Private Use
on Musical Works, Rights of Public
Performance,
and Collecting Society Systems.
By'
Judge Visit Sripibool
withdraw
their administration if the so wish. Under the GEMA decisions, rightholders
are free to assign their repertoire to the society offering the best conditions.
In SABAM,(206) the European Court of Justice stated that a copyright society
purely manages private, individual property interests. Collective administration
has to leave maximum freedom to rightholders to manage their rights. To
retain rights for five years after a member withdrew was ruled to be "unfair".
Mechanics of Administration
When
an author joins a collecting society, he will normally give the society
either an assignment of the rights to be administered or a mandate or
license to administer these rights. The society, so armed and also representing
repertoires of societies in other countries, is then in a position to
issue licenses to those who intend to use the protected material. Such
licenses may be in "blanket" form, covering the whole of the
society's repertoire, or there may be ad hoc licenses for particular uses.
Tariffs are established for the various licenses and in general there
is a complex system of arrangements to allow flexibility for the various
needs of the users. Such users may range from organizations of national
importance, such as the national broadcasting organization, to modest
establishments which require a license for the entertainment of their
clientele, in cafes, restaurants, etc.
An important feature of administration of rights is the presence in many
countries, as abovementioned, of tribunals set up by law to determine
the tariffs which are to apply in particular cases.
There are complex scheme which apply in the distribution of the monies
collected, and these will often involve arrangements between societies
of different countries in order to cover the reciprocal use of repertoires.
Societies may also have to deal with the problem of undistributed revenue,
that is revenue which has been collected which cannot be attributed to
a particular right owner.
Sometimes the royalties are distributed in accordance with the returns
of user, made by the licensee: in order cases sampling techniques are
used. Sometimes, some of per cent of collected license fees will be paid
for the social cultural fund.(207)
With the development of new technological means of presenting works to
the public, and disseminating copies, the techniques for collection and
distribution of royalties have become more and more sophisticated and
are likely to involve digital identification and use tracking methods
as new techniques emerge.
Within
the European Union, most collective organizations are allowed to retain
a monopoly status or have conferred them a monopoly position in relation
to their specific fields of activity. The reason is economically persuasive.
For users, it is simply more expedient to be directed to one collective
body which manages one specific type of right or rights in relation to
one specific type of work. If more than one society exists in relation
to this specific right or type of work, a user will be in the position
of having to
incur extra transaction
costs, in terms of time and expenditure, by obtaining licenses from
two or more societies, since it would be practically impossible in many
cases to limit one's use to the repertoire held by one society. Where
copyright holders are concerned, the aggregation of rights within a
particular collecting society brings a measure of power over their markets
which is capable of being exercised in beneficial ways.
The rationale
results in a strong society that is able to wield stronger bargaining
power as against equally strong user organizations. The collective power
of these organizations within the European Union and global market should
not be underestimated. First, the monopolistic position of a collective
organization in a specific area of copyright is strengthened by reciprocal
organization in a specific area of copyright is strengthened by reciprocal
relationships with other collecting societies in other Member States.
Ostensibly, this allows such organizations to monitor and license each
other's repertoires; practically, this also results in a co-ordinated
effort to influence market and governmental policies. Secondly, a further
result of this reciprocity is large memberships and international ties
which allow societies to collect substantial license fees. Thus, in
the area of music copyright, the approximate licensing revenues in 1997
were as follows for the following organizations: GEMA(Germany)-US$824.8
million; MCPS-PRS Alliance(United Kingdom)-US$661 million and SACEM(France)-US$564.6
million.(208)
Compulsory Representation,
Compulsory Assignments and Compulsory Licenses
The
main feature of copyright is the right to forbid the use of a work. The
copyright owner has the exclusive right not to authorize the use of his
works, but only if the manages his rights individually, either by himself
or by a commercial agent. Only then he can decide freely whether and on
which financial or other conditions he will authorize the use of his work.
If he requires outrageous royalties or refuses his authorization altogether
he does not have to give any reason.(209) However, the above concept is
limited by the idea of the compulsory license. Sometimes, the compulsory
license is so-called 'Non-voluntary licensing'.(210)
The
compulsory license lies in the middle ground between the copyright owner's
absolute control over the exploitation of his work on the one hand and
a statutory or judicial exemption granting anyone the freedom to use a
work on the other. The compulsory license mechanism takes to use a work
on the other. The compulsory license mechanism takes away from authors
their right of authorization, but leaves them with a right of remuneration.(211)
Obviously, there are varying conceptual definitions for compulsory licenses.
