Tag Archives: Performing rights

Income from performing rights set to rise in 2019

SUISA’s December Board meetings usually focus on the figures for the coming year. Budgets, staffing plans and cost coverage deductions for business year 2019 were thus the central discussion point. Report from the Board by Dora Zeller

Report from the Board: Income from performing rights set to rise in 2019

Neuchâtel Reggae band Moonraisers, shown on the main stage of the Label Suisse Festival in Lausanne in September 2018; the event is co-supported by SUISA. Regarding the income from performing rights, including concerts, SUISA expects an increase during business year 2019. (Photo: Anne Bichsel / Label Suisse)

For the second time in SUISA’s history, the Board inspected the group budget of SUISA on top of its regular inspection of the budget of SUISA, the Cooperative Society and parent company. The latter comprises the numbers of the parent company, the 100% subsidiary company SUISA Digital Licensing (SUISA Digital) and the 50% share in the Joint Venture Mint Digital Services AG. The budgets of SUISA Digital and Mint are approved by the respective administrative boards of the two companies; the relevant numbers are then incorporated into the group accounts.

Increase in income thanks to performing rights

SUISA’s budget for 2019 provides for an increase of the income from the exploitation of copyright in Switzerland and Liechtenstein, especially due to the income from performing rights (more events, higher admission charges). The decline in mechanical/reproduction rights is set to continue. In the case of compensation claims, growth is expected; the same applies to online usage income. Foreign income has been calculated analogously to 2018, secondary income has been set higher.

For business year 2019, a total turnover of CHF 166.5m has been budgeted (2018: CHF 152m). Costs are expected to rise from CHF 29.5m in the previous year to CHF 32.5m. This is due to higher staff costs required for collections regarding Tariff CT 3a (background entertainment) and additional positions in the IT department.

Cost deductions, Articles of Association, Regulations

With respect to the cost deductions, the Board sets a percentage each year in relation to the distribution of the income that is to be deducted in the following year. For 2019, the percentages of the previous year will be retained in the offline sector. Cost deductions in the online business, however, are subject to change; the reason for this is the outsourcing of licensing and partially distribution activities to the subsidiary companies.

SUISA members had agreed to various changes to the Articles of Association at the General Assembly in June 2018. The revision of the Articles of Association also took place in the context of the alignment with the Liechtenstein Collecting Societies Act and the EU Directive on Collective Rights Management (CRM Directive). As a consequence, the division of powers and the organisational policies had to be adapted, and rules of procedure for the newly created Complaints Committee had to be drawn up. The Board has ratified all of these policies.

FONDATION SUISA and Revision of the Swiss Copyright Act

The SUISA Board Committee for Organisation and Communication and the responsible parties of the FONDATION SUISA have established an “annual dialogue” which takes place at the end of the year. This time, Marc Savary, President of the Foundation Board of the FONDATION SUISA reported on the amendments in the respective Statutes and regulations/policies. He also provided an overview on the activities of SUISA’s foundation for music promotion and answered questions of the Committee members.

Furthermore, the Board was concerned about the news that the National Council intends not to adhere to the compromise by the Working Group on Copyright (AGUR12) in its deliberations on the Copyright Revision and plans to provide for an exception regarding TV reception in guest rooms in the law. As a consequence, the new law would be worse than the previous one. The Board has instructed Management to undertake measures so that the Council of States corrects the decision of the National Council.

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SUISA’s December Board meetings usually focus on the figures for the coming year. Budgets, staffing plans and cost coverage deductions for business year 2019 were thus the central discussion point. Report from the Board by Dora Zeller

Report from the Board: Income from performing rights set to rise in 2019

Neuchâtel Reggae band Moonraisers, shown on the main stage of the Label Suisse Festival in Lausanne in September 2018; the event is co-supported by SUISA. Regarding the income from performing rights, including concerts, SUISA expects an increase during business year 2019. (Photo: Anne Bichsel / Label Suisse)

For the second time in SUISA’s history, the Board inspected the group budget of SUISA on top of its regular inspection of the budget of SUISA, the Cooperative Society and parent company. The latter comprises the numbers of the parent company, the 100% subsidiary company SUISA Digital Licensing (SUISA...read more

“Hands-on” – the new Common Tariff K

The new Joint Tariff K applies to events which have taken place since 01 January 2017. An overview of the changes to the concert tariff in force and some answers to frequently asked questions which have arisen based on the experience gathered with the new provisions in the first few months. Text by Chantal Bolzern

“Hands-on” – the new Common Tariff K

Since January 2017, a new concert tariff has been in force in Switzerland and in Liechtenstein. The picture shows SUISA member Seven (in the middle) on stage at the Tonart Festival in Altdorf, where he performed with a trio in March 2017. More information on Seven is available in the brochure “Where the music is new”, 2017 edition. (Photo: Tabea Hüberli)

What’s new?

