Who collects my royalties?
UPDATED: January 6, 2010
It’s all about you. We want to help you make the right legal decisions.
We strive to help you make confident law decisions. Finding trusted and reliable legal advice should be easy. This doesn't influence our content. Our opinions are our own.
(1) Mechanical Royalties: Domestic (US) mechanical royalties are collected by domestic record companies for records sold. Foreign mechanical royalties are collected from foreign Performance Rights Organization ("PRO") by sub-publisher(s) for records sold in their territory.
(2) Performance Royalties: Domestic (US) performance royalties are collected by one of the three main Performance Rights Organization: (1) ASCAP; (2) BMI; and (3) SESAC. These PROs issue blanket licenses to music users for publicly performing their songs in the operation of their businesses and broadcasts. To ensure prompt and timely payment of performance income from a PRO, each songwriter and music publisher must first join as a member and properly register their songs and current whereabouts.
Foreign performance royalties are collected by foreign, government-owned PROs. To ensure prompt and timely payment of performance income from a foreign PRO, each songwriter and music publisher should enter into a "sub-publishing" agreement and properly register their songs and current whereabouts with the sub-publisher in each territory their songs are performed. The foreign performance societies contact each sub-publisher in their territory and request they designate an agent for the performance rights in all their songs. They then contact the users of those songs in their territory (e.g. local radio stations, nightclubs, TV, etc.), and grant them performance licenses to use all the songs of all the sub-publishers they represent. The foreign PROs then collect and pay the publishers share of performance income to sub-publishers, and pay the writers share to one of the American PROs (ASCAP, BMI or SESAC), which then pays the artist. If there is no foreign sub-publishers, the publishers share eventually is paid to the US music publisher via one of the American PROs, but this process takes much longer.
(3) Synchronization Fees: Synchronization fees are collected by the song writer and/or music publisher that grants a synchronization license to users or broadcasters of the songs, which then create a derivative audiovisual work in the form of movies, TV programs, commercials, etc.
(4) Print Music Income: Print music income is collected by the song writer and/or music publisher that grants a print music license to music printers which then prints sheet music or folios.
(Reprinted with permission of Ruben Salazar, Esq.)