WORKSHOP ON COPYRIGHT – COLLECTIVE MANAGEMENT INT MARKT IND/EXP organized in co-operatation with the Ministry of Culture of the former Yugoslav Republic of Macedonia Skopje, June 3-5, 2013 MAIN FIELDS OF COLLECTIVE MANAGEMENT (PROMOTING THEIR ESTABLISHMENT; LEGAL BASIS; REMUNERATION SYSTEMS) Dr. Mihály Ficsor, Member and Honorary President, Hungarian Copyright Council, former Assistant Director General of WIPO

M. Ficsor, Skopje, June 3-5, ESTABLISHMENT OF COLLECTIVE MANAGEMENT ORGANIZATIONS

Raison d’être of (need for) collective management in the light of history  Collective negotiation with users („one for all, all for one” vis-à-vis users )  Beaumarchais; 1777, SACD  Professional forum; representation of authors’ interests (ALI, ALAI, Berne Convention)  Balzac, Dumas, Victor Hugo, 1837, SGDL  Fully-fledged collective management of rights  Henrion, Parizot, Bourget at Les Ambassadeurs, , SACEM M. Ficsor, Skopje, June 3-5, 20133

Basic functions of collective management – possible additional tasks  Negotiations with users on remuneration and other licensing conditions  Setting and publishing tariffs  Licensing uses  Monitoring uses  Enforcement of rights  Collection of remuneration  Distribution of remuneration ______________________________  + Promotion of (national) creativity  + Role in national cultural (and financial) policy  + Social assistance for members M. Ficsor, Skopje, June 3-5, 20134

Main fields of collective management  Authors’ musical „performing” rights  Authors’ musical „mechanical” right  Performers’ and producers of phonograms’ right to single equitable remuneration concerning broadcasting and communication to the public of phonograms published for commercial purposes  Interactive right of making available to the public in musical works and concerning the rights of performers  Cable retransmission right  Public performance right in dramatic works  Reprographic reproduction right  Right to remuneration for private copying  Authors’ and performers’ „residual” right to remuneration after the transfer of their rental right to producers  Resale rights (droit de suite) 5M. Ficsor, Skopje, June 3-5, 2013

Main forms of collective management  Fully fledged and partial  partial: public performance rights of dramatic works, remuneration rights, resale right  Voluntary, „extended” and mandatory (obligatory )  Independent (separate) and „coalitions”  coalitions: right to single remuneration of performers and producers of phonograms; remuneration rights for public performance, cable retransmission rights  National and transborder  transborder: AGICOA  transborder: CELAS, etc. 6M. Ficsor, Skopje, June 3-5, 2013

Contributors to the establishment of collective management organizations (1) Interest, initiative and participation of the owners of rights concerned  Possible basis for the establishment of new organizations: unions of creators (writers, composers, audiovisual creators, journalists, authors of visual arts, photographers, etc.), associations or trade unions of performers, associations of publishers, producers of phonograms, producers of films, etc. The role of the government:  Information, sensibilization;  Appropriate legislative and administrative framework;  Initial support and participation. M. Ficsor, Skopje, June 3-5, 20137

Contributors to the establishment of collective management organizations (2) Intergovernmental and regional organizations (institution building; training)  European Union’s projects  Cooperation programs of the World Intellectual Property Organization (WIPO) International non-governmental organizations (institution building; legal and technical assistance; training)  CISAC, BIEM, GESAC - authors  FIM, FIA, SCAPR, AEPO – performing artists  IFPI – producers of phonograms  IFRRO – writers, authors of graphic arts, photographers, publishers  AGICOA – producers of films M. Ficsor, Skopje, June 3-5, 20138

