Civil Law and Copyright Collective Rights Management Litigation in Europe

1. Introduction

Copyright collective rights management (CRM) refers to the system under which organisations known as collective management organisations (CMOs) administer copyright and related rights on behalf of authors, composers, performers, publishers and other rightsholders.

Instead of every creator negotiating separately with every:

broadcaster,

streaming service,

restaurant,

concert organiser,

television company,

radio station,

digital platform,

public venue,

a CMO can collectively administer the relevant rights.

Examples of activities include:

licensing;

collecting royalties;

distributing royalties;

monitoring usage;

enforcing rights;

negotiating tariffs;

representing rightsholders.

Litigation in Europe therefore frequently involves a triangular relationship:

Rightsholder ↔ CMO ↔ User/Licensee

European copyright collective-management disputes combine civil law, intellectual property law, contract law, competition law, EU internal-market law and procedural law.

2. Meaning of Collective Rights Management

A copyright owner normally has exclusive rights over uses of the protected work.

For example:

reproduction;

communication to the public;

making available;

distribution;

broadcasting;

public performance.

A CMO administers some of these rights collectively.

Simple example

A composer writes 1,000 songs.

It would be impractical for the composer to negotiate individually with:

every radio station;

every nightclub;

every streaming service;

every television channel.

The composer therefore authorises a CMO to license the relevant rights and collect royalties.

The CMO then distributes the money according to its rules.

3. European Legal Framework

The central European instrument is the Collective Rights Management Directive 2014/26/EU.

It establishes rules concerning:

governance of CMOs;

membership rights;

rightsholder participation;

transparency;

distribution of royalties;

deductions;

complaints;

dispute resolution;

multi-territorial licensing of online musical rights.

Copyright itself is also regulated through several EU directives, including the:

Information Society Directive 2001/29/EC;

Rental and Lending Rights Directive;

Enforcement Directive 2004/48/EC;

Copyright Term Directive;

Copyright in the Digital Single Market Directive 2019/790.

4. Civil-Law Character of the Relationship

The relationship between a CMO and a rightsholder may have contractual characteristics.

Important questions include:

What rights were transferred or entrusted?

For how long?

Can the author withdraw rights?

How are royalties calculated?

What deductions may the CMO make?

When must royalties be distributed?

Can the CMO refuse membership?

Can the rightsholder appoint another CMO?

The precise legal character differs among Member States.

5. Collective Management Organisation

A CMO typically performs five major functions.

1. Licensing

The CMO grants permission to users.

2. Collection

It collects royalties.

3. Distribution

It distributes royalties to rightsholders.

4. Monitoring

It monitors whether protected works are being used lawfully.

5. Enforcement

It may take legal action against unauthorised users.

6. Types of Litigation

Copyright collective-management litigation can involve:

A. Royalty disputes

The rightsholder claims that insufficient royalties were paid.

B. Tariff disputes

A user challenges the amount demanded by the CMO.

C. Membership disputes

An author challenges refusal of membership or treatment by a CMO.

D. Distribution disputes

Rightsholders challenge the way collected royalties are allocated.

E. Transparency disputes

Rightsholders seek information concerning:

revenue;

deductions;

licensing;

distribution methodology.

F. Competition disputes

A CMO is accused of abusing a dominant position.

G. Cross-border licensing disputes

The dispute concerns rights exercised across several European countries.

H. Online music licensing

Streaming platforms may require multi-territorial licences.

7. CMO and Competition Law

CMOs often occupy a powerful market position because obtaining a licence from them may be essential for lawful commercial exploitation.

This creates an important competition-law question:

When does legitimate collective management become an abuse of market power?

Article 102 TFEU is particularly important.

Possible abuses include:

excessive tariffs;

discriminatory tariffs;

unreasonable licensing conditions;

refusal to deal;

territorial restrictions;

exclusionary conduct.

8. Excessive Copyright Tariffs

A CMO may charge businesses for public use of copyrighted music.

For example:

hotels;

restaurants;

shops;

broadcasters;

gyms;

public events.

The business may argue:

“The tariff is excessive compared with the economic value of the music.”

The CMO may respond:

“The tariff reflects the value of the copyright licence.”

Courts and competition authorities may therefore need to determine whether the tariff is objectively justified.

