Musicians' Neighbouring Rights Royalties

Do We Have Money For You?

The Canadian Federation of Musicians advocates the rights of musicians in their live and recorded performances in the United States and Canada and other countries, and where it deems appropriate, collects and distributes government mandated or other compulsory royalties of remuneration that are subject to collective administration.

Neighbouring Rights

The phrase "neighbouring rights" describes copyright protection for three categories of works: sound recordings, performer's performances and communication signals. Although sound recordings have been protected by copyright in Canada for many years, the protection for performer's performances was first enacted in 1994 and expanded upon as of September 1, 1997.

As of September 1, 1997, performer's performances captured on sound recordings and the producers (owners) of those sound recordings were provided with a neighbouring right, entitling them to "equitable remuneration" when their performances and sound recordings are either performed in public or broadcast. Before September 1, 1997, only the composer of the music had the right to be paid for public performance or broadcasting.

Examples of public performance are the playing of recordings in shopping malls, bars, nightclubs, discotheques, hotels, airlines, skating rinks and restaurants. An example of the broadcasting of performances and sound recordings is radio airplay. In fact, radio stations are the largest single broadcast user of recorded music. Each time a radio station plays an eligible sound recording a royalty is paid to the composer, the maker of the sound recording and any performer whose performance is fixed on that recording.

The royalties for neighbouring rights are paid to "eligible performers and record producers". Those eligible in the sound recording category are: Canadian citizens or permanent residents of Canada; citizens or permanent residents of a Rome Convention country; and corporations with headquarters in Canada or a Rome Convention country. Sound recordings where "all the fixations" for the recording occurred in Canada or a Rome Convention country are also eligible.

Those eligible in the performers category are a performer's performance which takes place in Canada or in a Rome Convention country, and performances fixed in an eligible sound recording.

Some 91 countries are members of the Rome Convention. Canada's membership in this Convention entitles Canadian performers to receive royalties when their sound recordings are performed or broadcast, not only in Canada but also in the 79 countries that are members of the Rome Convention.

The amount that radio stations are required to pay for the use of recorded music is subject to rules in the Copyright Act.

The royalties are split equally between performers and record producers.

Private Copying

Private copying refers to the making of copies of pre-recorded musical works, performer's performances and sound recordings onto a blank recording medium, such as audio tape, cassette or CD for personal use. An example is buying a blank CDR/CDRW, going home and making a second copy of your favourite CD so you can have a copy to play in the car. Three copyrights can be involved when private copies are made: copyright in the sound recording, copyright in the music and copyright in the performer's performance. Because these copies are made privately, creators cannot enforce their copyright and consequently cannot collect the royalties due.

Effective March 19, 1998 the Copyright Act permits these private copies to be made and introduces a levy to compensate copyright owners for royalties lost to private copying. The levy is collected on all blank audio recording media, for example, on cassettes and tapes as well as CDR and CDRW. The levy applies to all blank recording media made or imported into Canada.

The proceeds from the levy are payable to eligible composers, lyricists, performers and producers of sound recordings through their professional associations or collectives. Generally, citizens or permanent residents of Canada as well as citizens, subjects or permanent residents of countries which give similar benefits for private copying to Canadians are eligible to share in the proceeds of the levy.

The amount of the levy is determined by the Copyright Board, a specialized tribunal set up under the Copyright Act. The Board is required to consider the views of interested parties and is also required to satisfy itself that the levies are "fair and equitable".

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