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Contractual relations between collective management societies of performers and users :

 

Collective management societies administer exclusive rights and remuneration rights on behalf of performers.

When administering performers' exclusive rights, collective management societies either grant individual authorizations (for instance, a film producer wants to use a commercial phonogram on which the performance of performers whose rights are managed by the collective management society, is recorded), or they conclude general agreements for widespread use (for example, an Internet service makes recordings available to the public).

The scope of these agreements will depend on the ability of the collective management society to represent the performers concerned: members of the organisation, rightholders represented by reciprocal agreements, even non-members when for certain uses legislation provides for compulsory collective management by a representative organisation.

This system has been used in European Directive 93/98 of 27 September 1993 concerning the transmission by cable of broadcasts between the Member States of the European Union.

Compulsory collective management of an exclusive right constitutes an attractive system for performers. When managed collectively, this right is protected against contractual transfer to the benefit of the user.

Such a system could be envisaged to the benefit of performers for making their performances available to the public, and for audiovisual broadcasting ... Performers' contractual freedom would certainly be undermined, but at least they would really benefit from the rights granted to them.

In some aspects, contracts concerning collective management of performers' rights are similar to those existing for authors' rights: authorization mechanism, declaration of uses, and payment of the corresponding remuneration...

When contractual undertakings are not respected, the authorization granted should be withdrawn and it should be possible to forbid the contracted use.

The exercise of remuneration rights in the framework of a legal license is slightly different:  the delivery of an authorization is not necessary and does not constitute the object of the contract. Indeed, the use referred to in the contract is authorized by law as the counterpart to the payment of remuneration.

Concerning the determination of the level of remuneration, according to national laws, many possibilities exist:

  • determination of the amount by negotiation, with recourse to arbitration or a court when no agreement can be reached, or to an administrative commission,
  • determination of the amount directly by a jurisdiction or an administrative commission.

Nevertheless, a contract can be concluded and will comprise the necessary provisions to identify the performances to be used as well as the necessary declarations for the calculation of the remuneration to be paid ...

Should the terms of the contract not be respected, damages and / or criminal sanctions can be sought against the user. More rarely, non payment of the remuneration can lead to action seeking the prohibition of the contracted uses (for which an authorization is normally not necessary).

Such a system, in which a “right to forbid” is provided in the event of a right not being respected generally enables an easier application of these systems when faced with partners acting in bath faith.

Being generally in a situation of monopoly, collective management societies administering exclusive rights have to comply with competition law (particularly precarious in the European Union) and must respect certain rules with regard to the users with whom they contract:

  • similar contractual conditions with respect to the same category of users
  • identical tariffs in these same conditions
  • an obligation to contract with users of good faith
    ...

 
 
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