In the last interview published, we highlighted allegations made by the President of the Recording Industry Association of Trinidad and Tobago (RIATT), Mr. Fabien Alfonso towards the Copyright Organization of Trinidad and Tobago (COTT). It was alleged that COTT deductions have been much higher than the advised percentage. After the interview published we spoke with Ms. Melissa Arnaud, COTT's Comunication Officer, who was more than willing to assist with all the queries and questions raised by RIATT and COTT members. Attached are two documents which COTT has used to help address this matter..... This interview is like no other, as it tackles the business and operational aspects of the industry. Yes we macco these issues too.
Entertainment Macco: Can you please give a brief description of COTT, how long has the organization been around and what exactly the organization does, and how does one become a member?
COTT: "The Copyright Music Organisation of Trinidad and Tobago (COTT) is a non-profit making membership organisation of songwriters, composers, lyricists, and music publishers of all genres. The organisation was incorporated in 1984 and has been operating since January 1985. COTT administers, i.e. grants permission for the public performance, broadcasting, communication to the public, mechanical reproduction and synchronisation rights granted by law to music users from the creators and owners of original music.
To be eligible for COTT membership you must meet at least one of the following criteria:
• your music is published by a person or company that carries on business as a music publisher, OR
• your music has been released as a commercial recording, OR
• your music has been publicly performed or broadcasted within the last year and that performance is licensed by COTT (i.e. on radio, television, in concert, clubs, etc.).
There is an application fee of One Hundred Dollars ($100.00) Non-refundable"
Entertainment Macco: In the press release issued by COTT (seen below), the increased percentages were as a result of the "onset of the Global Recession" and "the imminent mortgage obligation for its new Headquarters", was this information ever communicated to the members?
COTT: "This was communicated to our members as it is our obligation to do so. In fact, we had members meetings throughout the period addressing this, sent letters to all members and met with those who were aggrieved." | |||||
| PRESS RELEASE |
Entertainment Macco: Has COTT ever taken 78% in administration rates?
COTT: "Administration rate refers to the overall cost of collecting relative to overall revenue and it has never been 78%. There are different distributions streams which will have their own administration costs attached to them. The 78% refers to one of those distributions streams, General Distribution. Note this distribution stream is the most costly to collect because of the non compliant nature of music users in Trinidad and Tobago generally. Representatives of COTT must actually visit clients (most times repeatedly) to collect what is owed to members and endure the trials when facing uncooperative clients. Unlike our sister organisation TONO, in Norway, which has no representatives as music users voluntarily pay for use of music without an approach from TONO."
Entertainment Macco: What is the highest amount that COTT has ever deducted to cover administrations expenses?
COTT: "60% in 2009; this is year that COTT has taken out 78% in the general distribution category."
Entertainment Macco: Pardon my ignorance but i am under the impression that COTT works with other copyright organization's worldwide and collect royalties for nonmembers and this money is then sent to the organizations that represent these members, are COTT administration rates deducted from these monies as well? and is it at the same rate as deducted from members of COTT?
COTT: "Yes we do for both instances."
Entertainment Macco: If for a particular period the administration rates are unusually high, does COTT attach an addendum to member statements with an explanation?
COTT: "COTT, as happened in all occasions and mentioned previously, has communicated to its members through our members meetings, which happens after a royalty distribution, and sent letters when these incidences happened."
Entertainment Macco: The dates that you supplied the deduction rates span from 2006 -2009, with the exception of 2007 the rates have steadily increased and as you state this is due to the global recession and the acquisition of the new headquarters, so has the deduction rates for 2010 increased from the 60%?
COTT: "No, in fact it has decreased as the unaudited administration rate for 2010 is 40%."
Entertainment Macco: Since the release of the letter by members of COTT and RIATT, have members been contacting the organisation to highlight their concerns? Is this the first time that members have raised questions with regards to this issue?
COTT: "Firstly, RIATT has no formal relationship with COTT. As such our obligation is not to this organisation but to our members. Since the release of the letter, we have had 3 members contacting us directly i.e. they have sent in letters. Also, administration rates are one of the key performance indicators that are used in the management of collecting societies and are always monitored by the Board and Management."
Entertainment Macco: When does COTT plan to finalise a date to meet with members?
COTT: "We have scheduled to meet on Thursday April 14th 2011 at COTT’s Head Office, 139-141 Abercromby Street, Port of Spain for 5:30pm with our members only."
Entertainment Macco: With your press release you also included page from a WIPO Document (See below) The Setting -up of New Copyright Societies written by Dr Ulrich Uchtenhagen, page 11 point 24 where it states verbatim:
"24.A copyright society can only claim to have “efficient management”
if the costs of that management remain within a reasonable range.
