Palau has written its first copyright laws and established penalties for a controversial practice of reproducing others works for profit without compensation.
President Tommy Remengesau says people can now benefit from their work and receive due recognition.
In the past people in Palau have reproduced things such as audio recordings and written works of Palauans and foreigners, although on a small scale and for minor profit.
The new law protects work from literature and sound recordings to architectural work and computer programmes. It also protects the rights of performers.
Mr Remengesau says the law is timely because Palau is set to host the 9th Festival of Pacific Arts in July and expects large delegations of artists and performers from all over the Pacific.
He says the rights of performers and artists was a major concern of previous hosts of the festival.
Mr Remengesau says the law should also encourage foreign companies trading with or investing in Palau.