September 26, 2017 – Toronto and Montréal: On August 25, 2017, the Copyright Board of Canada (“Board”) released its decision certifying the royalties payable to songwriters and music publishers for the reproduction of musical works by online music services operating in Canada, including services that offer music downloads, on-demand streaming and webcasting. CMRRA-SODRAC Inc. (“CSI”), the music collective that represents the vast majority of music rightsholders in Canada, is greatly disappointed by the decision and has filed an application for judicial review before the Federal Court of Appeal on a number of reviewable errors.
“CSI does not agree with many aspects of the Board’s decision, including the very dramatic reduction in the royalty rates for streaming services and the virtual elimination of minimum rates for subscription services and services offered on a free or ad-supported model,” said Alain Lauzon, President of CSI and General Manager of the Society for Reproduction Rights of Authors, Composers and Publishers in Canada (“SODRAC”). “If applied, these rates would significantly decrease royalties payable to songwriters and music publishers, and provide no compensation at all in some cases.”
CSI and the rightsholders it represents know that the decision widens the value gap in an era where music is more in demand than ever before. Rightsholders are now faced with a tariff that has unacceptably low royalty rates, largely based on the scant evidence that was available at the time of the hearing, and which was produced before most of today’s online music services began operation in Canada.
This tariff, which applies to the years 2011-2013, took more than three years to be rendered after the conclusion of the hearing in early 2014. “During this time a new streaming market has emerged and, in the absence of a Board certified tariff, CSI has negotiated directly with these new services to license them at rates much more favourable than those specified in the tariff,” said Caroline Rioux, Vice President of CSI and President of Canadian Musical Reproduction Rights Agency Ltd. (“CMRRA”). “CSI and its rightsholders welcome new services to Canada and believe that it is in the best interest of songwriters, music publishers, and the services to continue to negotiate directly for solutions that benefit both sides.”
At the current pace, a new tariff for the post-2013 period within which these services launched in Canada is unlikely to be certified for years to come. In the interim, this decision will continue to cause confusion and frustration in the market for songwriters and music publishers every day. For these reasons, CMRRA and SODRAC look forward to participating in the consultations that were recently announced by the Ministry of Innovation, Science and Economic Development on the Board.
ABOUT CMRRA-SODRAC INC.:
CMRRA-SODRAC Inc. (CSI) is a joint venture of the Canadian Musical Reproduction Rights Agency Ltd. (CMRRA) and the Society for Reproduction Rights of Authors, Composers and Publishers in Canada (SODRAC). CSI licenses the reproduction rights in the joint repertoire of CMRRA and SODRAC to various music users, including radio stations, background music services and online music services. Together, CMRRA and SODRAC represent the vast majority of songwriters and music publishers whose songs are active in the Canadian market place.
ABOUT CANADIAN MUSICAL REPRODUCTION RIGHTS AGENCY LTD.:
Founded in 1975, Canadian Musical Reproduction Rights Agency Ltd is a music licensing collective representing music rightsholders who range in size from large multinational music publishers to individual songwriters. Together, they own or administer the vast majority of songs recorded, sold, broadcast and streamed in Canada.
ABOUT THE SOCIETY FOR REPRODUCTION RIGHTS OF AUTHORS, COMPOSERS AND PUBLISHERS IN CANADA:
Since 1985, SODRAC represents thousands of authors, composers, music publishers and creators of artistic works. Thanks to its unique skills in collective management of reproduction rights in North America, the company facilitates the use of the works of its members through all broadcasting platforms in order to fairly retribute their work.
For more information, please contact:
Canadian Musical Reproduction Rights Agency (CMRRA)
320 – 56 Wellesley Street West, Toronto, ON M5S 2S3
Phone: 416.926.1966 ext. 228
Society for reproduction rights of authors, composers and publishers in Canada
Tower B, Suite 1010, 1470 Peel Street, Montréal QC H3A 1T1
Phone: 514 845-3268 / 1 888 876-3722 ext. 223