From private copying to concerts and to SBC

The 2022 highlights in a nutshell:

Private copying

In 2021, we had already negotiated a new Common Tariff 4i (CT 4i) relating to private copying on digital media. This tariff used to apply also to smartphones and tablets. In consultation with the user associations, its scope has now been extended to laptops and external hard drives. A uniform fee will henceforth apply to all these devices. The tariff was approved by the Federal Arbitration Commission on 21 May 2022 and came into force on 1 July. Given that the blank audio media levy is still a controversial issue, the new tariff is a positive development. All the more since it should result in a significant increase in our private copying revenues.

Alongside the CT 4i negotiations, we have (for some time) been negotiating a new levy for private copying in the cloud via systems such as Dropbox, Google Drive, and the like. We believe that Swiss law provides the legal basis for such a levy – but in Europe, this was the subject of debate. In its Judgment of 24 March 2022, the European Court of Justice ruled that copies made in the cloud are effectively subject to remuneration for private copying. The European Court of Justice determined that it was for Member States to set the terms of such remuneration which, however, had to be co-ordinated with existing fees. Overall, the European ruling is favourable to entitled parties and should serve to faciliate negotiations in Switzerland as well. That said, the earliest market data from summer 2022 show that a stand-alone tariff for the cloud is unlikely to be profitable: the cost of managing the tariff (especially since the main providers are established abroad) would be disproportionate in relation to the prospective remuneration. Accordingly, we are currently negotiating the incorporation of the cloud segment into CT 4i. This would not create any additional administrative costs for SUISA since the levy for copying in the cloud would be paid by the existing CT 4i customers. These negotiations are being continued in 2023.

SBC Tariff

In spring 2022, we negotiated with SBC (Swiss Broadcasting Corporation: SRG SSR) the incorporation of their online uses in Tariff A. Hitherto, such uses were regulated in a separate agreement between SUISA and SBC. However, the Federal Intellectual Property Institute (IPI) held that if SUISA intended to remunerate the entitled parties for the online uses of their works by SBC under this Tariff, these uses had to be incorporated into Tariff A. SBC consented and a new supplemented Tariff A was approved by the Federal Arbitration Commission. The new tariff came into force on 1 January 2023.

At the same time, we initiated negotiations with SBC for the tariff applicable from 2024. Two factors cloud the situation: firstly, political developments could have a negative impact on SBC revenues, especially in view of the “CHF 200 are enough” popular initiative (which seeks a significant reduction in the fees for radio and TV reception charged to households and businesses); and secondly, media convergence, which will soon require a revision of the existing tariff structure. The demarcation between radio and television is disappearing as content becomes increasingly transmedial, i.e. created for use in radio, television and internet. This trend is still in its early stages, however, and will not impact the tariff for a few years yet. By the same token, adverse political developments are also unlikely to have any effect before 2026 at the earliest. Under the circumstances, we decided to propose to SBC an extension of the existing tariff, with only a few updates, and for a relatively short duration (2024 and 2025, with two extension options for one year each). At the same time, we have already started talks with SBC on the next tariff in order to anticipate political and technical developments. These talks are being continued in 2023.

Concerts and other events

SUISA aims to simplify Common Tariff K, especialy for smaller events, with a view to saving administration costs and facilitating access to music. But, generally speaking, the associations participating in the negotiations consider that the tariff is no longer equitable and are demanding a significant reduction in the fees due thereunder. They hold that the tariff does not take adequate account either of the considerable costs which the organisers have to bear, or of the non-musical elements which draw concert-goers to concerts. In the process, however, the associations are calling into question the fundamental principles underlying copyright and tariff law – and this SUISA cannot accept.

In December 2022, three associations involved in the negotiations terminated the existing tariff for the end of 2023. As a result, in order to respect the time limit under the Copyright Ordinance, SUISA must propose a new tariff to the Federal Arbitration Commission by the end of May 2023. Meanwhile, negotiations continue in the hope of finding a solution. It is possible that no agreement will be reached and that in the last resort the Federal Arbitration Commission will be called upon to decide.