Compulsory license for making and distributing phonorecords.
In the case of nondramatic musical works, the exclusive rights provided
by clauses (1) and (3) of section 106, to make and to distribute
phonorecords of such works, are subject to compulsory licensing under
the conditions specified by this section.
(a) Availability and Scope of Compulsory License.--
(1) When phonorecords of a nondramatic musical work have been
distributed to the public in the United States under the authority of
the copyright owner, any other person may, by complying with the
provisions of this section, obtain a compulsory license only if his or
her primary purpose in making phonorecords is to distribute them to the
public for private use. A person may obtain a compulsory license for
use of the work in the making of phonorecords duplicating a sound
recording fixed by another, unless: (i) such sound recording was fixed
lawfully; and (ii) the making of the phonorecords was authorized by the
owner of copyright in the sound recording or, if the sound recording
was fixed before February 15, 1972, by any person who fixed the sound
recording pursuant to an express license from the owner of the
copyright in the musical work or pursuant to a valid compulsory license
for use of such work in a sound recording.
(2) A compulsory license includes the privilege of making a musical
arrangement of the work to the extent necessary to conform it to the
style or manner of interpretation of the performance involved, but the
arrangement shall not change the basic melody or fundamental character
of the work, and shall not be subject to protection as a derivative
work under this title, except with the express consent of the copyright
owner.
(b) Notice of Intention to Obtain Compulsory License.--
(1) Any person who wishes to obtain a compulsory license under this
section shall, before or within thirty days after making and before
distributing any phonorecords of the work, serve notice of intention to
do so on the copyright owner. If the registration or other public
records of the Copyright Office do not identify the copyright owner and
include an address at which notice can be served, it shall be
sufficient to file the notice of intention in the Copyright Office.
The notice shall comply, in form, content, and manner of service, with
requirements that the Register of Copyrights shall prescribe by
regulation.
(2) Failure to serve or file the notice required by clause (1)
forecloses the possibility of a compulsory license and, in the absence
of a negotiated license, renders the making and distribution of
phonorecords actionable as acts of infringement under section 501 and
fully subject to the remedies provided by sections 502 through 506 and
509.
(c) Royalty Payable Under Compulsory Licence--
(1) To be entitled to receive royalties under a compulsory license, the
copyright owner must be identified in the registration or other public
records of the Copyright Office. The owner is entitled to royalties
for phonorecords made and distributed after being so identified, but is
not entitled to recover for any phonorecords previously made and
distributed.
(2) Except as provided by clause (1), the royalty under a compulsory
license shall be payable for every phonorecord made and distributed in
accordance with the license. For this purpose, a phonorecord is
considered "distributed" if the person exercising the compulsory
license has voluntarily and permanently parted with its possession.
With respect to each work embodied in the phonorecord, the royalty
shall be either two and three-fourths cents, or one-half of one cent
per minute of playing time or fraction thereof, which amount is larger.
(3) A compulsory license under this section includes the right of the
maker of a phonorecord of a nondramatic musical work under subsection
(a)(1) to distribute or authorize distribution of such phonorecord by
rental, lease, or lending (or by acts or practices in the nature of
rental, lease, or lending). In addition to any royalty payable under
clause (2) and chapter 8 of this title, a royalty shall be payable by
the compulsory licensee for every act of distribution of a phonorecord
by or in the nature of rental, lease, or lending, by or under the
authority of the compulsory licensee. With respect to each nondramatic
musical work embodied in the phonorecord, the royalty shall be a
proportion of the revenue received by the compulsory licensee from
every such act of distribution of the phonorecord under this clause
equal to the proportion of the revenue received by the compulsory
licensee from distribution of the phonorecord under clause (2) that is
payable by a compulsory licensee under that clause and under chapter 8.
The Register of Copyrights shall issue regulations to carry out the
purpose of this clause.
(4) Royalty payments shall be made on or before the twentieth day of
each month and shall include all royalties for the month next
preceding. Each monthly payment shall be made under oath and shall
comply with requirements that the Register of Copyrights shall
prescribe by regulation. The Register shall also prescribe regulations
under which detailed cumulative annual statements of account, certified
by a certified public accountant, shall be filed for every compulsory
license under this section. The regulations covering both the monthly
and the annual statements of account shall prescribe the form, content,
and manner of certification with respect to the number of records made
and the number of records distributed.
(5) If the copyright owner does not receive the monthly payment and the
monthly and annual statements of account when due, the owner may give
written notice to the licensee that, unless the default is remedied
within thirty days from the date of the notice, the compulsory license
will be automatically terminated. Such termination renders either the
making or the distribution, or both, of all phonorecords for which the
royalty has not been paid, actionable as acts of infringement under
section 501 and fully subject to the remedies provided by sections 502
through 506 and 509.