Policy paper

Collective rights management in the UK

Updated 1 January 2024

Introduction

The Collective Management of Copyright (EU Directive) Regulations 2016 set minimum standards for the governance, transparency, and behaviour of collective management organisations (CMOs) established in the UK, as well as certain requirements for independent management entities (IMEs), right holders and users. The Regulations also place specific obligations on CMOs that license the online use of musical works on a multi-territorial basis.

The Intellectual Property Office (IPO) is the National Competent Authority (NCA) responsible for monitoring and enforcing compliance with the Regulations on behalf of the Secretary of State for Science, Innovation & Technology.

The IPO has published The Collective Management of Copyright (EU Directive) Regulations 2016 guidance on its interpretation of the Regulations and on its approach to How the IPO will carry out investigation and enforcement activities. The IPO produces an annual report detailing its activity as the NCA. This is the seventh of these reports, covering the period from 1 April 2022 to 31 March 2023.

Approach to regulation

The main objective of the IPO as the NCA is to ensure compliance with the Regulations. The IPO takes a proportionate approach in dealing with possible breaches. For example, a minor breach, could be dealt with by giving the CMO the opportunity to take immediate remedial action, such as updating its procedures to prevent repetition. If there are greater concerns, then it is more likely that that the NCA will deploy its powers to determine the nature and seriousness of any breach and decide whether enforcement action should follow. Sanctions can take the form of a formal compliance notice, and/or financial penalties up to £50,000.

Overview of collective rights management in the UK

The collective rights management landscape in the UK is well-developed and covers various sectors of the creative industries, including music, literature, art and film. During this financial year, the IPO estimates from various source documents ^{[footnote 1]} that 15 CMOs in the UK collectively managed the rights of over 500,000 right holders and distributed almost £2bn of royalties to them. The IPO has published information about Licensing bodies and collective management organisations operating in the UK. These bodies have reciprocal right collection arrangements with counterparts in other jurisdictions.

Monitoring compliance and enforcement

The IPO’s role of monitoring compliance by regulated parties, carried out on behalf of the Secretary of State, can be divided into three main strands of activity.

1. Reactive

This section relates to the IPO’s role in responding to information about possible non-compliance with the Regulations.

The IPO has not initiated any investigations in the period covered by this report. This is because although it has had a number of approaches about possible non-compliance, either no evidence has been forthcoming when sought, or the matter has been pursued informally in line with the IPO’s approach to achieving regulatory compliance.

Other correspondence

Alongside the complaints about possible breaches of the Regulations, the IPO also received around 35 complaints or queries about licensing bodies. These fell outside the scope of the Regulations and included correspondence to Government Ministers, the IPO’s Information Centre, and direct complaints to the collective rights mailbox.

Predominantly, this correspondence concerned licensing tariffs and came from users of copyright material who typically questioned the need for a licence or wished to complain about licensing practices. Whilst these types of complaint did not engage the Regulations, they have been included here to give a broader picture of the overall collective rights landscape.

2. Proactive

This section reports on the proactive monitoring of regulated parties by the IPO to ensure that CMOs are fulfilling their regulatory obligations.

Annual General Meetings (AGMs) - The IPO aims to attend all annual general meetings of CMOs as an observer. This allows it to monitor the involvement of the CMOs’ members in their decision-making processes, and to check that matters reserved for the AGM are dealt with there. During this reporting year, the IPO was invited to, and attended, 8 AGMs. We have reached out to all CMOs to request an invitation to future meetings.

Scrutiny of Annual Transparency Reports (ATRs) - The Regulations require each CMO to produce an Annual Transparency Report (ATR), with detailed information about its activities in the previous financial year. The ATR allows right holders to monitor the performance of a CMO over the reporting period and the IPO has provided guidance on Collective Management of copyright to CMOs on completing ATRs. The IPO analyses ATRs against Regulation 21 and provides feedback and guidance to individual CMOs. There were three minor queries raised by the IPO this year, which were resolved immediately.

3. Collaborative

This area describes the work the IPO undertakes in conjunction with regulated parties to help achieve compliance with the Regulations.

Working groups: The IPO engages with regulated parties by hosting working-level meetings that discuss the application of the Regulations, update attendees on any current developments, and provide a forum to raise regulatory and related issues of common interest, for example Collective Rights Management in the context of international trade policy. There are specific working groups for CMOs, and IMEs and IPO may also meet with individual regulated entities bilaterally. This year we held working group meetings in summer and autumn 2022 for CMOs, IMEs, rightsholders and user representatives.

Retained EU Law (Revocation and Reform) Act

The Act includes powers to amend, repeal or replace EU originating legislation.  These powers have been used in The Design Right, Artist’s Resale Right and Copyright (Amendment) Regulations 2023 to remove the audit requirement for annual transparency reporting for smaller CMOs, aligning to UK company law.

This implements the suggested change on audit costs in the Post Implementation Review of the Collective Management of Copyright (EU Directive) Regulations 2016, completed in 2021.

Provisions in the Act which abolished the principle of supremacy of EU law at the end of 2023 are considered to have restored the Secretary of State’s ability to consider and approve applications for extended collective licensing (ECL) schemes by overriding the effect of the CJEU decision in C-301/15 (Soulier and Doke), which had made UK ECL schemes unworkable since 2016.

Additionally, there has been an opportunity to replace a European Economic Area address for service in The Copyright Tribunal Rules 2010 with a UK address for proceedings in the Copyright Tribunal.

Getting in touch

If you wish to provide us with information about potential non-compliance with the Regulations, please contact collectiverights@ipo.gov.uk.

If you wish to complain about the IPO as the NCA, then there is a complaints procedure, that includes information about escalation to the Parliamentary Ombudsman.

1. Source documents include CMOs ATRs, website information and email exchanges ↩