EC moots pan-European music licensing

Good governance

By OUT-LAW.COM, 13th October 2005

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The European Commission today set out measures for updating the management of online rights in musical works, recommending that an EU-wide copyright licensing system be established.

The Commission published a study on the current position in July, concluding that the absence of pan-European copyright licences makes it difficult for new European-based online services, such as simulcasting (a simultaneous broadcast of programs or events across more than one medium) and webcasting (where a broadcast is uploaded by the sender and downloaded by the receiver), to take off.

In particular, it found that the present structures for cross-border collective management of music copyright – which were developed for the analogue environment – prevent music from fulfilling its unique potential as a driver for online content services.

It consulted on the issue, asking respondents whether it should:

do nothing;
improve cooperation among collecting societies by allowing each society in the EU to grant a EU-wide license covering the other societies’ repertoires; or
give right-holders the choice to appoint a collective rights manager for the online use of their musical works across the entire EU.

According to the Commission, respondents were generally agreed that doing nothing was not an option, but were divided between the other two approaches.

Commercial users favoured option two; the majority of collective rights managers favoured modified versions of the second option; while the music publisher’s community, the independent record labels and certain collective rights managers preferred the third option.

As a result, the Commission has recommended that right-holders and commercial users of copyright-protected material should be given a choice as to their preferred model of licensing, as different online services might require different forms of EU-wide licensing policies.

The recommendation therefore proposes the elimination of territorial restrictions and customer allocation provisions in existing licensing contracts, while leaving right-holders who do not wish to make use of those contracts the right to offer their repertoire for EU-wide direct licensing.

The recommendation also includes provisions on governance, transparency, dispute settlement and accountability of collective rights managers, which the Commission hopes will introduce a culture of transparency and good governance into the system.

“Today we have made workable proposals on how licensing of musical work for the internet can be improved,” said Internal Market and Services Commissioner Charlie McCreevy. “I believe that this recommendation strikes the right balance between ease of licensing and maintaining the value of copyright protected works so that content is not available on the cheap.”

“I will be monitoring the situation closely,” he added, “and if I am not satisfied that sufficient progress is being made, I will take tougher action.”

The Recommendation (8-page / 35KB PDF)