TORONTO: Canada moved on Friday to impose levies on digital media recorders, such as MP3 players, as part of its program to compensate artists and music publishers for people copying their songs.

The Copyright Board of Canada will place a levy of C$2 ($1.52) on MP3 players with recording capacity of up to 1 gigabyte, C$15 for players with a capacity of 1 gigabyte to 10 gigabytes, and C$25 for those over 10 gigabytes.

"It was a difficult decision," said Claude Majeau, secretary-general for the Copyright Board, which is responsible for deciding the private copying tariff.

The board also froze copying levies that already exist on blank CDs and audio tapes until the end of 2004.

The new levy comes at a time when the music industry has moved to combat what it sees as a sharp rise in music piracy, with people downloading songs and albums via the Internet.

All manufacturers of digital media, such as Apple Computer Inc. , will have to remit the same amount, but how it will affect the consumer in the end is not yet known.

The group representing the music industry, the Canadian Private Copying Collective, was mixed on the decision.

"I am both disappointed and happy to see that we have made some gains even though they are limited," said vice-president Lucie Beauchemin. The group is responsible for allocating and paying the royalties to copyright holders.

The controversial levy came into effect in 2000, with the purpose of compensating artists for royalties they lost through people copying their music.

The move sparked an outcry among manufacturers, consumer groups and retailers who argued that there was scant proof that individuals were buying the materials for illegal copying purposes.

The Copying Collective later fell under sharp criticism for collecting large amounts of money and not distributing the funds to the artists.

Since the levy was put in place, the lobby group has collected C$59 million. In 2002, it collected C$27 million.

Beauchemin points out that the process of identifying the artists is time consuming.

"We wanted to make sure that the backup guitar player will get paid as well as the front runner," she said.

This is the first year that royalties have been distributed. So far C$11 million has gone out.

Currently the levy on audio cassette tapes of 40 minutes or longer is 29 Canadian cents, 21 Canadian cents on recordable CDs, and 77 Canadian cents on audio CDs and minidiscs.

Reuters