operator incurs for passing on a call from another operator. According to the Commission, the recommendations will bring down the charges by around 70 percent. The guidelines are non-binding, but Reuters notes that EU states are obliged to take the “utmost account” of them. They do not specify prices but the new method used to calculate termination fees will push them down to EUR0.015 to EUR0.03 by end-2012, the Commission said.

The news caused Vodafone’s shares to fall £0.062 to £1.21. Europe’s tier one operators have previously denounced the measure, arguing it would jeopardise investments in future networks and there was no guarantee it would benefit consumers. In a statement, industry association the GSMA noted that although it “welcomes greater harmonisation of the approach to termination regulation across the EU,” it is “greatly concerned that these significant proposed changes are being recommended without a thorough impact assessment by the Commission to understand the social and economic implications on national markets, and without any justification or confidence that these changes would benefit consumers.” The cuts in mobile termination rates are the latest efforts by the European Commission to step up its offensive on mobile phone fees. Last month the European Parliament adopted a law – initially proposed by EU telecoms commissioner Viviane Reding – that will cut by up to 60 percent the price of using a mobile phone to send text messages or download data while outside a home state in the European Union.