The Australian Competition and Consumer Commission has mandated greater transparency about licence fees and royalties as a condition of reauthorising the Australasian Performing Right Association’s (APRA) musical works licensing arrangements for a further four years.
APRA and its members, including composers, songwriters and publishers, hold performing rights for almost all commercially popular music played or performed in Australia, and earn royalties from those rights. In most cases, members assign these rights on an exclusive basis to APRA, which collects royalties by imposing licence fees on users of that music.
For many businesses that play music, including most retailers, cafes, bars and broadcasters, their only option is to obtain and pay for a licence from APRA. The fees from these licences are distributed by APRA to its members.
“Collective management of copyright is generally more efficient than songwriters having to independently negotiate and collect royalties directly from each business that plays their songs,” ACCC Deputy Chair Mick Keogh said. “However, APRA’s exclusivity provisions can mean higher fees for some businesses that want to play music.”
Key issues raised in submissions to the ACCC’s consultations included concerns about the licence fees APRA charges. Respondents were also concerned about APRA’s lack of transparency and accountability, both to its songwriter members and to businesses from which it collects licence fees.
“The ACCC is granting reauthorisation with a number of conditions to limit APRA’s market power and help protect songwriters and small businesses when dealing with APRA,” Mr Keogh said.
These conditions require APRA to publish its methodologies for calculating the rates for each category of licence it offers. APRA will also be required to publish an explanation each time it increases licence rates by more than CPI.
The conditions also require APRA to publish more detailed information about its royalty distributions to its members; to publish an annual transparency report with information on rights revenue, operating costs and payments to members, and to continue the “Resolution Pathways” alternative dispute resolution scheme set up in response to a previous ACCC condition.
“If the information APRA publishes about how it calculates its licence rates is not sufficiently clear and detailed, the ACCC is able to require that an independent report be prepared,” Mr Keogh said.
A copy of the determination is available on the ACCC’s Public Register at Australasian Performing Right Association.