November 29, 2006 11:43 AM PST

Russia agrees to shut down Allofmp3.com

Russia has agreed to shut down Allofmp3.com and other music sites based in that country that the U.S. government says are offering downloads illegally.

The nation has struck the agreement with the Office of the U.S. Trade Representative as it seeks entry to the World Trade Organization. The U.S. has suggested that it would hold up Russia's acceptance in the WTO unless leaders there took action against digital piracy.

"Russia will take enforcement actions against the operation of Russia-based websites," according to a press release issued November 19 by the U.S. Trade Representative. "(Russia will) investigate and prosecute companies that illegally distribute copyright works on the Internet."

On Wednesday, Allofmp3.com was still operating. Gretchen Hamel, a spokeswoman for the Office of the U.S. Trade Representative, said that she didn't know when the deal requires the Russian government to begin taking action.

"AllofMP3 doesn't expect the Russian government to take any action against the company since it operates within the current law," said Rory Davenport, an Allofmp3.com spokesman. "The company is fully committed to its business."

Allofmp3.com is one of many internationally based download sites that the U.S. and several other countries are trying to close down. Music labels and movie studios say that such sites are not authorized to sell music and don't compensate copyright holders.

The move is a setback for Allofmp3.com, which has come under continued U.S. pressure in recent months. In October, Visa announced that it would no longer process the company's credit card transactions.

Allofmp3.com has denied charges of piracy by pointing out that the company is compliant with Russian copyright law. It says it is careful to pay royalties to artists via the Russian Multimedia and Internet Society, which claims to represent copyright holders.

The U.S. has never recognized that organization as legitimate and, as part of the agreement, requires Russia to stop such groups from "acting without right holder consent."

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