Touring Business Handbook 2024 Preview

THE TOURING BUSINESS HANDBOOK 2024

IN ASSOCIATION WITH THE TOURING BUSINESS HANDBOOK 1

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Centtrip Limited is a company registered in the UK with company number 08651138. Centtrip Limited is authorised and regulated by the Financial Conduct Authority as an Electronic Money Institution under registration number FRN 900717. Registered office: 1 Mark Square, London, EC2A 4EG. The Centtrip Prepaid Mastercard is issued by PFS Card Services (Ireland) Limited pursuant to a license by Mastercard.. PFS Card Services (Ireland) Limited, trading as (PCSIL) is regulated by the Central Bank of Ireland. PFS Card Services (Ireland) Limited, trading as PCSIL, is authorised and regulated as an issuer of electronic money by the Central Bank of Ireland under registration number C175999.

Registered office: EML Payments, 2nd Floor La Vallee House, Upper Dargle Road, Bray, Co. Wicklow.

CONTENTS TOURING BUSINESS HANDBOOK 2024 FIRST EDITION EDITORS Francine Gorman & Eamonn Forde SUB EDITOR Michael Muldoon DESIGNER Philip Millard MARKETING & ADVERTISING Tom Brint

INTRODUCTION

5

LIVE MUSIC INSURANCE

6

Five tips to get the right policy for your artist Cancellation insurance Insuring shows in the US Key insurance stories in live music

TOUR ACCOUNTANCY

16

The case for touring an accountant Tour finance: ten top planning tips Withholding tax: mitigation & utilisation

ARTIST TAXATION

16 18 20

24

Artist taxation, social security & VAT European tax rates Withholding tax: what is it & why should it be taken seriously?

LEGAL

24 29 30

34

European concert & festival contracts Safeguarding cancellation risk in performance contracts Navigating supplier contracts Key recent legal developments in live music

34 37 38 40

VISAS & IMMIGRATION

42

European touring in 2024 Touring in the UK Touring in the US

42 44 46

PERFORMANCE ROYALTIES

48

An update from PRS for Music Direct licensing

48 50

CURRENCY EXCHANGE

IQ MAGAZINE Unit 31 Tileyard Road London, N7 9AH info@iq-mag.net www.iq-mag.net Tel: +44 (0)20 3743 0300 Twitter: @iq_mag

6 7 10 14

52

Currency considerations Five top Centtrip-tips The business manager’s view

52 53 54

CONTRIBUTOR CONTACTS

57

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YOU PROVIDE THE SHOW WE PROVIDE THE COVER SPECIALISTS IN MUSIC & EVENT INSURANCE Our experience in the world of live entertainment means we truly understand the nature of risk. We have become market leaders as insurance providers to various facets of the Music & Event industries.

Contact a member of our Music & Events team: Tim Thornhill | 07717 424471 | tim.thornhill@tysers.com Fiona Flynn | 07867 977975 | fiona.flynn@tysers.com Visit our website: www.tysers.com/tyserslive

 Artists  Bands  Festivals  Tours  Production  Promoters

60 YEARS

OF EXPERIENCE Our Music & Event industry roots date back to 1964

Tysers Retail Limited is an Appointed Representative of Tysers Insurance Brokers Limited, a private limited company registered in England under 02957627. Registered office: 71 Fenchurch Street, London, United Kingdom, EC3M 4BS. It is authorised and regulated by the Financial Conduct Authority to conduct general insurance activities, Firm Reference Number: 305496. This can be verified on the FCA’s website. R.279.1.24.V1.0

WELCOME

TO THE TOURING BUSINESS HANDBOOK IN ASSOCIATION WITH

Welcome to the first edition of the Touring Business Handbook. The following pages contain a wealth of advice and information from specialists in insurance, law, visas & immigration, accountancy & tax, performance royalties and currency exchange.

With thousands of tours heading out each year, IQ wanted to produce a single publication, updated every year, containing as much practical information as possible to help artists and their teams as they plan to cross borders.

When we started planning this first edition of the Touring Business Handbook, it was hugely encouraging that so many of the professionals we approached said the same thing – that this was something sorely missing from the desks of those planning, budgeting, and building tours.

So in this first edition, we’ve invited contributions from many of the world’s top experts, who have kindly taken time to put pen to paper. And we must say a huge thank you to all of them for giving both their time and knowledge in the process.

We’ll be refining the handbook in future editions, and please do get in touch with the IQ team with any ideas for topics, data, tips or information that you’d like to see in it.

Francine Gorman & Eamonn Forde Editors, Touring Business Handbook

Thousands of professionals read IQ every day. Make sure you get the whole picture…

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LIVE MUSIC INSURANCE

FIVE TIPS TO GET THE RIGHT POLICY FOR YOUR ARTIST Tour insurance is critical for everyone in the live business, but there are a multitude of variables that need to be considered when taking out a policy. Tim Thornhill, managing director at Tysers Live, offers five essential tips for getting the right policy and ensuring that you are covered no matter what happens on the road.

WHY DO YOU NEED INSURANCE?

Simply put, without cancellation and non-appearance insurance in place, any tour is at serious risk if the unforeseeable happens.

In addition, if anything does go wrong on tour, it can result in major disruptions and unforeseen costs. Having the right insurance policy in place can help to get you back on track. Without certain essential covers, such as non-appearance and public liability, venues may refuse to book performers, while certain policies (such as employers’ liability) are a legal requirement. Therefore, it is crucial that you have the right cover in place before starting your tour.