Certain basic principles of the establishment of collective management organizations (1) „Collective Management of Copyright and Related Rights” (WIPO publication No. 855(E), Chapter 7 Conclusions, pages (hereinafter: WIPO Conclusions); principle (9): „(9) Whether one single, general joint management organization or separate organizations for various rights and various categories of right owners are more appropriate depends on the political, economic and legal conditions and traditions of the countries concerned. The advantage of separate organizations is that, through them, the particular interests of the different categories of rights owners may be more fully and directly taken into account. The advantage of a general organization is that it may settle more easily the problems of emerging new uses and may more efficiently enforce general interests of rights owners. If there are separate organizations, there is a need for close cooperation between them, and, sometimes, for joint actions in the form of specific ‘coalitions,’ while, in the case of a general organization, guarantees are needed to avoid neglecting the interests of certain categories of rights owners. ” M. Ficsor, Skopje, June 3-5, 20139

10 REMUNERATION SYSTEMS – „PERFORMING RIGHTS” AS A BASIC EXAMPLE

„Performing rights” – international treaties, EU directives, national legislation Berne Convention Article 11. Right of public performance (1) Authors of dramatic, dramatico-musical and musical works shall enjoy the exclusive right of authorizing: (i) the public performance of their works, including such public performance by any means or process; (ii) any communication to the public of the performance of their works. (2) Authors of dramatic or dramatico-musical works shall enjoy, during the full term of their rights in the original works, the same rights with respect to translations thereof. M. Ficsor, Skopje, June 3-5,

„Performing rights” – international treaties, EU directives, national legislation Berne Convention Article 11 bis. The right of broadcasting and related acts (1) Authors of literary and artistic works shall enjoy the exclusive right of authorizing: (i) the broadcasting of their works or the communication thereof to the public by any other means of wireless diffusion of signs, sounds or images; (ii) any communication to the public by wire or by rebroadcasting of the broadcast of the work, when this communication is made by an organization other than the original one; (iii) the public communication by loudspeaker or any other analogous instrument transmitting, by signs, sounds or images, the broadcast of the work. M. Ficsor, Skopje, June 3-5,

„Performing rights” – international treaties, EU directives, national legislation Berne Convention Article 11 bis. The right of broadcasting and related acts (2) It shall be a matter for legislation in the countries of the Union to determine the conditions under which the rights mentioned in the paragraph 1 may be exercised, but these conditions shall apply only in the countries where they have been prescribed. They shall not in any circumstances be prejudicial to the moral rights of the author, nor to his right to obtain equitable remuneration which, in the absence of agreement, shall be fixed by competent authority. M. Ficsor, Skopje, June 3-5,

„Performing rights” – international treaties, EU directives, national legislation Berne Convention Article 11 bis. The right of broadcasting and related acts (3) In the absence of any contrary stipulation, permission granted in accordance with paragraph (1) of this Article shall not imply permission to record, by means of instruments recording sounds or images, the work broadcast. It shall, however, be a matter for legislation in the countries of the Union to determine the regulations for ephemeral recordings made by a broadcasting organization by means of its own facilities and used for its own broadcasts. The preservation of these recordings in official archives may, on the ground of their exceptional documentary character, be authorized by such legislation. M. Ficsor, Skopje, June 3-5,

„Performing rights” – international treaties, EU directives, national legislation  The EU directives do not contain specific provisions on authors rights of public performance.  „InfoSoc” Directive. Art. 3(1) Member States shall provide authors with the exclusive right to authorise or prohibit any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them from a place and at a time individually chosen by them.  See furthermore, specific norms on satellite broadcasting under the Satellite and Cable Directive. M. Ficsor, Skopje, June 3-5,

„Performing rights” – international treaties, EU directives, national legislation Rome Convention. Article 12: If a phonogram published for commercial purposes, or a reproduction of such phonogram, is used directly for broadcasting or for any communication to the public, a single equitable remuneration shall be paid by the user to the performers, or to the producers of the phonograms, or to both. Domestic law may, in the absence of agreement between these parties, lay down the conditions as to the sharing of this remuneration. M. Ficsor, Skopje, June 3-5,

„Performing rights” – international treaties, EU directives, national legislation WPPT. Article 15(1) (f) “broadcasting” means the transmission by wireless means for public reception of sounds or of images and sounds or of the representations thereof; such transmission by satellite is also “broadcasting”; transmission of encrypted signals is “broadcasting” where the means for decrypting are provided to the public by the broadcasting organization or with its consent; (g) “communication to the public” of a performance or a phonogram means the transmission to the public by any medium, otherwise than by broadcasting, of sounds of a performance or the sounds or the representations of sounds fixed in a phonogram. For the purposes of Article 15, “communication to the public” includes making the sounds or representations of sounds fixed in a phonogram audible to the public. M. Ficsor, Skopje, June 3-5,

