The Making Available right has failed performers in the UK and many other EU states as producers have taken the view that the right is swept up in their recording agreements. We believe that to ensure that the right delivers real benefits to performers it should in part be a non-assignable equitable remuneration right. There already exists precedent for this in Spain, where performers are entitled to a payment of equitable remuneration whenever their works are made available on demand.

AMP believes that streaming services such as Spotify and Pandora are simply a more sophisticated version of a radio broadcast and should therefore be viewed and remunerated in the same way. When a consumer uses a streaming service they are not ‘purchasing’ a copy of the music in the way that would be the case with digital download sites such as iTunes and Amazon; they are simply choosing to ‘listen’ to a particular track. Accordingly, we believe that streaming services are better seen as ‘communication to the public ‘ rather than ‘making available’ and performers should be paid for streaming in the same way as they are paid for radio play, namely by non-assignable equitable remuneration (50/50) through a CMO.

The UK Government chose to implement Article 8 of Directive 92/100 EEC in such a way as to make the performer subservient to the record companies. Section 182D. (1.b) of the Copyright and Related Rights Regulations 1996 states: “1b) Where a commercially published sound recording of the whole or a substantial part of a qualifying performance is included in a broadcast or cable programme service, the performer is entitled to equitable remuneration from the owner of the copyright in the sound recording.”

This means that it is record companies who, as the copyright holders in sound recordings, have the sole ability to licence and collect remuneration. Performers must seek their share of equitable remuneration from the record companies and are given no right of interaction with the user of their work. When the UK Government implemented the Term Directive it encountered considerable problems in ensuring that the exercise of the use-it-or-lose-it provision did not remove the performer’s right to receive equitable remuneration, this is as a direct result of not properly implementing Article 8 of Directive 92/100 EEC. We believe that performers should receive equal treatment when compared to other rights holders and therefore UK performers should be granted a right against the user.

AMP believes that outdated and indefensible clauses should be outlawed from recording contracts and that all clauses in music industry contracts should be clear, transparent and accountable. Record companies rely upon, and continue to include, clauses in their contracts with artists that have no place in a digital environment. These include clauses that, harking back to an analogue era, reduce the royalty’s payable on a download. These clauses bear no relation to digital sales. The following is an example of these unfair clauses:

Packaging Deductions were introduced in the late 1950’s to share the costs between artist and label for any packing beyond a simple paper record sleeve. i.e. If an artist wanted a gold embossed gatefold album sleeve ( or even a simple photo) then the label took 25% from the Royalty rate ( regardless of cost). Packaging Deductions were later appropriated by the Labels as a way to share the burden of the cost of the industry moving format from vinyl to CD. Packaging deductions, sometimes referred to as ‘new technology discounts’, are still widely applied to digital formats where there is no packaging.

Breakages: A flat reduced royalty rate was applied by labels to artist’s share to cover the ‘eventuality’ of broken vinyl. i.e. If a box of fragile vinyl LP’s was dropped in a shop, the artist was charged for the (possible) mishap even if no records were damaged. This deduction was carried forward through the CD era and is still widely applied to the artist share for digital formats where breakages are not possible.

Distribution: A flat deduction from the artist Royalty Rate was applied contractually to share the costs of transport of Records/CDs to and from retailers. Such deductions are also widely applied to Digital formats, where a Wav file is sent directly from the Mastering Engineers to the Label, via the web, and is then uploaded to i-Tunes or any other digital aggregator, and often directly from the Mastering Service to the seller’s site.

Returns: A flat reduced rate was widely applied to the Artist share to cover for CDs/Vinyl returned from Record Stores via sale and return. Clearly in the digital marketplace there is no such thing as a return.

Manufacturing deduction: A flat deduction was widely applied to the artist royalty to cover for the cost of manufacturing product. This rate was increased for CD production. It is an unpopular deduction, for obvious reasons, (a book publisher does not charge the author for the cost of the paper to print books), so the cost of manufacture is commonly hidden within a distribution deduction. Digital formats have no manufacturing costs. In fact, on many modern pop recordings, even the studio costs are covered by an unpaid record producer/artist working on spec, who’s copyright of the recording is then assigned as an addendum to his/her recoupable producer fee, if the label chooses to use the recording. Manufacturing deductions have no place in the digital marketplace.

Non Disclosure Agreements: The fact that so many of the licensing agreements that record companies enter into with digital platforms are subject to non-disclosure agreements (NDA’s) renders the audit provisions in recording agreements wholly ineffective.

We are aware that the record companies in agreeing to licence their catalogue to third party digital services receive substantial upfront payments which are not always shared with the performers and have a direct effect on the level of royalty that the record company subsequently receives from the licensee. This is money that should be shared with the artists.

We believe that performers should no longer be expected to assign their recordings for life of copyright when signing a recording contract; rather, the recordings should be licensed for a limited period after which the copyright reverts to the performer.