In essence, insurance can be invaluable when things do not go to plan, providing financial protection and support in getting your tour back on the road.

Stay protected with our five top tips: Weather the odds. Unforeseen events such as extreme weather and natural disasters can disrupt your schedule and lead to cancelled performances. An event cancellation policy can offer financial protection and cover loss of touring revenue if performances

1

6 THE TOURING BUSINESS HANDBOOK

cannot take place. Many circumstances can be covered, including accident, illness, or death of key persons; adverse weather; venue damage, unavoidable travel delays; and national mourning.

2

Cover your crew. Even freelancers working as part of your touring crew will need cover for accidents, illness, and other liabilities. Employers’ liability (EL) insurance is required by UK law if one or more persons works for you, including workers who are part-time, temporary, or freelance. EL insurance covers the costs of compensation if someone you employ is injured or becomes ill at work due to the work that is being carried out – and can also pay towards legal fees.

3

Protect your instruments and equipment. Without your essential equipment, the show cannot go on.

Make sure your equipment is always stored securely (never overnight in vehicles) and have an instrument and equipment policy in place. Many instrument policies offer “new-for-old” replacement of equipment (dependent on age and condition), allowing performers to source replacements quickly and continue touring with minimal disruption. Enhanced cover for instruments that are vintage or unique collectibles can also be arranged.

4

Travel smart. Follow safety guidelines and advice given while travelling overseas, including local weather warnings; and make sure you have travel insurance in place and that it includes medical cover and repatriation. If you are touring in North America or an area where the cost of medical care is high, you should carefully consider how much cover you might need if you become ill or have a serious accident that requires an extended hospital stay. If you are unsure about the right amount of cover, guidance from an experienced insurance broker can be invaluable and will provide peace of mind through the knowledge that you have the right protection in place.

5

Go global (with your cover). If you are traveling in the EU/EEA area or internationally, your policy must cover these areas. Ensure that you check your policy before travelling because many travel policies have exclusions for certain territories that are considered high risk due to war, terrorism, natural disasters, and other perils. It is also important to check that all of your policies are valid in the countries you are visiting on tour, including equipment insurance and public liability insurance.

Public liability insurance is essential for all touring musicians and performers, crew, and freelancers.

Wherever people gather to enjoy live music, there are always potential risks to safety and property. If an accident occurs during a performance that injures a member of the public, you may be held liable.

Public liability insurance pays the cost of compensation and legal fees if a third party claims for injury or property damage. Even if you already have a policy in place, it is important to check that your policy covers all territories where performances are scheduled.

For example, if you are touring in North America, you will need liability insurance that specifically covers North America, as claims awarded and legal fees are typically higher than in other parts of the world.

ABOUT TYSERS LIVE

Tysers Live is a market-leading insurance broker for the live entertainment and events industry. We arrange cover for some of the biggest worldwide events in the calendar and insure some of the most prestigious international artists.

Tysers Live has a wealth of experience in the world of live entertainment and events, which means we truly understand the nature of the risks you face. Our team

CANCELLATION INSURANCE NAVIGATING COMPLEX POLICIES

Insurance is often viewed as a “compulsory nuisance,” a monetary drain when there are no claims, yet it can be an absolute lifesaver for when an issue arises. Martin Goebbels of Miller’s music & touring team explains what cancellation insurance is, some of the key areas it covers, and why it is growing in importance.

The substantial shift in extreme weather patterns globally in recent times in regions previously unaffected – such as escalating temperatures, heatwaves, heavy snowfall, storms, and hurricanes – coupled with wildfires and persistent threats or incidents of terrorist attacks and local disturbances, any of which can affect travel plans, as well as actual live events, have led

ABOUT THE AUTHOR Tim Thornhill has over 20 years’ experience across both the live events and insurance sectors.

He joined Tysers in January 2018, having worked as commercial director at The Ardonagh Group’s Towergate. Prior to that, he worked as managing director to a tour operator and event management company. He is now managing director for Tysers Live leading strategy and development.

Tim was instrumental in lobbying the UK government to get the events industry back on its feet during Covid, and he works across all sectors of the live events and entertainment industries. He has a global focus, working primarily with clients in the UK, Europe, and the Middle East.

of experienced brokers can advise on the best cover for your needs to ensure you have the right protection in place and provide unique and innovative solutions.

Our clients range from newly formed bands to established global artists, festivals, venues, infrastructure companies, and event organisers and promoters. We cover a range of events, from national tours and local festivals to worldwide tours and international performances.

To discuss your insurance requirements, please get in touch with one of our specialist insurance providers: musicandevents@tysers.com +44 (0)20 3037 8000 www.tysers.com/tyserslive

numerous event planners and touring artists to consider cancellation insurance more than ever before.

While cancellation insurance is not legally required – though occasionally it might be contractually required – many anticipate insurers to provide comprehensive coverage at minimal expense. However, the main factors that might prompt you to consider such insurance policies are the same reasons that cause insurers to tread carefully.

Experienced brokers, and the insurers they use, will use various statistics to negotiate the best possible terms for you. It is their expertise and understanding of these elements that can assist in securing the most suitable and cost-effective coverage for your needs.

