The impact of the newly revised Copyright Law on the music industry - Part Two - Lexology
The new law gives the phonogram right holder the right to get remuneration for the playing and performing of phonograms in public, expanding the rights of record companies. With the advent of the digital and network era, the income of the traditional record market, on which the phonogram right holders depend, is extremely shrinking, and the phonogram producers cannot obtain income through the right of reproduction and distribution. After more than ten years’ appeal from the right holders in the recording industry, the new law finally gives the phonogram producers the right to get remuneration for the public broadcasting and performance of the phonograms. The new law provides that if a phonogram is used for wired or wireless public dissemination, or is publicly disseminated to the public through technical equipment for transmitting sound, remuneration shall be paid to the phonogram producer (Article 45).
The new law expands the income sources of record producers, which is undoubtedly worth cheering for record practitioners. I worked in the International Federation of the Phonographic Industry (IFPI) many years ago, thus having some knowledge of sound recording practitioners. I always believe that the process of recording music is also a process of creation, that the producer’s technical means and level, artistic taste and experience fully reflect the originality, and that the phonogram products should be protected as phonogram works. However, China’s Copyright Law adopts the “author’s right” system of the Civil Law System, in which the phonogram producer is a disseminator, and the producer’s right is a kind of the neighbouring right. The producer’s rights only consist of four attributes: reproduction, distribution, lease and information network transmission (Article 44), and the protection level is far lower than the thirteen property rights enjoyed by the right holders of works. The two additional rights to remuneration for producers in the new law are, in fact, compensation for the absence, which is also called “luxury goods” in the industry.
After the expansion of the new law, the broadcasting rights include the means of cable technology transmission, and thus the range of remuneration for phonogram producers for the broadcasting act will be extended to the transmission and broadcasting in wired and wireless ways. The specific use scenarios are as follows: playing phonogram products by radio stations, television stations and network radio stations, and playing background music during live webcasting.
The act of public broadcasting to the public through technical equipment for transmitting sound is interpreted as mechanical performance/playing of phonogram products, including publicly broadcasting records, audiotapes and videotapes containing performances by using recording and playing equipment, such as playing music and singing and dancing performances for customers in hotels, restaurants, shops and dance halls, and using music accompaniment in concerts. In the old law, only the right holders of music works enjoyed the right to performance. After the implementation of the new law, phonogram producers also have the right to receive remuneration.
It is worth noting that the Copyright Law provides that the statutory license system should be applied to the use of music works in broadcasting (Article 46), but the payment of remuneration for using phonograms in broadcasting as provided in the new law does not belong to the statutory license, and what the right holder enjoys is the right to remuneration without the licensing basis. The difference of rights basis directly affects the charging practice, including the legal basis of charging, the charging subject and the formulation and implementation of remuneration standards.
source: https://www.lexology.com/library/detail.aspx?g=9e9e587b-18cd-49d9-9fde-66d3c965ad4b
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