The Indonesian president, Joko Widodo (Figure 1), is a big heavy metal fan, often seen sporting t-shirts of his favourite bands, including Metallica and Napalm Death. Since his election, he has been inching towards securing more legal rights to enable musicians, record labels and publishers to financially capitalise on their works.
Figure 1: President Widodo in his Lamb of God (a heavy metal band) t-shirt
His first step was revamping the Copyright Act in 2014, where the idea of a national collective management organisation was promulgated. The previous legislation, the Copyright Act 2002, provided for the collection of royalties by private agreement between concerned parties. Local record labels had their own ways of collecting royalties from hotels, restaurants and other big establishments piping and performing live covers of copyrighted music. Such collection was opaque, and rights holders (especially musicians) never quite felt that they received their fair share.
From 2016 to 2019, the Ministry of Law and Human Rights and Indonesia's first national collection agency (the LMKN) have been defining places liable for royalty payments (eg, nightclubs and cinemas) and setting the tariffs. One limitation was that the amount distributed did not depend on how many times any one song or artist was played.
The new Regulation 56/2021 on Royalty Management for Copyrighted Songs/Music obliges the LMKN to create a database of songs (SILM), which is to be the foundation on which accurate royalties will be apportioned for different artists. Rights holders must register their interests with the LMKN to receive royalties. Comprehensive details of copyright holders will be kept. Where a song appears on the SILM database, but the rights holder has not registered, the LMKN will keep the money due for two years, after which it will redistribute the unclaimed money among the rights holders registered with it.
This should make the distribution of royalties more accurate and fairer. However, there is a dearth of provisions relating to streaming music platforms. Spotify pays around $0.005 per play, which many criticise as unfairly low. The current legislation is silent on internet music royalties. Moreover, venue owners have questioned the timing of these changes, arguing that businesses have suffered during the covid-19 pandemic, so the government should not be looking to collect more money at this time. On the other side of the coin, musicians have not been able to perform live during recent times, thus have also suffered from loss of income.
For further information on this topic please contact Ian Mirandah at Mirandah Asia by telephone (+60 322 788 686) or email ([email protected]). The Mirandah Asia website can be accessed at www.mirandah.com.