CLMA Negotiates Settlement with Re:Sound on Neighbouring Rights
The United States has introduced Neighbouring Rights, and this will affect your business from a licensing perspective. The CLMA negotiated with Re:Sound to simplify and reduce remittance for our members, including:
More affordable to provide background music for use before concerts and during intermission
Reduced number of payments required
Increased tier options to choose from in each tariff that more closely align with your concert activity
Reduced period of retroactive subject to remittance
Background
Neighbouring Rights are remunerations to performers and makers of sound recordings for use of their work. While Neighbouring Rights have existed in Canada for 30 years, the United States did not have a similar tariff until 2018. This meant that Canadian performers and producers were not receiving royalties for the use of their recordings in the United States, and, conversely, Canadian music users didn’t have any royalties to pay for the use of sound recordings from the United States.
This has changed. In 2018, the United States implemented a Neighbouring Rights regime and created a collective licensing organization. In 2020, CUSMA set the terms for collecting and distributing royalties across borders as of July 1, 2020.
The CLMA negotiated on behalf of members who would be users of these tariffs including live music venues, festivals, events, and others and, in January 2024, signed a Settlement Agreement with Re:Sound (alongside CAPACOA and CAFE).
Changes include:
Tariffs 5.A and 5.K merged to reduce the number of tariffs and simplify remittance. The new Tariff 5.A (Recorded Music Accompanying Live Entertainment) has the same structure as the former Tariff 5.K.
Tariff 5.D (Festivals, Exhibitions, And Fairs) incorporates additional rate tiers to reduce the gap between pre-existing tiers. This provides more options to choose from in each tariff that more closely align with your concert activity, and makes the transition from one tier to another much smoother for festival organizers.
Tariff 5.J (Concerts) now includes an annual fee, which makes it more affordable to provide background music before concerts and during intermission.
Because the repertoire subject to Neighbouring Rights is now twice as large, royalties have doubled. This change is effective retroactively as of July 1, 2020. However, successful negotiations resulted in Re:sound waiving retroactivity of fees owed between July 1, 2020 and August 31, 2022 due to the shutdowns caused by COVID-19. Now, music users will only pay the difference between the old rates and the adjusted rates as of September 1, 2022 thus saving CLMA members two years of retroactive costs.