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Global publishers now reportedly pulling rights from controversial Spanish society SGAE

By | Published on Tuesday 3 July 2018

SGAE

Five global music publishers have reportedly told Spanish collecting society SGAE that they are pulling rights out of the organisation as a result of the ongoing dispute over the distribution of TV royalties in the country.

There have been various controversies surrounding the Spanish society in recent years, of course. The most recent relates to an alleged scam via which certain SGAE members and certain Spanish broadcasters have conspired to skew the way TV royalties collected by the society are distributed to writers and music publishers.

The global music publishing companies, whose rights are represented in numerous licensing scenarios by SGAE in Spain, have become increasingly critical of the society and its management in the last year. And even more so after reps from those global publishers were locked out of the society’s board meetings.

As anger grew among global rights owners, the International Confederation Of Music Publishers called on CISAC – the worldwide grouping of song right collecting societies – to suspend SGAE’s membership until the Spanish society dealt with the controversy.

Then, in a more recent statement, the ICMP said that, unless urgent action was taken by SGAE’s governing bodies, “ICMP and individual music publishers [would be] forced to consider unilateral actions. This may include finding alternative licensing options in order to protect their repertoire in Spain”.

Now, according to Spanish newspaper El Pais, Universal, Warner/Chappell, Sony/ATV, BMG and Peermusic have all written to SGAE informing the society that they are pulling rights relating to their Anglo-American repertoires out of the society. It will mean that SGAE will no longer be able to license works written by countless global music stars to Spanish TV broadcasters, and likely other groups of licensees as well.

The management of song rights is complicated because of the way songwriters assign different elements of their copyrights to collecting societies and music publishers. And because the conventions are different in continental Europe versus Anglo-American markets like the UK, Canada and Australia. Conventions in the US are different again.

However, when it comes to Anglo-American repertoire, publishers are generally in control of at least the so called mechanical rights in the songs they represent, and so can unilaterally pull those rights out of the collective licensing system if they so wish. And when broadcasters synchronise music to programmes that are then aired on their TV networks, they exploit both the mechanical and performing rights.

European law also requires societies to offer a degree of flexibility, so that publishers can pull repertoire from some categories of licenses while allowing the society to continue to represent works in other categories. This is how the publishers have been able to direct license Anglo-American repertoire to streaming services in Europe, while still allowing the collective to license other uses, such as broadcast.

It’s not clear precisely what rights the five publishers are proposing to pull from SGAE, though obviously with TV royalties being the issue, the aim will be to prevent SGAE from licensing Anglo-American repertoire to broadcasters, which would then need to negotiate direct deals with the publishers to continue using those works.

Though it’s thought that pulling from SGAE’s TV categories would also likely result in the big publishers pulling from other licensing categories too, because of the way SGAE’s different licences are structured.

Whereas with digital, the big music publishing firms went the direct licensing route for commercial reasons, most publishers insist they prefer the collective licensing approach for other users of music. So pulling out of SGAE in this way is a last resort with, presumably, the hope that such a dramatic move might finally force the society’s hand.

A number of resolutions were reportedly voted down by SGAE members at a recent meeting of the society’s General Assembly, resulting in calls for the resignation of the organisation’s President, José Miguel Fernández Sastrón. He seemingly refused instead proposing a new road map for reform. However, it’s feels like the global publishers now see a fundamental change of leadership as being the only solution.

Whether pressing the button on the nuclear option of pulling significant bodies of rights out of the Spanish collective can now force that change remains to be seen.



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