EU one step closer to simplifying music licensing for streaming services

Pan-EU licensing would be a boost for online music providers, say parliamentarians

Online music service providers are a step closer to more easily operating legally in the E.U. thanks to a vote Tuesday by a European Parliament committee.

The Parliament's legal affairs committee voted unanimously to allow online providers to obtain copyright licenses to stream music across E.U. borders. Currently, companies wanting to offer such services must obtain copyright licenses from 28 different member states. The proposed law would allow for a small number of authors' collective management organizations to operate across E.U. borders.

The Parliament said the proposal should mean more and better online music services. The law would apply to music streaming services such as Spotify as well as online music retailers including Amazon and Apple.

The use of rights in the music sector accounts for about 80 percent of the revenue received by collecting societies. There are more than 250 collecting societies across the E.U. It is not clear whether organizations would pass monetary savings on to users if the law is passed.

However, a recent survey by the Office for Harmonization in the Internal Market (OHIM) showed that although only a tenth of Europeans openly admit to having engaged in behaviors that infringe on intellectual property over the last 12 months, more than a third tolerate these same behaviors when considered subjectively.

According to the OHIM, the majority of those surveyed believe that intellectual property protection primarily benefits businesses and artists, not citizens. When asked who benefits the most from the protection of intellectual property, only 11 percent mentioned consumers and less than 20 percent mentioned small and medium-size enterprises. But more than 40 percent said that large companies and famous artists benefit from intellectual property protection.

"Today's vote demonstrates that, contrary to some misconceptions, all political groups acknowledge that copyright is compatible with the digital age and can easily adapt to it," said Marielle Gallo, the French member of Parliament who crafted the law.

The proposed law, called the Collective Rights Management Directive, also establishes a minimum set of rules for the collective management organizations. For example, royalties would be distributed to artists no later than nine months from the end of the financial year in which the rights revenue would be collected.

The committee vote was welcomed by GESAC, the European Grouping of Societies of Authors and Composers, which represents almost 700,000 authors, composers and writers, and the Society of Audiovisual Authors (SAA), which represents more than 120,000 film and television European screenwriters and directors.

The full Parliament will vote on the proposed rules in early 2014 and is expected to pass the text negotiated by the legal affairs committee without a hitch.

Follow Jennifer on Twitter at @BrusselsGeek or email tips and comments to jennifer_baker@idg.com.

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