In a landmark victory for songwriters, the U.S. Copyright Office issued a new rule on July 10 that ensures songwriters who reclaim their works from their publishers will also receive streaming royalties for those works through The Mechanical Licensing Collective (MLC).
Recording Academy CEO Harvey Mason Jr. spoke on the ruling: "After years of engagement and activism on this issue, the Academy applauds the Copyright Office for protecting the rights of songwriters and affirming their ability to receive appropriate compensation after reclaiming their copyrights. We also thank our friends in the music community for their partnership and collaboration as we fought for this important victory."
Songwriters often sign over the copyright to their music to publishers who then promote, license, and monetize their work. By law, songwriters have "termination rights" which allow them to end their publisher agreement and regain their copyrights after a period of time under certain conditions.
However, the MLC — which administers a blanket license for streaming platforms to use songs — initially determined that royalties generated from streams would continue to go to the license holder at the time a song is uploaded to a streaming service rather than to the current copyright owner at the time a song is streamed.
Starting back in 2020, the Recording Academy, along with other songwriter groups, opposed this practice as it undermined the purpose of termination rights, which exist to level the playing field for songwriters and other creators who may have entered into unfavorable deals.
Since 2020, the Recording Academy held multiple ex parte meetings with the Copyright Office to discuss the impacts of the MLC's determination, and submitted formal comments and reply comments throughout the Office's rulemaking proceedings.
In stating its position, the Academy argued its belief that termination rights are among the most important protections that songwriters, artists, and other creators have for their work. The Academy also urged the USCO to avoid weakening or infringing on these protections.
The U.S. Copyright Office has since agreed with the Recording Academy and deemed the MLC's decision an "erroneous" rule, stating that if a songwriter reclaims the copyright to their music, they should receive the royalties. And after multiple years of rulemaking, the Copyright Office published a final rule last week directing the MLC to distribute royalty payments in accordance with the Copyright Act.
The rule:
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Directs the MLC to make future royalty payments to the copyright holder at the time a stream is played.
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Directs the MLC to engage in a "corrective adjustment" process to address any overpayments made due to the erroneous rule.
The Recording Academy is proud to champion ownership rights for songwriters and to amplify the voices of small creators. For more information about the new rule, visit here.
