The Government Issues Implementing Regulations on Song and/or Music Royalties Management

Apr 09, 2021

The government has just recently issue Government Regulation No. 56 of 2021 on Song and/or Music Copyrights Royalties Management (GR 56/2021). This regulation which serves as the implementing regulations of Law No.28 of 2014 is promised to provide clearer guidelines on the royalties distribution management for copyright owners specifically from song/music industries. Among of the notable provisions under the GR 56/2021 are as follows:

· Establishment of Music and/or Song Database (Database): the GR 56/2021 mandates the Government, in this case is the Ministry of Law and Human Rights (MLHR) to establish Music/Song Database. This database will serve as basis of royalty distribution for the commercial use of the song recorded within MLHR’s database. The database which will be updated on 3-month basis will automatically include any song and/or music that has been previously recorded at MLHR. The Database must be built within 2 years as of the issuance of GR 56/2021.

·Establishment of Song and/or Music Information System (Sistem Informasi Lagu dan/atau Musik/SILM): under GR 56/2021, in addition to the establishment of Database, LMKN is required to established SILM. The SILM will serves as data and information system used to distribute music and/or song royalty. The SILM will be managed by the LMKN and must be operated within 2 years of the issuance of the GR 56/2021.

· Royalty Management: The GR 56/2021 provides clearer guidance on the royalty of management for song and/or music integrated at the Database. Any commercial use of Music and/or Song will be integrated at the database, while for the enforcement of license agreement on the use of song and/or music must be reported to LMKN via SILM. In addition on setting up reporting requirements, the GR 56/2021 also provides provision on royalty distribution which may be divided into: a) royalty distributed to copyright holder/creator and neighboring rights holder; b) operational funds; and c) contingency funds. This provision also regulates that for royalty of a copyright which its holder is unknown, may be kept by LMKN for 2 years, or otherwise will be distributed. In addition to that, for any dispute on distribution royalty, may be reported to the Directorate General of Intellectual Property to settled via mediation. 

Albeit the issues of royalties remain to be managed and regulated by the Ministry of Law and Human Rights, the GR 56/2021 provides clarity on the authority of LMKN to collect, pool, and distribute royalty based on commercial purposes. The GR 56/2021 also regulates type of commercial use covering, among others, radio, and TV broadcasting, which the list may further be expanded based on Ministerial regulations. (bcs)