9. Important Case 1 — Tournier v SACEM

CJEU, Case C-395/87, 13 July 1989

This is one of the foundational European cases concerning copyright collecting societies.

Facts

The dispute involved the French collecting society SACEM and the licensing of musical copyright.

Issue

The case concerned territorial arrangements and the relationship between collecting societies and European competition law.

Principle

The CJEU recognised that the activities of copyright-management organisations can fall within EU competition law.

Restrictions imposed through reciprocal representation arrangements may therefore be examined under EU law.

Importance

The case established an important bridge between:

Copyright protection

and

Competition law.

A copyright monopoly does not automatically place every conduct of a collecting society outside competition law.

10. Important Case 2 — Lucazeau and Others v SACEM

CJEU, Joined Cases C-110/88, C-241/88 and C-242/88, 13 July 1989

Facts

The dispute involved tariffs charged by SACEM for use of musical works.

Principle

The CJEU examined whether collecting societies could be regarded as abusing a dominant position by charging significantly higher fees than comparable societies in other Member States.

The Court indicated that significant differences in tariffs may provide evidence requiring investigation.

Importance

This is a fundamental authority for excessive royalty/tariff disputes.

It demonstrates that:

A CMO's dominant position does not give it unlimited freedom to impose unreasonable tariffs.

11. Important Case 3 — Ministère Public v Tournier

The Tournier litigation is also important for the territorial and reciprocal relationships between collecting societies.

Principle

The CJEU considered the relationship between:

copyright territoriality;

collecting societies;

reciprocal representation agreements;

restrictions on cross-border licensing.

Importance

The case is significant for understanding the development of the European market for collective music licensing.

It helped establish the foundation for later European reforms concerning:

multi-territorial licensing;

cross-border licensing;

competition between collecting societies.

12. Important Case 4 — Kanal 5 Ltd and TV 4 AB v Föreningen Svenska Tonsättares Internationella Musikbyrå (STIM)

CJEU, Case C-52/07, 11 December 2008

Facts

The case concerned a Swedish collecting society and the calculation of copyright royalties charged to television broadcasters.

Principle

The CJEU considered whether the method used by a collecting society to calculate royalties could amount to an abuse of a dominant position.

Importance

The case is especially important for:

broadcasting;

royalty calculation;

proportionality;

competition law;

collective management.

It illustrates that the method of calculating copyright royalties can itself be scrutinised under Article 102 TFEU.

13. Important Case 5 — CISAC v European Commission

General Court, Case T-442/08, 12 April 2013

Background

The European Commission investigated reciprocal representation arrangements between European collecting societies.

The arrangements concerned the territorial scope of licensing.

Principle

The General Court examined the relationship between:

collecting societies;

reciprocal representation agreements;

territorial restrictions;

competition law.

Importance

The case is particularly significant because it concerns the historical territorial structure of collective music licensing in Europe.

It demonstrates the tension between:

National copyright administration

and

the EU internal market.

14. Important Case 6 — OSA v Léčebné lázně Mariánské Lázně

CJEU, Case C-351/12, 27 February 2014

Facts

The dispute concerned the use of musical works in a spa establishment and the licensing rights administered by the Czech collecting society OSA.

Principle

The CJEU examined the relationship between copyright licensing and the freedom to provide services.

The Court accepted that certain restrictions connected with copyright licensing could be justified by the protection of intellectual property, subject to EU-law requirements.

Importance

The case illustrates that copyright collective management may have consequences for businesses operating across borders.

15. Important Case 7 — CISAC v European Commission

Court of Justice, Case C-410/13 P, 12 April 2017

This appeal followed the earlier General Court litigation concerning CISAC and European collecting societies.

Importance

The litigation illustrates the complexity of applying competition law to collective-management arrangements.

The central European-law tension is:

Territorial copyright rights

versus

cross-border market integration.

It is particularly useful for understanding why European collective licensing has gradually moved toward more flexible multi-territorial structures.

16. Important Case 8 — AKM v Zürs.net

CJEU, Case C-138/16, 16 November 2017

Principle

The case concerned the communication of copyright-protected works to the public and the role of collective management.

Importance

It illustrates how technological means of transmitting content can create copyright-licensing obligations.

For modern CMOs, the case is relevant to:

cable transmission;

retransmission;

digital distribution;

licensing scope.

