Policy paper

Collective rights management in the UK

Updated 28 November 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 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 this annual report of its activities as the National Competent Authority (NCA). This is the eighth of these reports, covering the period from 1 April 2023 to 31 March 2024.

Approach to regulation

The main objective of the IPO is to ensure compliance with the Regulations. The IPO takes a proportionate approach in dealing with possible breaches that is consistent with the Regulators’ Code and has regard to the May 2024 statutory guidance on the ‘Growth Duty’. 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 avoid repetition. If there are greater concerns, the NCA may 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 16 CMOs in the UK managed the rights of over 550,000 right holders and distributed over £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, can be divided into three main strands of activity.

1. Complaints

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

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

Parliamentary and other correspondence

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

Predominantly, this correspondence concerned either licensing tariffs - where users of copyright material typically questioned the need for a licence or wished to complain about licensing practices - or contractual royalty disputes. 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.

Freedom of Information Act releases

The IPO has previously published Freedom of Information Act releases on Complaints against Collective Management Organizations and on its Inspections.

2. Monitoring

This section reports on the IPO’s proactive monitoring of parties subject to the Regulations.

Annual General Meetings (AGMs) - The IPO aims to observe all CMO AGMs, which allows it to monitor members’ involvement in decision-making processes, and check that matters reserved for the AGM are dealt with there. During this reporting year, the IPO was invited to, and attended, 9 AGMs. We have encouraged all CMOs to invite us to future meetings.

Scrutiny of Annual Transparency Reports (ATRs) - The Regulations require CMOs to produce Annual Transparency Reports (ATR), with detailed information covering activities in the previous financial year, for which the IPO has provided guidance on Collective Management of copyright. The IPO analyses ATRs against Regulation 21 and provides feedback and guidance to individual CMOs. There were two minor queries raised by the IPO this year, which were resolved immediately.

3. Collaboration

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

Stakeholder engagement: The IPO hosts meetings with regulated parties to discuss regulatory and related issues of mutual interest, for example Collective Rights Management in the context of international trade policy. There are discrete meetings for CMOs, IMEs, representatives of copyright users and rightsholders and IPO may also meet with individual regulated entities bilaterally. Meetings with CMOs were held in August 2023 and February 2024; with IMEs in September 2023 and May 2024; rightsholders in October 2023; and copyright user representatives in September 2023.

Retained EU Law (Revocation and Reform) Act 2023

The above Act provides powers to amend, repeal or replace EU originating legislation, which were 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 2021 Post Implementation Review of the Collective Management of Copyright (EU Directive) Regulations 2016.

1. Extended Collective Licensing

As the Act abolishes the doctrine of the supremacy of EU law over UK law, the IPO considers that the CJEU Decision in C-301/15 (Soulier and Doke) no longer has the effect of precluding the Secretary of State from considering and approving an application to operate a scheme of collective licensing with extended effect (ECL) under The Copyright and Rights in Performances (Extended Collective Licensing) Regulations 2014.

Updated guidance for relevant licensing bodies on applying to run ECL schemes will be re-issued.

2. Copyright Tribunal

The 2023 Regulations also provided 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 see Section 3 of How the IPO regulates licensing bodies on reporting concerns to the IPO and contact [email protected].

If you wish to complain about the IPO’s role in terms of the regulations, then there is a complaints procedure, that includes information about escalation to the Parliamentary Ombudsman.

1. Source documents include CMOs’ Annual Transparency Reports, website information and email exchanges. ↩