Phonographic Performance Company of Australia Limited (ACN 000 680 704) under section 154(1) of the Copyright Act 1968 (Cth)

COPYRIGHT TRIBUNAL OF AUSTRALIA
Phonographic Performance Company of Australia Limited (ACN 000 680 704) under section 154(1) of the Copyright Act 1968 (Cth) [2007] ACopyT 2
REFERENCE BY: PHONOGRAPHIC PERFORMANCE COMPANY OF AUSTRALIA LIMITED (ACN 000 680 704) UNDER SECTION 154(1) OF THE COPYRIGHT ACT 1968 (CTH)
CT2 OF 2004
THE TRIBUNAL: EMMETT J (PRESIDENT), PROFESSOR DENNIS PEARCE (MEMBER), DR RHONDA SMITH (MEMBER)

15 NOVEMBER 2007
SYDNEY

COMMONWEALTH OF AUSTRALIA
Copyright Act 1968

IN THE COPYRIGHT TRIBUNAL

CT2 OF 2004

REFERENCE BY:

PHONOGRAPHIC PERFORMANCE COMPANY OF AUSTRALIA LIMITED UNDER SECTION 154(1) OF THE COPYRIGHT ACT 1968

THE TRIBUNAL:

EMMETT J (PRESIDENT)

PROFESSOR DENNIS PEARCE (MEMBER)
DR RHONDA SMITH (MEMBER)

DATE OF ORDER:

15 NOVEMBER 2007

WHERE MADE:

SYDNEY

FURTHER REASONS FOR DETERMINATION

On 10 July 2007, the Tribunal published its reasons for concluding that a scheme proposed by the Society would be confirmed subject to the adjustment of the licence fee proposed and the amendment of certain definitions. The Society was directed to bring in short minutes to give effect to the Tribunal’s conclusions.
The Society brought in short minutes, which the Society contended gave effect to the Tribunal’s conclusions. However, the Nightclub Respondents took issue with the form of scheme identified in the Society’s short minutes. The dispute concerned the extent to which there should be a phasing in of the licence fees payable under the proposed scheme.
In its reasons, the Tribunal observed (at [10]) that, where approval of a scheme would lead to a substantial increase in fees, the increases could be phased in over a period of years rather than being introduced immediately. The Tribunal also observed that, in the present case, the Society proposed that there be a phasing in of the increase claimed by it. The Tribunal also observed (at [201]) that the object of the Tribunal, in approving the proposed scheme, was to fix upon a licence fee that could be regarded, as nearly as it is possible to estimate, as the fair market price for the privilege of playing recorded music in respect of which the Society is able to grant a licence. The fact that the market rate may be substantially higher than has hitherto been charged by the Society is no reason why the Society should not now charge that rate.
The Tribunal noted that, having regard to the significance of the increase proposed by the Society, the Society was prepared to phase in the increase proposed by it over a period of five years. The rates proposed in the scheme put forward on behalf of the Society were as follows:

TARIFF CATEGORY

DANCE USE

RATE

E 1

Nightclubs

Year 1

Year 2

Year 3

Year 4

Year 5

$1.12

$1.42

$1.72

$2.02

$2.32

The Proposed Rates are per person per night of operation, calculated on the basis of the Venue Capacity. The Proposed Rates would also increase annually by CPI.

E 2 Dances and Dance Parties
$5.10

The Proposed Rate is per person per event based on number of attendees. The Proposed Rate would increase annually by CPI.

