Understanding the Role & Functions of Collective Management Organisations (CMOs)

Part 2 of 13 Reasons Why Kenyan Music Creators Need A New CMO Legal Framework

In this second part of 13 Reasons Why Kenyan Music Creators Need a New CMO Legal Framework we discuss the Roles of Collective Management Organisations. We delve into the functions of Collective Management Organisations and put a strong case for legislation that clearly spells out the mandate of CMOs and the critical role they play in the creator economy and copyright business systems of a country.

Role

CMOs provide appropriate mechanisms for the exercise of copyright and related rights, in cases where the individual exercise by the Rightsholder would be impossible or impractical. Collective management is an important part of a functioning copyright and related rights system, complementing individual licensing of rights, resting on robust substantive rights, exceptions and limitations, and corresponding enforcement measures. In this vein, CMOs can provide a bridge between Right holders and Users, facilitating both access and remuneration

Functions

CMOs provide a mechanism for obtaining permission to use copyright materials, as well as for paying the corresponding fees or remuneration for certain uses of such materials, through an efficient system of collection and Distribution of license fees and/or remunerations. Some CMOs provide social, cultural, and promotional services.

LEGISLATIVE PROPOSALS

1. A CMO is an organization with a primary responsibility towards the Right holders it represents. A CMO should always act in the best interest of those Right holders, in accordance with applicable law and its Statute.

2. With respect to certain uses and/or rights, collective management may be the most cost-effective mechanism to enable the effective exercise of copyright and related rights, in order to make ensure these rights are duly represented.  

3. A CMO provides licensing, collection and/or Distribution services to the Users/Licensees of copyright content.  

4. CMOs will play an important role in copyright and as promoters of culture, by providing social, cultural, and educational services for the benefit and welfare of Rightsholders.  

5. Rightsholders entrust a CMO with the management of their rights. A CMO should undertake its services diligently, efficiently, and in a transparent and non-discriminatory manner.  

6. Within the limits of the mandate provided by a Rightsholder or granted by law, a CMO should:  

a. License and/or collect remuneration for the rights it represents or conclude agreements for the use and/or collection of such rights, as the case may be;

b. collect all Rights Revenue in respect of the use of such rights or of relevant copyright remuneration schemes;  

c. monitor the use of such rights.

d. prevent and act against the unauthorized use of such rights and enforce remuneration schemes, taking into account applicable provisions on limitations and exceptions, as well as relevant licensing arrangements; and

e. collect and process data on the use of such rights to enable the timely and accurate individual Distribution of monies.  

7. Within the limits of its mandates and in the interest of the Rightsholders it represents, a CMO may engage in activities aimed at increasing public awareness about copyright and related rights, collective rights management and CMOs, as well as highlight evidence of their positive effect on the national economy and on cultural diversity, including its cultural and social activities

Information for the General Public

In order to ensure a relationship of mutual trust, it is important for all stakeholders in the value chain to have easy access to accurate information about CMOs, as well as to how they are organized. The provision of certain basic information about a CMO’s operations is usually an essential step towards the creation of a more positive perception of CMOs amongst the general public. Day- to- day operations of a CMO must remain transparent to establish and bolster trust among all stakeholders.

LEGISLATIVE PROPOSALS

A CMO should regularly publish on the CMO’s website and keep up to date:  

1. Its Statute, membership terms and rules on termination of membership.  

2. Its tariff structure information.

3. Its general Distribution policy.

4. Its policy on deductions (such as any administration, social, cultural or educational deductions);  

5. Its policy on the use of non-distributable Rights Revenue;

6. Its annual accounts, and, its annual report;

7. Its complaint and dispute resolution procedures;

8. A list of the persons who manage its business and who sit on its board;

9. The total amount of remuneration paid, and other benefits provided to the persons who manage the business of the CMO; and

10. The Rights Revenue attributed, the amounts paid by the collective management organization per category of rights managed, and per type of use, for the rights it manages under the Representation Agreement, and any Rights Revenue attributed which is outstanding for any period.  
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