SCPP collections reach €89m as French society ponders the future of aid funds after CJEU ruling

 

By Emmanuel Legrand

French neighbouring rights society SCPP reported total collections of €89 million in 2019, down 3.3% compared to 2018, when collections reached €91.5m. The €2.5m drop was due to "a sharp drop in collections for the distribution of music videos," down 18% year-on-year, and a 7.3% decline in remuneration from private copying. SCPP said collections in 2018 included "very significant adjustments" from previous years, as well as an increase in collections from equitable remuneration of nearly 4%.

  SCPP, which represents the three major companies and several hundred independent labels, distributed €88.8m to its members, an amount equivalent to that of 2018 (€88m), despite the drop in collections. SCPP explained that the high level of distribution was due to the fact that the society now distributes its collections for the use of recordings by television the year following collections rather than two years after their collection.

  "This result was made possible by the use of automatic identification services for broadcast content," said SCPP. SPRE, the umbrella organisation that collects the proceeds from private copying and equitable remuneration, has been relying on data from Barcelona-based company BMAT for the tracking of content used on TV.

Low admin rates

  SCPP said the company's cost of management remained stable in 2019, at 8.2%, which is described as "one of the lowest rates in Europe" by SCPP's management. 

  In 2019, the SCPP allocated €21.7m to support schemes, including €4m coming from non-distributable sums. During 2019's financial year, granted funds to 1,218 projects, against 1,080 in 2018, for an amount of €18.4m. 

  During the company's Annual General Meeting, held in Paris at the end of September, instead of the normal June event, due to the pandemic, SCPP's board addressed the impact of the recent decision of the Court of Justice of the European Union, which ruled that equitable remuneration (performance rights on recordings) should be paid to performers regardless of their origins. 

A significant drop in support funds

  So far, SCPP, like all French neighbouring rights societies (SPPF, ADAMI and Spedidam), have not paid performers from countries such as the United States. SCPP explained that French legislation, in accordance with the Rome Convention of 1961, "did not allow the equitable remuneration" to be distributed to certain phonograms, in particular phonograms fixed in the United States, because the country is not a signatory to the Rome Convention. Instead, the sums collected for the use of this specific repertoire were aggregated into the non-distributable and allocated to support funds. 

  "The CJEU considers that European law does not allow, as it stands, to exclude certain phonograms from the benefit of equitable remuneration," said the society. Part of SCPP's 2020 aid budget was financed by non-distributable from equitable remuneration, which can no longer be the case. As a result, the Board of Directors of SCPP has decided "to postpone any decision concerning the allocation or payment of aids," in order to "take into account the new situation created by the decision of the CJEU."  

  SCPP is working on a new support scheme 2021 that will be discussed at an exceptional General Meeting of its partners, which should be held at the end of 2020. "The CJEU decision has the effect of almost halving the SCPP's recurrent aid budget for 2021 compared to what it was in 2020, so it is necessary that SCPP's Board of Directors propose a new aid system," explained the society.