Most service and retail businesses create a welcoming atmosphere for their customers with background music. It can often be heard while strolling through a shopping mall or store, or dining in a café or restaurant. But unfortunately, not every business owner knows that you have to pay for the right to play music in your place of business, otherwise you may be fined for violating the music copyright. To play songs legally or broadcast radio streams or music TV in your place of business, you must first sign a license agreement for the right to do so. In this article, we examine the legal formalities of copyright protection.
What Is Considered Copyright Infringement
Copyright infringement is the use (reproduction, distribution, playing and other actions) of someone else's musical work, including even a sample or melody of a song, or the song itself, without initially signing a contract that gives rights to this type of use.
For example, a waiter in a restaurant or a manager at a beauty salon plays background music in the business where he works using Yandex.Music, BOOM and similar streaming services with a paid subscription from his smartphone. This is considered an infringement of copyright and related rights, since the license for such services does not include playing music in public spaces, whether for profit or not. The owner of the music can safely sue the business and get material compensation for the infringement of his rights.
How then can a musician, especially a foreign one, discover that someone is illegally playing his music in a cafe on a quiet Moscow street? Fortunately, there are special organizations that monitor such activities with copyrighted materials, such as the Russian Author’s Society (RAO) and the World Intellectual Property Organisation (WIPO).
Both organizations are engaged in the collective management of rights to intellectual property. They collect and distribute remuneration for authors and rightsholders of copyrighted material for the public performance of their works. RAO is a Russian organization and WIPO is an international organization with an office in Moscow and state accreditation to handle such activities.
Fines and Compensation
Russian law provides three types of liability for violations of copyright and related rights.
According to articles 1301 and 1311 of the Russian Civil Code, a person who publicly uses musical compositions without buying the rights to them may be held civilly liable by court order. The plaintiff has the right to claim damages or compensation for infringement of intellectual property rights in the amount from 10,000 to 5 million rubles or compensation for double the value of the right to use the work.
According to Article 7.12 of the Code of Administrative Offenses of the Russian Federation on the Violation of Copyright and Similar Rights, the violator(s) of such rights shall be fined in the amount of 10,000 - 20,000 rubles (for individuals and individual entrepreneurs) and from 30,000 - 40,000 rubles (for organizations). It is important to note that upon discovery of the infringement, a court order grants authorities the right to confiscate from the defendant all copies of the infringed work(s), phonograms and other related materials, as well as any equipment used for such illegal reproduction.
Article 146 of the Criminal Code of the Russian Federation provides for criminal penalties in such cases. The amount of the fine for such infringements is directly dependant on the value of the rights to the legal use of the work. The minimum amount is 200,000 rubles. The maximum punishment involves imprisonment for up to 6 years and a fine of up to 500,000 rubles.
It is safe to say that anyone interested in playing licensed music publicly, should go through the process of educating themselves on how to acquire the rights to play such compositions instead of potentially facing legal troubles in the future for not taking the precautions.
Legislative Framework
The protection of copyright and related rights to musical works has become one of Russia’s legislative priorities for the creation of a well-established jurisprudence. After all, the creative industries are actively developing, more and more musicians and musical works are entering the market and as a consequence, there is a growing number of legal disputes in regard to the protection of intellectual property rights.
Below, we have provided the main references to the legal framework of Russia’s copyright law.
Civil liability is governed by the Civil Code of the Russian Federation and is described in Articles: 1250, 1251, 1252, 1253, 1290, 1301.
Administrative liability is regulated by the Code of Administrative Offenses of the Russian Federation Art. 7.12.
Criminal liability is regulated by Art. 146 and Art. 147 of the Criminal Code of the Russian Federation.
To avoid having to face the legal consequences of copyright infringement, it is strongly recommended for every conscientious business owner to obtain the official licenses for the right to use music in their places of business.
How to Avoid Penalties for Playing Music in Public
In order to legally use music in public places, you can conclude a contract directly with one of the collective rights management organizations (CMOs) — RAO or WIPO — or with a company that specifically provides such intermediary services. Let’s look at both options.
Contract with RAO or WIPO.
Representatives of the organizations will calculate the monthly payment rates for using licensed music rights, based on the type of business, the population in the city where the business or event is located, the number of businesses owned by the owner, and the total coverage area of the location where the music will be played. The popularity of the music also plays a role in the cost of the right to play it — the more popular it is, the more expensive are the rights. Upon signing a contract with the CMO for the right to play selected music, the person who purchased such rights is legally bound to pay the amount specified in the contract and submit monthly song play reports to the CMO. The reports help the CMOs calculate owed royalties for each rightsholder, both Russian and foreign, for the played tracks.
Contract with an intermediary company.
This option is an easier and more convenient way to legally play licensed music in a business. An intermediary company enters into music license agreements directly with musicians and music studios, as well as with CMOs. They handle all of the processing and transmission of monthly usage reports, which is a strong argument in favor of using the services of such intermediary companies. One such company is FONMIX.
The FONMIX music catalog contains over 12 million tracks, grouped by theme, genre, mood, type of business, time of day, season, and many other parameters. Additionally, it offers more than 300 regularly updated, themed ready-to-play playlists. Read more about the service's playlists and catalogs in this article.
The FONMIX service can be used by downloading the FONMIX app to any device (computer, tablet, smartphone) or by purchasing the FMBox, which already has the FONMIX app pre-installed. Both options offer the possibility to use the service both online and offline, in case the place of business for intended use does not have Internet access.