The "free use" proposal for copyrighted works was categorically
compulsory licenses. The "free use" proposal for copyrighted
works was categorically refused due to the absence of compensation for
copyright owners. In contrast, compulsory license systems contain significant
differences. The obvious difference between compulsory license systems
and the "free use" concept is the latter's lack of compensation
for copyright owners. In addition, "free use" is not applied
through governmental authority. However, neither system requires the user
to request authorization from the copyright owner. Due to the inherent
nature of compulsory license systems, it is obvious that copyright owners
do not have the choice to either accept or refuse a license. Instead,
it is their obligation to grant the license. Furthermore, a compulsory
license still necessitates that the publisher, and through him, the author,
be informed of the application, a feature absent in the informing the
author that his copyrighted work is going to be copied and requesting
permission for the authorization to translate and copy.(212) In the other
word, Compulsory licensing forces an intellectual property owner to allow
others to use that property at a fee set by the government. The owner
is not allowed to refuse to license or to negotiate voluntary license
fees is a free market, but is compelled to license at a rate thought to
be 'reasonable' be the government.(213)
Compulsory License
in the United Kingdom
In
the United Kingdom, compulsory licenses may be granted by order of the
Secretary of the State in respect of the rental to the public copies of
sound recordings, film or computer programs. Moreover, in the private
sector, the Copyright Tribunal has the power to settle the royalty payable
if the parties cannot agree on a royalty.(214)
Moreover,
the collecting societies typically will represent any rightholder above
a minimum threshold. For a composer to become a member of the PRS, for
example, she or he must have three works either commercially recorded,
broadcast within the past two years, or performed in public on at least
twelve occasions within the past two years (and be commercially published).
In Germany, the law regulating collective administration even prescribes
a so-called 'compulsory representation'. In providing a service to all
rightholders, the larger players in effect subsidize the system, since
it is more costly to set up accounts, collect and distribute small amount
of royalties.(215)
In
the Copyright, Designs and Patents Act 1988 the Copyright Tribunal has
jurisdiction on an application by a person who wishes to make a copy of
a recording of a performance to give consent in place of a performer in
either two cases(216) :
(a) where the identity or whereabouts of the performer could not be ascertained
by reasonable inquiry; or
(b) where the performer has unreasonably withheld his consent.
Compulsory License
in the United States
In
the United States, the most important limitation on the reproduction right
for musical works is the compulsory mechanical license. A mechanical license
gives the licensee (a record company or artist) permission to reproduce
and distribute a copyrighted musical work in recordings. In most situations,
licenses are negotiated and of a copyright owner does not want to issue
a license, it is free to decline to do so. However, the compulsory mechanical
license provision says that under certain circumstances, a mechanical
license can be obtained regardless of whether the copyright owner gives
permission or not. The compulsory license was introduced in the 1909 Copyright
Act in order to prevent a monopoly from arising in the manufacture of
piano rolls. Although piano rolls are no longer used for the mechanical
reproduction of music, the compulsory license still serves its purpose
by insuring that no company (not even the major recording and publishing
companies) can have a monopoly on the recording of musical compositions.
The compulsory license provision was contained in Section 115 of the 1976
Copyright Act and provides that once a musical composition has been distributed
in phonorecords in the United States with the copyright owner's permission,
anyone may reproduce the composition. This means that the copyright owner
has absolute control over the first recording of its song. However, once
that first recording has been distributed, the copyright owner cannot
prevent anyone else from recording their own version of the song. Distribution
of audio recordings of any type (cassette, compact disc, etc.), but does
not include audiovisual works since audiovisual works are embodied in
copies rather than phonorecords. In the United States, there are four
key words that are well-known in the area of licensing. That is, Mechanical
license: allows the licensee (record company or recording artist) to reproduce
and distribute a copyrighted musical work in recordings such as compact
discs and cassettes in return for a royalty (a percentage of the sale
price) on recordings sold. Performance license: allows the licensee (radio
or television station, concert venue, business establishment, etc.) to
publicly perform a copyrighted musical work in return for a royalty. Synchronization
license: allows the licensee (movie or television producer, etc.) to reproduce
and distribute a copyrighted musical work in audiovisual recordings such
as movies, television and videocassettes in return for a flat fee and/or
a royalty. Print license: allows the licensee to reproduce and distribute
a copyrighted musical work in printed form such as sheet music in return
for a royalty.(217)
In
the United States, there are five compulsory licenses. They are(218):
1 The cable license, which establishes a compulsory license for secondary
transmissions by cable television systems;
2 The mechanical license, which established a compulsory license for production
and distribution of phonorecords of non-dramatic musical works;
3 The public broadcasting license, which establishes a compulsory license
for the sue of certain copyrighted works by non-commercial broadcasting
entities;
4 The satellite Retransmission license, which establishes a compulsory
license for satellite retransmissions to the public for private viewing.
