Spain’s Supreme Court sides with promoters over disproportionate 10% tariff

June 2016

Live events sector



The Supreme Court of Spain has ordered national music collection society the Sociedad General de Autores y Editores, or Society of Authors and Publishers (SGAE) to immediately abolish its “abusive” 10 per cent tariff on box-office receipts in favour of a “fair” levy to pay music copyright-holders.
SGAE had appealed a ruling by the National Competition Commission (Comisión Nacional de los Mercados y la Competencia, CNMC) which held that Spain’s 10 per cent rate was excessive and unfair to Spanish concert promoters noting that much lower royalty fees were applied in other European countries – the rate in the UK is a 3% tariff applied by the PRS on box office (Tariff LP) – and also noted the 1% tariff the US. In 2014 the CNMC ruled that SGAE had committed an abuse of a dominant position, and infringed Spanish and European competition regulation. The CNMC fined SGAE with 3.1 million euros and urged the Spanish collecting society to modify the rate system for live music licensing within a period of 3 months. SGAE had failed to comply with the CNMC resolution much to the fury of Spanish concert promoters
The Supreme Court dismissed SGAE’s appeal. The court noted that the lowering of the fee would benefit the country’s often “fragile” concert promotion business, and said that promoters should be treated “sensitively” and not burdened with “excessive or disproportionate fees”. It also said that no “third-party interests that deserve protection would be seriously affected” if the 10% rate was scrapped. The decision was welcomed by the Spanish Music Promoters’ Association (Asociación de Promotores Musicales, APM).
The UK’s Tariff LP is currently being reviewed by the PRS, and whilst concert promoters fear the CMO is seeking a rise in the levy and a wider application on revenue streams, festival promoters calling for a reduced rate for festivals similar to the Republic of Ireland.

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