A new directive in France could see peer-to-peer users cut off if they continue to share files.
A memorandum of understanding has been signed by some French ISPs, the recording industry and the French government under which ISPs will hand over data on who is using file sharing networks to a new government agency.
The agency will issue warnings to those whom it feels are breaking the law. If the behaviour persists, the internet connection can be shut down.
John Kennedy, chairman of the International Federation of the Phonographic Industry, said: "This is the single most important initiative to help win the war on online piracy.
"By requiring ISPs to play a role in the fight against piracy [French president] Nicolas Sarkozy has set an example of how to ensure that the creative industries can remain major economic and cultural contributors to society."
In return, the recording industry has agreed to release movies on DVD faster and to make more DRM-free content available for sale.
"Today an accord is signed and I see a decisive moment for the civilised internet," said Sarkozy.
"The US, UK and others have tried to find a permanent resolution to the problem of piracy. We are the first to try to build a national grand alliance around clear and viable proposals."
The agreement came about after Denis Olivennes, head of French chain store FNAC, was asked to review the situation and make recommendations.
Olivennes claimed that the deal is a way to avoid the tough sentences being given to file sharers for intellectual property theft.
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