The European Commission is set to offer a pan-European copyright license for online music stores. The move would mean easier overall royalty payments to artists without going though each individual member state.

Internal Market and Services Commissioner Charlie McGreevy said of the plan: "The absence of pan-European copyright licenses makes it difficult for new European-based online services to take off. This is why we are proposing the creation of Europe-wide copyrights clearance."

EU executives are now talking to industry members and receiving recommendations on how best to move forward.

The EU plans to have the license law adopted by October this year.

Currently, the cost of negotiating a single license is currently 9,500 euros in Europe.

The EU trails the U.S in online music revenues.

In 2004 U.S companies made $249 million from online music sales compared to Europe's small $32 million.

It is hoped the new law will allow European online music stores to better compete with their American counterparts.