Engaging an insurance broker who fully grasps your business is key in fostering a trust-filled professional Thousands of relationship. It is important to remember that a broker professionals represents you and not the insurer and should ideally read IQ every day. Make be regarded as part of your team, much like lawyers or accountants. You should be comfortablesure discussing you get the

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TOUR ACCOUNTANCY

THE CASE FOR TOURING AN ACCOUNTANT A lot of tour accounting can be done remotely. While the act is playing around the world, the accountant can be running the numbers in their own office. But having an accountant on the road during the tour can pay for itself several times over. Adrian Bullock of Bullocks Touring explains what the tour accountant does, what types of unanticipated issues can reveal themselves while working through a tour schedule, and how the tour accountant can keep the show on the road.

As touring productions become more complex and as performer and crews increase in size, it is ever more important to have someone on the road whose sole focus is to manage the financial aspects of the tour, working with the statutory accountants, business managers, lawyers, and artist management alike.

Although the primary role is to negotiate (aka haggle) the show settlement with the promoter, we get involved at the planning stage of the tour to work on the budgets and contractual provisions, using our experience and

8 THE TOURING BUSINESS HANDBOOK

local knowledge to add value to the deal structure.

The tour accountant will also be closely involved in budgeting the tour. We have built up strong relationships with many tour production suppliers across all the main elements – sound, lights, video, SFX, trucking, bussing, catering – so we have a good idea of the going rate, supply, and demand at any given time.

THE POST-COVID RETURN AND ITS CHALLENGES

Since post-Covid lockdown restrictions were lifted, the live industry exploded back into life again, but a lot of experienced crew either retired or changed careers, and there was massive demand on equipment, which pushed prices up, not to mention rocketing flight costs and a shortage of crew. That has meant the past two years have been very challenging.

With live performance more likely to be an artist’s primary source of income, it was no wonder everyone was keen to get back out to work, and it seems that 2024 is the first post-pandemic year where things look more normal.

BREXIT BARRIERS & THE SCHENGEN SITUATION

Another ongoing issue is, of course, Brexit. We have found a lot of issues arising with Schengen, which means non-EU citizens can only spend 90 days in any 180 days within the Schengen zone.

We worked on a tour last year that spent 104 days in Schengen in a 180-day period, so we coordinated the movements to bring in “deputies” to keep everyone within the 90-day period.

TROUBLESHOOTING: THE CONSTANT CONCERN

Whilst not necessarily a strictly financial role, the tour accountant brings a lot of potential crossover skills, which can provide various forms of troubleshooting assistance. We are yet to work on a tour that has not needed some sort of troubleshooting. And of course, we get deeply involved with withholding tax issues, keeping abreast of the latest local conditions, and indeed how “flexible” they might be if you know the right questions to ask.

CONTRACT COMPLICATIONS

Regarding the performance contracts, are there any other income streams beyond a share of the ticket face value that the artist can share in? Who gets the booking fee? What about bank interest on the ticket revenue generated months before the show? Of course, there is merchandise, but what about food, beverages, and concessions? Is the promoter passing on bulk discounts to your specific artist?

The show, thanks to the artist’s performance, potentially generates a lot of revenue, so we explore these avenues and see if the artist should be receiving a share of it.

SETTLEMENT ISSUES

As for the show settlement, as the artist and the shows gets bigger, so it warrants someone dedicated to negotiating this with the promoter. It can definitely pay to have someone to review the ticketing reports in detail and be able to approve (or not) the show costs, having been there to see for yourself how many riggers there were, what PA system was hired, how many portacabins were built etc. And don’t get us started on towels…

A memorable settlement was for an outdoor show where the infrastructure was built, and all the costs charged against the show. We discovered that this was to remain in place for two further (at that point unannounced) shows, so we were able to encourage the promoter to play nicely and share the costs equally across the shows, thereby saving a considerable amount of money.

Ultimately, having a dedicated tour accountant means keeping the promoter honest, and we pride ourselves on working collaboratively with them, albeit enjoying a robust exchange of views when the need arises. We often find that once the promoter knows there is an onthe-road tour accountant, that in itself is enough to get the most transparent show accounting from the get-go.

TOUR ACCOUNTS AS THE EYES & EARS OF THE ARTISTS

Likewise, the tour accountant keeps an eye on the production accounting, whether it is on-the-road cash floats, credit card receipts, or just being able to verify those curveball expenses that follow the tour around, some extra video here, some more hotel rooms there, and anything in between.

The tour accountant is the artist’s eyes and ears on tour, ensuring that the revenue is maximised through show settlements and similarly controlling production costs. With everyone’s attention naturally on getting the show on the stage at the given hour, the tour accountant can spend more time looking dispassionately at the road costs involved to make sure the artist’s money is being spent wisely, so any signs of profligacy are highlighted and dealt with as required.

Fundamentally, we cross over all business elements of the tour, liaising with artists and business management, lawyers, and accountants and work with insurers, immigration, health and safety, forex, tax agents, promoters… you name it.

The beauty of the role is the flexibility to get more or less involved with any aspect as the tour demands, which comes from the years of experience of life on the road.

PROBLEM SOLVING: TALES FROM THE FRONTLINE OF A TOURING ACCOUNTANT CASH It is harder to get hold of physical cash in large amounts, so we introduced a system to have per diems and expenses paid directly to personnel “currency cards,” preventing a rebellion, reducing admin, and of course taking away the risk associated with carrying large sums of cash around.

TRUCKS Production load out was taking too long because of the complexity of the truck pack, but the budget did not allow for an extra truck. We carried out some analysis, which established that the extra truck would shave an hour off the load-out time, making a saving on local labour costs that would far exceed the cost of adding an extra truck. A shiny new truck arrived the next day to smiles all round.

