Meet the Collective Societies

Also called collective management organizations (CMOs), collective societies make it possible for rights holders in various industries to receive royalties in exchange for the use of their intellectual property. In the Canadian music industry, these organizations often work with the Copyright Board to establish tariffs (or licence fees) based on how, where, when, and why music is performed, broadcast, or reproduced. In addition, collective societies increasingly negotiate fees with licensees directly. It is then their responsibility to collect these fees from licensees and distribute them to their members in the form of royalties.

Music creators and publishers rely on two types of collective societies in particular—performing rights organizations (PROs) and reproduction rights organizations (RROs). If a writer is also the owner of a sound recording (or master rights holder), or they perform on one, there are additional collective societies that administer their neighbouring rights and private copying royalties.

Performing Rights Organizations (PROs)

• PROs administer performing rights for music creators and publishers. This includes the licensing of musical works—but not sound recordings—for public performance. 
• In Canada, “performance” in this context includes traditional radio and TV broadcasts, movie theatre screenings, digital media streaming, live concerts, background music played at commercial venues, and other forms.

There is only one PRO in Canada—the Society of Composers, Authors and Music Publishers of Canada (SOCAN). Foreign PROs include ASCAP, BMI, and SESAC in the US; PRS in the UK, GEMA in Germany, SACEM in France, IPRS in India, and many others. Some of these organizations (including SOCAN) administer additional rights as well (e.g., reproduction rights).

SOCAN

• Like most PROs around the world, SOCAN is a non-profit organization governed by an elected board of music creators and publishers (it is not a crown corporation). Membership is free for writers, but publishers must pay a one-time fee of $50 (plus tax) to join. 
• SOCAN currently represents in excess of 150,000 music creators and publishers in Canada. It also has agreements with more than 100 foreign PROs, which means that, when a work by a SOCAN member is performed in another country, the designated partner PRO in that territory will collect the appropriate royalties on SOCAN’s behalf. (And SOCAN does the same when works by members of partner PROs are performed in Canada.)
• While SOCAN deducts its operating costs from the licence fees it collects domestically, all foreign royalties are passed along to SOCAN members in their entirety.
• However, it’s important to note that what’s classified as a public performance in Canada may not be in another country. Further, tariffs and royalties may be calculated differently—so music creators shouldn’t assume their royalties from foreign play will match those they receive from SOCAN.
• To enable SOCAN to distribute royalties, publishers or music creators must register their works via the members section of the SOCAN website (please note that, even though a work may have been successfully registered, it will not appear in the public repertoire database until it has accrued royalties). That way, when a musical work is included on a cue sheet for an AV production or a Notification of Live Music Performance (NLMP) form that’s submitted to SOCAN, or it’s played on the radio or a streaming service and identified by SOCAN’s tracking technology, the PRO knows how to direct the funds.

Have questions about SOCAN? Check out their FAQ page.

Reproduction Rights Organizations (RROs)

• RROs—sometimes called mechanical rights organizations (MROs) as well—administer reproduction rights for music creators and publishers. This includes the mechanical licensing of musical works—either as part of, or distinct from, sound recordings—to be copied or otherwise reproduced in a variety of forms.
• Synchronization rights, another category of reproduction rights, are usually administered by music creators or publishers directly, but some RROs offer this service as well.
• In Canada, “reproduction” in this context currently includes the manufacturing of physical audio media (e.g., CDs and vinyl), the downloading of sound recordings, the streaming of audio and some AV content, traditional radio and some TV broadcasting, the inclusion of AV content on certain social media sites, and other forms.
• Reproduction royalties derived from traditional radio and TV broadcasts—in advance of which sound recordings or AV productions are copied for technical reasons—are often referred to as “broadcast mechanicals.” (And the reproductions themselves are called “broadcast-incidental copies” in this context.)

There are two RROs in Canada: the Canadian Musical Reproduction Rights Agency (CMRRA) and SOCAN Reproduction Rights (SOCAN RR). Foreign RROs include The Harry Fox Agency and MLC in the US, MCPS in the UK, JASRAC in Japan, UBC in Brazil, SACM in Mexico, and many others. Some of these organizations (including SOCAN) administer additional rights as well (e.g., performing rights).

