Whether or not collection societies are monopolies, or act like monopolies, is a tricky issue: Many in the business world want ‘one stop shops’ for effective licensing, especially in a global digital market – but no one wants a bully!
The Tokyo High Court has now overturned a previous ruling by the Japan Fair Trade Commission (JFTC) and has concluded that the Japanese Society for Rights of Authors, Composers and Publishers (JASRAC) violates the country’s anti-monopoly law. The court says the JFTC ruling in 2012 that JASRAC was not a monopoly was “a mistake.”
Presiding Judge Toshiaki Iimura said that JASRAC’s practices makes it very difficult for other music copyright businesses to enter the business, “essentially excluding them from competition”. The copyright society currently has ‘blanket licences’ with major broadcasting stations giving them unlimited access to songs that are under the JASRAC management for ja fee of 1.5% of the previous fiscal year’s broadcast earnings. Other copyright companies have to charge fees for each separate use of a song. The court found that because of this, broadcasters limit the use of non-JASRAC music for purely economic reasons. In fiscal 2012, 98.03 of all music copyright fees were paid to JASRAC while Tokyo based e-License only received 0.76% (according to figures from the Agency for Cultural Affairs). e-License brought this issue to the courts.
The June 2012 ruling by the JFTC said that JASRAC’s business practices were not in violation of competition laws itself overturned a February 2009 decision by a commission, ordering JASRAC to change its business model because it is essentially a monopoly.. Now pendulum has swung back to that position and the JFTC will now have to revisit the legality of JASRACs licensing policies. A JFTC legal affairs representative said an appeal was being considered, citing the decision as “very disappointing.”