„Performing rights” – international treaties, EU directives, national legislation WPPT. Article 15 (1) Performers and producers of phonograms shall enjoy the right to a single equitable remuneration for the direct or indirect use of phonograms published for commercial purposes for broadcasting or for any communication to the public. (2)Contracting Parties may establish in their national legislation that the single equitable remuneration shall be claimed from the user by the performer or by the producer of a phonogram or by both. Contracting Parties may enact national legislation that, in the absence of an agreement between the performer and the producer of a phonogram, sets the terms according to which performers and producers of phonograms shall share the single equitable remuneration. M. Ficsor, Skopje, June 3-5,

„Performing rights” – international treaties, EU directives, national legislation Rental, Lending and Related Rights Directive. Article 8(2): 2. Member States shall provide a right in order to ensure that a single equitable remuneration is paid by the user, if a phonogram published for commercial purposes, or a reproduction of such phonogram, is used for broadcasting by wireless means or for any communication to the public, and to ensure that this remuneration is shared between the relevant performers and phonogram producers. Member States may, in the absence of agreement between the performers and phonogram producers, lay down the conditions as to the sharing of this remuneration between them. M. Ficsor, Skopje, June 3-5,

„Performing rights” – remuneration systems Main methodological criteria for tariffs in respect of the use of authors’ musical performing rights in restaurants, bars and similar establishments:  The basic tariff system may be differentiated according to: (i) the level of the services (and corresponding prices) of the establishments (sometimes expressed in the number of stars or other categorization); (ii) the location of the establishment (whether in the capital, bigger or smaller cities or villages); (iii) the duration of the opening of the establishment.  The tariff system may be further differentiated: (i) according to the size (such as the surface) of the establishment; (ii) according to the capacity of the establishment in respect of how many persons it is able to serve; and (iii) according to whether recorded music or live music is used (in the latter case the tariffs being increased). M. Ficsor, Skopje, June 3-5,

„Performing rights” – remuneration systems Main methodological criteria for tariffs in respect of the use of authors’ musical performing rights in hotels and similar establishments:  It is to be noted that if restaurants, bars, etc. are operated in hotels and similar establishments, the tariffs mentioned above apply equally for each of them. Separate tariffs apply for the common areas, such as lobbies or halls of the hotels etc.  The basic tariffs are to be calculated according to the level of the service of the hotel or other establishment, expressed by the stars or other categorization and according to the location of the hotel. The tariffs should be higher: (i) if on the surface of the common areas of the hotel, such as lobby or hall, also a bar or similar establishment is operated; and (ii) if not recorded music but live music is used as a background.  According to the court practice established by the European Court of Justice, the public performance right is applicable also in case of offering music in hotel rooms. The tariffs in such a case may be differentiated: (i) according to the level of the services (and prices) of the hotel; (ii) according to the number of rooms in the hotel; and (iii) according to whether special recorded music program of the hotel is played or only broadcast programs are available. M. Ficsor, Skopje, June 3-5,

„Performing rights” – remuneration systems Main methodological criteria for tariffs in respect of the use of authors’ musical performing rights in shops, department stores, supermarkets and similar establishments:  The basic criterion of the tariffs is, in general, the surface of the establishment. It is to be understood that, if a restaurant, bar or similar establishment is operated in a department store, supermarket, etc., those establishments have to pay separately the tariffs indicated above.  The tariffs calculated on the basis of the surface of the establishment may be substantially lower in the case of parking houses and similar establishments (factories, offices, etc.) and higher in the case of spas and wellness services.  While the above-mentioned tariffs should be paid monthly, the tariffs to be paid by the organizers of fairs, expositions, sport events and other similar events should be paid on a daily basis. In the case of fairs, expositions and other similar events, the tariffs are calculated on the basis of the surface of the establishment, while in the case of sport events, on the basis of the capacity of the sport establishment.  In the case of mass transport (bus, ship, train), a lower monthly tariff is to be applied, while in the case of commercial transport service (such as organized tours and sightseeing), the tariff may be established according to the capacity of the transport means. However, the tariff may also be adapted in a way that the number of the uses of the transport means is taken into account. M. Ficsor, Skopje, June 3-5,

