How does the current contractual system work?

---

The current contractual system operates at the point of recording or fixation. Actors normally receive a buyout fee, with no share in the revenue from streaming of the film or TV programme. For musicians, there is a different system. When a featured artist makes a recording, the rights are normally contracted in a recording contract. A non-featured musician will normally receive a session fee in return for a buyout of the rights. The record company contract includes a small royalty for streaming (often regarded as secondary income) and session buyout contracts have no remuneration for streaming usage. These contracts normally did not envisage the explosion in streaming, which is now the main way people watch or listen to music and videos.

---

How can we be sure that a CMO will act in the interests of performers?

---

CMOs are owned by their members and regulated by the Directive 2014/26, the Collective Rights Management Directive. This Directive sets out rules for governance, accountability and transparency to ensure that performers receive fair remuneration for their rights.

---

What is the remuneration right in the Copyright Directive?​

---

The latest Copyright Directive (EU) 2019/790 introduced a mandatory provision on fair remuneration for authors and performers. Specifically this provision obliges European Union member states to “ensure that where authors and performers license or transfer their exclusive rights for the exploitation of their works or other subject matter, they are entitled to receive appropriate and proportionate remuneration.” European Union member states now have until 7 June 2021 to introduce such remuneration into the national law.

---

How much do performers receive now from streaming?​

---

About half of all performers receive no revenue from streaming. Performers who are streamed more than 100k times, normally get less than €1k. In a recent survey for #PayPerformers, 45% of actors, musicians and artists receive no remuneration from streaming, even though their work is played on streaming platforms. For performers who have been streamed more than 100,000 times, the revenue is still low. 70% of these performers receive less than €1,000 per year. The streaming platforms and producers receive substantial revenues from streaming subscriptions and ad revenue. For record companies, streaming is now the largest source of revenue.

---

What is a CMO?​

---

A collective management organisation (CMO), sometimes also called collecting society, is an organisation mandated by rightholders (in our case performers) to agree licences with users on their behalf and collect and distribute relevant royalties.

The legal definition is:

Any organisation which is authorised by law or by way of assignment, licence or any other contractual arrangement to manage copyright or rights related to copyright on behalf of more than one rightholder, for the collective benefit of those rightholders, as its sole or main purpose, and which fulfils one or both of the following criteria:

(i) it is owned or controlled by its members

(ii) it is organised on a not-for-profit basis (CRM Directive)

---

Why are CMOs best placed to administer the remuneration right?​

---

CMOs have the critical mass of rights to provide a one-stop shop for commercial users to pay for the use of the work. They are also able to administer huge amounts of works which a single performer would not be able to do. Performer CMOs have shared databases of 700,000 performers, several million recordings and annually process up to a trillion lines of data. They are best placed within the music value chain to administer high volume rights such as remuneration.

They often also fulfil cultural and societal objectives eg by supporting performers and composers in a hardship.

---