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Management of online rights in musical works
This Recommendation proposes measures to improve the licensing of online music across the European Union (EU). It aims to make EU-wide licences more easily accessible to online music service providers and thus help these services to take off in Europe.
ACT
Commission Recommendation 2005/737/EC of 18 May 2005 on collective cross-border management of copyright and related rights for legitimate online music services (Official Journal L 276 of 21 October 2005, p. 54-57).
SUMMARY
This Recommendation on the management of online rights in musical works puts forward measures for improving the EU-wide licensing of copyright and related rights for legitimate online music services. In particular, it recommends that rights-holders and commercial users of material protected by copyright or related rights should be given a choice as to their preferred model of licensing. Improvements are necessary because new Internet-based services such as ‘webcasting’ , ‘streaming’ or on on-demand music downloads need a licence that covers their activities throughout the EU.
Relations between rights-holders, collective rights managers and commercial users
Rights-holders should be able to able to assign the management of the rights necessary to operate online music services, on the territorial scale of their choice, to the rights manager of their choice. The choice of such a rights manager should be possible irrespective of the latter's EU country of residence or nationality.
As regards the licensing of online rights , the relationship between rights-holders and collective rights managers, should be governed by, at least, the following:
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rights-holders should be able to determine the online rights to be entrusted for collective management;
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rights-holders should be able to determine the territorial scope of the mandate of the collective rights managers (i.e. the countries covered);
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rights-holders should have the right to withdraw any of the online rights and transfer the management of those rights to another collective rights manager, irrespective of the latter's EU country of residence or nationality.
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Collective rights managers should inform rights-holders and commercial users of the repertoire they represent, any existing reciprocal representation agreements, the territorial scope of their mandates for that repertoire and the applicable tariffs.
Collective rights managers should grant commercial users licences on the basis of objective criteria and without any discrimination.
Equitable distribution and deductions
Collective rights managers should distribute royalties charged on downloaded online music to all rights-holders or the category of rights-holders they represent in an equitable manner.
Contracts between collective rights managers and rights-holders should specify whether any deductions from the royalties are to be distributed for purposes other than for the management services provided. Such deductions should be specified to rights-holders upon payment of the royalties.
Non-discrimination and representation
The relationship between collective rights managers and rights-holders should be based on the following principles:
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equal treatment of any category of rights-holder as regards all elements of the management service provided;
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fair and balanced representation of rights-holders in the internal decision-making process.
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Accountability
Collective rights managers should report regularly to all rights-holders they represent on any licences granted, applicable tariffs and royalties collected and distributed.
Dispute settlement
EU countries should provide for dispute resolution mechanisms, in particular in relation to tariffs, licensing conditions, entrustment of online rights for management and withdrawal of rights.
Multi-territorial licensing of rights: new Directive
In 2014, Directive 2014/26/EU was adopted. It aims to enable online service providers to obtain licenses for cross-border music services from collective management organisations operating across EU borders. It should also increase transparency and efficiency in the functioning of copyright collective management organisations. EU countries are required to incorporate its provisions in their national law before 10 April 2016.
Background
In July 2005, the European Commission published a study on the detailed rules for issuing licences to use musical works over the internet. The study concluded that there was a need to reorganise the cross-border collective management of copyright and related rights for the use of online music. To this end, it suggested, in particular, enabling rights-holders to authorise a collective rights manager of their choice to manage their work throughout the EU.
KEY TERMS
Webcasting: the broadcasting of audio and/or video content over the internet.
Streaming: technology used in webcasting for the broadcasting of audio and video content.
Rights-holder: any natural or legal person who holds rights.
Collective rights manager: any organisation the sole or one of the main objects of which is to manage or administer copyright or related rights.
Online rights cover:
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exclusive right of reproduction;
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the right of communication to the public of a musical work, either in the form of a right to authorise or prohibit, or a right to equitable remuneration. This includes webcasting, internet radio and near-on-demand services received either on a personal computer or on a mobile telephone;
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the exclusive right of making available a musical work, which includes on-demand or other interactive services.
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Commercial user: any person involved in the provision of online music services who needs a licence from right-holders in order to provide legitimate online music services.
Repertoire: the catalogue of musical works administered by a collective rights manager.
Further information is available from the European Commission's Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs website.
RELATED ACTS
Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market (Official Journal L 84 of 20.3.2014, p. 72-98).
Last updated: 06.03.2015