FALSE ECONOMY On a South American tour, management were looking to trim some costs and found some flights online that were a bit cheaper than those through the travel agent. I insisted that the crew party at least stay with the travel agent, and the band party booked online. When the volcano went off, it was not the crew party that were stranded because they couldn’t change their flights for the next four days.

ABOUT THE AUTHOR Adrian Bullock is the director of Bullocks Touring. The company provides tour direction, tour Thousands of management, and tour accounting professionals read services for many prominent global artists.

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ARTIST TAXATION

residents on a worldwide basis. That means it is not only income earned in the country itself but also foreign income that is taxable in the home country. The end result is that income from foreign performances will be taxed twice: first in the country of performance and then in the country of residence. The result is double taxation.

ARTIST TAXATION, SOCIAL SECURITY & VAT

To eliminate this double taxation, countries started to develop bilateral tax treaties over a century ago. Without this, cross-border work would be very unprofitable. Tax treaties divide the taxing rights across the two relevant countries.

Most countries accept these tax treaties as stronger than national law, which means that they set aside national rules for international agreements. The OECD in Paris coordinates the bilateral tax treaties with a Model Tax Convention (plus Commentary). There are special rules for artists in this Model, in Article 17, which have been taken over in the tax treaties.

Artist performances are rarely restricted to their own country and will often cross borders. Dr Dick Molenaar, partner at All Arts Tax Advisers and member of the Tax Law department at Erasmus University Rotterdam, works through the specifics around taxation, social security, and VAT, explaining the rates, the legislation, and all the other information that is critical for touring artists and their business teams.

INTRODUCTION

Just like everyone else, performing artists have to pay income tax. But in which country? And how do they avoid double taxation? The same applies when companies are involved, which may be taxable as (or exempted from) corporation income tax. There are special tax rules for performing artists and this chapter explains how they work, both in the country of work/performance and in the country of residence. It will show how the (European) social security rules work when performing in other countries. And finally, two VAT aspects will be explained: the VAT rates on ticket sales and the reverse charge system.

NATIONAL ARTIST TAX RULES

Many countries want to tax every income stream that has been earned by non-residents because they are anxious that otherwise it may not be taxed anywhere.

In addition, they will want to use the tax earnings within their national budget.

For performances from visiting artists, most countries have a source withholding tax in their national legislation. The tax rate is most often lower than normal – such as 10% in Luxembourg, 15% in France, 18% in Belgium, 20% in the UK, 25% in Portugal, and 30% in both the US and Italy. At the end of this chapter, there is a table outlining how the artist withholding tax rates apply in EU member states and some other countries.

The reason for rates that are lower than normal is because tax is calculated from the gross performance fee without deductions for expenses. This will be discussed in Deduction of Expenses on page 25.

On the other hand, countries tax the income of their

10 THE TOURING BUSINESS HANDBOOK

BILATERAL TAX TREATIES: ARTICLE 17

The OECD Model has the following relevant articles for the music business: Article 7 Business profits Article 12 Royalties Article 15 Income from employment Article 17 Entertainers and sportspersons Article 23 Elimination of double taxation With Article 7, countries agree how the taxing right for business profits (companies and self-employed) will be divided. The main rule is that these profits are only taxable in the country of residence, which means that the source country cannot raise any tax, unless there is a permanent establishment (PE) in the source country, because then the profits of this PE are also taxable in that other country. A PE normally comes into existence after more than 12 months. An independent agency does not create a PE. With Article 12, a separate rule has been created for royalties and allocates the taxing right solely to the residence country of the beneficial owner of the royalties, although it also allows source countries to tax the royalties at a low percentage, such as 5%, 10%, or 15%. Some countries are using this exception, such as Italy, Japan, and Portugal, as well as some other countries.

With Article 15, income from employment becomes essentially taxable in the country of residence, except when the work is done in the other country. There is a major exception in Article 15(2) for employees working for their employer in the other country because then the taxing right remains in the country of the employer if the work period is less than 183 days.

With Article 17, a special taxing rule has been created for entertainers (and sportspersons), allocating the taxing right to the country of the work, regardless of whether they are self-employed or an employee. This is also the case when the fee is not directly paid to the entertainer or sportsperson but to another person, such as an agent, management, or other company.

With Article 23, double taxes should be eliminated.

The residence country will also tax the foreign income as

part of the worldwide income but has to allow a foreign tax credit (or a foreign income exemption) to prevent the double taxation.

PERFORMANCE COUNTRY: ARTICLE 17 FOR ENTERTAINERS (AND SPORTSPERSONS)

The special Article 17 for performing artists in the OECD Model makes foreign performances complicated. The article has been taken over in almost every bilateral tax treaty and is meant to counteract tax avoidance behaviour by top artists and sportspersons who have moved their residence to tax havens, such as Monaco.

Examples are Andrea Bocelli and Luciano Pavarotti, and sporting personalities Boris Becker, Steffi Graf, Tom Boonen, and Max Verstappen. Monaco does not have an income tax rate, only VAT. It is unclear why a tax treaty provision would be needed to tax these top stars. Monaco does not have tax treaties, so is not affected by an Article 17 in, for example, a tax treaty between Germany and the UK. It would be enough if every country left its national withholding tax in place for artists, sportspersons, and others with Monaco as their country of residence.

In 2014, the OECD also provided other reasons for Article 17, such as the country of residence

having problems with obtaining information about foreign income and that source taxation can easily be administered.

Article 17 is a catch-all provision, because the country of the performance has the taxing right for any income arising from the performance, regardless of who is being paid – the artist themselves or another party.

