Digital Performance Right in Sound Recordings and Ephemeral Recordings for a New Subscription Service, 63532-63535 [E7-22044]
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Federal Register / