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PPL tariffs - a right Royalty increase?

Licensed premises will no doubt be familiar with the Phonographic Performance Limited (PPL) which, in brief, is responsible for granting copyright licences for the use of sound recordings on behalf of record companies and performer members.

Put more simply, they collect music royalty fees.

Unfortunately for operators, PPL is looking to increase the tariff it charges for certain music royalties, provisionally to take full effect from 2014, although with a potential phasing in period up until then. In their current format, the proposals will likely mean a substantial increase in fees due from operators when carrying out what will be known as ‘Specially Featured Entertainment' or SFE for short.

SFE events include DJ events or dancing events (the latter being interpreted fairly widely to include, for example, "table/lap dancing, dancing on ice, or roller discoing"). Importantly, ‘dancing' will also include the mere provision of dance facilities as long as there is exists a reasonable expectation that dancing will take place.

The formula for calculating the new tariffs is rather complicated (even Carol Vorderman might struggle!!), being based on the average attendance of events together with the number and duration of SFE events. The tariff should therefore cause the largest increase in fees for night clubs etc. but the potential percentage increases will likely reflect a large rise for all operators.

The proposals are currently going through a consultation process, which expires 14th October 2011. Further details of the proposals, the consultation itself and how to comment on it can be found on the PPL website.

For the avoidance of doubt, the consultation does not affect the use of music videos (which are administrated by Video Performance Limited (VPL)) or public performance licences operated by the Performing Rights Society (PRS).