Neighbourhood Watch Dr Johannes Ulbricht looks at the German ‘neighbouring right of the concert promoter’ – an overlooked risk and a possible source of revenue... It is fair to say that the neighbouring right of the phonogram producer is – and always has been – one of the legal cornerstones of the music industry. Like other neighbouring rights, this exclusive right grant is justified by the producer’s financial investment. Today, concert promoters often invest at least an equivalent financial amount, and acoustic and audiovisual live performance recordings have become an increasingly important source of revenue. In most jurisdictions, a neighbouring right does not protect the concert promoter’s investment and consequently they don’t participate in revenues from live recordings. However, a legal equivalent with almost the same scope of the phonogram producer’s neighbouring right exists in Germany to protect the concert promoter’s financial investment. Concert promoters from all over the world have a right to participate in the revenue made by commercial exploitation of recordings of their concerts in the German market, no matter where in the world the concert took place. This concept of granting the promoter a neighbouring right may encourage creativity and innovation: traditionally, the promoter’s financial motivation is limited – they only make their money by selling tickets. So there is less interest in promoting new talent that may not sell many tickets right now but might become famous in the future. However, as many live venues become increasingly important as hotbeds of innovation, encouraging promoters to invest more in new talent might be beneficial for all players in the music industry. The scope of the neighbouring right of the concert promoter is stipulated in Article 81 of the German Copyright Act (Urheberrechtsgesetz). The law grants the concert promoter a full property right comparable in scope to other neighbouring rights – he may prohibit any copying, public or online distribution of an audiovisual recording of a live concert he has organised. Furthermore, the neighbouring rights granted are even wider in some aspects than others: without the promoter’s consent, the audiovisual recording may not be broadcast or reproduced in public. The neighbouring right of the promoter remains a rather obscure law, but as legal director of the German Live Industry Association (BDV), I’m optimistic that very soon we will succeed in considerably increasing the economic importance of this promoters’ right. The
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minimal practical application of this right in the past means there has been very little relevant jurisdiction and few academic publications. So, many questions remain unclear; particularly, exactly who is the concert promoter, and thus bearer of the neighbouring right. The German counterpart of the British PPL is the GVL (Gesellschaft für Leistungsschutzrechte – Collection Society for Neighbouring Rights). Members are mainly performing artists and record companies, but concert promoters are also accepted as members. However, the scope of rights administered on their behalf is currently very limited. The GVL does not grant licences for copying, public distribution or making a live recording available (these rights have to be obtained directly from the promoter) but only collects and distributes the promoter’s share in the copyright levies collected on copying devices: printers, copying machines and, more importantly, CD Burners, computers, mobile phones and MP3 players etc. As most promoters have been unable to negotiate substantial licencing fees in the past, the promoter’s share on the total levies collected has been quite small. However, in the future, GVL plans to track individual rights uses, monitoring internet downloads; radio and television broadcasting; and more. So, it may be possible that the GVL will soon be able to capture individual uses of the promoters’ right. The GVL accepts international concert promoters as members. Membership costs are deducted from collected revenue; so, there is no financial risk in joining for a concert promoter otherwise not making use of his neighbouring right. Generally, joining such a society makes sense where individual usage monitoring would be impossible or too expensive. As those administrated by the GVL are limited to participation in copyright levies distribution, membership does not limit the promoter’s freedom to license his right individually. Obscure as it may seem, the German neighbouring right of the concert promoter may become of huge practical importance, and it is likely to increase in the near future as our association is currently entering into negotiations to ensure the promoter receives his legal entitlement. Dr Johannes Ulbricht is attorney at law and partner, Michow & Partner Lawyers, Hamburg.
IQ Magazine issue 33.