Italian government agency ENPALS has extended by three months the deadline for payment of royalty-based retroactive pension contributions by record labels.

Labels were supposed to make the payments by July 15, but this date has now been put back to Oct. 16. The decision was announced at a meeting in Rome last week between members of the Italian parliament's culture commission and representatives of the "Amici della Musica" ("Friends of Music") lobby group.

ENPALS had announced earlier this year its intention to impose royalty-based pension payments by record labels. Labels were asked to pay an initial fee per singer per recorded track which would subsequently be updated according to the numbers of albums and singles sold.

Moreover, the agency requested that the payments be made retroactive to 2004. Whereas the major labels accepted the new arrangement without protest, the indies, particularly those associated with the Audiocoop representative body, argued that the measure would force many of them to go bankrupt and therefore lobbied for a deadline extension.

Roberto Pietrangeli, the head of Unione Artisti-Unimpresa, a group which is working alongside Audiocoop in its negotiations with ENPALS, tells "This extension of the deadline was obligatory because, in its current form, this new law could not have been applied. We will now set up negotiations with the Ministry of Labour in order to modify the original decree. Our sector will be in a position to obey this law, only if it is modified."

Mario Limongelli, president of the indie representative group PMI, agrees: "This deadline extension enables us to open negotiations in order to review the law and modify it."