As reported in the market updates section of this newsletter, the UAE Ministry of Economy recently reviewed the fees charged by its various departments, including the Trade Mark, Patent and Copyright Office. As part of this review, the Ministry has revised the applicable fees relating to the setting up and operation of collecting societies:
- a fee of AED 100,000 (equivalent to approximately USD 27,200) for obtaining a licence to operate a collecting society; and
- an annual fee of AED 50,000 (equivalent to approximately USD 13,600) for renewing a licence to operate a collecting society.
At present, there are no collecting societies which are licensed to operate in the UAE. However, by revising the fees for setting up and operating a collecting society, we assume that the Ministry of Economy is considering licensing a collecting society to operate in the UAE, within the framework envisaged by the UAE Copyright Law (UAE Federal Law No 7 of 2002).
The legislative framework
Ministerial Decisions) provides for the establishment and operation of collecting societies to manage the collection of royalties in the UAE on behalf of rights owners. This sets out certain requirements for a collecting society, which include:
- obtaining an annual licence from the Ministry to operate as a collecting society in the UAE;
- preparing and maintaining a detailed report on its catalogue of rights, including the names of its licensors, the rights held, the duration and value of such rights;
- preparing financial reports and accounts of the royalties received from licensees and the profits generated and distributed;
- allowing licensees to inspect its accounts at any time;
- taking all administrative and legal action necessary to protect the rights of the contracting parties;
- providing reports to the licensors setting out the details of the parties that have used their works and the royalties collected; and
- submitting the information and documents set out above to the Ministry on request.
The requirement to obtain a licence to operate as a collecting society from the Ministry of Economy means that, without such a licence, is it not possible to operate lawfully as a collecting society within the UAE.
At present, there are no collecting societies licensed to operate in the UAE. However, with the introduction of the revised fees, we assume that the establishment of a collecting society in the UAE is presently under consideration by the Ministry.
The role of a collecting society
A collecting society’s role is to act as an intermediary between rights owners (seeking to license their rights) and users of these rights (seeking to obtain a licence). For example, collecting societies commonly have a central role in relation to the playing of music in public.
Typically, a piece of music will bring together various works which are protected under the UAE Copyright Law, such as the music itself, the lyrics and a sound recording of the music. If a company wishes to play music in public, then it should obtain a licence from each of the rights owners for each piece of music which is played.
This is where the collecting society comes in. It builds up a catalogue of rights from multiple copyright owners (such as composers and lyricists) for multiple pieces of music. The collecting society then acts as a single point of contact for the licensing of these rights to companies wishing to play music from the collecting society’s catalogue.
However, the absence of a collecting society in the UAE means that businesses are not able to obtain a licence from a single point of contact, as is the case in many other countries.
Progress in the UAE
By publishing the official fees to be paid in order to set up and maintain a collecting society, we assume that the Ministry of Economy is considering moving towards setting up a collecting society regime in the UAE.
Consideration will also need to be given to the role of the UAE Competition Law (UAE Federal Law No 4 of 2012). In the January 2015 edition of our newsletter, we looked at the impact of the UAE Competition Law on the licensing of intellectual property rights. In addition to satisfying the requirements of the Copyright Law, a collecting society will need to comply with the Competition Law (which may require it to avoid the abuse of a dominant position).
Nevertheless, the step taken by the Ministry of Economy is in the right direction towards collecting societies being established for the benefit of both rights owners and users.