In 2002, the Copyright Arbitration Royalty Panel (CARP) system was initiated by the United States Congress in order to oversee decisions regarding royalty rates and terms, particularly in regard to digital distribution of audio. Many webcasters believed the 2002 proposed royalty structure to be overly burdensome and intended to disadvantage independent Internet-only stations. CARP was later phased out in favor of the Distribution Reform Act of 2004.
Due to these rate increases, it has been suggested that some U.S.-based Internet broadcasts should be moved to foreign jurisdictions where US royalties do not apply. "For example, Mercora, a service that allows individuals to launch their own webcasts, has established a Canadian site that they believe falls outside U.S. regulatory and royalty rules."
