1. Commission proposal for a Directive on
collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market
Internal Market and Services DG
Unit D1 - Copyright
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2. Overview I – Current status II - Governance & Transparency
III - Multi-territorial licensing of author's rights in musical works for online use ("MTL")
IV – Enforcement provisions
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3. I – Current status
July 2012: Commission adopted proposal for Directive on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market
Since September 2012 discussions
Under Cypriot and Irish Presidency of Member States in the Council
In the European Parliament (lead Committee: JURI)
October European Council conclusions: work on the proposal should be accelerated to achieve a fully functioning Digital Single Market
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4. II – Governance & Transparency: Identified problems
difficulties in joining foreign CS
obligations to entrust all rights, for all territories, etc.
discrimination of foreign members
limited membership rights of publishers
limited access to annual reports
limited information on cross-border royalty flows
late distribution of royalties
risky investments
unclear rules on the use of non-distributed income
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5. II – Governance & Transparency: consequences of identified problems
Concerns as to management and handling of revenues in some CS
Less revenue for rightholders
Less incentives to create
Less innovation for consumers
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6. II - Governance & Transparency: Main provisions
Apply to ALL collecting societies (whatever category of rightholders they represent, whatever rights, remunerations, compensations they manage)
Membership of collecting societies
Participation of rightholders in the decision-making process
Handling of funds
Relations with other CS and users
Transparency and financial reporting
13/09/2012

7. II - Governance & Transparency: Selected issues
Article 3 (note: current definition from compromise proposal of Presidency) – Definition of a collective management organisation (in COM proposal: collecting society)
'collective management organisation' means any organisation authorised by law or by way of assignment, licence or any other contractual arrangement to manage copyright or rights related to copyright on behalf of more than one rightholder, for the collective benefit of those rightholders as its sole or one of its main purposes, and which is:
(i) owned or controlled by its members, or
(ii) organised as a not for profit organisation.
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8. II - Governance & Transparency: Selected issues
Article 5 – Rights of rightholders
Mandates by rights, categories of rights, types of works, territories
Rights' withdrawal (in the same manner as mandates), notice not exceeding 6 months
Article 12 - Distribution of royalties
Accurate & timely (12 months from the end of the financial year in which the rights revenue was collected)
Rules on non-distributable income
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9. II - Governance & Transparency: Selected issues
Art. 16 – RIGHTHOLDERS, on the management of their rights
Art. 17 – OTHER CS, on the management of rights under representation agreements
Art. 18 – RIGHTHOLDERS, MEMBERS OTHER CS & USERS, on request
Art. 19 – THE PUBLIC (on-going disclosure of certain information)
ANNUAL TRANSPARENCY REPORT (Art Annex I)
Transparency & financial reporting
Different levels of information obligations vis-à-vis
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10. III – MTL: Licensing of music rights for online uses
Online music service provider
needs to clear
Authors' rights
Authors' collecting societies
Record producer's rights
Record producers
Performers' rights
Record producer
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11. III - MTL: Identified problems
fragmentation of repertoire (CS/publishers)
lack of data processing infrastructure adjusted to per-use/per-work reporting
identification of repertoire
identification of rights that can be licensed
identification of territories in which rights can be licensed
inaccurate invoicing leading to over-payments for the same repertoire, same rights, same territory
legal uncertainty
complex and costly licensing system
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12. III – MTL: consequences of identified problems
Many collecting societies not prepared to engage in MTL online licensing
Difficulties for service providers when clearing rights for online services
Less innovative music services available to consumers across the EU
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13. III – MTL: Selected issues
Capacity to grant multi-territorial licenses
CS granting multi-territorial licenses
Accurate identification of multi-territorial repertoire on a per-work basis
Accurate & timely payment to rightholders
Accurate reporting on the use of repertoire by electronic means
Timely & accurate invoicing by collecting societies on a per-work basis
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14. III – MTL: Selected issues
What can a CS do if it does not fulfill the requirements for MTL?
CS can conclude a representation agreement with other CS on non-exclusive basis (Article 28)
Under certain circumstances obligation to represent another CS (so-called TAG-ON obligation - Article 29)
If a CS does not provide MTL or enter into representation agreement after one year after transposition date: rightholders may choose to mandate another CS/other entity/license individually for MTL (Article 30)
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15. III – MTL: Other provisions
Application of certain provisions to entities owned in whole or in part by CS
Flexibility of licensing terms required to encourage the granting of licences to innovative online services
Derogation for online music rights required for radio and TV programmes (simulcasting, catch-up TV)
Necessity for MS to ensure that compliance with the requirements of Title III can be effectively reviewed by competent authorities (complaints, sanctions and measures)
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16. IV – Enforcement provisions
CS to provide complaint procedures to members and rightholders
MS will need to have appropriate mechanisms for solving disputes between collecting societies & users
Alternative dispute resolution for purposes of multi-territorial licensing of online music rights
MS to ensure compliance with directive; sanctions and measures
MS and COM will cooperate to ensure monitoring of the compliance of collecting societies with rules on multi-territorial licensing
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17. Thank you for your attention!
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