This can be an agent, management, a theatre or dance company, orchestra, or the personal company of the artist themselves.

DEDUCTION OF EXPENSES

Initially, the deduction of expenses was not recognised in the bilateral tax treaties. Most countries decided to raise a relatively low artist withholding tax rate, which is taken from the gross fee without any deductions. As mentioned in the National Artist Tax Rules on page 24, 10% in Luxembourg, 15% in France, 18% in Belgium, 20% in the UK, 25% in Portugal, and 30% in both the US and Italy. The end of this chapter provides an overview with the artist withholding tax rates applying in the EU member states and some other countries.

Thousands of Expenses can be deducted in advance in the UK, the US, and Australia so that the tax is only professionals raised on the read IQ every day. actual profit. The UK has the Foreign Entertainers Unit Make (FEU), the US has the Central Withholding Agreement sure you get the

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LEGAL

EUROPEAN CONCERT & FESTIVAL CONTRACTS The granular specifics of a concert contract may change depending on the artist, but the fundamentals of contractual agreements remain and provide the building blocks of the live business. Prof Dr Ralf Kitzberger outlines what a concert contract is, who the key parties are, how they must collaborate, and then works through the key components in such contracts, what they cover and what all parties need to be aware of and account for in their contractual dealings.

CONCERT CONTRACT

SUBJECT MATTER OF THE CONTRACT The concert contract regulates the contractual relationship between artist and promoter with regard to the provision of a concert performance and the remuneration to be paid for it.

The artist undertakes to provide a self-determined artistic performance, independent of instructions, over the content and of which the promoter has no influence.

In consideration, the promoter undertakes to pay the artist the agreed remuneration and is obliged to create

12 THE TOURING BUSINESS HANDBOOK

or provide the performance conditions agreed in the contract (Michow in Moser/Scheuermann/Drücke, Handbuch der Musikwirtschaft, and 7th edition 2018, Section 66 Rz. 4).

PROMOTER The promoter is the person who has ordered the artist’s performance. The promoter is responsible for the performance in organisational and financial terms. For example, they make the contracts with the artist, the venue, and the audience. The person who only makes the external arrangements necessary for the performance is not the promoter (BGH GRUR 1956, 515 (516); BGH GRUR 1972, 141 (142); BGH GRUR 1959, 150 (151); Michow in Handbuch der Musikwirtschaft, § 66 Rz. 4) ARTIST The artist is the person who performs the music, sings, plays, or otherwise presents a work or contributes artistically to such a performance (Michow in Handbuch der Musikwirtschaft, § 66 Rz. 6).

WHAT SHOULD BE HANDLED IN THE CONCERT CONTRACT? The concert contract should contain the following points (see also Michow in Handbuch der Musikwirtschaft § 66 Rz. 20, 21): n The exact name/company name including the legal form of the contracting parties and their representatives; is it a limited company, a GmbH etc.? n Who represents whom? Who is to be whose contractual partner? Who is authorised to demand what

from whom? Is the contract partner the agency or the artist? n Is the negotiating partner acting in their own name or are they a representative of the artist? n Is the contractual partner a natural person, a majority of persons, or a legal entity? n The “key data” of the event (performance venue/date/ performance time). n The remuneration (amount, due date, any advance payments). n Does the remuneration creditor receive a fixed remuneration and/or do they receive a share of the event turnover? Is there financial participation after the breakeven for the artist?

concert but also for a series of concerts at various locations (a tour).

SETTLEMENT OF TAX ISSUES: WHICH TAX LAW APPLIES? n Is the artist subject to limited or unlimited tax liability in the state where the performance takes place? n Is the remuneration with or without VAT (reversed charge)? n What about withholding taxes? Should the tax be borne by the promoter, or will it be paid by way of tax deduction from the remuneration? n Is the taxpayer a national of a member state of the European Union or of another state to which the Agreement on the European Economic Area applies, and are they resident or ordinarily resident in the territory of one of these states? If not, net flat-rate taxation is excluded. n Who is liable for the artist’s social security contribution? n Have the parties assumed advertising obligations (organising event advertising, sending press material, posters etc.)? Approval rights for the artist regarding advertising. n Who bears travel, accommodation, and catering costs? n Who bears the technical costs (e.g. of the sound and lighting system and the costs of necessary personnel)? n What are the legal consequences of the cancellation of the event (whether due to fault or not) (e.g. in the event of cancellation by the organiser or illness of the artist)?

If there is no performance, will the event request the return of artist fees? n What is force majeure, and what are the legal consequences of force majeure? n What are the legal consequences in case of inclement weather? What is the definition of inclement weather? n Which insurance is necessary? Who pays the cost of the insurance? n Who pays the fees for music collection societies (for example, in Germany GEMA)? n Can the concert be recorded audio-visually? n Are there any additional contractual agreements (e.g. stage directions) that should become part of the contract? n Are there any verbal side agreements? n Which law applies? Where is the place of jurisdiction? n Severability clause.

SUBJECT MATTER OF THE CONTRACT The agency agreement regulates the contractual relationship between the artist and the agent. The agent regularly receives a revenue share or commission for his agency activities. This is paid to the agent by the respective client – artist or organiser (Michow in Handbuch der Musikwirtschaft, § 66, Rz. 54).