Here again, international standards apply as already mentioned. The
deduction of costs up to 30% for the management of performance and
broadcasting rights and up to 25% for the management of reproduction
rights, can be justified on condition that the distribution activities
lead to regular, detailed and individual accounts for each author and
publisher. These percentages can be provisionally exceeded in times of
high inflation, for instance, or where there has been large-scale investment
in facilities such as the procurement of a data processing system.
Be that as it may, a copyright society whose deductions continually
exceed the above-mentioned standards signals problems of
sustainability and is therefore considered ripe for a review of its administrative
structure."
Based on the figures you provided showing an increase in fees, is COTT in Trouble?
COTT: "The document supplied was the “guidelines” that RIATT used to support their argument and as such we supplied it to you as reference. To give some background information, The Setting -up of New Copyright Societies – Experiences and Reflexions paragraph 24 is premised on what was written in paragraph 23:
“23.Whether or not the amounts paid are commensurate depends essentially on the calculation of the tariffs, constituting the calculation basis for the royalties or remuneration paid by the users. Guidance is given by national usage and international standards, particularly:
- the “10 % rule” according to which the authors and publishers are entitled to 1/10th of all income obtained by copyright users from the exploitation of the works;
- the “pro-rata temporis rule” according to which the 10 % share of the authors and publishers is proportionally reduced where protected and free works are exploited together;
- the “ballet rule” according to which the 10 % share of the authors and publishers is also proportionally reduced where several works are exploited at the same time.”
 |
| WIPO DOCUMENT |
Entertainment Macco: Alright understood, continue...
COTT: "None of COTT’s tariffs are at a 10% level, as per paragraph 23. Given the non compliant nature of music users in T&T it is highly unlikely that COTT can collect at this level successfully, though it would be great to do so, as the market does not support that level of tariff,. Finally, but most importantly, in the preface to the publication mentioned above, a disclaimer reads as follows which is very important:
“The opinions contained in this publication reflect only the views of the author and not necessarily those of WIPO”
Therefore by this document, WIPO does not set any admin rates or tariff rates for Collective Management societies, which is outside its remit."
COTT: "The World Intellectual Property Organization (WIPO) is a specialized agency of the United Nations. It is dedicated to developing a balanced and accessible international intellectual property (IP) system, which rewards creativity, stimulates innovation and contributes to economic development while safeguarding the public interest. WIPO was established by the WIPO Convention in 1967 with a mandate from its Member States to promote the protection of IP throughout the world through cooperation among states and in collaboration with other international organizations. <http://www.wipo.int/about-wipo/en/what_is_wipo.html>WIPO’s Member States determine the strategic direction and activities of the Organization. They meet in the Assemblies, committees and working groups (WIPO decision-making bodies).There are currently 184 Member States, i.e. over 90 percent of the countries of the world (membership criteria). < http://www.wipo.int/about-wipo/en/how_wipo_works.html>"
Entertainment Macco: What else is there to know about WIPO?
COTT: "It is important to know that WIPO does not set standards for Collective Management Organisations such as COTT, CISAC does. CISAC, the International Confederation of Societies of Authors and Composers, works towards increased recognition and protection of creators’ rights. CISAC was founded in 1926 and is a non-governmental, non-profit organisation. Its headquarters are in Paris, with regional offices in Budapest, Santiago de Chile, Johannesburg and Singapore."
Entertainment Macco: What are the aims of CISAC?
COTT: "CISAC’s main activities and member services aim to:
- To strengthen and develop the international network of copyright societies
- To secure a position for creators and their collective management organisations in the international scene;
- To adopt and implement quality and technical efficiency criteria to increase copyright societies’ interoperability;
- To support societies’ strategic development in each region and in each repertoire;
- To retain a central database allowing societies to exchange information efficiently;
- To participate in improving national and international copyright laws and practices.
As of June 2010, CISAC numbers 229 authors’ societies from 121 countries and indirectly represents around 3 million creators and music publishers within all the artistic repertoires: music, drama, literature, audio-visual, graphic and visual arts. < http://www.cisac.org/CisacPortal/afficherArticles.do?menu=main&item=tab2&store=true> COTT is the only Collecting Society in Trinidad and Tobago recognized by CISAC. Also, COTT is the only Collecting Society in T&T recognized by the 228 author/composer societies in the world."
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1 Response
This is one of the most interesting interviews done by EM. Fantastic on both sides, the concerns, the rebuttal, the valuable information provided, overall a job very well done.