Higher Regional Court decides against GEMA sharing its collections with the publishers
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The Higher Regional Court in Berlin has decided on 14 November 2016 that GEMA may no longer allocate shares on its collections to publishers as it had done previously. GEMA, however, continues to hold the view that authors and publishers should participate in the pay-outs of collective management organisations, if authors have agreed to this with their publishers.
The Higher Regional Court in Berlin has decided on 14 November 2016 (AZ 24 U 96/14) that GEMA may no longer allocate shares on its collections to publishers as it had done previously. Point of origin for the decision was a lawsuit lodged by the two authors and GEMA members Bruno Kramm and Stefan Ackermann. The plaintiffs had argued that they should also receive the publishers’ share on top of their authors’ share, as it was the authors alone who brought usage rights into GEMA. In line with the oral explanations of the Court, the decision is mainly based on the fact that a clear message on how a publisher should participate was not apparent in the relevant publishing agreements. The grounds for the decision have not been published yet. In April 2016, the German Federal Court of Justice had decided in the case of VG Wort, which represents writers and book publishers, that a pay-out of licence fees for statutory remuneration claims to publishers could only be made in exceptional cases. Unlike in the case of VG Wort, GEMA does not participate its music publishers on a lump sum or blanket basis, but only in those cases where the authors have agreed such a participation with the publishers in the publishing agreement. Dr Harald Heker, CEO of GEMA, comments: “We consider this decision to be wrong. It is particularly deplorable that the Higher Regional Court only bases its decision on who actually brought in the rights. This principle could, depending on the form of the publishing contract, also be applied to the disadvantage of authors. It is, however, more important that authors and publishers had an agreement for decades that both sides should benefit from the collected royalties through the assignment of their rights. If an author wishes to pay a publisher in consideration for the publishing activities of the latter, such a share is legitimate.” Prof Dr Enjott Schneider, composer and Chairman of the GEMA Supervisory Board, highlights the shared solidarity between all professional groups: “Authors and publishers sit jointly at the table at GEMA – as is the case in the majority of other collective management organisations – because because they need each other. Cultural diversity can only be created by this kind of alliance. Luckily, politicians have understood that the long-established cooperation between authors and publishers is absolutely necessary and therefore a legal clarification must be established.” The scope of the rights managed by GEMA is not affected by this decision as it affects a pure distribution issue. The judgement is not yet legally binding. GEMA represents the copyrights of more than 70,000 members (composers, lyricists and music publishers) in Germany, and more than two million copyright owners globally. It is one of the largest societies for authors of musical works in the world. Since 2007, GEMA has been represented in Brussels via a liaison office.