17. Important Case 9 — Recorded Artists Actors Performers Ltd v Phonographic Performance (Ireland) Ltd

CJEU, Case C-265/19, 8 September 2020

Subject

The case concerned performers' rights and equitable remuneration.

Importance

It demonstrates the importance of related rights within collective management.

Collective rights management is not limited to authors.

It can also involve:

performers;

recording artists;

producers;

broadcasters.

18. Important Case 10 — RAAP v PPI

CJEU, Case C-265/19, 8 September 2020

This litigation is particularly important concerning performers' related rights and equitable remuneration.

Principle

The CJEU interpreted EU rules concerning remuneration for performers and phonogram producers.

Importance

It illustrates that collective management must respect the substantive rights granted by EU copyright and related-rights legislation.

19. Collective Management Directive 2014/26/EU

The Directive significantly changed European collective-management law.

Its major objectives include:

Transparency

Rightsholders should receive information concerning:

revenue;

deductions;

distribution;

licensing;

administrative costs.

Governance

Rightsholders should have meaningful participation in CMO governance.

Choice

Rightsholders receive greater ability, subject to applicable rules, to choose or change their CMO.

Cross-border licensing

The Directive facilitates multi-territorial licensing of online musical rights.

Complaints

CMOs must provide mechanisms for dealing with complaints.

20. Rightsholder Membership

An author may wish to join a CMO because individual enforcement is expensive.

Membership can provide:

licensing;

royalty collection;

monitoring;

enforcement;

administrative services.

But membership also raises questions about:

eligibility;

withdrawal;

representation;

voting rights;

distribution rules.

21. Withdrawal of Rights

A rightsholder may wish to withdraw certain rights from a CMO.

The legal question is:

Can the author take back the rights and license them independently?

European law provides greater flexibility than older systems in certain circumstances.

However, withdrawal may be subject to:

notice;

contractual arrangements;

existing licences;

territorial considerations;

statutory requirements.

22. Royalty Distribution

Collection is only half of the CMO's function.

The second question is:

Who receives the money?

A CMO must maintain appropriate systems for identifying usage and allocating royalties.

Disputes may arise where:

usage data is incomplete;

works are incorrectly identified;

songs are attributed to the wrong author;

international data is delayed;

administrative deductions are disputed.

23. Distribution Keys

CMOs often use distribution rules.

For example:

Total collected revenue

minus

permitted deductions

equals

distributable amount

The amount is then allocated based on:

actual usage;

broadcast data;

performance data;

streaming information;

sampling;

agreed distribution methodologies.

A rightsholder may challenge whether the methodology is fair or compliant with the CMO's legal obligations.

24. Administrative Deductions

CMOs may incur:

employee costs;

technology costs;

monitoring expenses;

legal expenses;

collection expenses.

They may deduct certain amounts before distributing royalties.

But excessive or inadequately disclosed deductions can create disputes.

Transparency is therefore essential.

25. Digital Streaming

Streaming has fundamentally changed collective rights management.

Examples include:

Spotify-type services;

video platforms;

podcasts;

social-media music;

short-form video;

livestreaming.

A single digital service may operate across dozens of countries.

This creates questions concerning:

territorial licences;

multiple CMOs;

repertoire;

royalty calculation;

metadata;

cross-border enforcement.

26. Multi-Territorial Licensing

Traditional European copyright licensing was strongly territorial.

A CMO in France might manage French rights.

Another society might manage German rights.

Another might manage Italian rights.

Online services require a more integrated system.

A streaming platform wants:

One efficient multi-territorial licensing mechanism.

The Collective Rights Management Directive facilitates such arrangements, particularly for online musical rights.

27. Competition Law and Territorial Restrictions

Historically, collecting societies often used reciprocal representation agreements.

These could effectively create:

One collecting society per territory.

Competition law raised concerns about whether such arrangements unnecessarily restricted cross-border licensing.

The CISAC litigation is therefore particularly important.

28. Tariff Litigation

A business may challenge a CMO tariff by arguing:

it is excessive;

it is discriminatory;

it is unrelated to actual use;

it imposes disproportionate costs;

it differs significantly from tariffs elsewhere.

The CMO may argue:

the tariff reflects the economic value of the repertoire;

the business obtains significant commercial benefit;

monitoring and administration have costs.

The court or competition authority must assess the relevant economic and legal circumstances.

29. Discrimination Between Users

A CMO may also face claims concerning unequal treatment.

