The Spanish Society of Writers and Publishers (abbreviated SGAE in Spanish) was fined 6.38 million euros (over $6.9 million, using the 2023 average conversion price) by the Comisión Nacional de los Mercados y la Competencia (CNMC) for anti-competitive practices related to licensing agreements with radio and television stations.
The SGAE has been fined for “two infringements of abuse of a dominant position” by designing and implementing licensing rates in a way that obliges radio and television operators to accept an “average availability rate” (comparable to a flat rate) in order to be able to use his repertoire, according to a CNMC Press release on Wednesday (June 26).
The widespread application of the flat rate by the Spanish collecting society “had a double anti-competitive effect”, says the CNMC. The first result, which the CNMC refers to as “exploitative abuse”, arises from SGAE's practice of forcing licensees to pay a flat fee “that is unrelated to the actual use of their repertoire, both in terms of the number of projects as well as in terms of intensity. of their use,” according to the statement, which says this practice has been ongoing since “at least” January 1, 2016.
Because licensees are forced to pay the flat rate regardless of the extent of use of SGAE's repertoire, the CNMC adds, licensees' incentives to contract with SGAE competitors with less substantial repertoires are limited — a second anticompetitive effect which prevents “the entry and expansion” of those competitors into the market.
According to the CNMC, SGAE “reinforced” the latter result – which it says SGAE enacted from “at least” January 1, 2016 to December 31, 2017 – by “presenting its musical repertoire to users as universal and offering guarantees of compensation against possible third-party claims for the use of rights that do not belong to its repertoire.” The CNMC argues that this further limited incentives for franchisees to enter into contracts with SGAE competitors.
In addition to fines, SGAE has been ordered to stop these behaviors.
Investigations into SGAE were initiated following complaints from audiovisual media copyright entities Management Entity (Dama) and Unison Rights, SL (Unison), the statement said.
Advertising sign contacted SGAE but had not heard back by press time.
Earlier this year, Advertising sign stated SGAE's intentions to improve its reputation under the new CEO Cristina Perpiñá-Robertwho was appointed just over a year ago.
“SGAE is one of the leading CMOs in the world, with a critical role to play for its members,” Perpiñá-Robert previously said. “This year is our 125th anniversary, which is an opportunity to celebrate what we have achieved but also to highlight where we need to reform. I am determined that SGAE should achieve a greater presence internationally.”
Last year, SGAE collected 349.1 million euros ($377.8 million, based on the average 2023 conversion price) and distributed 354.1 million euros ($383.2 million), according to its 2023 financial results. while the number of copyright members increased from 36,956 to 83,148.
from our partners at https://www.billboard.com/pro/spanish-collecting-society-sgae-fined-7m-anti-competitive-conduct/