There is now one instead of two tariffs. That way, all information that is relevant to customers, and the respective licensing terms and conditions are now combined into one single document. This makes life much easier, especially for event organisers who organise, apart from concerts, also other events such as theatre performances, cabarets etc.

The types of events are defined and explained in more detail and clarity. Apart from concerts, there are now specific event categories for concert-like performances, shows, ballet and theatre. These are intended to help customers to find their type of event and the licensing rates required for calculating the budget more quickly.

The licence fee percentages have been newly defined and reduced for many events depending on the type of event (concert, concert-like performance, show, ballet, theatre).

Apart from concerts, Common Tariff K (CT K) also governs licensing for music appearing in comedy, shows (such as “Art on Ice” or “Masters of Dirt”), sport tournaments with choreographies such as show dances or theatre performances with musical background or bedding. The calculation of the licence fees for comedy, tattoo festivals etc. in particular will become easier since the event is now relevant as a whole for the amount of the licence rate; it is no longer necessary to license individual works at different rates. This also helps making the budgeting process for event organisers easier and reduces the efforts of SUISA.

Small concerts are invoiced based on the works that were actually used (“pro rata temporis” rule) and no longer as a lump-sum. At the same time, licensing based on the costs of the music usage was re-introduced. Thus, the copyright remuneration will be calculated on the basis of the income generated or the costs incurred. The latter specifically applies to concerts which are free of charge and charity events.

Customers may also deduct the costs for external ticket sales up to a lump-sum of 10%, even for small concerts, if they submit the relevant supporting documents. SUISA thus takes into consideration that event organisers nowadays do use external ticket agencies, even for small or non-commercial events.

Performing artists of any recordings that are played by event organisers prior or after the event, or between the live performances, now also grant the event organiser reproduction rights. This entails a slight increase of the licensing rate for neighbouring rights from 0.2% to 0.25%.

Following the afore-mentioned lowering of the licensing fees, there was a review of the discount system. The volume discount is now only granted for small concerts and the contractual customer must be a member of a recognised association of event organisers in order to qualify for a discount.

What has not changed?

Services to concert goers by third parties that are included in the entrance fee, such as the use of public transport, a voucher for an inclusive drink etc. as well as ticket and value-added tax may still be deducted from the income if the relevant supporting documents are submitted.

The minimum licence fee has remained the same and still amounts to CHF 40 per event. Our contractual customers continue to receive the association discount as well as a 2% cash discount if they pay their invoice within 10 days.

Event organisers must submit set lists or lists of the performed works to SUISA. Firstly, SUISA requires such lists so that it can calculate a correct licensing amount. If SUISA does not hold the rights in all the titles, because, for example, copyright protection has already lapsed, the licensing amount is reduced on a pro rata temporis basis. The licensing rate also gets reduced on a pro rata temporis base if music is not used throughout the entire performance, as is the case quite regularly for theatre performances or comedy. Secondly, SUISA requires the lists in order to distribute the income collected to those composers and publishers whose music has been performed during the event.

Answers to frequently asked questions

Why does the new tariff create more administrative effort?
Introducing a new tariff is always an opportunity to check with long-term customers whether the modalities for the notifications of the events are still suitable for both parties. Furthermore, it is possible that with the partial changes to the licensing rates or conditions under the tariff, SUISA requires different information from customers. This mainly affects such concerts for which event organisers had received a licence based on the Common Tariff Kb between 2009 and 2016 (small concerts). Unfortunately, this is linked to an increased administrative effort for customers as well as for SUISA during a transitional period. As soon as we have clarified with individual customers in each case how we can licence and distribute correctly, this will get easier again.

