"...The German electronics industry is up in arms over a proposal to levy a fee on hardware manufacturers - money which will go to reimburse intellectual property owners whose works are distributed online. The idea, reinforced and supported in a speech last week by Chancellor Gerhard Schroeder, will see the funds paid annually to musicians, artists, and writers.

Germany is the largest Internet economy in Europe, so other countries are watching the debate with interest. Governments worldwide are presently grappling with the effect online distribution of copyrighted work has on existing intellectual property laws.

Industry bodies say the fees are unfair, and could eventually lead to a decline in Internet usage by Germans. Schroeder, however, sees an annual royalty payment to copyright holders as the ideal way to cope with an online distributor like Napster, a music site with a vast audience but no method to remunerate artists for the use of their material.

Call it a fee, or call it a tax, the industry says it amounts to the same thing. Electronics manufacturers would pass the cost on to consumers, driving up the price of new technologies.

The fees could be introduced as early as the end of the year, said Dr. Frank Thoms, who is in charge of new intellectual property rights for VG Wort, an organisation that distributes payments to writers. They would apply to personal computers and CD burners. Other electronic equipment like fax machines, photocopiers and scanners are already levied a nominal fee..."