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28th Feb 2021

Musicians fear 'chaos' as Brussels gets set to regulate royalties

  • Frank Dostal: 'From rock and roll to mainstream and majors. This is the logical outcome' (Photo: Sandrine Muscarella)

The European Commission is looking to regulate collecting societies this spring - the bodies that collect royalties on behalf of musicians - a senior civil servant has revealed, but the artists themselves are apprehensive, saying that the last intervention of Brussels in the sector has produced "chaos".

As part of an overall strategy aimed at tackling issues around patents, trademarks, commercial secrets, the fight against counterfeit goods on the internet and online piracy, the commission will be looking to settle its concerns about authors' societies.

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The strategy will be unveiled by the end of March, Kerstin Jorna, the acting head of internal market commissioner Michel Barnier's cabinet told sector stakeholders on Wednesday (26 January).

Whether this will take the form of a directive or a regulation - which means that all member states would have to enforce the new rules in exactly the same fashion rather than having them tweaked by national parliaments - is undecided, she said, but suggested the commission may be leaning toward the latter.

"Michel Barnier believes creativity and innovation give Europe a competitive edge and this needs to be preserved," she said at a Brussels conference on digital rights and cultural diversity in Brussels organised by this paper. "All those involved - rights holders, broadcasters, need to have the right framework in a single market to exploit this competitive edge."

The purpose of the new "legal text" will be "to create a clear legal margin of manoeuvre for collective rights management but introduce checks and balance in the governance [of collecting societies] - how you treat your members, how works are tracked, what databases are necessary," she continued.

"It is then up for members of collecting societies to define the scope of their actions."

She added that the commission would be looking for the creation of a 'one-stop shop' for users to access content licences "for one, or three or 27 territories", with "harmonised governance rules".

The commission however is yet to decide whether it will simply cover the music sector or cover other creative content domains.

In 2005, in the interest of competition, the commission told national collecting societies that they would have to end agreements that prevented them from competing against each other.

Until then, musicians collected royalties only from the collecting agency in their own country and farmed out collection to sister agencies in other countries.

The collecting societies and musicians however argued that the increased competition would hurt non-anglo-american bands, regional acts, those that do not sing in English and that play non-mainstream music.

Danish copyright lawyer and former chairman of the country's AntiPirate Group, Peter Schonning, said that the fall-out from the commission's actions in the sector resembles what a fox in the recent Lars Von Trier film, Anti-christ, exclaims at the end: "chaos."

"The commission has created an avalanche of problems and complexities," he said.

Describing an increase in bureaucracy that he said had occurred, he said that "for repertoires that are not so popular such as jazz or folk, it has become more difficult to find licences."

"This is a direct threat to cultural diversity."

The new regulation, he feared is: "Barnier trying to solve a problem that the commission created."

Frank Dostal, the deputy chairman of the board of supervisors of the German collecting society, Gema, was furious at the commission's actions, describing them as a "threat".

"We're being told our collecting societies, one of our biggest defenders, are not any good any more," he said.

"[With the old structure] the small are supported, the regional are supported the non-commericial are supported. The ones in need are supported. All this suddenly seems to be wrong.

"What they are preaching is the death of rock and roll. No more small labels, no more small publishers," he added.

"From rock and roll to mainstream and majors. This is the logical outcome."

Last week, the European Parliament called on the commission to be more sensitive, particularly as regards competition policy, and adapt regulation to the specific needs of the creative content sector.

Ms Jorna rejected the criticisms however, saying that the commission was acting in the best interests of artists.

"I don't like the term ‘threat," she said. "What we want to do is help rights holders to organise themselves in the best fashion and respond to the new challenges presented to them."

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