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Here Is Why Your Business Should Care About Copyrights!

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Intellectual property traditionalists often tend to view intellectual property as a bundle of rights. As a music artist, the laws regarding the commercial applications of their recordings is mostly contained within the Indian Copyright Act, 1957. Enshrined within are many rights, including an artist’s inalienable right to receive royalties from the commercial utilization of their performances[1]; and protection of such works from being copied or reproduced without their consent.

Why Should Your Business Care About Copyrights?

Most businesses should care about copyrights as they can easily attract copyright liability via

  • The background music played at their retail locations

  • Playing music videos by way of T.V.

  • Caller Tunes and Music-on-hold on their commercial phone lines etc.

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In today’s age, businesses already must take into consideration different kind of compliances. While at one time obtaining IP licenses would have been low amongst peoples priority, slowly the respect for IP law is catching up to the more developed counterparts of the world. This move primarily comes from a more proactive stance taken towards enforcement by the government and bringing into force a far more equitable law towards both the composers and the people desirous of purchasing the legal rights within.

After some recent judgments against hotels/pubs/restaurants for playing music within their premises[2]. Many big societies like the Federation of Indian Hotels have come up with policies making a performance license a prerequisite to playing recorded music or conducting live events within their premises. In the retail sphere, most of the Shopping Malls obtain this license as well.

Does that mean businesses must contact every artist to obtain their permission?

No, the business practice is to usually obtain a ‘Public performance of pre-recorded music’ license from the Copyright Society or Company which is engaged in the collective administration of these musical works.

What is a collective administration of musical works?

Since practically an individual composer may also find it difficult to keep track of all the infringing uses of his work. By granting the license to a registered copyright society, he gains the advantage of Collective Administration by a specialized body over his copyrighted work. Collective Administration is a concept where management and protection of copyrights in works are undertaken by a society of owners of such works. The society because of its organizational facilities and strength, is able to keep a better vigil over the uses made of that work throughout the country and collect due royalties from the users of the work. These royalties are then in turn distributed amongst the artists after the deduction of administrative costs.

There are broadly Four such organizations in India: 1) Society for Copyright Regulation of Indian Producers for Film and Television (SCRIPT), for cinematographical works 2) The Indian Performing Rights Society Limited (IPRS) for musical works 3) Phonographic Performance Limited. For Sound Recordings and 4) Phonographic Digital Limited (PDL), for mobile and digital licenses.

What are the Particulars of these licenses?

The licensing rates and terms aren’t fixed because many factors are taken into account when granting a PPL. Common periods for which licenses are granted for are 1 month, 3 months, 1 year, 5 years and in perpetuity.

Most of the licenses are non-exclusive, conditional and for limited purpose and period. There is no transfer of effective title, control, possession or custody or ‘right to use’ of copyrights, which rests solely with the owner.

PPL and IPRS are the two main music licensing organizations for musical works, they both have application forms to be filled. The final license for Public Performance of Pre-recorded music can be obtained by making an application in the prescribed format, effecting a payment of License fee specified in the Published Tariff and executing a license agreement with appropriate terms, conditions, and provisions as provided on their website.

What if a business doesn’t obtain this license?

The direct consequences emanating out of the same is that if subsequently there is an Indian artist or entity which would like to enforce its rights restricting the business from playing its music for commercial purposes; it would be able to do so.

Playing of sound or music records in public places requires a mandatory license from, and payment of copyright license fees to the copyright owner.

Failure to obtain the aforesaid is a criminal offence under the Act. The minimum punishment for infringement of copyright is imprisonment for 6 months, which may extend to 3 years and a minimum fine of Rs. 50,000, which may extend to Rs. 2,00,000.[3]

 


[1] Section 38A read with Sec 18(1) Third and Fourth Provisos of The Indian Copyright Act, 1957.
[2]  Phonographic performance Limited (PPL) v. Manuj Agarwal & Ors, SUIT (L)NO.1190 OF 2016; Phonographic performance Limited (PPL) v. Corum Hospitality & 4 Others, SUIT (L) NO. 1137 OF 2016; M/S Event and Entertainment Management Association (EEMA) v Union of India & Others, CM No.48304/2016 & W.P.(C) No. 12076/2016.
[3] Section 63 read with Section 68A of The Indian Copyright Act, 1957.

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