[Federal Register Volume 85, Number 40 (Friday, February 28, 2020)]
[Rules and Regulations]
[Pages 11857-11859]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-03305]
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LIBRARY OF CONGRESS
Copyright Royalty Board
37 CFR Part 380
[Docket No. 19-CRB-0005-WR (2021-2025) (Web V)]
Determination of Royalty Rates and Terms for Ephemeral Recording
and Digital Performance of Sound Recordings (Web V)
AGENCY: Copyright Royalty Board, Library of Congress.
ACTION: Final rule.
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SUMMARY: The Copyright Royalty Judges publish a final rule governing
the rates and terms for the digital performances of sound recordings by
certain public radio stations and for the making of ephemeral
recordings necessary to facilitate those transmissions for the period
commencing January 1, 2021, and ending on December 31, 2025.
DATES: Effective January 1, 2021.
ADDRESSES: Docket: For access to the docket to read submitted
background documents go to eCRB, the Copyright Royalty Board's
electronic filing and case management system, at https://app.crb.gov/
and search for docket number 19-CRB-0005-WR (2021-2025).
FOR FURTHER INFORMATION CONTACT: Anita Blaine, Program Specialist, by
telephone at (202) 707-0078 or email at [email protected].
SUPPLEMENTARY INFORMATION: On October 29, 2019, the Copyright Royalty
Judges (Judges) published a proposed rule governing the rates and terms
for the digital performances of sound recordings by certain public
radio stations and for the making of ephemeral recordings necessary to
facilitate those transmissions for the period commencing January 1,
2021, and ending on December 31, 2025. 84 FR 57833. The rates and terms
in the proposed rule were the subject of a settlement among
SoundExchange, Inc. (``SoundExchange''), National Public Radio, Inc.
(``NPR''), and the Corporation for Public Broadcasting (``CPB'')
(together, the ``Settling Parties'') of their interests related to Web
V \1\ royalty rates and terms for certain internet transmissions by
public broadcasters, NPR, American Public Media, Public Radio
International, Public Radio Exchange, and certain other unnamed public
radio stations for the period from January 1, 2021, through December
31, 2025. Joint Motion to Adopt Partial Settlement, Docket No. 19-CRB-
0005-WR (2021-2025) (``Web V''). The Judges received no comments on the
proposed rule.
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\1\ Web V is short for Webcasting V. This proceeding is the
fifth since Congress enacted the compulsory sound recording
performance license for webcasting.
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The Judges ``may decline to adopt the agreement as a basis for
statutory terms and rates for participants that are not parties to the
agreement,'' only ``if any participant [in the proceeding] objects to
the agreement and the [Judges] conclude, based on the record before
them if one exists, that the agreement does not provide a reasonable
basis for setting statutory terms or rates.'' 17 U.S.C.
801(b)(7)(A)(ii). Because no Web V participant has objected to the
settlement, and the Judges find no basis in the record to conclude that
the settlement does not provide a reasonable basis for setting
statutory terms and rates, the Judges adopt the terms and rates as
proposed.
List of Subjects in 37 CFR Part 380
Copyright, Digital audio transmissions, Performance right, Sound
recordings.
Final Regulations
For the reasons set forth in the preamble, the Copyright Royalty
Judges amend 37 CFR part 380 as follows:
PART 380--RATES AND TERMS FOR TRANSMISSIONS BY ELIGIBLE
NONSUBSCRIPTION SERVICES AND NEW SUBSCRIPTION SERVICES AND FOR THE
MAKING OF EPHEMERAL REPRODUCTIONS TO FACILITATE THOSE TRANSMISSIONS
0
1. The authority citation for part 380 continues to read as follows:
Authority: 17 U.S.C. 112(e), 114(f), 804(b)(3).
0
2. Revise subpart D to read as follows:
Subpart D--Public Broadcasters
Sec.
380.30 Definitions.
380.31 Royalty fees for the public performance of sound recordings
and for ephemeral recordings.
380.32 Terms for making payment of royalty fees and statements of
account.
Subpart D--Public Broadcasters
Sec. 380.30 Definitions.
For purposes of this subpart, the following definitions apply:
Authorized website is any website operated by or on behalf of any
Public Broadcaster that is accessed by website Users through a Uniform
Resource Locator (``URL'') owned by such Public Broadcaster and through
which website Performances are made by such Public Broadcaster.
CPB is the Corporation for Public Broadcasting.
Music ATH is aggregate tuning hours of website Performances of
sound recordings of musical works.