„Performing rights” – remuneration systems  Main methodological criteria for tariffs in respect of the use of authors’ musical performing rights in concerts:  The tariffs basically should be a certain percentage of the income (such as 9-10%), but it cannot be lower than the minimum tariff, which is also applicable where no entry fee is to be paid and it is to be calculated according to the capacity of the event.  Main methodological criteria for tariffs in respect of the use of authors’ musical performing rights in discos, balls and similar establishments and events:  The calculation of the tariffs may be similar as in the case of concerts, but they should express that, in such a case, music plays a decisive role in the establishment of the event. M. Ficsor, Skopje, June 3-5,

„Performing rights” – remuneration systems Main methodological criteria for tariffs in respect of the use of rights of authors of musical works for broadcasting, cablecasting, webcasting and simulcasting:  While the concept of broadcasting is clear, it should be clarified that the concept of cablecasting means the transmission of the cable organization’s own original program; that webcasting means non- interactive transmission of programs through the Internet (such as Internet radios); and simulcasting means the simultaneous and unchanged retransmission of broadcast programs through the Internet by the originating broadcasting organization. (continues) M. Ficsor, Skopje, June 3-5,

„Performing rights” – remuneration systems Main methodological criteria for tariffs in respect of the use of rights of authors of musical works for broadcasting, cablecasting, webcasting and simulcasting: (continued)  In case of broadcast programs, the tariffs may take two basic forms: (i) a lump sum-type percentage where it is not measured and calculated what part of the programs music may play, in which case the percentage may be lower (such as from public subsidy 1%, from subscription fees 2%; from the income of advertisement and sponsorship 4%), but not lower than a minimum tariff to be taken into account irrespective of availability of the incomes; (ii) where the tariff is calculated more or less precisely according to the part of music within the program (for example, up to 25% or 50% or 75% or more percentage of the program), in the case of the lowest percentage, the tariff may be lower (for example, from public subsidy 1%; from subscription 1.5%, from advertisement incomes 2%), while in the case of the highest percentage, it may be correspondingly higher (from public subsidy 1%, from subscription 4%, from advertisement income 8%). M. Ficsor, Skopje, June 3-5,

„Performing rights” – remuneration systems Main methodological criteria for tariffs in respect of the use of rights of authors of musical works for broadcasting, cablecasting, webcasting and simulcasting: (continued)  In case of cablecasting, the same kinds of tariffs may be applied.  In case of non-interactive webcasting, the tariffs may be based on concrete amounts to be paid monthly, which should also take into account the number of channels (webcast programs).  For simulcasting of the broadcast program by originating broadcasting organization, a percentage of the tariff paid for broadcasting should also be paid (on the understanding that for simulcasting by other organizations, separate authorization is needed on the basis of exclusive rights). M. Ficsor, Skopje, June 3-5,

„Performing rights” – remuneration systems  It is understood, that for the same acts also performers and producers of phonograms also receive remuneration. The tariff system is similar. The amount of the tariffs for these both categories together may be the same as in the case of authors rights.  It is to be noted, that, in addition to the actual tariffs, the tariff system usually also contains: (i) definitions of the various concepts; (ii) provisions about the obligation of users or other persons obligated to pay remuneration to inform the CMOs in advance (in the absence of which the sanction may be that the double amount of the remuneration should be paid); (iii) as well as the obligation to communicate the repertoire used (in the case of non fulfillment of which the sanction may be a smaller percentage in increase of the remuneration every day). M. Ficsor, Skopje, June 3-5,

БЛАГОДАРАМ BLAGODARAM THANK YOU M. Ficsor, Skopje, June 3-5,