Christophe Depreter, CEO SABAM, Belgium Seminar AEPO-ARTIS Panel discussion 3 - Collective management of rights in a globalised environment Role and challenges 18 – 19 November 2010

Christophe Depreter, CEO SABAM, Belgium Rules of governance and aims of Collective rights management organisations, including cultural and social aspects

Christophe Depreter, CEO SABAM, Belgium 1- Aims  for members / stakeholders:  to maximize collections and distributions  for customers  to offer an easy and secure access to the world repertoire

Christophe Depreter, CEO SABAM, Belgium 2- Vision and values  Transparency

Christophe Depreter, CEO SABAM, Belgium 3- Rules of governance Internal regulation  Corporate Governance Charter  Definition of all decisional bodies within the society, their composition and responsibilities.  Distinction between the strategic bodies (Board of Directors) and operational bodies (management committee).  Ethic rules (including the individual signature of a Code of Conduct).  Code of conduct  To avoid conflicts of interests (functional and material interests).  To guarantee a professional and objective behavior.  To guarantee the secrecy of discussions held within the Board of Directors.

Christophe Depreter, CEO SABAM, Belgium Legal framework (Belgian law of 10th December 2009 on the status and the control of collective management societies) 1- Authorization authorization in order to collect rights on Belgian territory Foreign societies must collect through a branch in Belgium. totally or partially withdrawn in case of infringement of the law 2- Rules Societies must comply with a set of rules imposing transparency towards its’ members as well as towards users Website, annual reports, distribution sheets and invoices must contain certain information.

3- Societies must foresee in an internal administrative structure, rules of corporate governance and internal control. 4- Societies need to take the necessary measures in order to avoid conflicts of interests. 5- Societies may deduct maximum 10% of the collected amounts and use these rights for social, cultural and educative aims. The Board of Directors must report how the monies were used to the General Assembly. 6- Societies must appoint a commissioner to whom special tasks are imposed. 7- Societies are controlled by the Minister of Economics to whom they must submit certain information (including proposals to modify tariffs, rules and regulations). 8- Societies must finance said control.

Christophe Depreter, CEO SABAM, Belgium International self regulation  Common declaration GESAC / ICMP Representation within the Board of Directors Categories of on-line rights in the rules and regulations  CISAC Professional Rules & binding Resolutions

9 TD Author: Original language: English Christophe Depreter, CEO SABAM, Belgium CISAC Professional Rules & Binding Resolutions for Authors’ Societies

10 TD Author: Original language: English Christophe Depreter, CEO SABAM, Belgium The Professional Rules

11 Professional Rules The rules consist of a set of binding principles intended to promote The fair and non-discriminatory collective management of copyright Cost efficiency and increased productivity A professional approach to the management of the creator’s rights

12 What do the Professional Rules cover? Governance & Membership Establish who can be members of a collective management organisation, members’ rights, Board of Directors composition and the society’s inherent compliance with laws and regulations Transparency & Confidentiality Deal with the information that authors’ societies are required to share with their members, sister societies and CISAC (annual report, licensing income, distribution rules, etc.) and the policy concerning disclosure of confidential information to third parties

13 What do the Professional Rules cover? Licensing & Collection Detail the different criteria for authors’ societies related to the granting of licences, the collection of royalties, and the monitoring of uses of their repertoires Documentation & Distribution State that authors’ societies must carry out all documentation of works in their repertoire and distribution of royalties in accordance with the Binding Resolutions Compliance & Conflicts Describe the various principles related to compliance with the rules and the various procedures for dealing with litigation and dispute settlement

14 Compliance timetable The Professional Rules for musical and visual arts societies came into force in June 2008, after being approved by the CISAC Board of Directors and General Assembly. All musical rights and visual arts societies must now be in compliance with their respective Professional Rules. Compliance for the DLV societies has been agreed in 2009

15 Compliance timetable Detailed information is available on CISAC website: Full text of the rules for each repertoire FAQ on Professional Rules Online compliance declaration (available for the end of the year)

16 Compliance with Professional Rules Compliance means that a society operates according to 100% of the principles established in the Rules All societies must fill out an annual online declaration stating that their practices adhere to CISAC’s Professional Rules The Secretariat has been asked by the Board of Directors to carry out several random checks per year in each region 3 Societies per region – 2009 first PR Review conducted

17 Compliance with Professional Rules What are the consequences of non- compliance? If a society is not in compliance with the Professional Rules, the Governance and Compliance Committee will consult with the Board of Directors who will determine an appropriate course of action This could include modifications to the society’s membership status or, in serious cases, expulsion Nevertheless, CISAC will take all of the necessary measures including assistance and training to ensure that all societies can quickly adapt and easily function in compliance with the Rules

18 The Binding Resolutions

19 What are the Binding Resolutions? The CISAC Professional Rules establish the general principles necessary to ensure that a Society conducts its operations with integrity, transparency and efficiency and employs practices that are adapted to the market and technological developments The Binding Resolutions define the principles for Documentation and Distribution, as a technical annex to the CISAC Professional Rules for Musical Societies They represent a consolidation of existing technical rules established to ensure the smooth functioning of societies

20 What are the Binding Resolutions? The principles of Binding Resolutions for musical societies were adopted by CISAC Board of Directors and subsequently endorsed by the General Assembly. The Interim final legal document is available and the final version should be submitted to the next Board meeting and GA for approval Binding Resolutions for audiovisual societies were approved by the DLV Technical Committee in 2008 and have been approved by the Board of Directors Final versions of Binding Resolutions for the other repertoires are being elaborated.

21 What are the Binding Resolutions? Compliance timetables are: From 2009 to 2011 for musical societies From 2009 to 2012 for audiovisual societies The Binding Resolutions for musical societies are classified into 3 categories: Documentation Distribution Use of the CIS tools and format

22 Why Binding Resolutions? Assure that societies are compliant with the common rules and processes, enforce a “quality” level for societies. Commitment of societies on documentation and distribution practices to make international distribution more efficient.

23 Binding Resolutions Time Table Official validation of the Binding Resolutions Developed and Developing Societies compliance Dead line Developed and Developing Societies compliance Dead line Least Developed Societies compliance Dead line Least Developed Societies compliance Dead line From 2010 to 2012 for some of the Audiovisual Binding Resolutions that are more complex to implement