Australian Hotels Association v Copyright Tribunal

By Emmanuel Narokobi

Lets Talk Music For a bit

Been a while since I’ve written about music on this blog and with all the Hoo Ha still raging on with Telikom/Digicel/GreenCom etc (see, Sell! Sell! Sell! Come and get it while its Hot!) I need a break. Can they stop talking and actually start doing something about interconnection or in GreenCom’s case get in the ring to add some green to the blue and red mix going on here?!

So anyway Oala Moi, PNG’s strongest advocate for musical copyright protection, sent me an email the other day about an interesting legal development in regards to copyrights. To begin with, I’ve had the opportunity to chat with a number of successful PNG musicians and allot of their hopes and dreams appear to be pointing towards joining the Australasian Performing Right Association or more commonly known as APRA. (You can read about APRA’s involvement with PNG music here).

However it is still a complex road ahead for our artists so looking at what’s happening in Australia should give us a better idea of what we’ll need to sort out here to make it work for us in PNG or anywhere in the pacific as well.

What is APRA?

Essentially the gist of APRA is to provide a management body of some legal standing to allow for royalties for musical work to be paid directly to an artist. So nobody else can use their work without getting their permission first, and if necessary, paying a royalty for this use. APRA as a not-for-profit organisation collects royalties on behalf of its 47,000+ members, and by agreement, for all the copyright owners around the world.

In further detail their website explains it as:

Copyright and royalties

Whenever music is performed in public, communicated or reproduced the songwriter may be entitled to a payment or royalty. This is because the Australian Copyright Act gives writers what are known as ‘economic rights’ which cover certain uses of their music. By licensing and allowing the public performance, communication or reproduction of their music, songwriters may generate income known as royalties.
Click here for more information on copyright and APRA.

Public performances of music include music used in pubs, clubs, fitness centres, shops, cinemas, festivals, CDs or even playing the radio or television. Communication of music covers music used for music on hold, music accessed over the internet or by television or radio broadcasters. Reproduction of music covers making a copy of the work, such as a CD recording, using music in a video or DVD, a mobile phone ring tone, digital download, as production music or in the making of audiovisual and broadcast material.

APRA collects and then pays these royalties to its members throughout the year. Royalties collected from domestic sources are paid twice a year in May and November; overseas royalties are paid as they accrue.
Click here for more information about how royalties are distributed.

Music – a ‘user pays’ system

All businesses, organizations or individuals that choose to publicly perform, communicate, or reproduce copyright music need permission from the copyright owners.

In most instances, an APRA licence provides a simple solution. This is because APRA collectively administers the public performance and communication rights on behalf of the majority of Australian and overseas copyright owners. APRA simplifies the legal process for business proprietors who would otherwise need to obtain a licence from each copyright owner whose music they wish to play.
Click here for more information about how music users are licensed.

Australian Hotels Association v Copyright Tribunal, what happened?

On 10 July 2007, the Copyright Tribunal handed down its decision in relation to a new nightclub and dance party licensing scheme. Click here to view the Copyright Tribunal’s judgment.

In relation to nightclubs, a rate of $1.05 was set for each person per night of operation, to be calculated on the basis of the venue’s capacity. For dances and dance parties, the Tribunal adjusted the rate to $3.07 for each person that attends each event.

At a hearing on 15 November 2007, the Tribunal confirmed that nightclub licence fees payable under the new scheme are to be phased in over a five year period. The rates fixed by the Tribunal per person per night of operation are set out below. On 15 November, the Tribunal also stated that the new dance party rate of $3.07 will not be subject to a phase in period.

On 23 November 2007, the Tribunal issued an Order formalising its decision on the implementation of the schemes. Click here to view the Copyright Tribunal’s Order. The Order provides that the Dance Use licence scheme (nightclubs and dances/dance parties) comes into operation as of 23 November 2007. The annual phasing-in increases for the nightclub tariff will take effect from 23 November 2007 as set out in the following table:

23.11.07 – 22.11.08

23.11.08 – 22.11.09

23.11.09 – 22.11.10

23.11.10 – 22.11.11

23.11.11 onwards

$0.51

$0.64

$0.78

$0.91

$1.05

Annual CPI increases will apply from the second year.