For example:

Business A pays 2% of revenue.

Business B pays 8%.

Different treatment is not automatically unlawful.

There may be objective reasons.

But unexplained discriminatory pricing can raise competition-law concerns, particularly where the CMO has a dominant position.

30. Civil Liability of CMOs

A CMO may potentially face liability for:

failure to distribute royalties;

wrongful withholding;

inaccurate distribution;

failure to account;

breach of contractual obligations;

unlawful refusal of membership;

negligent administration.

The precise cause of action depends on national law.

31. CMO Transparency

Transparency is one of the central themes of modern European collective-management law.

Rightsholders should be able to understand:

what was collected;

from whom;

what was deducted;

how much was distributed;

how distribution was calculated.

Without transparency, rightsholders cannot effectively monitor the organisation representing their interests.

32. Governance of CMOs

A CMO is not simply a commercial licensing company.

Its governance structure can involve:

general assembly;

board;

supervisory structures;

rightsholder participation.

Questions may arise concerning:

voting rights;

conflicts of interest;

executive remuneration;

distribution policies;

strategic decisions.

33. Copyright and Competition: Important Balance

European law must balance two interests.

Copyright interest

Creators need effective protection and remuneration.

Competition/internal-market interest

Collective management should not become a mechanism for unjustified market foreclosure.

Therefore:

Copyright exclusivity does not create unlimited immunity from competition law.

This principle is particularly visible in Tournier, Lucazeau, STIM and CISAC.

34. Enforcement Against Unlicensed Users

A CMO may bring proceedings against a business using music without an appropriate licence.

Possible claims include:

injunction;

damages;

payment of royalties;

accounting;

cessation of infringement.

The user may defend itself by arguing:

no communication to the public occurred;

the CMO lacks authority;

the tariff is unlawful;

the licence is unnecessary;

the demanded amount is excessive.

35. Communication to the Public

A recurring copyright question is:

When does the use of protected material constitute a communication to the public?

This is particularly relevant to:

hotels;

restaurants;

shops;

gyms;

hospitals;

public transport;

websites;

streaming services.

CJEU case law has developed detailed principles concerning what constitutes communication to the public.

36. Evidence in CMO Litigation

Evidence may include:

CMO membership agreements;

licensing agreements;

tariff schedules;

royalty statements;

usage reports;

streaming data;

broadcast logs;

repertoire databases;

accounting records;

correspondence;

distribution policies.

Digital metadata has become particularly important.

37. Limitation and Prescription

Claims concerning unpaid royalties or copyright infringement are subject to applicable national limitation rules.

Important questions include:

When did the infringement occur?

When did the claimant discover it?

Was the infringement continuing?

When did the CMO become aware of the claim?

Does each individual use constitute a separate cause of action?

The answer varies by jurisdiction.

38. Alternative Dispute Resolution

Collective-management legislation encourages appropriate mechanisms for resolving disputes.

Possible methods include:

negotiation;

mediation;

arbitration;

specialised administrative proceedings;

judicial proceedings.

This can be particularly useful because tariff disputes may involve complex economic evidence.

39. Major Legal Tensions

40. Six Most Important Cases for Examination

41. Ultra-Basic Legal Flow

Copyright owner

↓

Joins/appoints CMO

↓

CMO manages rights

↓

User wants to use protected work

↓

Licence

↓

Royalty

↓

Collection

↓

Distribution to rightsholder

If dispute arises:

Tariff?

Licence?

Infringement?

Distribution?

Transparency?

Competition?

Cross-border licensing?

↓

Civil / administrative / competition proceedings

42. Conclusion

Copyright collective rights management litigation in Europe concerns the legal relationship between creators, collective management organisations and users of protected works.

The most important disputes involve royalty collection, tariff levels, distribution, transparency, membership, withdrawal of rights, licensing, digital streaming, territorial restrictions and competition law.

The European legal framework attempts to achieve a balance:

Creators need effective collective enforcement and remuneration, while users and competing licensing structures must not be subjected to unjustified restrictions.

The foundational cases are Tournier, Lucazeau, Kanal 5/STIM, CISAC, OSA, AKM and RAAP. Together, they demonstrate the development of European law from traditional nationally organised copyright collection toward a more integrated system involving EU competition law, cross-border licensing, digital exploitation, transparency and collective consumer/rightsholder protection.