[Federal Register: January 30, 2002 (Volume 67, Number 20)]
[Notices]
[Page 4472-4474]
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LIBRARY OF CONGRESS
Copyright Office
[Docket No. 2002-1 CARP DTRA3]
Digital Performance Right in Sound Recordings and Ephemeral
Recordings
AGENCY: Copyright Office, Library of Congress.
ACTION: Initiation of voluntary negotiation period.
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SUMMARY: The Copyright Office is announcing the initiation of the
voluntary negotiation period for determining reasonable rates and terms
for two compulsory licenses, which in one case, allows public
performances of sound recordings by means of eligible nonsubscription
transmissions, and in the second instance, allows the making of an
ephemeral phonorecord of a sound recording in furtherance of making a
permitted public performance of the sound recording.
EFFECTIVE DATE: The voluntary negotiation period begins on January 30,
2002.
[[Page 4473]]
ADDRESSES: Copies of voluntary license agreements and petitions, if
sent by mail, should be addressed to: Copyright Arbitration Royalty
Panel (CARP), P.O. Box 70977, Southwest Station, Washington, DC 20024.
If hand delivered, they should be brought to: Office of the General
Counsel, James Madison Memorial Building, Room LM-403, First and
Independence Avenue, SE, Washington, DC 20559-6000.
FOR FURTHER INFORMATION CONTACT: David O. Carson, General Counsel, or
Tanya M. Sandros, Senior Attorney, Copyright Arbitration Royalty Panel,
P.O. Box 70977, Southwest Station, Washington, DC 20024. Telephone:
(202) 707-8380. Telefax: (202) 252-3423.
SUPPLEMENTARY INFORMATION: In 1995, Congress enacted the Digital
Performance Right in Sound Recordings Act of 1995 (``DPRA''), Pub. L.
104-39, which created an exclusive right for copyright owners of sound
recordings, subject to certain limitations, to perform publicly the
sound recordings by means of certain digital audio transmissions. Among
the limitations on the performance right was the creation of a new
compulsory license for nonexempt, noninteractive, digital subscription
transmissions. 17 U.S.C. 114(f).
The scope of this license was expanded in 1998 upon passage of the
Digital Millennium Copyright Act of 1998 (``DMCA'' or ``Act''), Pub. L.
105-304, in order to allow a nonexempt eligible nonsubscription
transmission and a nonexempt transmission by a preexisting satellite
digital audio radio service to perform publicly a sound recording in
accordance with the terms and rates of the statutory license. 17 U.S.C.
114(a).
An ``eligible nonsubscription transmission'' is a noninteractive,
digital audio transmission which, as the name implies, does not require
a subscription for receiving the transmission. The transmission must
also be made as part of a service that provides audio programming
consisting in whole or in part of performances of sound recordings the
purpose of which is to provide audio or entertainment programming, but
not to sell, advertise, or promote particular goods or services. A
``preexisting satellite digital audio radio service'' is a subscription
digital audio radio service that received a satellite digital audio
radio service license issued by the Federal Communications Commission
on or before July 31, 1998. See 17 U.S.C. 114(j)(6) and (10).
In addition to expanding the current Sec. 114 license, the DMCA
also created a new statutory license for the making of an ``ephemeral
recording'' of a sound recording by certain transmitting organizations.
17 U.S.C. 112(e). The new statutory license allows entities that
transmit performances of sound recordings to business establishments,
pursuant to the limitations set forth in Section 114(d)(1)(C)(iv), to
make an ephemeral recording of a sound recording for purposes of a
later transmission. The new license also provides a means by which a
transmitting entity with a statutory license under Section 114(f) can
make more than the one phonorecord permitted by the exemption specified
in Section 112(a). 17 U.S.C. 112(e).
Determination of Reasonable Terms and Rates
The statutory scheme for establishing reasonable terms and rates is
the same for both licenses. The terms and rates for the two new
statutory licenses may be determined by voluntary agreement among the
affected parties, or if necessary, through compulsory arbitration
conducted pursuant to Chapter 8 of the Copyright Act.