Review of Copyright Tribunal’s Decision

In August 2007, the Australian Hotels Association (AHA) lodged an application in the Federal Court for a review of the Tribunal’s decision of 10 July 2007 in relation to nightclubs (“the Appeal”). The Federal Court may either confirm the Tribunal’s decision or require the Tribunal to reconsider the case.

The Federal Court heard the Appeal on 6 March 2008. The decision was delivered on 13 March 2008 (click here to view the Federal Court’s Reasons for Judgment). The Court dismissed the Appeal. This means that the Tribunal’s Order of 23 November 2007 continues to be effective and the licence fee rates set out above are confirmed.

What?? Does it mean now that I need to pay fees for playing music at my Night Club?

Well for PNG not yet, as we have 2 principal issues and that is getting the Hotels and Clubs to participate and having the actual singers registered with a body like APRA to enforce licensing participation. What the case above basically highlights is a clear and definite legal development in copyright protection for music (and other forms of art). If our local artists push further with an association with APRA then the above revenues could become a reality in PNG. (Keep in mind here though that this post is only referring to revenues from music being played in businesses. Revenues from CD sales and public performances etc are a whole other topic).

From the outset it is a complicated affair and the calculating of licencing fee’s and what is to be billed for within a licence was the main issue involved in the above case. I can imagine Hotels and Clubs suddenly jumping up and down about added expenses and how music licencing in public places will add a Kina to my beer. So licensing fee’s will have to be simplified and calculations made clear before pushing this through in PNG.

Now I hope I don’t make this posting more complicated by adding that the above case wasn’t related to an APRA licence, but a licence from the Phonographic Performance Company of Australia Limited (PPCA). PPCA grants licences for the broadcast, communication or public playing of recorded music (e.g. CDs, tapes, records) or music videos. They then distribute the licence fees they collect to the record labels and Australian recording artists registered with them.

So it appears that in Australia you may need more than one licence to cover yourself.

Why 2 licences?

It’s important to note that if you need a licence of the type available from PPCA, you’ll probably need a licence from APRA (Australasian Performing Right Association Ltd) as well. That’s because there are at least two copyrights in most recordings and music videos:

  1. the copyright in the song (lyrics, composition etc.) – licences available from APRA ;
  2. the copyright in the recording and/or music video of the song (a particular recorded performance) – blanket licences available from PPCA, or individual licenses from each of the relevant copyright holders.

So who in Australia needs a licence? (Cos this gives us an idea of who potentially may need one in PNG).

The Copyright Act specifies the rights granted to copyright owners. These include the right to allow their recordings to be heard in public (ie. played in a public place such as a retail store, restaurant, fitness centre, etc.). This is known as the ‘public performance right’ in recordings.

To avoid infringing copyright, any business that wants to:

  • play protected sound recordings, other than by radio or television broadcast (eg. CDs, tapes) in a public place;
  • exhibit music videos; or
  • use sound recordings as music on hold;

should obtain a licence to do so from all of the copyright owners for each protected recording or video
they play.

So Back at the Ranch what should we do?

Well the ingredients are here:

  • we have a copyright law,
  • we have APRA scratching at the door,
  • we have a tribe of artists with small mountains of produced music, and
  • we have businesses who use music for various purposes in their operations.

So either some bar or restaurant gets caught playing local music without permission and taken to court or these entertainment businesses start getting registered with APRA licencing. On the same note our artists will also need to get registered with APRA to get any benefits. But to be fair to any business that plays protected sound recordings the licensing fees must firstly be relevant to our market size. The licences also need to be simplified as much as possible for businesses to take it seriously and without fear of added business costs.

I think the greatest benefit that could come out of this, could be the kick starting of an actual music industry where musicians can do this as a profession and not a part-time job. But it has to be a simple and straightforward exercise for all involved.

3 thoughts on “Australian Hotels Association v Copyright Tribunal

  1. Manu,

    Its an interesting read. I was also in touch with APRA last month for my little projects. APRA has advised that they are moving into PNG in the coming months…. this will be really great for local artists to start registering with APRA and benefiting from royalties of their music..

    So its all happening real soon… we should start sending messages to artists to get prepared for this.

    Rex

  2. Yeah, Oala Moi has been doing allot of work in promoting the cause. I’ve spoken to several main stream artists and they are not really familiar with what it entails. But since CHM is also aligning themselves with APRA I’d expect them to educate their artists as much as they can.

    But at the end of the day each musician has to start being smarter about their music careers and their options.

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