New EU music licensing rules could open up online services

The Commission proposes a multiterritorial licensing law for music on the Internet

The European Commission on Wednesday proposed new rules that would make it easier for online music services like Spotify to set up in the E.U.

The Commission proposals call for more transparency and E.U.-wide standards for music licensing -- specifically improved governance and greater transparency of collecting societies. Collecting societies manage the licensing of copyright-protected music tracks for online use on behalf of artists and collect and redistribute to them corresponding royalties.

There are currently more than 250 collecting societies in the E.U., but many have struggled to adapt to the need for cross-border rights management created by online music services. Wednesday's proposal would establish obligatory minimum standards for collecting societies that want to offer multi-territorial licensing.

Collecting societies would have to demonstrate the technical ability to appropriately and accurately handle data electronically, make quicker payments to members, improve clarity in revenue streams from exploitation of rights, and submit an annual transparency report.

According to the Commission, the proposed directive would make it much easier for providers of online services, such as those that allow music downloads or streaming, or access to films and games where music is an important element, to obtain the rights to use such works. This, in turn, would make it easier for consumers to legally access content.

"Currently that's harder than it should be," said Digital Agenda Commissioner, Neelie Kroes, in her blog. "If you're in Belgium, for example, licensing restrictions often prevent you legally buying MP3 downloads from other E.U. countries -- even though you could buy the physical CD online and have it posted. Those restrictions to buying cross-border are not just a barrier to our single market: they're also frustrating for citizens," she said, reiterating that she was convinced of the need to reform copyright for the digital age.

Follow Jennifer on Twitter at @BrusselsGeek or email tips and comments to jennifer_baker@idg.com.

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Jennifer Baker

IDG News Service

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