NPR is National Public Radio, Inc.
Originating Public Radio Station is a noncommercial terrestrial
radio broadcast station that--
(1) Is licensed as such by the Federal Communications Commission;
(2) Originates programming and is not solely a repeater station;
(3) Is a member or affiliate of NPR, American Public Media, Public
Radio International, or Public Radio Exchange, a member of the National
Federation of Community Broadcasters, or another public radio station
that is qualified to receive funding from CPB pursuant to its criteria;
(4) Qualifies as a ``noncommercial webcaster'' under 17 U.S.C.
114(f)(4)(E)(i); and
(5) Either--
(i) Offers website Performances only as part of the mission that
entitles it to be exempt from taxation under section 501 of the
Internal Revenue Code of 1986 (26 U.S.C. 501); or
(ii) In the case of a governmental entity (including a Native
American Tribal governmental entity), is operated exclusively for
public purposes.
Person is a natural person, a corporation, a limited liability
company, a partnership, a trust, a joint venture, any governmental
authority or any other entity or organization.
Public Broadcasters are NPR, American Public Media, Public Radio
International, and Public Radio Exchange, and up to 530 Originating
Public Radio Stations as named by CPB. CPB shall notify SoundExchange
annually of the eligible Originating Public Radio Stations to be
considered Public Broadcasters per this definition (subject to the
numerical limitations set forth in this definition). The number of
[[Page 11858]]
Originating Public Radio Stations treated per this definition as Public
Broadcasters shall not exceed 530 for a given year without
SoundExchange's express written approval, except that CPB shall have
the option to increase the number of Originating Public Radio Stations
that may be considered Public Broadcasters as provided in Sec.
380.31(c).
Side Channel is any internet-only program available on an
Authorized website or an archived program on such Authorized website
that, in either case, conforms to all applicable requirements under 17
U.S.C. 114.
Term is the period January 1, 2021, through December 31, 2025.
Website is a site located on the World Wide Web that can be located
by a website User through a principal URL.
Website Performances are all public performances by means of
digital audio transmissions of sound recordings, including the
transmission of any portion of any sound recording, made through an
Authorized website in accordance with all requirements of 17 U.S.C.
114, from servers used by a Public Broadcaster (provided that the
Public Broadcaster controls the content of all materials transmitted by
the server), or by a contractor authorized pursuant to Sec. 380.31(f),
that consist of either the retransmission of a Public Broadcaster's
over-the-air terrestrial radio programming or the digital transmission
of nonsubscription Side Channels that are programmed and controlled by
the Public Broadcaster; provided, however, that a Public Broadcaster
may limit access to an Authorized website, or a portion thereof, or any
content made available thereon or functionality thereof, solely to
website Users who are contributing members of a Public Broadcaster.
This term does not include digital audio transmissions made by any
other means.
Website Users are all those who access or receive website
Performances or who access any Authorized website.
Sec. 380.31 Royalty fees for the public performance of sound
recordings and for ephemeral recordings.
(a) Royalty rates. The total license fee for all website
Performances by Public Broadcasters during each year of the Term, up to
the total Music ATH set forth in paragraphs (a)(1) through (5) of this
section for the relevant calendar year, and Ephemeral Recordings made
by Public Broadcasters solely to facilitate such website Performances,
shall be $800,000 (the ``License Fee''), unless additional payments are
required as described in paragraph (c) of this section. The total Music
ATH limits are:
(1) 2021: 360,000,000;
(2) 2022: 370,000,000;
(3) 2023: 380,000,000;
(4) 2024: 390,000,000; and
(5) 2025: 400,000,000.
(b) Calculation of License Fee. It is understood that the License
Fee includes:
(1) An annual minimum fee for each Public Broadcaster for each year
during the Term;
(2) Additional usage fees for certain Public Broadcasters; and
(3) A discount that reflects the administrative convenience to the
Collective (for purposes of this subpart, the term ``Collective''
refers to SoundExchange, Inc.) of receiving annual lump sum payments
that cover a large number of separate entities, as well as the
protection from bad debt that arises from being paid in advance.
