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MIC says Congressional letter in support of BMI and ASCAP fails to deal with DoJ arguments around 100% licensing

By | Published on Friday 30 September 2016

MIC Coalition

The consent decrees debate continues. The MIC Coalition, which brings together trade groups representing American tech, broadcast and hospitality companies, has criticised the previously reported letter signed by eighteen members of US Congress urging the country’s Department Of Justice to reconsider its position on 100% licensing.

As much previously reported, after reviewing the consent decrees that regulate US collecting societies BMI and ASCAP, the DoJ said that – under existing rules – the two performing rights organisations were obliged to operate a 100% or full work licensing system, as opposed to the so called fractional licensing approach they currently employ.

That would mean that where a song is co-owned by an ASCAP member and a BMI member, a licensee could make use of that song with either an ASCAP licence or a BMI licence, whereas previously a licence would be required from both. The licensee would then pay one society any royalties that are due, and it would be for the PRO to ensure both rights owners got paid their respective share of that money.

The music industry believes that the DoJ got it wrong on the 100% licensing point, and BMI took the matter to court, quickly winning a judgement in its favour. And this week, eighteen members of Congress signed an open letter urging the DoJ to alter its position on this issue, noting both the ruling in the BMI court action, and the fact the US Copyright Office disagrees with the DoJ on its interpretation of the consent decrees.

The letter concluded: “DoJ should take prompt action to limit the confusion and chaos [its ruling] creates in the market, and restore certainty to the efficient licensing by ASCAP and BMI of public performing rights for the benefit of all songwriters, composers and music publishers as well as music users”.

But the MIC, which has already criticised the ruling in the BMI court case, says the Congress members who have signed this week’s letter haven’t countered any of the specific arguments put forward by the DoJ as to why it concluded 100% licensing is required under the current wording of the BMI and ASCAP consent decrees.

Says the Coalition: “After conducting a two year investigation, the Justice Department issued a meticulous closing statement setting out several pro-competitive arguments justifying its clarification that the ASCAP and BMI consent decrees require full-work licensing. Many of these pro-competitive outcomes serve to directly benefit songwriters, music licensees, and constituents in districts across America alike. Unfortunately, the member letter dispatched today fails to respond to any of those arguments”.

This debate, we are sure, will continue.