WASHINGTON (Reuters) - Media companies would be allowed to sabotage Napster-style networks to prevent songs, movies and other copyrighted materials from being swapped over the Internet under a bill introduced in Congress on Thursday.

The bill would permit recording companies and other copyright holders to hack onto networks to thwart users looking to download free music, and would protect them from lawsuits from users.

Although Congress has little time to debate the bill before the August recess, sponsor Rep. Howard Berman, a California Democrat, said the measure was necessary because the decentralized systems were impossible to shut down.

"No legislation can eradicate the problem of peer-to-peer piracy. However, enabling copyright creators to take action to prevent an infringing file from being shared via P2P (peer-to-peer) is an important first step," Berman said in remarks on the floor of the House of Representatives.

Many large record labels have already resorted to a method known as "spoofing," where they hire firms to distribute "decoy" files that are empty or do not work in order to frustrate would-be downloaders of movies and music.

Additionally, sources have said the major recording companies, like Bertelsmann AG BTGGga.D BMG, EMI Group Plc EMI.L , Vivendi Universal EAUG.PA and Sony Corp 6758.T are considering taking a new tack by suing individuals who use the services, rather than the companies that host them.

The industry's trade group, the Recording Industry Association of America, on Thursday welcomed the bill.

"We applaud Congressman Berman for introducing bipartisan legislation that takes an innovative approach to combating the serious problem of Internet piracy," said Hilary Rosen, chairman and chief executive officer of the RIAA.

"Online piracy undermines the growth of legitimate music sites and hurts all consumers in the long run. Every dollar lost to piracy is a dollar that cannot be invested in fresh, new artists we have all come to expect and enjoy," said Rosen.

The bill does not specify what measures copyright owners could take to foil online song swapping, but does impose some limits on their efforts.

Copyright owners would only be able to stop the trading of their own songs, and would be required to notify users and the Justice Department when they took action.

Overzealous companies could face a government ban and lawsuits from users who suffered economic harm.

The recording industry blames rampant online piracy for a decline in CD sales last year and has prosecuted online networks aggressively.

But while the industry succeeded in shutting down the pioneer Napster service last summer, other less centralized networks like Kazaa and Morpheus continue to attract millions of users.

"The current landscape for online music is dangerously one-sided, with the peer-to-peer pirates enjoying an unfair advantage," Rosen of the RIAA said.

"It makes sense to clarify existing laws to ensure that copyright owners -- those who actually take the time and effort to create an artistic work -- are at least able to defend their works from mass piracy," Rosen said.

Members of the movie industry also embraced the initiative, but not entirely.

"We're pleased that a bipartisan group of lawmakers .. want to curb the explosion of Internet piracy," said Jack Valenti, president and chief executive officer of the Motion Picture Association of America, in a statement.

"However, there are aspects of the bill we believe need changing as it moves through the legislative process. We look forward to working with Congress in this regard," he said.

A spokesman for Valenti was not immediately available to elaborate.