Licencing Requirements for Music

Do You Need To Be Licensed?

There are many scenarios which will require you to be licensed for the public performance of copyright-protected works. These include:

• Having a jukebox.
• Having a DJ playing music.
• Having Karaoke Shows.
• Having hold music on your telephone system.

The performance licence fees must be paid by the venue and are independent of the mechanical royalties which are included in the price of the CD or CD-G (which is paid by the Karaoke Service). Read on for more information.

Mechanical and Performance Royalties

There are two main sets of royalties which are pertinent to any venue playing recorded music for the public.

I mention Mechanical royalties here because in Canada, the AVLA (Audio-Video Licensing Agency) actually licenses the right for members to make compilation CD's for their DJ Service. This type of royalty refers to the ability to take purchased music and mechanically copy it to a new medium for the shows. (NOT FOR RESALE). Sadly, this does not apply to Karaoke discs.

Performance royalties are significant for Karaoke bars. The right to have the public performance of the recorded music must be licensed in Canada through SOCAN (The Society of Composers, Authors and Music Publishers of Canada). Depending on the types of performances you hold in your venue, you may be subject to more than one of the tariffs. Look through their site for more detailed information and contact them for the most current information. Please note: Owning the disc does not give you the license to have the work performed publicly.

Why Are These Fees Levied?

This is the bulk of how artists, songwriters and publishers are paid. The bulk of the performing artist's share comes from the Mechanical royalties. The bulk of the songwriters' and publishers' shares come from Performance royalties. The more popular their works are, the more they are paid from the pool of funds collected by the various licensing organizations. When the songs are played on the radio, performance royalties also apply and are paid by the radio stations.

Who Is Responsible For The Licencing?

In most cases, the venue will need to seek the licence. If the performance is for a wedding or a party, the organizers of the party are responsible for ensuring the appropriate licencing is in place. The DJ or KJ may cover the licence fees, but this will usually raise the price of the service by more than the cost of the licence to cover the time spent by the DJ or KJ for the paperwork.

In the case of the AVLA, the DJ must attain the licence in order to make compilations of their music - this is not the responsibility of the venue unless the venue itself is making these compilations.

What Happens If No License Is Attained?

The responsible parties may be fined for infraction of the Canadian Copyright Act and damages may be awarded by the courts for the illegal use of copyright-protected material. While most people seem to ignore the Copyright Act because it's very difficult to chase down and charge individual infractions, it is not advisable for a business to do the same. It's not worth the possible fines if you get caught and the licence fees are actually quite reasonable (And, for those number crunchers, it's a business expense and tax-deductible).