What is a small concert and why is there no longer a specific tariff for it?
Between 2009 and 2016, a proper tariff applied for small concerts, Common Tariff Kb. Since the beginning of this year, small concerts are governed by the same tariff again as major concerts, theatre performances or comedy events.

In order to continue to fall under the “small concert” category, the capacity of the event venue must be no bigger than 999 people, and the income generated from ticket sales may not exceed CHF 15,000 per event. In this segment, the basic licensing rates were lowered from 10% until 2008 via 9.5% in 2016 to 9% for this year. Until 2008 the same rules have applied, and now, from 2017 onwards, apply again for the declaration of the concerts and licensing such as major concerts. This means that customers deliver the same information to us and don’t have to ask themselves each time which category the event falls under and how they should submit their documentation to SUISA.

This is especially a simplification of matters for medium-sized clubs whose capacity is just less than 1,000 people and which have generated more than CHF 15,000 in ticket sales in one instance and less in another. It’s also facilitating matters immensely for the venues that organise cabarets and concerts. Until now, you had to adhere to CT Ka for comedy, dance, acrobatics etc., and CT Kb for concerts.

Why are sponsoring monies or subsidies suddenly taken into consideration as income in the case of small concerts?
The basic idea of copyright is that authors participate in the collections which have been generated from the exploitation of their works. In the event business, the main income source are usually the ticket sales. If an event organiser’s plans for their budget only caters for the music costs such as payment for musicians to be covered by way of third party means, such third party means (sponsoring, subsidies etc.) must be taken into consideration as an income. This rule has already been established in concert tariffs as early as 20 years ago. It applies for all major concerts, comedy and theatre performances and used to apply to small concerts up until 2008. Due to the combination of the two tariffs CT Ka and CT Kb, it now applies to small concerts again since the beginning of this year.

Many non-commercial clubs and stages create annual budgets, where they make a hybrid calculation. They receive subsidies from their municipalities or cantons, but finance themselves from ticket income and turnover generated by the gastronomy on top of that. As long as they assume in their annual budgets that their ticket sales cover the artists’ performance salaries, the new tariff entails no changes for them. For long-term customers it therefore suffices to glance over their old invoices (up until 2008) to see whether a change has taken place. During the tariff negotiations, we undertook thorough calculations and research together with the associations whose results are now confirmed when implementing the tariff: for the vast majority of the event organisers of the non-commercial sector and especially clubs and stages, nothing will change.

The changes do, however, affect event organisers of corporate events or events that are free of charge, but also categories which can only pay artists’ salaries and other costs related to music by means of subsidies or sponsors’ subsidies.

What are non-musical performances at major concerts and what do they entail?
Both the old Common Tariff Ka (item 25 CT Ka) as well as the new Common Tariff K (item 14.1 CT K) include the term “non-musical performances”. We found out in everyday application of the tariff, that it wasn’t always clear to event organisers what is meant by this term. In order to answer these questions in the tariff, we have clarified this term in the new tariff text: it includes sophisticated choreographies, elaborate costumes and costume changes, video installations or light shows which go beyond the ‘must-have’. By doing so, we want to – as is required by copyright law – take performance-related activities into consideration which are not music but are still protected by copyright.

In practice, this means that the entire concept is taken into consideration for concerts of artists such as Beyoncé or bands like Archive, and the event organiser has to pay a lower licensing rate for the copyright in musical works. It also means that even in big stadiums, concerts sometimes will take place without elaborate artistic production and the event organiser will pay the usual basic licensing rate. That does not only apply to big classical concerts but can also be the case for concerts of certain singer songwriters, like Bruce Springsteen or Neil Diamond.

Why were the new provisions of the concert tariff made known so shortly before its introduction?
In June 2016, SUISA had announced that a new tariff had been negotiated with the relevant user associations such as SMPA, petzi, KTV, ATP etc. and that an agreement had been made. The result of the negotiations was submitted to the Federal Arbitration Commission for copyright and neighbouring rights (ESchK) for approval. The EschK approved the new Common Tariff K on 20 December 2016 and the tariff could thus come into force on 01 January 2017. The relevant tariff documents could not be officially published prior the approval had been given by the ESchK. SUISA had no influence on the date of the approval.

Further information:
«Concerts, comedy shows, shows, ballets, etc.» on www.suisa.ch

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The new Joint Tariff K applies to events which have taken place since 01 January 2017. An overview of the changes to the concert tariff in force and some answers to frequently asked questions which have arisen based on the experience gathered with the new provisions in the first few months. Text by Chantal Bolzern

“Hands-on” – the new Common Tariff K

Since January 2017, a new concert tariff has been in force in Switzerland and in Liechtenstein. The picture shows SUISA member Seven (in the middle) on stage at the Tonart Festival in Altdorf, where he performed with a trio in March 2017. More information on Seven is available in the brochure “Where the music is new”, 2017 edition. (Photo: Tabea Hüberli)

What’s new?

There is now one instead of two tariffs. That way, all information that is relevant to customers,...read more

SUISA expects significant rise in streaming collections

At the top of the agenda for the SUISA Board meeting in December 2016 was the budget for the following financial year. It was with satisfaction that the Board established a continuation of the positive developments from the past years in relation to the collections (+3.2%). Expenditure remains stable and the distributable amount increases slightly (+2.91%). Report from the Board by Dora Zeller

SUISA expects significant rise in streaming collections

The remuneration pot for streaming exploitations is expected to fill up for authors and publishers even more: In its budget for financial year 2017, SUISA expects an increase in the online sector income of +13.4% compared to the previous year. (Photo: Manu Leuenberger)

The budget for financial year 2017 includes higher collections arising from broadcast and performing rights as well as compensation claims. An increase of approx. 11% is expected from tariffs CT 4i (smart phones) and CT 12 (set top boxes rental). A significant rise is also expected in the online sector, especially streaming (+13.4%). Due to the market developments, it is expected that reproduction rights are due to decrease (-3.8%). Regarding income from abroad, the amounts in the budget are also lower than previously (-4.5%).

Board and Management of SUISA also plan long-term: Apart from the roadmap for 2017, financial planning and strategy until 2020 were discussed. The Board discussed and ratified the drafts presented by Management.

Cost deductions stay the same

Another recurring agenda item for the end of the year are the cost deductions. The Board resolves which deductions will be taken in the subsequent year from collections in the current year. For Switzerland and the online sector, the percentages are between 10 and 15% just like in the previous year. An exception are the cost rates for the reproduction sector, in particular tariffs PI and VI which are subject to the Cannes Agreement (7.025% and 9.025%).

Furthermore, the percentage deducted from income from abroad in the last few years on the basis of reciprocal representation agreements was examined. Since various sister societies apply higher deductions, the pros and cons of an increase were thoroughly considered. The Board members decided, however, to keep deduction levels at 4%.

Benvenuti a Lugano

For the autumn meetings 2017, the Board members of SUISA will not travel to Lausanne, as they did before, but to Lugano instead. Why not hold the General Assembly in the Italian-speaking part of Switzerland? In line with SUISA’s planning it could happen in 2021.

By-elections in the Distribution and Works Committee

Alex Kirschner, composer for advertising and film music, steps back from his post in the Distribution and Works Committee (VWK) in summer 2017. Jonas Zellweger – SUISA member since 2009 – applies for the vacant seat; he is active in the same music category. The Board is going to unanimously propose his candidature to the General Assembly for election.

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All comments will be moderated. This may take some time and we reserve the right not to publish comments that contradict the conditions of use.

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At the top of the agenda for the SUISA Board meeting in December 2016 was the budget for the following financial year. It was with satisfaction that the Board established a continuation of the positive developments from the past years in relation to the collections (+3.2%). Expenditure remains stable and the distributable amount increases slightly (+2.91%). Report from the Board by Dora Zeller

SUISA expects significant rise in streaming collections

The remuneration pot for streaming exploitations is expected to fill up for authors and publishers even more: In its budget for financial year 2017, SUISA expects an increase in the online sector income of +13.4% compared to the previous year. (Photo: Manu Leuenberger)

The budget for financial year 2017 includes higher collections arising from broadcast and performing rights as well as compensation claims. An increase of approx. 11% is expected...read more

New distribution key for performing and broadcasting rights

The SUISA distribution key for performing and broadcasting rights will be changed from 01 January 2017 onwards. For works with an original publisher, the share of the author shall be 66.67% and that of the publisher 33.33%. The distribution rules are thus adapted to the CISAC key which is applied at international level. Text by Irène Philipp Ziebold

8/12 for authors, 4/12 for publishers: SUISA will adapt its distribution key for performing and broadcasting rights to European standards again. (Photo: Manu Leuenberger)

The majority of SUISA’s European sister societies apply the so-called “CISAC key” when it comes to originally published works in the performing and broadcasting rights sector. CISAC is the international umbrella for collective management organisations (Confédération Internationale des Sociétés d’Auteurs et Compositeurs). The shares of the distribution key recommended by the umbrella organisation for performances and broadcasts amount to 66.67% for authors and 33.33% for publishers.

