News & Cues: Copyright Societies and Controversies

by Koka Tarini Siddhartha

In this post, as some people might say, “we’re going rogue!” We write this post to underscore the fact that the two major copyright societies in India are no longer validly registered, and to make the implications of this known to everyone.

Wait, what are you talking about?

Well, we were doing some research, and with some help from SpicyIP posts, and other content from the glorious virtual world, we dug out some very interesting and relevant news surrounding the legality of the two copyright societies operational in India, namely the Indian Performing Rights Society (IPRS) and the Phonographic Performance Limited (PPL).

Here’s some information to give you an insight into these copyright societies:

Copyright Society The Indian Performing Rights Society Limited [IPRS] Phonographic Performance Limited [PPL]
Date of incorporation August 27, 1969 1941
Date of registration as a copyright society March 27, 1996 1996
Application date for registration as a copyright society subsequent to 2012 Amendments [June 8, 2012]

[Last date for filing – June 21, 2013]

May 8, 2013 May 10, 2013
Functions The designated copyright society to administer all performing rights associated with composition and lyrics. The designated copyright society to administer all public performance rights associated with sound recordings.
Members Lyricists, composers and music companies. Music companies
(Music company members are usually members of both IPRS and PPL.)

Essentially, a musical work is composed of three elements: the lyrics, the melodic composition and the sound recording. The IPRS issues licenses for the composition and lyrics of the musical work while the PPL grants licenses for the sound recordings. The functions of both these bodies are distinct and separate, for as per Section 33 of the Copyright Act, 1957, no two copyright societies can have the same or overlapping functions.

Why are we talking about these societies in the first place?

In 2012, the Copyright Act was amended and a series of changes were incorporated. One of the reasons for this amendment was a tiff amongst the sound recording companies that monopolised the IPRS, over the equal distribution of royalties. The key change with respect to copyright societies was the need for their re-registration as a society with the Registrar of Copyrights, which in turn would submit their applications to the central government.

As seen in the table above, both societies applied for their registration as a copyright society only a month prior to the expiration of the one-year period granted to pre-registered societies. Both their applications lapsed, and they have since withdrawn their status as copyright societies.

There were several complaints received by the central government regarding the illegal functioning of the societies, the lack of transparency and accountability, and even charges of money laundering! In response to this, in February, 2014, the central government appointed Justice Mukul Mudgal (former chief justice of the Punjab & Haryana Court) as the inquiry officer, who in turn appointed Justice Sridevan as a consultant. Both judges resigned from the positions as they were challenged several times on grounds that only persons above the position of deputy secretary could be appointed as inquiry officers.

Two letters, one from the IPRS and the other from PPL, dated June 2, 2014 and May 20, 2014 respectively, were sent to the government regarding the appointment of the inquiry officer. Owing to the lapse of their registration applications, both IPRS and PPL submitted in their letters (available here and here) that they were no longer copyright societies but were not-for-profit private companies registered under the Companies Act, 1956; thus, not regulated by the Copyright Act, 1957.

The Bombay High Court dismissed the IPRS’ contention in IPRS v. Union of India and Hasan Kamal in March, 2015 and reprimanded the IPRS for not having approached the Court with clean hands. This order was challenged through a special leave petition which the Supreme Court of India dismissed.

Does this mean the IPRS and PPL are not copyright societies anymore?

The Copyright Act provides for the setting up of copyright societies under Section 33 of the Act, which specifically states that only a registered copyright society or an authorised agent can carry out the business of issuing and granting licenses. Both societies have publicly stated that they are not registered copyright societies and even the Ludhiana High Court ruled in 2013 that IPRS was not a registered society.

While IPRS and PPL can continue issuing licenses in the guise of an agent, they can lawfully do so only in the name of the copyright holder, and not in their own name. This implies that neither body can initiate legal proceedings when there is an unauthorised use of a sound recording, lyrics or composition, as an agent of a copyright holder cannot institute legal proceedings.

Despite this, IPRS and PPL have repeatedly acted otherwise. In 2014, the IPRS filed a suit at the Delhi High Court where it verified that it was a copyright society, completely contradicting itself. In two 2014 cases — namely IPRS v. Goodwin Jewellers and ors. (March 26, 2014) and IPRS v. Black and White Media India and ors. (May 05, 2014), it approached the Delhi High Court as a copyright society, successfully managing to get the court to rule in its favour. In March 2015, the PPL sent a defamation notice to the Telangana Chamber of Events Industry (TCEI), ordering it to pay damages to the tune of ten crore rupees.

What happens now?

In August, 2015, the central government appointed Y.P.C. Dangey (retired joint secretary and adviser on legal affairs in the Ministry of Law and Justice) as the inquiry officer, to investigate these alleged irregularities in the IPRS’ working and to subsequently submit a report. IPRS unsuccessfully moved a writ petition against the Union of India regarding Dangey’s appointment.

Further, the enforcement directorate attached IPRS and PPL investments worth over rupees seventy crores and thirteen crores respectively, following the allegations of money laundering, and on grounds of withholding payments due to composers and lyricists.

A more recent case, Chitra Jagjit Singh v. The Indian Performing Rights Society (March 15, 2016), saw the IPRS being restrained from granting any licenses or recovering fees for Jagjit Singh’s copyrighted work as the court held, for the first time, that the IPRS could no longer grant licenses for any copyrighted work. IPRS nonetheless continues to collect license fees in spite of this order. A notice dated July 8, 2016, sent by IPRS to a popular establishment is available here.

The prominent propagators of the movement against these two copyright societies are currently Javed Akhtar and Sanjay Tandon, director of the Music Composers Association of India (MCAI) and the Indian Singers’ Rights Association (ISRA), although the first crusader against them was Lata Mangeshkar, who in the 1960s raised the issue of royalties in the Indian film industry.

Owing to the non-existence of a legitimate copyright society to collect royalties from consumers, opposers suggested the establishment of a new copyright society for musicians, composers and record labels, for a period of five years, which would be renewed from time to time depending on the report submitted by the registrar of copyrights.

What can we, as consumers, do?

The IPRS and PPL, although derecognised, continue to collect fees from resorts, shacks, weddings, restaurants etc., who pay out of the fear of confiscation of their equipment or worse, the closure of their establishments or venues.

In the absence of any legitimate copyright society in place, there is no governing body that can keep track of the various usages of a copyrighted work. The IPRS and PPL continue to bully various establishments to pay license fees, which we must prevent to the maximum extent possible.

Nevertheless, the works of content creators cannot be distributed without any remuneration. A better course of action, although a tedious one to carry out, might be for one to approach the record labels or artists directly to obtain licenses. That way, there is no free riding of content and we are not forced to pay unregistered societies like the IPRS and PPL who misuse the royalties collected.

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