The EC (European Commission) has shelved its plan to overhaul copyright fees, after intense lobbying from France and from groups representing artists and authors.
The EC had intended to replace the patchwork of national rules with a Europe-wide code designed to be more suitable for the digital age. Its decision to drop the plan has come as a surprise.
Presently most countries impose copyright levies on a wide range of products, from photocopiers and mobile phones to recordable formats such as CD-Rs. The levies vary widely from country to country. Only the UK, Ireland and Luxembourg do not impose any such levies.
Copyright levies are supposed to compensate artists and authors who don't receive any payment when their copyrighted music, documents or pictures are duplicated by consumers.
The EC wanted to harmonise the rules and scrap levies on most hardware. Its aim was to reduce the fees, which in some cases increase the price of goods dramatically.
For example, in Spain consumers have to pay almost €300 (about £200) in levies when they buy an 80GB MP3 player; in Austria the equivalent charge is just €8, according to the CLRA (Copyright Levies Reform Alliance), a coalition of businesses dedicated to harmonising and lowering copyright fees in Europe.
The EC said it is abandoning the rule change for now. It had planned to publish a proposal before the end of this year. "More reflection is needed on this complex issue," said an EC spokeswoman. She wouldn't give a new timetable for the legal proposal.
She acknowledged that the French prime minister, Dominique de Villepin, had written to the EC earlier this month, urging it to drop the plan. But she insisted that the EC will decide for itself when the proposal will be launched.
The EC has been planning to harmonise copyright levies since 2000. Since then the case for scrapping most levies has grown stronger as DRM (digital rights management) software has become commonplace.
The EC's climbdown sparked an angry reaction from the companies and industry groups pushing for a change to the system. "European industry is deeply disturbed by the EC's apparent about-face on the planned reform of copyright levies," said a spokesman for the CLRA.
"With this decision, it is clear to industry that the EC has abandoned any serious efforts to establish transparency, efficiency and fairness in the way these levies are set, collected and distributed."
The spokesman added that without the revamp of copyright levies, several large European companies now intend to file official complaints with the EC that are likely to result in a wave of infringement procedures against certain member states.
"The reform of copyright levies would then move from the European executive to the European Court of Justice," the CLRA said.