SUISA’s distribution key

SUISA’s distribution key had deviated from the internationally established CISAC standard in the past. Up to now, SUISA distribution rules provided that the shares for originally published works for performing and broadcasting rights was 65% for authors and a maximum of 35% for publishers. Regarding the production of sound and audio-visual recordings, the composers receive 60% and the publishers 40%.

In the case of works with a sub-publisher, the author has an entitlement as per the distribution rules to receive 50%, and the publisher and sub-publisher to claim the remaining 50% for performances and broadcasts. Regarding the production of sound and audio-visual recordings, the composers receive 40% and the publisher and sub-publisher share the remaining 60%. In this context, it is worth mentioning that SUISA usually adopts the contractually agreed split between the publisher and the sub-publisher in the case of sub-published works. Only in the absence of such agreed splits will SUISA apply the keys established by the distribution rules.

Alignment with the European CISAC standard

The distribution keys by SUISA will now be adapted in the case of originally published works in the performing and broadcasting rights to European standards. The keys relating to the production of sound and audio-visual recordings (mechanical reproduction rights) shall remain unchanged in the distribution rules. Strictly speaking, the application of the CISAC key of 67% for authors and 33.33% for publishers is nothing new, but rather a re-introduction of a previous provision.

The key applied on a Europe-wide level is actually expressed in fractions 8/12 (author’s share) resp. 4/12 (publisher’s share). When SUISA began working with IT systems back in 1962, the aim was to avoid decimal places after the decimal point. As a consequence, SUISA changed the key, and rounded it to 65%, resp. 35%. The majority of the other European societies kept the translated fractions i.e. 66.67% and 33.33%.

Effects of the changed distribution rules

Thanks to the adaptation of the distribution keys, authors will be remunerated with the share that is deemed as standard in the European area. While the publisher share will be decreased by 1.67%, they will, together with the authors, benefit from positive effects which the changes bring about.

Apart from the harmonisation with other European societies, the (re)introduction of the CISAC key for originally published works entails further significant advantages:

  • Important increase in efficiency during work registration: Processing of SUISA works with international contributors will become simpler. Difficult conversions in the case of joint productions with international authors become redundant.
  • Processing distributions of the sister societies will be significantly simplified: The matching distribution keys will facilitate the processing of distributions by international sister societies to a great extent.

Validity of the changes to the distribution rules

Both the SUISA Board of Directors as well as the Swiss Federal Institute of Intellectual Property (IPI) have agreed to this change. The new distribution keys will come into force from 01 January 2017 without any retroactivity. This means, that all works declared after 01 January 2017 will be registered with the new distribution key. In the case of works that had been registered before that date, the distribution key in place shall remain valid. These works will not be changed.

The decision of the IPI dated 28 July 2016 is published at the SUISA website.

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All comments will be moderated. This may take some time and we reserve the right not to publish comments that contradict the conditions of use.

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The SUISA distribution key for performing and broadcasting rights will be changed from 01 January 2017 onwards. For works with an original publisher, the share of the author shall be 66.67% and that of the publisher 33.33%. The distribution rules are thus adapted to the CISAC key which is applied at international level. Text by Irène Philipp Ziebold

8/12 for authors, 4/12 for publishers: SUISA will adapt its distribution key for performing and broadcasting rights to European standards again. (Photo: Manu Leuenberger)

The majority of SUISA’s European sister societies apply the so-called “CISAC key” when it comes to originally published works in the performing and broadcasting rights sector. CISAC is the international umbrella for collective management organisations (Confédération Internationale des Sociétés d’Auteurs et Compositeurs). The shares of the distribution key recommended by the...read more