If the agent is granted the right in the agency contract to conclude the contract between the artist and the promoter independently on behalf of the artist, the agent requires not only the authorisation to act in principle but also the authorisation to conclude the contract for the artist with binding effect for the artist. In most cases, the agent makes their position clear by using the words "represented by" or “on behalf of” (Michow in Handbuch der Musikwirtschaft, § 66, Rz. 55).

TOURING CONTRACT

SUBJECT MATTER OF THE CONTRACT The promoter engages the artist not only for a single

LOCAL ORGANISER The promoter can work together with a local organiser.

The task of the local organiser is to organise an event onsite. The legal structuring possibilities of such co-operations are just as varied as the structuring of the distribution of income (For more details, see Michow in Handbuch der Musikwirtschaft, § 66, Rz. 25.) A cooperation agreement with the tour organiser regulates the tasks of the local organiser as well as its economic interest in such a cooperation.

AGENCY AGREEMENT

WHAT SHOULD BE HANDLED IN THE AGENCY AGREEMENT? The agency agreement should contain the following provisions (see also Michow in Handbuch der Musikwirtschaft § 66 Rz. 81): n The exact name/company name including the legal form of the contracting parties and their representatives. n Territory of the agency agreement: worldwide or territorially limited. n Exclusive or non-exclusive; can the artist work together with other agents? n Authorisations of the agent: power of attorney to conclude contracts or only the power to act; clarification that declarations of intent made by the agent to third parties on the basis of the power of attorney granted have direct effect for and against the artist. n Authorisation for the agent to collect money. n Mutual information obligations (e.g. about bookings made, contracts concluded, blocked dates etc.). n Remuneration (revenue share) of the agent; usually between 15-25% of the net revenues. n Basis of assessment for the agent’s remuneration (net revenues or gross revenues?). n Post-contractual commission claims and surplus commission. n Possible mutual right to inspect accounting documents.

Thousands of n Term of the contract, notice periods, renewal options. n Are there any verbal side agreements?professionals read day. Make n Which law applies? Where is the place IQ of every jurisdiction? n Severability clause. sure you get the

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VISAS & IMMIGRATION Touring on an international scale requires thorough preparation to ensure that an artist, band, and crew are able to travel swiftly across borders and to work and generate income in multiple locations, customs areas, and legal settings. Planning, budgeting, and importantly, allowing adequate time to prepare and secure visas and paperwork are key steps in producing a successful tour, and knowledge of the different rules, regulations, and entry requirements of different territories is essential.

We’ve invited experts from the field of visas and immigration to outline the planning considerations and entry requirements for key markets in the global touring industry for 2024 and beyond.

With the UK’s exit from the European Union and the imminent arrival of the long-awaited ETIAS (European Travel Information and Authorisation System), travel to and throughout Europe and the Schengen area is changing. Sebastian Hoffmann and Felix Sodemann from touring artists update us on key developments and best practices for European touring in 2024, guiding us through essential updates regarding movement within Europe.

ETIAS

ETIAS travel authorisation is an entry requirement for visa-exempt nationals travelling to 30 European countries. It is linked to a traveller’s passport. It is valid for up to three years or until the passport expires.

WHO SHOULD APPLY?

Currently, a visa is not required by non-visa nationals for short trips to countries in the Schengen area if the trip is for 90 days or fewer in a 180-day period and if you’re visiting as a tourist or for specific reasons including travelling for business for your UK employer, for example, to attend a business meeting or conference, journalism, or other media activities.

TRAVEL TO EU SCHENGEN AREAS

Non-visa nationals entering the European Union will need ETIAS travel authorisation, which is similar to an ESTA. ETIAS is going to be launched in 2025 and will remain valid for three years, costing €7 for individuals

14 THE TOURING BUSINESS HANDBOOK

between the ages of 18 and 70 and free for those under 18 or over 70.

WHO NEEDS ETIAS?

At the moment, especially post-Brexit, people from the UK often mix up their visa-free Schengen stays with a notion of holiday stays and work stays. Both are actually Schengen stays. There have been many cases of people getting rejected at EU country borders or sometimes even before getting on the plane in the UK because they have a potential overstay risk, but a new Entry-ExitSystem (EES) will soon replace passport stamping and will make it easier for border guards to spot overstayers.

INFORMATION ON ESS

TOURING IN THE EU

When travelling to the EU or countries in the Schengen area, two specific points to think about are: access to the labour market for non-EU citizens and visa requirements.

Every country in Europe has its own national legislation when it comes to allowing non-EU citizens to work. If you are a non-EU citizen, you’ll need to check each country's work permit regulations individually.

VISA & WORK PERMITS PER EU COUNTRY INC. COSTS (UK > EU)

It’s also necessary to check if a stay in itself is legal or not, so whether a Schengen visa is required, if it’s possible to enter visa free, or if a visa is needed for a stay for longer than the 90-day short-stay limit.

WHO NEEDS A SCHENGEN VISA?

VISA It's important to understand that these are two separate legal areas: the Schengen visa code, and the national work access legislation. If a UK citizen, for example, wants to go to Germany visa free to work, then they have to look at both conditions simultaneously and they have to meet both conditions as well.

GERMAN WORK PERMIT EXEMPTIONS

GREY AREA BETWEEN SHORT- AND LONG-TERM STAYS AND CONTRACTS

An issue that we consult on a lot, and which doesn't currently have a solution, is that an artist can be close to using up all of their short-stay visa-free days – 90 within 180 days in the entire Schengen area for any visa-free purpose. They might then receive a contract offer from a German promoter or organiser, offering, for example, a guest performance slot over a period of two weeks. The artist wouldn't be able to do this visa free because they will have used up all their visa-free days. The issue here is that in order to get a visa or residence permit for a longer stay in Germany, the artist would need to prove that they need to be in Germany for at least 90 days in the future.

