The Irish Government will be the last EU government to award third-generation (3G) mobile phone licences following decisions by France and Luxembourg to press ahead with their 3G competitions. The Republic is certain to miss a European Commission deadline of January 1st, 2002 for the award of licences - which is likely to result in formal censure by the Commission.

Third-generation mobile phone technology will enable telecoms operators to offer high-speed internet services on a variety of mobile devices. However, its introduction has been delayed, in part, because of huge fees paid by operators for 3G licences and the high costs of building a network.

The French government moved on Wednesday to attract extra bidders for its licences by cutting the price of licences and extending their duration to 20 years, from 15.

The upfront cost of a licence will fall to €619 million (£487.5 million), compared to the €4.95 billion fixed at the height of the telecoms boom last year. The original fee had caused several firms to pull out of the French competition. However, the government will levy a tax on 3G revenues that is yet to be fixed. Therefore, the French exchequer will benefit from a successful introduction of the technology.

Meanwhile, Luxembourg is to begin its competition to award 3G mobile licences before the year end, according to a spokesman for its telecoms regulator.

A stand-off between the Republic's telecoms regulator, Ms Etain Doyle, and Minister for Finance, Mr McCreevy, is delaying the award of 3G licences here.

Ms Doyle favours a cheaper price for the licences while Mr McCreevy wants to charge a fee of up to £100 million (€127 million). Both seem reluctant to compromise, despite Japanese operator NTT Docomo introducing the world's first 3G service last week.

Asked if the Republic would consider a similar compromise to France, a spokeswoman for the telecoms regulator said "various ways of dealing with the spectrum fee were being considered".