SOCAN is Canada’s music performing rights society. Pursuant to the applicable provisions of the Canadian Copyright Act (the “Acf’), SOCAN carries on the business, on a not-for-profit basis, of granting licences for the public performance and communication to the public by telecommunication of musical works in Canada.
Essentially, SOCAN owns and/or administers in Canada the performing rights in the world repertoire of copyright protected music, including the works of U.S. authors, composers and publishers.
SOCAN wishes to comment briefly on rate court proceedings and the importance of access to all relevant information for the purpose of establishing reasonable fees. It is SOCAN’s understanding that, in U.S. rate court proceedings, ASCAP and BMI always have the burden of proof to establish the reasonableness of the fees that they seek.
More specifically, the task is to determine the fair market value of blanket licenses for the public performance of music. Should the societies not succeed in establishing that the proposed fee is reasonable, the Court is to determine a reasonable fee based upon all the evidence.
SOCAN submits that the current approach to valuing the rights of the societies in the U.S. is flawed, for a number of reasons. First, experience continues to show that establishing the fair market value of performing rights is typically a very difficult and subjective exercise.
To saddle the societies with such a burden without exception appears arbitrary and baseless, particularly when the users of their repertoire have a legal right to a license for that use upon request, a licence which may be free of charge or at low interim fees for lengthy periods of time pending a decision of the rate court.
SOCAN suggests that the burden associated with the establishment of a reasonable fee should rest with both parties equally, as both have a significant, albeit different interest in the outcome as payer and payee, respectively.
A fairer and more balanced approach would be to treat disputes by way of private arbitration between the parties. That is similar to the approach that the Copyright Board of Canada takes for the purpose of valuing SOCAN’s performing rights.
An arbitration style proceeding has proven to be more conducive to an efficient means by which to elicit probative evidence in support of the various positions being advanced before the Board.