AUCKLAND, New Zealand—Megaupload founder Kim Dotcom is launching a new version of his now-defunct file-sharing website 12-months after U.S. charges were laid alleging criminal copyright infringement and conspiracy to commit racketeering.

The launch of the new site, called Mega, comes as Mr. Dotcom, who was arrested in Auckland last January, and three codefendants in New Zealand continue to fight extradition to the U.S. for trial. The U.S. Federal Bureau of Investigation had shut Megaupload, which the FBI alleged was used to pirate entertainment content valued at US$500 million.

Mr. Dotcom said lawyers have examined the new site, and he is confident it is compliant with the law. The site promises increased privacy to users through encryption of every file loaded onto the site, according to the Internet entrepreneur.

The new site was developed by Mr. Dotcom, 39 years old, and his fellow defendants—Megaupload chief marketing officer Finn Batato, 38; chief technical officer, director and co-founder Mathias Ortmann, 40, both from Germany; and Dutch national Bram van der Kolk, 29—as they wait on bail for a decision on whether they will be extradited to the U.S. All have denied the charges.