CMRRA

• CMRRA is owned by SXWorks, which is a subsidiary and “the music publisher services arm” of SoundExchange, a US-based non-profit collective society. It’s guided by a committee of Canadian publishers who are appointed by the board of Music Publishers Canada.
• The organization represents most of the publishers and self-published music creators in Canada. Membership is free, and CMRRA deducts its operating costs from the licence fees it collects.
• CMRRA primarily licenses music for physical reproduction, downloading, streaming, and traditional radio broadcasting. 
• It has also negotiated licensing agreements with some social media companies—namely, Facebook and TikTok—to ensure that publishers (and the writers they represent) are compensated when their works are shared via these platforms.
• While CMRRA isn’t involved in sync licensing, it does offer “audiovisual post-synchronization licensing,” which entails the collection and distribution of royalties generated by the digital reproduction of certain types of pre-existing AV properties (e.g., YouTube videos with embedded music).
• In 2021, CMRRA added to its offering the international collection of mechanical royalties derived from digital reproduction that occurs outside Canada.
• CMRRA does not distribute mechanical royalties to music creators directly (unless they are self-published). Instead, it pays the royalties to the publishers, who then distribute the appropriate shares to the music creators.

Have questions about CMRRA? Check out their FAQ section.

SOCAN RR

• In 2018, SOCAN acquired the Society for Reproduction Rights of Authors, Composers and Publishers in Canada (SODRAC) to extend its service offering to include reproduction rights administration. The resulting organization is called SOCAN RR.
• SOCAN RR represents publishers and self-published music creators in Canada. Those for whom SOCAN already administers performing rights must opt in to having SOCAN RR administer their reproduction rights as well—this is not automatic. However, each member’s musical works need only be registered with the collective society once. 
• In addition to the licensing of music for reproduction in the form of physical media, downloads, streams, and incidental copies made for traditional radio broadcasts, SOCAN RR is also able to collect broadcast mechanicals from some traditional TV broadcasters (e.g., CBC television and various Quebec-based broadcasters).¹ 
• Members can also direct SOCAN RR to collect royalties from international reproductions through its partner RROs and assist with sync licensing.
• By default, SOCAN RR distributes mechanical royalties to its publisher members, who then distribute the appropriate shares to the music creators. However, publishers can instruct the organization to pay the music creators directly.

Neighbouring Rights Collectives

• When a sound recording is played over traditional radio, as background music at a commercial venue, via non-interactive or semi-interactive music streaming, or as part of some live events (e.g., parades and fairs), the performers and sound recording owner (or master rights holder, which is usually a record label) are entitled to receive neighbouring rights royalties. 
• In Canada, there are six collective societies (one of which also acts as an umbrella organization for the other five) engaged in the distribution of these royalties.
  • Re:Sound is the only one that establishes tariffs with the Copyright Board. It also administers royalties, either directly or through one of its five member organizations:
    • The Musicians’ Rights Organization Canada (MROC); the Recording Artists’ Collecting Society, a division of the Alliance of Canadian Cinema, Television and Radio Artists (ACTRA RACS); and Artisti distribute royalties to performers.
    • CONNECT Music Licensing and Soproq distribute royalties to labels or other sound recording owners (e.g., independent artists).
• Performers and record labels should only register with one of these six CMOs (performers with MROC, ACTRA RACS, Artisti or Re:Sound, and labels with CONNECT, Soproq or Re:Sound) in order to receive their royalties.
• In 2019, SOCAN and Re:Sound formed a joint venture called Entandem, which streamlines the music-licensing process for business owners, allowing them to pay one fee to one organization for multiple public performance licences.

To make sense of the various Canadian collective societies, view this helpful infographic from CONNECT Music Licensing (PDF).

Private Copying Collectives

• Since sound recordings are often privately copied for people’s personal use, dedicated collective societies have been established all over the world to compensate all the rights holders associated with those recordings and the musical works they feature (i.e., music creators, publishers, performers, and labels).
• The Canadian Private Copying Collective (CPCC) establishes tariffs with the Copyright Board that set levies (which are similar to taxes, except they’re paid to the CPCC and not the government) on the manufacturing and importation of blank media that are sold for the purpose of private copying.
• However, since recordable CDs are currently the only media subject to these levies, the royalties collected by the CPCC are minimal (although the organization is advocating to have a private copying levy applied to cell phones and tablets (PDF), as is the case in the US and most European nations).
• Regardless of the amount collected, royalties are paid to the CPCC member collectives—namely, SOCAN/SOCAN RR, CMRRA, Re:Sound, and its five member organizations—which then distribute them to their members based on percentages linked to representative radio play and album sales.

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1 https://www.socan.com/socan-reproduction-rights-clients-awarded-1-5-million-in-royalties-for-copies-of-music-in-cbc-arbitration/