Publishers’ association of south africa

THE ROLE OF COLLECTING SOCIETIES

THE OBJECTIVE OF THE COLLECTING SOCIETY for the collective administration of rights is to provide a vehicle though which rights users can more easily clear permissions and rights holders more effectively get their remuneration. It is not always practicable for rights users to clear permissions one by one, and collecting societies for literary works, correctly named Reproduction Rights Organisations, or RROs, provide users with an acceptable means of copying extracts from copyright-protected published works for internal use when the whole work is not required, and provide rights owners with monetary compensation when extracts from their works are used. They are thus key players.
Whereas certain categories of rights can conceivably be administered by rights owners themselves, others are ideally suited to collective administration, in other words, to rights owners exercising their rights in concert through a collecting society. This normally happens where there is a need for instant legal access to high volumes of copyright protected material, such as the public performance of music or reproduction from literary works in educational institutions, government departments, administrative offices and corporations. In the same way as it would be impracticable for a user to apply to the relevant rights owner every time a piece of music is performed, so it is very cumbersome for an academic institution to seek permission from thousands of different rights owners to reproduce extracts from books and articles from journals as additional reading material for students.
Licensing can be transactional, requiring a separate transaction for each clearance, or through a blanket licence, which allows upfront comprehensive clearance for copying, within certain specified limitations, with reporting carried out retrospectively.
The way a blanket licence works is that the RRO obtains a mandate from rights owners to administer certain rights, such as reprographic reproduction, and it then negotiates licences with the organisations or institutions wishing to copy, providing them with a service in which they can copy freely within agreed limitations (for example, the percentage of a work allowed to be copied). In return for an annual fee, which is calculated on the basis of an estimate of the annual volume of copying in the institution, the rights user can then copy without having to get permission for every transaction. Blanket licence permission fees tend to be lower than transactional fees, providing an advantage to the institution. For the rights owner, the advantage is that once a licence is negotiated with an institution, all copying is covered and there is a revenue stream for much copying that otherwise might slip through the net.
Licensing can also be voluntary, or statutory. In a voluntary licence, rights owners join the system on a voluntary basis and some can choose to be excluded. In this case, users of the licence cannot copy excluded works. Price setting is through voluntary negotiation. While this system offers the maximum freedom to participants, it has its disadvantages, in that exclusions can pose administrative problems for users.
At the other end of the spectrum, statutory licensing requires the participation of rights owners and users in particular categories and the government regulates pricing and the functioning of the RRO. This has the advantage of comprehensiveness and the possibility of pricing structures that meet national needs.
In between – as is the case with Canada – are licensing systems that are voluntary, but which have a degree of government regulation and which include provisions to ensure that rights owners are encouraged to join the scheme and rights users to make use of it. It is this option that appears to appeal most to the South African government and the South African publishing industry. It has the advantage of voluntariness, without coercion, but with the potential for comprehensive coverage and pricing structures that are acceptable for users.
RROs such as the Norwegian Kopinor argue that illegal copying cannot be prevented and therefore should be controlled. Licensing generates awareness of copyright, provides an easy-to-administer service for the user at a reasonable cost and generates income for the rights owner. In a number of countries a proportion of the revenue generated is used for the promotion of copyright awareness and for creative development.
The RRO therefore offers an advantage to rights users, making permissions easier and their administration less burdensome. To rights holders the advantages are obviously payment for the use of their work, as granted by copyright law and a revenue stream to help the growth of creative industries.
The negotiation of collective licensing agreements does not tend to be an easy process and has, in most countries, led to heated debate between rights owners and rights users. Nevertheless, once mutual understanding has been reached, in many countries the existence of RROs has proved an invaluable tool in reaching the required balance between the protection of rights and access to information and knowledge. In countries like Australia, Canada and the UK, the trend is to use the negotiation of collective rights agreements as a balancing mechanism, rather than attempting to enshrine in legislation detailed limits for copying for educational and library use.
Groups of rights users commonly making use of collective licences internationally include schools and other public educational institutions (which would involve negotiations with government education departments), universities; government departments; and businesses.
Ownership and Regulation of RROs
Internationally, RROs tend to be not-for-profit organisations, owned by rights owners, for example authors, journalists, illustrators and photographers, book, newspaper and magazine publishers, composers and music publishers. This provides a broad rights owner front for the negotiation of comprehensive coverage and collection, ensures transparency and is a way of providing for the equitable distribution of royalties. It also helps ensure credibility for the RRO in its negotiations with universities, government departments and other rights users, because the RRO, acting as an intermediary, speaks clearly for the rights owners who own and manage it.
In some countries, government plays a monitoring role concerning the structure of the RRO and the licensing tariffs.
Different Models of Collecting Societies
There are currently 33 dedicated RROs worldwide. In order to exchange mandates and to collect royalties locally but disburse them internationally, RROs enter into bilateral agreements with each other, based on the principle of national treatment as found in the Berne Convention; each RRO, operating within its own legal environment, collects and distributes photocopy royalties on behalf of foreign rights owners in basically the same way that it does on behalf of its domestic rights owners. The RROs are further linked through membership of their umbrella organisation, the International Federation of Reproduction Rights Organisations (IFRRO). RROs do not own the rights they administer, but function under non-exclusive mandates from authors and publishers.
There are various models of rights licensing throughout the world, depending on the legislative framework within which they operate:

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