[Federal Register: January 6, 2004 (Volume 69, Number 3)]
LIBRARY OF CONGRESS
[Docket No. 2004-1 CARP DTRA4]
Digital Performance Right in Sound Recordings and Ephemeral Recordings
AGENCY: Copyright Office, Library of Congress.
ACTION: Initiation of voluntary negotiation period.
The Copyright Office is announcing the initiation of the
voluntary negotiation period for determining reasonable rates and terms
for two compulsory licenses, which in one case, allows public
performances of sound recordings by means of eligible nonsubscription
transmissions, and in the second instance, allows the making of an
ephemeral phonorecord of a sound recording in furtherance of making a
permitted public performance of the sound recording for the period
beginning January 1, 2005 and ending on December 31, 2006.
EFFECTIVE DATE: The voluntary negotiation period begins on January 6, 2004.
Copies of voluntary license agreements and petitions, if
sent by mail, should be addressed to: Copyright Arbitration Royalty
Panel (CARP), P.O. Box 70977, Southwest Station, Washington, DC 20024.
If hand delivered by a commercial, non-government courier or messenger,
they must be delivered to: The Congressional Courier Acceptance Site,
located at 2nd and D Streets, NE., between 8:30 a.m. and 4 p.m. If hand
delivered by a party, copies of voluntary license agreements and
petitions should be brought to: Office of the Copyright General
Counsel, James Madison Memorial Building, Room 403, First and
Independence Avenue, SE., Washington, DC.
Tanya M. Sandros, Senior Attorney, Telephone: (202) 707-8380. Telefax: (202) 252-3423.
FOR FURTHER INFORMATION CONTACT:
In 1995, Congress enacted the Digital
Performance Right in Sound Recordings Act of 1995 (``DPRA''), Public
Law 104-39, which created an exclusive right for copyright owners of
sound recordings, subject to certain limitations, to perform publicly
the sound recordings by means of certain digital audio transmissions.
Among the limitations on the performance right was the creation of a
new compulsory license for nonexempt, noninteractive, digital
subscription transmissions. 17 U.S.C. 114(f).
The scope of this license was expanded in 1998 upon passage of the
Digital Millennium Copyright Act of 1998 (``DMCA'' or ``Act''), Public
Law 105-304, in order to allow for the public performance of a sound
recording when made in accordance with the terms and rates of the
statutory license, 17 U.S.C. 114(a), by a preexisting satellite digital
audio radio service or as part of an eligible nonsubscription
An ``eligible nonsubscription transmission'' is a noninteractive,
digital audio transmission which, as the name implies, does not require
a subscription for receiving the transmission. The transmission must
also be made as part of a service that provides audio programming
consisting in whole or in part of performances of sound recordings the
purpose of which is to provide audio or entertainment programming, but
not to sell, advertise, or promote particular goods or services. A
``preexisting satellite digital audio radio service'' is a subscription
digital audio radio service that received a satellite digital audio
radio service license issued by the Federal Communications Commission
on or before July 31, 1998. See 17 U.S.C. 114(j)(6) and (10).
In addition to expanding the current Sec. 114 license, the DMCA
also created a new statutory license for the making of an ``ephemeral
recording'' of a sound recording by certain transmitting organizations.
17 U.S.C. 112(e). The new statutory license allows entities that
transmit performances of sound recordings to business establishments,
pursuant to the limitations set forth in Sec. 114(d)(1)(C)(iv), to
make an ephemeral recording of a sound recording for purposes of a
later transmission. The new license also provides a means by which a
transmitting entity with a statutory license under Sec. 114(f) can
make more than the one phonorecord permitted by the exemption specified
in Sec. 112(a). 17 U.S.C. 112(e).
Determination of Reasonable Terms and Rates
The statutory scheme for establishing reasonable terms and rates is
the same for both licenses. Terms and rates may
be determined by voluntary agreement among the affected parties, or if
necessary, through compulsory arbitration conducted pursuant to Chapter
8 of the Copyright Act. Rates and terms are set for a two-year period
through this process, unless a different period is otherwise agreed
upon by the parties as part of a negotiated agreement.
Parties may submit such an agreement to the Copyright Office and
request that the Office publish the proposed rates and terms in the
Federal Register for comment from the public. If no party with a
substantial interest and an intent to participate in an arbitration
proceeding files a comment opposing the negotiated rates and terms, the
Librarian may adopt the proposed terms and rates without convening a
copyright arbitration royalty panel. 37 CFR 251.63(b). On the other
hand, if the affected parties are unable to reach an industry-wide
agreement, or only certain parties negotiate private license
agreements, then rates and terms for the statutory licenses are
established through the arbitration process.
The arbitration process begins when an interested party files a
petition with the Librarian of Congress during the 60-day period
specified by the statute and requests that the rates be set through the
CARP process. The petition must be filed by a party with a significant
interest in the outcome of the proceeding and it must identify ``the
extent to which the petitioner's interest is shared by other owners or
users.'' 17 CFR 251.62(a). For both the section 112 and section 114
licenses, the period for filing a petition to set rates and terms for
the 2005 and 2006 license period shall begin on July 1, 2004. 17 U.S.C.
112(e)(6) and 114(f)(2)(C)(ii)(II).
Initiation of Voluntary Negotiations
Unless the schedule for setting terms and rates has been readjusted
by the parties in a previous rate adjustment proceeding, Sec. Sec.
112(e)(6) and 114(f)(2)(C)(i)(II) of the Copyright Act require the
publication of a notice in January 2000, and at 2-year intervals
thereafter, initiating the voluntary negotiation periods for
determining reasonable rates and terms for the statutory licenses
permitting the public performance of a sound recording by means of
certain digital transmissions and the making of an ephemeral recording
in accordance with Sec. 112(e). See 65 FR 2194 (January 13, 2000) and
67 FR 4472 (January 30, 2002). The publication of today's notice
fulfills this requirement.
The negotiation period shall begin on January 6, 2004 and end on
June 30, 2004. Parties who negotiate a voluntary license agreement
during this period are encouraged to submit two copies of the agreement
to the Copyright Office at the appropriate address listed above within
30 days of its execution.
In the absence of a license agreement negotiated under 17 U.S.C.
112(e)(4) or 114(f)(2)(A), those copyright owners of sound recordings
and entities availing themselves of the statutory licenses are subject
to arbitration upon the filing of a petition by a party with a
significant interest in establishing reasonable terms and rates for the
statutory licenses. Petitions must be filed in accordance with 17
U.S.C. 112(e)(7), 114(f)(2)(C)(ii)(II), and 803(a)(1) and may be filed
any time during the sixty-day period beginning on July 1, 2004. See
also, 37 CFR 251.61. Parties should submit petitions to the Copyright
Office at the appropriate address given in this notice. The petitioner
must deliver an original and five copies to the Office.
Dated: December 30, 2003.
Marilyn J. Kretsinger,
Associate General Counsel.