(c) Increase in Public Broadcasters. If the total number of
Originating Public Radio Stations that wish to make website
Performances in any calendar year exceeds the number of such
Originating Public Radio Stations considered Public Broadcasters in the
relevant year, and the excess Originating Public Radio Stations do not
wish to pay royalties for such website Performances apart from this
subpart, CPB may elect by written notice to the Collective to increase
the number of Originating Public Radio Stations considered Public
Broadcasters in the relevant year effective as of the date of the
notice. To the extent of any such elections, CPB shall make an
additional payment to the Collective for each calendar year or part
thereof it elects to have an additional Originating Public Radio
Station considered a Public Broadcaster, in the amount of the annual
minimum fee applicable to Noncommercial Webcasters under subpart B of
this part for each additional Originating Public Radio Station per
year. Such payment shall accompany the notice electing to have an
additional Originating Public Radio Station considered a Public
Broadcaster.
(d) Allocation between ephemeral recordings and performance royalty
fees. The Collective must credit 5% of all royalty payments as payment
for Ephemeral Recordings and credit the remaining 95% to section 114
royalties. All Ephemeral Recordings that a Licensee makes which are
necessary and commercially reasonable for making noninteractive digital
transmissions are included in the 5%.
(e) Effect of non-performance by any Public Broadcaster. In the
event that any Public Broadcaster violates any of the material
provisions of 17 U.S.C. 112(e) or 114 or this subpart that it is
required to perform, the remedies of the Collective shall be specific
to that Public Broadcaster only, and shall include, without limitation,
termination of that Public Broadcaster's right to be treated as a
Public Broadcaster per this paragraph (e) upon written notice to CPB.
The Collective and Copyright Owners also shall have whatever rights may
be available to them against that Public Broadcaster under applicable
law. The Collective's remedies for such a breach or failure by an
individual Public Broadcaster shall not include termination of the
rights of other Public Broadcasters to be treated as Public
Broadcasters per this paragraph (e), except that if CPB fails to pay
the License Fee or otherwise fails to perform any of the material
provisions of this subpart, or such a breach or failure by a Public
Broadcaster results from CPB's inducement, and CPB does not cure such
breach or failure within 30 days after receiving notice thereof from
the Collective, then the Collective may terminate the right of all
Public Broadcasters to be treated as Public Broadcasters per this
paragraph (e) upon written notice to CPB. In such a case, a prorated
portion of the License Fee for the remainder of the Term (to the extent
paid by CPB) shall, after deduction of any damages payable to the
Collective by virtue of the breach or failure, be credited to statutory
royalty obligations of Public Broadcasters to the Collective for the
Term as specified by CPB.
(f) Use of contractors. The right to rely on this subpart is
limited to Public Broadcasters, except that a Public Broadcaster may
employ the services of a third Person to provide the technical services
and equipment necessary to deliver website Performances on behalf of
such Public Broadcaster, but only through an Authorized website. Any
agreement between a Public Broadcaster and any third Person for such
services shall:
(1) Obligate such third Person to provide all such services in
accordance with all applicable provisions of the statutory licenses and
this subpart;
(2) Specify that such third Person shall have no right to make
website Performances or any other performances or Ephemeral Recordings
on its own behalf or on behalf of any Person or entity other than a
Public Broadcaster through the Public Broadcaster's Authorized website
by virtue of its services for the Public Broadcaster, including in the
case of Ephemeral Recordings, pre-encoding or otherwise establishing a
library of sound recordings that it offers to a Public Broadcaster or
others for purposes of making performances, but instead must obtain all
necessary licenses from the
[[Page 11859]]
Collective, the copyright owner or another duly authorized Person, as
the case may be;
(3) Specify that such third Person shall have no right to grant any
sublicenses under the statutory licenses; and
(4) Provide that the Collective is an intended third-party
beneficiary of all such obligations with the right to enforce a breach
thereof against such third Person.
Sec. 380.32 Terms for making payment of royalty fees and statements
of account.
(a) Payment to the Collective. CPB shall pay the License Fee to the
Collective in five equal installments of $800,000 each, which shall be
due December 31, 2020, and annually thereafter through December 31,
2024.
(b) Reporting. CPB and Public Broadcasters shall submit reports of
use and other information concerning website Performances as agreed
upon with the Collective.
(c) Terms in general. Subject to the provisions of this subpart,
terms governing late fees, distribution of royalties by the Collective,
unclaimed funds, record retention requirements, treatment of Licensees'
confidential information, audit of royalty payments and distributions,
and any definitions for applicable terms not defined in this subpart
shall be those set forth in subpart A of this part.
Dated: February 10, 2020.
Jesse M. Feder,
Chief Copyright Royalty Judge.
Approved by:
Carla D. Hayden,
Librarian of Congress.
[FR Doc. 2020-03305 Filed 2-27-20; 8:45 am]
BILLING CODE 1410-72-P