The agreement, known as the Santiago Agreement, was signed in
October 2000 by five organisations that collect royalties on behalf
of music authors, including the Performing Rights Society (PRS)
from the UK and Broadcast Music Inc from the US.
The Agreement is designed to tackle the problems that
traditional copyright licensing schemes face in light of the growth
of new technologies and internet use. The most obvious of these is
territoriality, or lack of it, for once uploaded to the internet,
copyrighted music is accessible from almost anywhere in the
world.
The traditional licensing framework requires a commercial user
wishing to offer such music to obtain a copyright licence from
every single relevant national society. The Santiago Agreement
sought to adapt the traditional framework to the on-line world by
allowing each of the participating societies to grant "one-stop
shop" copyright licences which included the music repertoires of
all member societies and which were valid in all their
territories.
The Agreement was notified to the Commission in April 2001 by
the collecting societies of the UK, France (SACEM), Germany (GEMA)
and the Netherlands (BUMA). These were subsequently joined by all
societies in the European Economic Area (except for the Portuguese
society (SPA) and the Swiss society (SUISA)).
In May the Commission sent a "Statement of Objections" to each
of the EU collecting societies party to the Agreement, explaining
that while it strongly supports the "one-stop shop" principle for
on-line licensing, it also considers that such crucial developments
in on-line-related activities must be accompanied by an increasing
freedom of choice for EU consumers and commercial users as regards
their service providers.
According to the Commission, the structure put in place by the
parties to the Santiago Agreement results in commercial users being
able to apply for the licence from only the collecting society
established in their own Member State. This, says the Commission,
could be in breach of competition rules.
The collecting societies were given two-and-a-half months to
reply to the Commission's objections, and are also entitled to
request a hearing at which they can submit their arguments directly
to the representatives of the national competition authorities. It
is this hearing which is being carried out today.