If the affected parties are able to negotiate voluntary agreements,
then it may not be necessary for these parties to participate in an
arbitration proceeding. See 17 U.S.C. 112(e)(5) and 114(f)(3).
Similarly, if the parties negotiate an industry-wide agreement, an
arbitration may not be needed. In the latter case, the Librarian of
Congress will follow current rate regulation procedures and notify the
public of the proposed agreement in a notice and comment proceeding. If
no party with a substantial interest and an intent to participate in an
arbitration proceeding files a comment opposing the negotiated rates
and terms, the Librarian will adopt the proposed terms and rates
without convening a copyright arbitration royalty panel. 37 CFR
251.63(b). If, however, no industry-wide agreement is reached, or only
certain parties negotiate license agreements, then those copyright
owners and users relying upon one or both of the statutory licenses
shall be bound by the terms and rates established through the
arbitration process.
Arbitration proceedings cannot be initiated unless a party files a
petition for ratemaking with the Librarian of Congress during the 60-
day period, beginning July 1, 2002. 17 U.S.C. 112(e)(6) and
114(f)(2)(C)(ii)(II).
On November 27, 1998, the Copyright Office initiated a six-month
voluntary negotiation period in accordance with Section 112(e)(3) and
114(f)(2)(A) for the purpose of establishing rates and terms for these
licenses for the period beginning on the effective date of the DMCA and
ending on December 31, 2000. 63 FR 65555 (November 27, 1998). Parties
to these negotiations however, were unable to reach agreement on the
rates and terms and, in accordance with Sections 112(e)(4) and
114(f)(1)(B), the Copyright Office initiated arbitration proceedings to
determine the rates and terms for use of these licenses through
December 31, 2000. 64 FR 52107 (September 27, 1999).
Subsequently, the Copyright Office initiated another voluntary
negotiation period in January 2000 for the purpose of setting rates and
terms for use of these licenses by services for the period between
January 1, 2001, and December 31, 2002. 66 FR 2194 (January 13, 2000).
Because the panel in both proceedings was to set rates and terms for
the same licenses, albeit for different time periods, the Office
consolidated the 1998-2000 proceeding with the 2001-2002 proceeding.
See Order, Docket Nos. 99-6 CARP DTRA and 2000-3 CARP DTRA2 (December 4,
2000). This consolidated proceeding is still ongoing and the CARP is
scheduled to submit its report on February 20, 2002. See Order, Docket
No. 2000-9 CARP DTRA1&2 (November 9, 2001).
Initiation of the Next Round of Voluntary Negotiations
Unless the schedule has been readjusted by the parties in a
previous rate adjustment proceeding, Sections 112(e)(7) and
114(f)(2)(C)(i)(II) of the Copyright Act require the publication of a
notice in January 2002, and at 2-year intervals thereafter, initiating
the voluntary negotiation periods for determining reasonable rates and
terms for the statutory licenses permitting the public performance of a
sound recording by means of certain digital transmissions and the
making of an ephemeral recording in accordance with Section 112(e).
Parties who negotiate a voluntary license agreement during this period
are encouraged to submit two copies of the agreement to the Copyright
Office at the above-listed address within 30 days of its execution.
The publication of this notice fulfills the requirement. The
negotiation period shall begin on January 30, 2002, and end on June 30,
2002.
Petitions
In the absence of a license agreement negotiated under 17 U.S.C.
112(e)(4) or 114(f)(2)(A), those copyright owners of sound recordings
and entities availing themselves of the statutory licenses are subject
to arbitration upon the filing of a petition by a party with a
significant
[[Page 4474]]
interest in establishing reasonable terms and rates for the statutory
licenses. Petitions must be filed in accordance with 17 U.S.C.
112(e)(7), 114(f)(2)(C)(ii)(II), and 803(a)(1) and may be filed any
time during the sixty-day period beginning on July 1, 2002. See also,
37 CFR 251.61. Parties should submit petitions to the Copyright Office
at the address listed in this notice. The petitioner must deliver an
original and five copies to the Office.
Dated: January 24, 2002.
David O. Carson,
General Counsel.
[FR Doc. 02-2242 Filed 1-29-02; 8:45 am]
BILLING CODE 1410-33-P