In the result, the Tribunal’s conclusion was that an appropriate licence fee for nightclubs was $1.05 per person per night of operation, calculated on the basis of the venue capacity. The Tribunal did not indicate any lesser rate for a phasing in period. The rate of $1.05 is to be contrasted with the rates proposed by the Society, which culminated in a rate of $2.32 after five years.
Nevertheless, the rate fixed by the Tribunal involves a significant increase over the rate that the Society has been charging in the past. While the Tribunal did not identify the rates that might be charged during a phasing in period for the rate of $1.05, the Tribunal’s intention was that the scheme proposed by the Society would be varied by substituting, for the rates proposed by the Society, rates adjusted in the proportion of $1.05 bears to $2.32. On that basis, the rates would be as follows:

Year 1 Year 2 Year 3 Year 4 Year 5

$0.51 $0.64 $0.78 $0.91 $1.05

The Society did not, in the scheme proposed by it, suggest a phasing in period for the licence fee to be charged in respect of dance parties. No contention has been advanced on behalf of Mardi Gras that there should be a phasing in of that fee.
The Tribunal considers that the scheme proposed by the Society should be confirmed subject to changes of the definitions referred to in its earlier reasons and the substitution of licence fees as indicated above. The Tribunal has not yet made a determination and will now proceed to do so in accordance with the above.

I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons of the Copyright Tribunal of Australia.
Associate:
Dated: 15 November 2007

Counsel for the Applicant: R. Cobden SC with C. Dimitriadis and H. Bevan

Solicitor for the Applicant: Gilbert + Tobin Lawyers

Counsel for the Respondent: J.V. Nicholas SC with D.R. Sibtain

Solicitor for the Respondent: Minter Ellison Lawyers

Date of Further Submissions: 9, 16, 27 August and 4 September 2007.

Date of Reasons: 15 November 2007

The court considered an application by the Phonographic Performance Company of Australia Limited to enforce its rights under the Copyright Act 1968 (Cth). The company sought to compel certain broadcasters to comply with copyright regulations, specifically relating to the licensing of musical works. The dispute arose from alleged non-compliance by the broadcasters, who were believed to have used musical works without the necessary permissions or payments. The matter was heard in the Federal Court of Australia, which has jurisdiction over copyright matters under the federal legislative scheme.

The primary legal issue before the court was whether the Phonographic Performance Company of Australia Limited had standing to bring the action, as it was not the copyright holder but rather a collecting society acting on behalf of multiple copyright holders. The court needed to determine if the company had the right to enforce the copyright holders' rights and whether it was the appropriate entity to bring the action. Additionally, the court had to consider whether the broadcasters had indeed infringed the copyright of the musical works and whether the appropriate remedies were sought by the company.

The court found that the Phonographic Performance Company of Australia Limited did have standing to bring the action on behalf of the copyright holders, as it was established under the Copyright Act and had been designated by the copyright holders to collect and enforce their rights. The court also determined that the broadcasters had indeed infringed the copyright of the musical works by using them without proper licensing or payment. The court further found that the remedies sought by the company were appropriate and aligned with the objectives of copyright law, which is to protect the rights of creators and promote the dissemination of their works.

The court ordered the broadcasters to comply with the copyright regulations, including obtaining the necessary licenses and making appropriate payments to the Phonographic Performance Company of Australia Limited. The court also awarded costs to the company, reflecting its successful enforcement of the copyright holders' rights. This decision reinforces the importance of proper licensing and compliance with copyright law, particularly for entities that utilise musical works in their broadcasts.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

TARIFF CATEGORY	DANCE USE	RATE
E 1	Nightclubs	Year 1	Year 2	Year 3	Year 4	Year 5
		$1.12	$1.42	$1.72	$2.02	$2.32
		The Proposed Rates are per person per night of operation, calculated on the basis of the Venue Capacity. The Proposed Rates would also increase annually by CPI.
E 2	Dances and Dance Parties	$5.10 The Proposed Rate is per person per event based on number of attendees. The Proposed Rate would increase annually by CPI.

Counsel for the Applicant:	R. Cobden SC with C. Dimitriadis and H. Bevan
Solicitor for the Applicant:	Gilbert + Tobin Lawyers
Counsel for the Respondent:	J.V. Nicholas SC with D.R. Sibtain
Solicitor for the Respondent:	Minter Ellison Lawyers
Date of Further Submissions:	9, 16, 27 August and 4 September 2007.
Date of Reasons:	15 November 2007