5 The digital audio tape device license, which establishes immunity from
liability for copyright infringement for manufacturers and importers of
digital recording devices, but imposes a levy on these devices, the proceeds
from which are to be distributed to copyright owners.
Enforcement
An
important role of the collecting society is the enforcement of the rights
which it administers. Here the society has facilities, in terms of finance,
expertise and personnel, which are far beyond those which a single rightowner
may have. Where proceedings are taken against a user who has failed or
refused to take out a license, an injunction may be obtained which obliges
the user to respect in future all the rights represented in the particular
repertoire, so that a benefit results to all members of the society, not
only those whose rights the defaulting user has infringed in the past.
In EEC and USA, the collecting societies have strongly worked on behalf
of the copyright owners. Their works can be seen in all areas both dealing
with cases in court and functioning on international forums. And sometimes,
they act as a political lobbyist to make a law for themselves.(219)
Monopolies of
Collecting Societies and Antitrust Law or Competition Law Concerns
Sometimes,
the collecting societies may abuse their powers. In the meaning of the
competition, the concept of abuse of power would be an objective concept
relating to the behavior of an undertaking in a dominant position which
is such to influence the structure of market where the degree of competition
is weakened and through recourse to methods which has the effect of hindering
the maintenance of the degree of competition still existing in the market
or the growth of that competition.(220)
A
very sensitive subject has always been the relationship between collecting
societies and competition law. Collecting societies have certain needs
which are difficult to satisfy according to established competition law
rules(221) The concept of the competition law encourages price competition.(222)
The competition laws want to foster the competition of price of goods
according to the theory of price(223) and to protect the system of free
market, and society.(224) Moreover, the law wants to maximize consumer
welfare through maximizing allocative efficiency.(225) The competition
policy is a cornerstone of economic policy in a free market. On the other
hand, the
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(206)
Belgische Radio en Television v. SABAM, [1974] E.C.R. 313. Case No.127/73.
(207) Martin Kretschmer, Copyright societies do not administer individual
property rights: the incoherence of institutional traditions in Germany
and the UK, Copyright in the Cultural Industries, Edited by Ruth Towse,
Edward Elgar Publishing, United Kingdom 2002 at 145.
(208) See Suthersanen, supra note 181, at 18-19.
(209) See Jehoram, supra note 186, at 3.
(210) Tarja Koskinen-Olsson, Collective Management for Reprographic Copying:Experience
in the Scandinavian Countries, a sheet distributed in the Seminar on "Fair
Use and Collective Management for Reprographic Copying", organized
by the Department of Intellectual Property. 31 July 2002 at the Arnoma
Hotel Bangkok, Thailand.
(211)
Makeen Fousd Makeen, Copyright in a Clobal Information Society, Kluw Law
International, 2000 at 116.
(212)
See Basalamah, supra note 12, at 519.
(213) J.T. McCarthy, McCarthy's Desk Encyclopedia of Intellectual Property,
1991 at 52.
(214) See Bainbridge, supra note 27, at 84.
(215)
See Kretschmer, supra note 207, at 153-154.
(216) See Arnold, supra note 124, at 73.
(217) David J. Moser, Music Copyright for the New Millennium, ProMusic
Press, 2002 at 54-55.
(218) See Leaffer, supra note 108, at 223.
(219) See Id, supra note 6.
(220) Inge Govaere, The Use and Abuse of Intellectual Property Rights
in E.C. Law, Sweet & Maxwell, 1996 at 249.
(221) See Jehoram, supra note 186, at 6 (Westlaw)
(222) Kevin Kennedy, Competition Law and the World Trade Organisation:
The Limited of Multilateralism, Sweet & Maxwell, 2001 at 11.
(223) Jack High, Competition, Edward Elgar Publishing , 2001 at 87.
(224) Id. at 374-385.
(225) Tim Frazer, Monopoly Competition & Law: the Regulation of Business
Activity in Britain, Europe and America, Wheatsheaf Books, 1988 at 1. |