[Federal Register: November 20, 2002 (Volume 67, Number 224)]
[Page 70093-70094]


Copyright Office

[Docket No. 2002-1 CARP DTRA3]

Digital Performance Right in Sound Recordings and Ephemeral 

AGENCY: Copyright Office, Library of Congress.

ACTION: Request for notices of intent to participate and written 
comments on scheduling.


SUMMARY: The Copyright Office of the Library of Congress is requesting 
written comments and proposals for the scheduling of Copyright 
Arbitration Royalty Panel (CARP) proceedings to adjust royalty rates 
and terms under provisions of the Copyright Act governing ephemeral 
recordings and digital transmissions of performances of sound 
recordings, as well as notices of intent to participate in the CARP to 
set rates and terms under the statutory license for eligible 
nonsubscription services to make certain digital audio transmissions of 
sound recordings for the 2003-2004 period.

DATES: Notices of intent to participate are due on or before December 
23, 2002. Comments and proposals for the scheduling of the CARP 
proceedings are due on or before December 2, 2002.

ADDRESSES: An original and five copies of notices of intent to 
participate, and written comments and proposals on scheduling, 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, they should be brought to: Office of the General 
Counsel, James Madison Memorial Building, Room LM-403, First and 
Independence Avenue, SE., Washington, DC 20559-6000.

FOR FURTHER INFORMATION CONTACT: David O. Carson, General Counsel, or 
William Roberts, Senior Attorney, Copyright Arbitration Royalty Panel 
(CARP), PO Box 70977, Southwest Station, Washington, DC 20024. 
Telephone: (202) 707-8380; Telefax: (202) 252-3423.

SUPPLEMENTARY INFORMATION: Section 112 and section 114 of the Copyright 
Act create statutory licenses for eligible nonsubscription services to 
make certain digital audio transmissions of sound recordings. The 
Library of Congress recently conducted a CARP proceeding which produced 
the royalty rates and terms for these licenses applicable to eligible 
nonsubscription services for the period from October 28, 1998, to 
December 31, 2002. See 67 FR 45239 (July 8, 2002). On January 30, 2002, 
the Library published a notice initiating a six-month voluntary 
negotiation period to adjust the rates and terms for the 2003-2004 
period. 67 FR 4472 (January 30, 2002). No settlements were reached and 
the Library received a petition to initiate a CARP proceeding. 
Consequently, the Library is directing interested parties that wish to 
participate in the CARP proceeding to submit their notices of intent to 
participate on or before December 23, 2002. Parties should be mindful 
of this deadline as failure to submit a timely notice may preclude 
their participation in the proceeding.
    The Library must also schedule this CARP proceeding. However, 
before a schedule can be determined, other proceedings under the 
section 112 and 114 licenses must be considered. Currently, there are 
three CARP proceedings for sections 112 and 114 that the Library must 
schedule in the upcoming months: (1) A proceeding to adjust the terms 
and rates for preexisting subscription services and to establish rates 
and terms for preexisting satellite digital audio services; (2) a 
proceeding to establish rates and terms for new subscription services; 
and (3) a proceeding to adjust rates and terms for nonsubscription 
services. Adding to the complications associated with scheduling three 
proceedings under the

[[Page 70094]]

same two statutory licenses \1\ is the fact that several of the parties 
affected by the outcomes will appear in all three proceedings. This can 
result in these parties, and their counsel, litigating more than one 
proceeding at a time. In the past, the Library has attempted to avoid 
such a scenario by scheduling proceedings sufficiently far apart. 
However, if the Library were to continue this practice, CARP 
proceedings would not be concluded until on or after the period in 
which the rates and terms established in that proceeding have expired. 
For example, the Library must schedule a proceeding for nonsubscription 
services for the 2003-2004 period. The parties in the preexisting 
subscription service/preexisting satellite digital audio service 
proceeding have petitioned the Library to postpone the start of that 
proceeding until March 20, 2003. If the Library grants their motion, 
the Librarian's decision setting forth rates and terms for preexisting 
subscription services and preexisting satellite digital audio services 
will not be issued until the end of 2003. Based on past practice, the 
Library would then have to wait several months after that to permit 
parties participating in both proceedings to prepare their cases for 
the nonsubscription service proceeding. The end result would be that a 
final determination in the nonsubscription service proceeding would not 
be made until the end of 2004 or the beginning of 2005. And this does 
not take into account the scheduling of the proceeding for new 
subscription services.

    \1\ This does not consider the CARP proceedings for other 
statutory licenses in the Copyright Act that must also be scheduled 
during the same time period.

    It is the position of the Library that CARP proceedings to 
establish or adjust royalty rates for statutory licenses should be, to 
the extent possible, scheduled so that final rates and terms are 
announced by the beginning of the time period to which they are 
applicable. Users of a statutory license should not be forced to use 
the license without knowing what the royalty obligations will be for 
the period prescribed by the license. This goal cannot be met if the 
section 112 and 114 CARPs are scheduled to run seriatim; serious 
consideration must be given to running multiple CARPs concurrently. To 
that end, the Library is requesting the parties in this proceeding to 
propose, in written comments on or before December 2, 2002, solutions 
to the problems identified above in scheduling three CARP proceedings 
for the section 112 and 114 statutory licenses.

    Dated: November 15, 2002.
David O. Carson,
General Counsel.
[FR Doc. 02-29511 Filed 11-19-02; 8:45 am]