Performance Rights Act, H.R. 848, 111th Cong. (2009).
Congress is considering legislation that would expand copyright protection for sound recordings. In particular, the proposed Performance Rights Act would eliminate an exemption that currently allows analog, nonsubscription AM and FM radio stations (broadcast radio stations) to broadcast a sound recording without acquiring permission from and paying a royalty to the copyright holder, performers, and musicians.
The proposed act would amend the statutory license for nonsubscription transmission services to include broadcast radio stations. Under the amendments to the statutory license, a radio station would pay a royalty based on its revenue and its status as a commercial or non-commercial station (See Table 1). The proposed act would also exempt some uses of music, such as music in broadcasts of religious services and the incidental use of music by non-music stations, while providing a per program license option for radio stations that make limited use of sound recordings, such as broadcasting sound recordings on an infrequent basis.
Under the proposed act, revenues from the proposed statutory royalty would be divided among recipients as follows: 50% would be paid to the copyright holder, 45% would be paid to the featured performer or musician, 2.5% would be paid to background musicians, and 2.5% would be paid to background performers and vocalists. A designated third party would collect and distribute royalties directly to the featured performer or musician.
Other provisions of the proposed act provide that existing royalties paid to music publishers, songwriters, and composers are to be unaffected by the proposed royalty. Broadcast radio stations would not be required to begin paying the royalty immediately. If a radio station has annual revenues below $5 million annually, it would begin paying a royalty 3 years after the proposed act becomes law; if the radio station has revenues above $5 million annually, it would begin paying a royalty after 1 year.
- ↑ H.R. 848, 111th Cong., as marked by the House Committee on the Judiciary (2009). The Senate has a companion bill (S. 379). While the House and Senate bills differ in some detail, both bills include a statutory royalty with a tiered structure where all broadcast radio stations with revenue below $1.25 million would pay a flat annual fee.
- ↑ The sound recording copyright holder is often the record company, but may also be the featured musician or performer.
- ↑ Statutory royalties for background musicians would be paid to the American Federation of Musicians and distributed to its members according to their performance on sound recordings.
- ↑ Statutory royalties for background vocalists and performers would be paid to the American Federation of Television and Radio Artists.
- ↑ While the proposed statutory license requires direct payment to musicians and performers, agreements between record companies and artists could take into consideration this additional source of revenue. Record companies and others in the recording industry have signed a Memorandum of Understanding agreeing that those signing the memorandum will not attempt to recover any performance royalties from the musicians or performers.