MEDTA is in favour of a civilized market of royalties and equitable remuneration for authors

https://www.me.gov.ua/News/Detail?lang=uk-UA&id=43dd0c2d-9cac-4204-8a1d-24162eb13bec&title=MinekonomikiVistupaZaTsivilizovaniiRinokRoialtiTaSpravedlivuVinagoroduDliaAvtoriv

The Ministry of Economic Development, Trade and Agriculture of Ukraine supported the bill №3377 “On amendments to some legislative acts concerning state support to the cultural sector, creative industries, tourism, small and medium business in connection with the restrictive measures related to the spread of the coronavirus disease (COVID-19)”, which has already passed the second hearing in the Committee and recommended for adoption in general.

“The MEDTA has consistently considares that the establishment of interim rates in the administrative order is excessive state intervention in the contractual relationship of the CMOs (as representatives of authors and right holders) and users. The most effective for the formation of tariffs for accredited collective management organizations will be the market pricing mechanism”, – noted in the Ministry.

Therefore, to resolve the situation jointly with the Committee on humanitarian and information policies have developed a number of changes that, among other positive sides, will:

1. unlock and complete the process of accreditation of collective management organizations (CMOs);
2. cancel the need for the establishment of temporary rates by the state.

The performance of these items will allow to:

1. complete the reform of the market of royalties in Ukraine and to transfer these functions to market;
2. ensure that authors and rights holders receive equitable remuneration through market mechanisms;
3. comply one of the international partners demands and to approach the exception to the 301 List (the list of “countries of pirates”) under which the U.S. sets export sanctions.

Note:

The current law regulating the activities in the field of creative industries №2415 from 15.05.2018 “On the effective management of the property rights of copyright holders in the field of copyright and (or) related rights” was developed and adopted in order to create a civilized royalty market. It was evaluated positively by the Ukrainian experts and the market, and international partners. In particular, the adoption and beginning of implementation of the law led to the abolition of export sanctions on the US market.

To fulfill the requirements of the law the accreditation  in the 3 spheres of collective management was held in December 2019:

– resale right in works of fine art;

– reprographic reproduction of works and their parts (fragments);

– reprodaction at home, for personal use of works, performances fixed in the phonogram, the videogram and their copies, as well as audiovisual works and their copies.

That was confirmed by issuing of relevant Orders of the Ministry from February 06, 2020.

Previously completed accreditation in 3 areas of extended and compulsory collective management:

– the right to fair remuniation, common to performers and producers of phonograms (videograms), for public performance of phonograms and performances fixed in them or public demonstration of videograms and the performances fixed in them, published for use with a commercial purpose;

– the right to fair remuniation, common to performers and producers of phonograms (videograms), for public performance of phonograms and performances fixed in them, videograms and the performances fixed in them, available for use for a commercial purpose, except for cable retransmission;

– cable relay of copyright and (or) related rights objects, except the rights of broadcasting organizations in respect of their own programmes (programs) of broadcasting;

Still pending the process of accreditation in two areas:

– public performance of musical non-dramatic works with or without text, including those compositions which are included in audiovisual works;

– public broadcasting  of non-dramatic musical works with or without text, including those compositions which are included in audiovisual works, in addition to cable retransmission.

Accreditation in these areas is currently impossible to finish due to a restraining order initiated by the market participants, as well as the restrictive measures in COVID-19 pandemic.

The introduction of collective management in these areas is a reflection of the European legislation (Directive 2014/26/ EU on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online use in the internal market) and is the practice of civilized markets.

In such fields as the resale right, the right to fair remuniation common to performers and producers of phonograms (videograms) for the public performance cable retransmission, after the negotiations between CMOs and users the contractual rates were established.

Negotiations between the CMOs and users on setting tariffs in the areas of “home reproduction” and “reprographic reproduction” are ongoing.

To regulate the issue of collecting royalties during negotiations between market players (CMOs and users), Law 2415 introduced a requirement for the Cabinet of Ministers to introduce temporary tariffs for the use of copyright and (or) related rights or as a deduction in favor of right holders in the absence of agreements between the parties of such negotiations.  Relevant changes were made by the Cabinet of Ministers by Resolution # 696 of August 14, 2019 – amendments were made to Resolutions # 71 and #72 of January 18, 2003 and it was determined that the CMU applies the remuneration rates approved by these resolutions as temporary tariffs.