The Government will delay implementation of a controversial new copyright law due to come into effect this week.
Last week, the Government was presented with a petition against Section 92A of the Copyright Act, signed online by more than 10,000 people.
The section requires Internet Service Providers to disconnect users accused of illegally downloading copyrighted material.
Opponents say people will be disconnected without evidence or court scrutiny.
Prime Minister John Key says the implementation of Section 92A will be delayed until 27 March to give the industry time to agree on a voluntary code of practice.
Mr Key says if there has not been agreement by then, the provision will be suspended.
If it is, a review in six months will determine whether the new law is working.
Mr Key says the internet is not the "wild west" and copyright holders are entitled to recognition or compensation for their work.
The Creative Freedom Foundation says the Government's move shows it accepts there are problems with the law.
However, the foundation says it would have preferred a repeal of Section 92A.