Setback for the SGAE (General Society of Authors and Editors) from the European Commission

17 July 2008

The Commission has issued a resolution that obliges 24 management entities to lift the ban that currently limits the rendering of services to artists and users to their corresponding national country.

According to the Commission, this practice was creating an infringement of article 81 of the Treaty and as a consequence they are obliging the management entities to modify their contracts and practice; in spite of this, no financial penalties are being imposed.

According to the Competition Commissioner, Neelie Kroes, this decision will benefit the cultural diversity in the EU, given that it will force management entities to improve their services offered to creators and users. The Commissioner especially emphasises that this decision is not intended to challenge the collective copyright management model, but it is believed that this decision will favour the creation of a unique market, as much for creators as for users and amateurs

The two main consequences of this decision on a contractual level will be: Management entities will not be able to impose limitations which prevent their members from changing management entity and have to remove country restrictions which until now prohibited the issuing of licences to users outside of the country in which the entity was rendering services.

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