Currently, for this group, there is no solution – they can’t just extend their short stay without a visa, so they have to wait until they can re-enter visa free. But on the other hand, they also don't meet the standard visa requirement, which says if you want to have a long-stay visa, you also need to prove that you need to be there for a long period, and a long period is always a minimum of 90 days. This issue has been raised many times with the visa department of the German Embassy in London and so on, whose response is that there’s currently no solution for this.

As such, the recommendation that we would give in this regard is to try to reduce visa-free stays in the

Schengen area as much as possible. Don't go on vacation in the Schengen area, for example, if you’re considering taking on a mid-duration contract in the future.

INSTRUMENTS ACROSS BORDERS

The EU is not the Schengen Area, and the EU is not the EU Customs Union. They’re three different things, and one of the most important things is that touring cultural professionals or artists know the difference between these three.

For example, Switzerland is not part of the EU, not part of the EU Customs Union but is part of the Schengen Area. If you want to transport gear to Switzerland, you’re going to a different customs area – and then you always have to check if there are any exemptions for musical instruments specifically.

Switzerland, the EU, and the UK all have exemptions for personal portable musical instruments. They differ slightly, but the general idea is if you can carry it and if it's your own instrument, it's fine. You don't need any paperwork. But we still recommend taking documents that prove that these instruments belong to you. If you have more equipment, this especially applies to huge productions with lots of stage decor etc., then you would have to get customs paperwork. The most common thing would be applying for a Carnet ATA to go to a different customs area, which is standard practice now for UK to EU touring.

MUSICIANS’ UNION INFORMATION ON PORTABLE MUSIC INDUSTRIES AND ASSOCIATED ATA CARNET REQUIREMENTS

PORTABLE MUSICAL INSTRUMENTS (CH)

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PERFORMANCE ROYALTIES The collection of performance royalties from touring can be a complex business when attention isn’t paid to the details. Keeping good records of setlists can help to make the process as smooth as possible, and spending time researching performance royalty rates within your touring destinations can give you an idea of the revenue you can expect to generate. In the following section, we’ll get an update on the status of royalty collection in 2024 and best practices with your PRO from PRS For Music, as well as taking a close look at direct licensing and the opportunities that it can present to rightsholders.

AN UPDATE FROM PRS FOR MUSIC

2024 with PRS For Music PRS for Music’s international revenues have been steadily climbing through 2022 and 2023, indicating impactful and positive growth around the world. We continue to build development opportunities for artists in partnership with the PRS Foundation, whose International Showcase Fund financially supports members who have been invited to perform at international showcasing festivals, songwriting camps, or conferences.

At the same time, UK musicians are still facing barriers to working and touring overseas. The Independent Society of Musician's Paying the Price report revealed the devastating impact that the UK’s exit from the EU is having on musicians and the music sector. We recognise that artists need long-term solutions for working in the EU if the UK is to remain a world-leading music exporter.

We believe that music is one of the UK’s greatest assets, and we continue to engage in discussions at parliament on behalf of our members to find solutions to the current issues UK touring artists are facing.

PAYING THE PRICE EPORT Our members’ music is played around the world, and we work tirelessly to get the most for our members through these relationships. PRS has one of the largest international teams, consisting of professionals from over ten countries who speak more than 15 languages and manage agreements in over 100 countries worldwide.

We have representatives based across the world who are there to support members.

PRS for Music continues to protect the value of our members’ rights. We work to revise reciprocal agreements with societies around the world, reducing deductions and ensuring greater transparency. This includes custom

16 THE TOURING BUSINESS HANDBOOK

terms for our Major Live Concert Service, which has been developed for, and with, several of the world’s biggest touring artists in direct response to their needs.

Major Live Touring Service The Major Live Touring Service (MLCS™) is a bespoke service for global touring artists available to PRS members who are touring at 5,000+ capacity venues.

MLCS™ puts control back into the hands of the music creator, demystifies tax, offers a pre-tour royalty calculation service, and allows for accurate forecasts of royalty streams throughout the tour. Those using the service receive accelerated monthly pay-outs.

In 2022, PRS for Music distributed a record £27.5m though our MCLS, for 230 qualifying artists across 1,300 global concerts, taking advantage of the reciprocal MLCS agreements that we have covering 53 territories.

Direct Licensing For Direct Licensing, it’s up to members to decide if that level of administration is right for them. Before embarking on this, members should consider that they will be responsible for directly licensing and collecting royalties for the concert of their work. PRS for Music will only process a request [notice] for a particular concert where we have received all of the necessary paperwork at least 20 working days before the concert.

BEST PRACTICES WITH YOUR PRO

Setlisting Is Key Live performances of music can generate royalties in the UK and around the world, whether it’s a local gig, a festival, or even a DJ set. If you’re a PRS for Music member, all you need to do is log into the portal, submit details of when and where performances took place, and submit the relevant setlists.

Update Your Works Make it a habit to continuously update works registrations. If you don’t add the song details and ownership splits them to the system, you can’t be paid for them, so keep them up to date as part of your monthly to-do list.

Keep Your Bank Details Current If your bank details aren’t up to date, that’s going to cause a payment issue. Ensure you update them if they change so that your royalties are paid out to you on our quarterly schedule.

