The simplification of collective rights management is one of the actions aimed at establishing a digital single market in accordance with Pillar I of the EU's Digital Agenda. Two recent developments are significant steps towards this aim: The draft of a proposal for a EU directive on collective copyrights management and the establishment of "Armonia", the first pan-European hub for licensing of online services.

The harmonization of collective rights management in the EU has been discussed by the European Commission and other European institutions and stakeholders for a while. The aim is to establish a more competitive framework for the cross-border management of copyright, enhancing the potential earnings of right holders by giving them the freedom to choose a collecting society also outside their national territories for the European licensing of their works.

Proposal for a EU Directive on Collective Rights Management

On 11 July 2012, the European Commission published a first draft of a Proposal for a Directive on Collective Management of Copyright and Related Rights and Multi-territorial Licensing of Rights in Musical Works for Online Uses in the Internal Market (the "Proposal"). Its two main objectives are:

  • To improve the efficiency, accuracy and transparency of collecting societies: The Proposal shall ensure a higher standard of accountability of collecting societies and allow the right-holders to have more control. For this, the Proposal will establish a number of provisions concerning the activity of the collecting societies, some organizational and transparency rules, guidelines on financial management and general principles concerning the relation between the collecting societies and users.
  • To create a single market for intellectual property by facilitating the promotion and the development of multi-territorial licensing: The Proposal intends to remove national restrictions for users to access cultural content, for providers to obtain the necessary rights in order to distribute their services and for right holders to be paid correctly for the use of their works.

The Proposal provides that collecting societies are free to decide whether to grant multi-territorial licenses or not. For both cases, it sets up minimum requirements. If a collecting society intends to grant multi-territorial rights it must comply with rules concerning the correct administration of licenses, the use of adequate procedures for reporting, the monitoring of digital exploitations, the invoicing and the distribution of the revenues to right holders.

In order to facilitate the aggregation of repertoires for the benefit of service providers, the Proposal sets out rules for agreements between collecting societies, in particular the obligation to represent other collecting societies for multi-territorial licensing on a non-discriminatory and non-exclusive basis.

The Proposal also provides that the Member States shall strengthen their national authorities to take appropriate measures in the event of infringement.

Once the Directive will come into force, it will help to accelerate the process of the pan-European licensing of rights. A more competitive framework will award entities to build relationships beyond national borders regardless of any advantageous positions acquired in local markets.

Armonia

In autumn 2012, the French collecting management society SACEM, the Spanish SGAE and the Italian SIAE founded the initiative "Armonia" which aims to create a licensing and administrative hub for granting multi-territorial licenses of music repertoires for mobile and online exploitations.

On 1 November 2012, Armonia and Google signed an agreement granting Google a multi-territorial license of the repertoire administrated by the collecting societies within their respective national borders. Google declared its intention to use the works licensed within its services.

The initiative is another step towards simplify the music licensing process for the benefit of copyright owners, service providers and final users.