The European Commission has shelved plans to review the levy which forces manufacturers of copying technology, such as iPods and even blank DVDs, to compensate artists, including film-makers.

The levy, or "fair compensation," takes the form of a tax on gadgets although the costs are generally passed on as higher prices to consumers.

The IT industry has put the commission under heavy pressure to reform the system operating in 19 EU countries, claiming it is outdated.

The Commission has also been concerned that the levy acts as a restraint on the internal market.

But film-makers have joined music artists in defending a levy that they believe gives them a cut of technology profits to which they believe they contribute.

Last month, a group of leading European film-makers - Pedro Almodovar, Ken Loach, Nanni Moretti, Costa Gavras, Mike Leigh, Lars Von Trier and the Dardennes brothers - addressed an open letter to Commision members demanding the retention of the current system.

The anger of artists and lobbying from the French government seem to have forced a rethink on reform.

A spokeswoman for the commission said: "We need to do it right and we need a bit more time."

No specific time has been mentioned.