ACCC re-authorises collective administration of music performing rights by APRA

9 March 2006

Arrangements under which the Australasian Performing Right Association administers and licences performing rights in musical works in Australia have been re-authorised by the Australian Competition and Consumer Commission, ACCC Chairman, Mr Graeme Samuel, said today.

"Under these arrangements APRA controls performing rights in virtually the world-wide repertoire of musical works within Australia", he said. "Anyone wanting to publicly perform or broadcast a musical work needs a performing rights licence to do so".

APRA's arrangements were first authorised by the Australian Competition Tribunal in July 2000. APRA has sought re-authorisation on the same terms as authorised by the tribunal.

In its draft decision the ACCC expressed concerns that by generally taking exclusive assignment of its members' rights APRA's arrangements effectively foreclose any realistic prospect of music composers and users dealing directly in most instances.

The ACCC also expressed concerns that APRA's propensity to only offer users licences covering its entire repertoire - irrespective of the needs of the users - eliminates incentives for music composers and users to negotiate performing rights licences other than through it.

"In response, APRA modified the arrangements by which it takes assignment of its members rights to make it easier for composers to negotiate rights in respect of their works directly. APRA has also indicated it is prepared to develop alternative licensing arrangements to allow direct dealing between music composers and users where the music user express such an interest.

"While the ACCC is encouraged by APRA's response, the utility of these amendments to facilitate direct dealing between music users and rights holders will still be very limited in most cases.

"However, the most likely alternative to APRA collectively administering virtually all performing rights in Australia is a number of competing collection societies each administering performing rights in respect of part of the repertoire. If this happened, it is not clear that there would be much competition between these societies, particularly in licensing rights to users who required access to the repertoires of a number of, or most, societies".

More generally, the cost of the restrictions resulting from APRA's arrangements must be weighed against the significant public benefits generated by APRA's collective administration of performing rights.

"It is far more efficient for APRA to administer performing rights than it would be for a number of competing societies to do so", Mr Samuel said. "The costs to composers in administering performing rights and monitoring use of works are reduced. Similarly, users' costs are reduced as they enjoy unfetted access to virtually any work in the world musical repertoire through a single performing rights licence.

"APRA's arrangements also save on the negotiation costs that composers and users would otherwise incur in having to deal with each other either directly or through a number of collection societies.

"Similarly APRA's arrangements contain enforcement costs and protect incentives for the creation of new works more effectively than would otherwise be the case".

On balance, given the significant public benefits generated by APRA's arrangements and the ability of the Australian Copyright Tribunal - which can determine the 'reasonableness' of licence terms and conditions- to constrain APRA's exercise of its monopoly power in some instances, the ACCC considers that APRA's arrangements remain in the public interest.

"The ACCC has therefore granted re-authorisation to APRA's arrangements for four years".

More information regarding the applications and a copy of the determination are available by following the Authorising anti-competitive conduct and Authorisations links on the ACCC's website.

Release number: 
MR 048/06
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Mr Graeme Samuel - 0408 335 555
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