Participate As a member organisation, PRS for Music relies on feedback from its members council, board, employees, and the community at large. It’s really important to take the time to share your thoughts so that they can be considered. Make sure to fill out the surveys you receive, so that your views are heard and considered.

Find More Ways To Support Your Career The music ecosystem can support your career in many ways. Whether it’s applying to develop as a composer through PRS’s New Streams initiative, attending an info session with PRS Foundation to find out where you’re eligible for funding, ensuring you have access to support via the PRS Member Fund, or attending an event in person or online with PRS for Music, tap into programmes that can move you further towards your goals.

EXAMPLES OF PERFORMANCE ROYALTY RATES & DISCOUNTS IN KEY EUROPEAN TOURING MARKETS FRANCE

Performing Rights Organisation (PRO): SACEM Members of live music association PRODISS pay a negotiated 8.36% for concerts and 8% for festivals.

GERMANY

PRO: GEMA Up to 2,000 people: 5.75% Up to 15,000 people: 7.6% More than 15,000 people: 8% Major promoter discounts apply when organising 11 to 30 events annually (10%) and 14.5% on 31 shows and above.

IRELAND

PRO: IMRO Rates for indoor shows are based on net revenue: n 6% of the first €170,172 n 3% of the next €170,172 up to €340,344 n 4.5% above €340,344 Outdoor events are 3% of new revenue while multi-stage events (Tariff MS) vary between 1.8% and 3% with up to a 33% discount on the rate for mixed-arts events.

ITALY

PRO: SIAE The performance royalty rate is 10%, which applies to: n 100% of net ticket income and presale rights n 100% of all radio or broadcast rights’ income n 50% of sponsorship income n 50% of contributions from public and private bodies

NETHERLANDS

PRO: BUMA STEMRA n 7% for events with more than two-thirds BUMA repertoire n 5% for between one and two thirds n 3% for less than a third Promoters organising more than 25 shows per year can claim a 5% discount.

SPAIN

PRO: SGAE 8.5% of box office receipts after VAT. Concerts with less than 1,000 people can opt for a flat rate based on event capacity.

SWEDEN

PRO: STIM STIM charge a scaled fee per visitor ranging from SEK5.11 for each free ticket to SEK15.48 for tickets between SEK651-700.

Tickets above SEK700 are charged at 2% of gross revenue (exc. VAT).

Multi-day events with paid tickets are charged at 5.5% of gross ticket revenue (excl. VAT, min SEK5.56 per visitor per day) and 2.5% of gross ticket revenue exceeding SEK1.5m (excl. VAT).

SWITZERLAND

PRO: SUISA Concerts: 7.5% to 10% “Concert-like productions” and open-air festivals: 7% to 8.5% Relevant association members can claim a 10% discount on these rates.

UK

PRO: PRS for Music 4% or 4.2% of gross receipts of live events, and 2.5% or 2.7% of gross receipts for qualifying festivals Thousands of (dependent on how licensee professionals read reports to PRS).

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CURRENCY EXCHANGE

Intelligent budgeting has always been central to successful touring, and that remains as true as ever in the current financial climate. We’ve seen the world’s markets struggle under significant strain in recent years, as well as seeing the global pandemic bring international tours to a complete standstill.

In 2024, generating significant income from international touring is a reality once again, and to make such activities as profitable as possible, currency and foreign exchange (FX) considerations should be placed at the centre of tour budgets and payment plans. A proactive strategy in this area can help to protect against potential losses, as well as help to maximise gains.

CURRENCY CONSIDERATIONS

Julian Justice at Centtrip offers advice on how best to approach currency exchange both in advance of a tour and while on the road.

Considering currency Touring is a big part of our business. Musicians on tour, typically speaking, will earn in different currencies, and a music tour encompasses everything that we do as a business – including foreign exchange and prepaid cards for the touring crew that make sure the artist can step on stage and plug in their guitar.

Currency is very much at the heart of touring because everyone needs to be paid and costs need to be covered.

Hotels, flights, everything associated with the tour is

18 THE TOURING BUSINESS HANDBOOK

going to have a cost implication. There are lots of places that you can get currency from – you can do it on your banking app. Without even calling it currency trade, you can just send money to somebody in a different country in a different currency – by doing so, you're actually booking a trade.

Currency outlook for 2024 The good thing about currency markets and how they represent themselves is that they’re almost like an output – everything else that's happening in the world will be reflected in the currency rates. They can be mysterious and difficult to work out, but at times, they're fairly straightforward. We all know what's happened in the last 12 months. 2023 was defined by inflation, which we saw go up a huge amount. The way that the central banks deal with that is to increase interest rates, which have risen a lot over the last 15 months. Different currencies are perceived as having different levels of strength based on a number of variable factors, so what we see then is that money flows into currencies where people feel that their money is safer, and they're going to get better returns and better yield.

The US dollar has been very much on the front foot again this year, and there are lots of reasons as to why Thousands of that might be. It's a strong currency and in some terms, a professionals read safe haven currency. The markets have really shown that IQ every day.

Make what’s developed on the world stage has led the dollar to almost run away with the year in terms ofsure the currency. you get the

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From backstage to mainstage: in tune with your legal needs.

www.LawBlacks.com Contact Pete Bott (Head of Music) 0113 207 0000 PBott@LawBlacks.com Blacks Solicitors LLP. Registered in England and Wales no. OC309566. Registered office: City Point, 29 King Street, Leeds, LS1 2HL where a list of members is open for inspection. Authorised and regulated by the Solicitors Regulation Authority no. 419628.