Fortunately, the epidemiological situation allowed the members of the SUISA Board of Directors and the Executive Committee to meet in person again. Of all people, it was ausgerechnet? Councillor of States, Johanna Gapany, newly elected to the Board at the General Meeting 2021, who was only able to join the meeting of the Committee for Organisation and Communication (O+K) via video link due to her participation in the session of the Federal Councillors in Bern. The SUISA meeting schedule 2022 is going to be adapted with the Council sessions in mind.
Cost unit accounting
The Board of Directors dealt with the results of the cost unit accounting for 2020, like every year in its autumn meeting. Based on the cost unit accounting, it can be determined how high the expenditure for collection and distribution is for each tariff in detail.
It is generally known that SUISA deducts a fixed percentage from the settlements to the rightsholders as a cost contribution for its expenditure related to collection and distribution. This percentage, i.e. 15% for performing and broadcasting rights, is a mixed calculation in relation to the effective costs. For example, collecting licence fees for music usages in the hospitality industry (CT H) or for dance and entertainment (CT Hb) is more costly than the collection from radio stations (Tariff A and CT S).
This cost unit accounting also makes these differences visible, and it can also be shown in a time dimension whether the costs for a specific tariff are showing a downward trend thanks to savings and rationalisation measures. The result of the cost unit accounting 2020 was somewhat clouded by the difficult collection situation due to the pandemic, less income but still costs which could not be reduced to the same extent.
Every year in its autumn meeting, the Board of Directors takes a look at the strategy of SUISA. The basis paper for this was created in 2019. It was now time to check whether the defined strategic objectives are still to be weighted equally and can be achieved in a meaningful way.
Due to the pandemic, slight adjustments were made; however, the fundamental strategic stance of “asserting oneself in the face of increasing competition through high yields with high cost-awareness and best service quality” remains the same.
Special meeting to discuss online usages
In relation to the company’s strategy, the Board of Directors is going to meet at the end of November in a special meeting to discuss online usages. One reason for this, among others, is also the five-year anniversary of Mint Digital Services, the Joint Venture with the US-American organisation SESAC.
For this special meeting, the Board of Directors approved an agenda and determined the main issues. The objective is to define the needs and expectations of the SUISA members and satisfy them by way of finding suitable measures at Mint Digital Services and the SUISA group of companies.
Distribution of “residuals”
Changes in the distribution rules normally have to be approved by the Swiss Federal Institute of Intellectual Property (in Switzerland) and the Office for Economic Affairs (in Liechtenstein). The competence in the case of distribution rules for collections for online licensing is different: The management of online rights is not subject to federal supervision. As such, the respective changes to distribution rules exclusively fall under the competence of the Distribution and Works Committee and the SUISA Board of Directors.
As part of this competence, the Board of Directors decided in its meeting on 30 September 2021 that item 5.6.1 of the distribution rules be changed respectively reviewed with regards to the distribution of the “residuals” paid by online platforms. “Residuals” are amounts paid by online music platforms for works or parts of works whose rights owners could not be determined and as such no claims were established by any collective management organisation.
Such difficulties arise in such cases when musical works have not been registered in time. For such cases, online providers pay so-called “residuals” after 18 months to the collective management organisation of the country where the music was used.
A so-called “multi-stage invoicing” has been agreed with the online music providers: The usage data of the distribution period will be matched after 90 and after 180 days again against the works database. During that time, it is possible to submit a late registration of the works resulting in a settlement for the work that has been registered late.
The Board of Directors decided that after 180 days, the payments for non-identified works (the “residuals”) shall be paid out as a supplement on top of the other used works in the corresponding distribution period. The alternative that up to five years after the usage, unidentified works can still be registered has been dismissed by the Board of Directors due to cost reasons. It is therefore important that new titles are registered as soon as possible so that online usages can be distributed as adequately as possible.
Francine Jordi elected to the Pension Board of the FONDATION SUISA
The Board of Directors of SUISA is the election committee of the Board of FONDATION SUISA, the foundation for music promotion of SUISA. In its autumn meeting, the Board elected Francine Jordi as a new Pension Board member.