SGAE statement on the WIPO arbitration award ending the conflict of night time slots on television 25/Jul/2017

Yesterday, Wednesday July 19, the World Intellectual Property Organization (WIPO) notified the General Society of Authors and Publishers (SGAE) of the award rendered in the arbitration procedure to which the entity was submitted by the agreement of Its Board of Directors on December 21, 2016. This award ends a long conflict that has affected the SGAE in relation to the distribution of copyright in so-called night time slots on television. The large number of actors involved and the conflicting interests in this case have made the internal solution difficult, which is why arbitration was requested.

Arbitration is an out-of-court procedure whereby a dispute is submitted, by agreement of the parties, to an arbitrator or a court that issues a decision on the same, known as an award, which is binding for the parties. In this case, the arbitration tribunal appointed by the WIPO has been working since January 2017 in order to resolve the dispute. This body was formed by D. Joaquín García Bernaldo de Quirós (president), D. Luis Berenguer Fuster and D. Mihály Ficsor.

The issues before the court were:

-The determination of the value weightings granted to the different slots in the SGAE Rules for the distribution, especially to the night time slots, with it being necessary to establish the criteria that have to be followed for its establishment.

-The rules for accepting or rejecting works declared by users in broadcasts of background music which are transmitted with a sound level significantly lower than that of ordinary broadcasts.

Over the last two years the SGAE Board of Directors, has worked on the modification of night time slots as a way of solving the conflict raised and the arbitral tribunal recognises this. However, these changes did not solve the existing distribution distortions, since, as the award states: "The television companies adapted their practices again, among others, by means of a more widespread use of works which, according to the rules of "variable content" - received a high rating".

The arbitration tribunal, after analysing each party's arguments and the documentation provided, as well as the large amount of evidence put forward, states in its resolution that the best way to address this problem is to establish a limit on the rights to be distributed to the night slots. So the surplus that exceeds the established limit must be redistributed among the rest of the time slots according to the currently established weight. This has a double effect: it avoids current distortion of the distribution and balances the distribution of rights between the rest of the slots.

The award is for direct application, in as far as the different departments of the SGAE are already working on the implementation of the necessary changes so that the next distribution of television rights is governed by these criteria and they are introduced in the organisation's internal regulations.

The operative part of the award, which has been unanimously established by the three arbitrators appointed, states the following:

1.  Dawn time slot: as this lacks a significant audience and commercial value, grant a total of each of the users' proceeds that amounts to a fixed sum that ranges between 10% and 20% of the total collected (suggesting that it is set at 15%).

2.  Remainder of time slots: a new distribution must be carried out with the existing amount after the application of the previous section.

Concerning background music and its distribution:

1.   Non-audible or inaudible background music: no distribution rights can be generated.

2.   "Barely audible" background music: it seems reasonable to reduce the allocation of rights for    this type of broadcast by 50%.