Monday, August 27, 2018 16:34PM / Oserogho & Associates
The Nigerian Copyright Commission (“NCC”) approval of the Music Copyright Society of Nigeria (“MCSN”) as a Collecting Society/Collective Management Organisation (“CMO/Collective Society”); and the suspension of the Copyright Society of Nigeria (“COSON”) operating licence for infringing provisions of the Copyright (Collective Management Organisations) Regulations, 2007 (“Copyright CMO Regulations”) has again brought to the fore the challenges that Copyright administration faces in Nigeria.
An examination of some of the key provisions of the Copyright Act and the Copyright CMO Regulations will be valuable to both Copyright Owners and Users.
Copyright Act – Collecting Society Licence
The Copyright Act provides that Copyright Owners, in respect of one or more classes or kinds of Copyright, may come together and form a CMO/Collecting Society, for the benefit and protection of Copyright Owners, Assignees and Licensors. The Regulatory Licencing authority for CMO/Collecting Societies is the NCC.
As part of its responsibility to protecting Copyright Proprietors, a CMO/Collecting Society is expected to negotiate and grant Copyright Licences from which the CMO collects and distributes the royalties/fees collected to the Copyright Owners. It is unlawful, with criminal sanctions attached, for any person or group of persons, or Copyright Owners to carry on the roles, duties and responsibilities of a CMO/Collecting Society without first obtaining a Collecting Society’s Licence from NCC. Any contravention of this provision attracts a fine on first conviction; and a fine or term of imprisonment for any subsequent convictions.
CMO Regulations – Applications, Licensing, Sanctions, Etc.
In addition to the submission of an Applicant’s incorporation documents, every application for a CMO or a Collective Society’s Licence or for the renewal of such a Licence must indicate that the CMO Copyright Owners are not less than One Hundred (100) in number. The Consent Letters, Membership Agreement and Current Repertoire must accompany every CMO/Collecting Society’s application for an operating Licence as a CMO/Collecting Society.
Copyright Owners who join a CMO/Collecting Society have the further right to withdraw their membership of such a CMO by giving reasonable notice to the CMO.
The Nigerian Copyright Commission (“NCC”) has amongst its statutory authority the right to revoke a CMO/Collecting Society’s Licence where among other things, it is in NCC’s opinion that the CMO/Collecting Society has contravened any of the provisions of the Copyright Act; or the Copyright (Collecting Management Organisations) Regulations 2007; and or the CMO/Collecting Society is no longer acting in the best interest of the Copyright Owners and the general public.
Other statutory sanctions available to the NCC include
a) A written Caution to the CMO to ratify any non-compliance;
b) Suspension of the CMO License pending the CMO full compliance with the Copyright CMO Regulations;
c) Revocation of CMO/Collective Society’s License where non-compliance persist despite warnings;
d) Disqualification of CMO/Collective Society principal officers who are found individually culpable in the CMO persist non-compliance.
CMO – Copyright Owners and Users Rights
In addition to some of the rights already expatiated on above, Copyright Owners, who are members of a CMO/Collecting Society, have a legal right to receive the following - copies of the CMO Annual Audited Accounts, with the Reports of the CMO’s Auditors, Employees remunerations’ and Governing Board’s Annual Reports.
Copyright Owners also have a right to vote at every CMO/Collecting Society’s Annual General Meeting (“AGM”).
Copyright Users in turn have the right to request from a CMO/Collecting Society some reasonable information regarding the copyrights that the CMO administers. Some of such reasonable information includes the CMO/Collecting Society’s licencing requirements like the terms and conditions of its licence, its tariff rates, etc. Any changes to the Tariff Rates must be publicised to the end-users of the Copyright.
Where the above regulatory provisions are practiced, some greater level of Copyright protection is to be expected.
CMO Royalties - Assessment and Distribution
In setting the Tariff Rates for the use of a CMO/Collecting Society’s Repertoire of copyrighted works, a CMO must have regard to, among other things, the purpose, the value, the manner or kind of use, with monetary advantages obtained by the User from copyrighted work(s).
A CMO may in furtherance of the above criteria, enter into a Tariff Scale Agreement with end-users’ Representative Trade Associations as to the use of the CMO/Collecting Society’s Repertoire by the members of such a Representative Trade Association. The CMO must however notify NCC regarding any such signed End-User Trade Association Copyright Licence.
Lastly, a CMO/Collecting Society shall as much as possible distribute the royalties that it collect to its members and any copyright owner who is not its member, in a manner that is reflective of the actual usage of the works in the CMO/Collecting Society’s Repertoire.
CMO Holding Accounts
Every CMO/Collecting Society is required to establish and maintain a Holding Account into which any distributable royalties which cannot be immediately distributed are kept.
Some of the common reasons why a royalty may not be immediately distributed includes where:- (a) the CMO has lost contact with the Copyright Owner; (b) the Copyright Owner is not at the time of the distribution a member of the CMO; or (c) there is a distribute regarding the royalty due for distribution; (d) etc.
Moneys in the CMO/Collecting Society Holding Account are to be held in trust for a period of not more than seven (7) years. At the expiration of the seven (7) years holding duration, such royalty income are to be returned to the CMO/Collecting Society general revenue account for distribution to the CMO members.
CMO Indemnity and Compensation
Every CMO/Collecting Society is required to make provision to pay compensation to any Copyright licensed User who is unable to utilise the Copyright Licence granted to it, by reason of the CMO’s misrepresentation, negligence or such other defaults attributable to the CMO.
Dispute Resolution and Copyright Management
By the provisions of the Copyright CMO Regulations, any dispute or disagreement arising from a Copyright Collective Management matter is required to be referred to the Director General of NCC who may decide to constitute a Nigerian Copyright Commission Dispute Resolution Panel (“NCC Dispute Resolution Panel”) to hear and determine such a dispute.
Where the Director General of NCC decides to refer a copyright management dispute, with the reliefs sought by the Applicant, to the NCC Dispute Resolution Panel, Notice of such a Dispute shall be served on the named Respondents for them to respond with their defences and proffer any counter claim.
The decision of the NCC Dispute Resolution Panel is final on the parties named in the Complaint; unless and until such a final decision is set aside or amended by a competent Court of Law.
In a properly structured economy, Artistes rely heavily on the royalties paid for the use of their copyrighted works. The proliferation, polarisation, politicisation and lack of transparency regarding the tariffs charged for the use of copyrighted works will continue to stiffen the professional administration of copyright royalties’ collection and disbursement.
The above concerns are especially more prevalent in the Music Industry; to the utmost disadvantage of Music Artistes who suffer too from the under-enforcement of the various Piracy Laws.
Also, the refusal of the various contending Copyright CMO/Collecting Societies to at least collaborate and transparently publish their Repertoires’ Licensing Requirements, with their Tariff Rates for each copyrighted work actually used, will continue to stifle the entertainment industry.
It is therefore strongly recommended that all CMOs’, including the ones for music royalties collections, should be compelled by the Copyright Regulator, which is the NCC, to follow best global practices of CMOs publishing their Repertoires and Tariff Rates on their websites and on other public mediums for its members and copyright users to appreciate and comply with the provisions of the Copyright Act.
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