UMI’s royalty row

EU filing claims collection rates are unfair

Universal Music Intl. has filed a complaint with the European Union over what it says are unfair royalty rates charged by songwriters’ collections agencies.

UMI charged that the Intl. Office of Recording and Mechanical Rights Collecting Societies (known by the French acronym BIEM) bullies record companies into accepting royalty terms that are among the highest in the world.

At the core of the dispute is a historical rule that set the mechanical royalty rate at roughly 9% of the “published price to dealers,” a source closed to the labels said.

The record companies complain that the flat rate is higher than those outside the EU, and that it doesn’t take into account discounted or free goods that are distributed for marketing purposes.

The official contract that set the rate expired more than two years ago, but the labels have continued paying at the 9% level as renewal negotiations dragged on.

Support expected

Universal, whose roster includes such acts as Andrea Bocelli, U2 and the Cranberries, acted alone in the complaint, but other labels are expected to line up in support of the action.

BIEM, which reps 41 separate royalty-collection societies in 38 countries worldwide, administers “mechanical” royalties, or payments made to a song’s authors when a hard copy of a recording (like a CD) is produced. The Paris-based org was not immediately available for comment.

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 0

Marketplace

    Leave a Reply

    No Comments

    Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

    Fill in your details below or click an icon to log in:

    WordPress.com Logo

    You are commenting using your WordPress.com account. Log Out / Change )

    Twitter picture

    You are commenting using your Twitter account. Log Out / Change )

    Facebook photo

    You are commenting using your Facebook account. Log Out / Change )

    Google+ photo

    You are commenting using your Google+ account. Log Out / Change )

    Connecting to %s

    More Biz News from Variety

    Loading