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Russian ministry presents plans for taking over collective licensing to Deputy PM

By | Published on Tuesday 4 October 2016

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The Russian government is seemingly continuing to develop its proposal that it take over collective licensing in the country, with the Economic Development Ministry sending two possible options for doing so to First Deputy Prime Minister Igor Shuvalov.

As previously reported, the latest moves by Russian ministers to take over collective licensing have come in the wake of the scandal that erupted at the country’s song rights collecting society RAO, where General Director Sergei Fedotov is in prison fighting off allegations of fraud. Although the society’s Author’s Council is backing Fedotov, some RAO members have been attempting to rewrite the organisation’s constitution and put new management in place.

According to Russian business newspaper Vedomosti, it’s the country’s Economic Development Ministry that is most proactively pushing for the government to take over collective licensing, and it has now shared the specifics of how that might be done with Shuvalov, who is leading a review of the country’s collective licensing system.

Although two possible options have been proposed, both seem to cut the existing societies – so the aforementioned RAO, the recording rights focused VOIS and private copy levy collector RSP – out of the equation. The main differences between the two proposals seem to be quite how close to the government a new state-established super collecting society would be, and whether that organisation would distribute monies to writers and rights owners directly or via other organisations.

As also previously reported, most Russian music industry execs – including those who have been critical of the current collecting societies – are against the idea of the government taking over collective licensing, while also questioning whether such a thing is even possible under a World Trade Organisation intellectual property treaty of which Russia is a signatory.

The bosses of the local divisions of Sony, Universal and Warner all joined a stack of other local music industry chiefs in signing a letter to the Russian government urging them to drop their plans to take over collective licensing. But that doesn’t seem to have stopped the Economic Development Ministry from developing its proposals.

Meanwhile last month the RAO published its financials for 2015, and seemed keen to stress the scale of its operation in Russia in terms of members and licensees, as well as its global connections with other collecting societies around the world.

It also bigged up its recent efforts to improve royalty distribution, partly through the introduction of something called the Common Information System which, it says, has been tested and approved by PRS and the global body for song right collecting societies, CISAC.

Basically, the message seemed to be, “we’re already tackling the issues, and look at the scale of our operation, are you really capable of taking that on?”

For now, the Economic Development Ministry seems to think that it is. It remains to be seen how Shuvalov responds to its proposals.