New Music Licensing Laws

Title III allows, among other things, music producers, mixers or sound engineers to obtain royalties for the use of sound recordings under the legal licence under section 114 by codifying a process by which the designated collective society (Sound Exchange) distributes these royalties to those parties under a “letter of direction”. The Musical Works Modernization Act (MWMA) is the bill first introduced in the Senate on December 17, 2017 by Representative Bob Goodlatte (H.R. 4706) and Senator Orrin Hatch on January 24, 2018. Both versions of the bill are expected to improve the way music licenses and royalties are paid, taking into account media streaming services. The bill established three important provisions:[2] The MMA revises U.S. copyright law and brings it into the 21st century with the modern era of music production and distribution. MMA`s key accomplishments include the creation of a mechanical licensing collective, which is scheduled to begin operations by January 1, 2021, and will establish a single database of songs and song ownership information, as well as an overhaul of the processing of pre-1972 sound recordings. Let`s take a look at these two most important achievements. An extremely important question, as copyrighted music and podcast laws are very unclear due to the technological differences between podcasts and streaming technology. The Orrin Music Modernization Act G. Hatch-Bob Goodlatte (Music Modernization Act) is the most important copyright law in decades and updates our current laws to reflect modern consumer preferences and technological developments in the music market.

The Act is divided into three main titles, which are described below: Title I – Musical Works Modernization Act; Title II – Law on the Protection and Access to Classics; and Title III – Music Producers Distribution Act. The Copyright Office has actively fulfilled its obligations under the MMA, including: The provision in Section 114(i) prohibiting PRO tariff tribunals from including royalties for digital performances of sound recordings in their rate-setting process for the public performance of musical works is partially repealed. This repeal does not apply to broadcasters. In addition, the legislation changes the way judges in the Southern District of New York are assigned to collective bargaining court proceedings set out in the ASCAP and BMI consent decrees by alternating each new collective bargaining dispute, rather than assigning all disputes to the same judge. The rise of streaming ushered in a new golden age for music, based on the shared understanding that without music, streaming services would suffer, and without streaming services, creators and fans would suffer. Recognition of a positive partnership between creators and streaming platforms is at the heart of the new music industry. First, copyright resides in the composition – that is, the underlying notes and texts. The copyright in this musical work usually belongs to the songwriter; However, many songwriters transfer some or all of these rights to a music publisher. Thus, if a musical work is copied, distributed, publicly performed, or used in another work for commercial purposes, the songwriter (and/or publisher) is generally entitled to songwriter royalties.

Once established, the MLC will establish and administer a procedure by which copyright owners can claim ownership of musical works (and parts thereof). Once an owner of a non-compliant work has been identified and located in accordance with the procedures established by the MLC, the MLC database of musical works and other recordings will be updated accordingly. The MLC Dispute Resolution Committee will implement policies and procedures to address and resolve disputes related to proprietary rights in licensed musical works. Music is a central part of our personal identity and shared culture, and fans have been clear: streaming is how they want to interact with music and their favorite artists. The Mechanical Licensing Collective (“MLC”) is a non-profit organization that will administer the new general licensing system introduced by the Music Modernization Act from the “license availability date” of January 1, 2021. The MLC receives communications and reports from digital music providers, collects and distributes royalties, and identifies musical works and their owners to be paid. It shall establish and maintain a publicly accessible database containing information on musical works (and parts thereof) and, where known, the identity and location of the copyright holders of such works and the phonograms in which the musical works are incorporated. In cases where the MLC is unable to attribute musical works to copyright holders, it has the right to distribute unclaimed royalties to copyright holders named in MLC recordings, based on the relative market shares of those copyright holders, which are reflected in the usage reports of digital music providers for the relevant periods.

This is because music is protected by copyright on two levels: founded in 1941 to combat the anti-competitive activities of ASCAP and BMI around the licensing of public performance of musical works, consent decrees are still crucial today.