On February 2004 the Computer Crimes division of Moscow City Police recommended that prosecutors initiate a criminal lawsuit against AllofMP3.com, a Russian music site selling MP3 downloads by the megabytes. The investigation was initially launched at the request of IFPI Moscow. The International Federation of the Phonographic Industry previously sued a similar Spanish project, with PureTunes.com settling with the industry for $10 million.
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The case of AllofMP3.com was further complicated by compulsory licensing, adopted by Russian legislature. Compulsory licensing stipulates that licenses should be issued in non-discriminatory manner to anyone who wants to get one on reasonable terms. Russian Multimedia and Network Society was in charge of establishing the reasonable terms, and according to Russian legislation, anyone could distribute music, provided they track downloads and pay back some nominal fee. This is very different from the legislature in the United States, where a music distributor would have to gain a license before selling any music online, and furthermore, could be denied such license for whatever reasons.