Collection societies break ranks on pan-Eurpean licensing

September 2008

Music publising, internet 

In a classic example of the concepts of territoriality in licensing pitted against the free market within the European Commuity the IPKat brings news of a dramatic development in the Netherlands where a Dutch has issued a preliminary injunction prohibiting Dutch collection society BUMA from granting any further licences for the online sale of the repertoire of works administered by the UK’s Performing Rights Society in so far as those licences extend beyond the territory of the Netherlands. BUMA had previously granted a licence for the territory of the entire European Community to PRS maintained that the reciprocal agreements between collecting societies did not grant BUMA any royalty-collecting rights beyond the Dutch territory. In its defence, BUMA attempted to rely on the Commission’s recent decision in CISAC where the European Commission ordered 24 European copyright collecting societies to stop restricting competition by limiting their ability to offer their services to authors and commercial users outside their domestic territory, while still letting them keep (i) their current system of bilateral agreements and (ii) their right to set levels of royalty payments due within their domestic territory. BUMA argued that any territorial restriction in its reciprocal representation agreements is null and void, as these restrictions are anticompetitive and infringe Article 81 of the Treaty of Rome. The judge in the interim proceedings rejected BUMA’s argument, stating that even if the territorial restrictions in the agreements are invalid, BUMA still has no right to license the PRS repertoire beyond the territory of the Netherlands.

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