German collection society GEMA feels the pressure

Although the live music sector in Germany is looking prettyhealthy, one aspect that is concerning the concert industry is the intention of GEMA to increase rates for live music performances. It is likely to take until next month for GEMA and the two live-music trade organizations IDKV and VDKV to reach an agreement on the new rates. The three parties are currently presenting their cases to a German Patent Office arbitral court, after the live music bodies refused to accept GEMA’s demands for significant increases in concert and festival rates. Among other proposals, GEMA wants to introduce a levy on sponsorship fees and ticketing-service charges. The new rates set out a gradually escalating pricing system rising to 10% of ticket prices for festival events by 2014. Representatives of IDKV and VDKD called GEMA’s demands extortion, but GEMA says it is merely acting on the requests of its members. So far, the arbitration court has conducted two hearings and plans to present its findings for fair compensation for performing rights next month. This decision will be considered binding for all concerned parties.

Although the conflict over performance rates gained coverage only in trade papers and music magazines, another case against GEMA reached a much bigger audience. Since September, German citizens have had the right to apply for a so-called e-petition. Monika Bestle, who runs a small venue in Sonthofen, a tiny town in the deep south of Germany, filed such a petition protesting about the policies of GEMA at the German Bundestag. Bestle’s petition gained – by sheer coincidence on June 22, the same day of GEMA’s annual meeting – the 50,000 signatures required to officially place it for consideration on the agenda of the German parliament.

In the petition, Bestle asks the German government to decide whether the policies of GEMA are in line with civil law regarding associations and copyright. She has also requested that the Government force GEMA to undertake a broad reformation of its rate system for small live-music promoters and the royalty-payment plan for artists; a simplification of business conditions; and transparency and amendment of its encashment rules. One year ago, the government’s Culture in Germany committee of enquiry confronted GEMA with a report that included similar observations.

During its general assembly, GEMA distributed a press release regarding the petition to its members, saying that it already offers several special rates for smaller concert promoters and that some postings in online forums contained false information. But this situation was not dismissed easily – when the petition gathered more than 80,000 signatures, several nationwide news sources, such as Spiegel.de and Frankfurter Rundschau picked up the issue, publishing reports critical of GEMA’s practices. Worrying for GEMA is that the petition has thousands more signatures than it has members. Also, earlier this year, it received critical media coverage when, due to a tariff conflict, YouTube Germany removed GEMA-protected repertoire from its servers.

Music & Copyright is a fortnightly research service published by Informa Telecoms & Media.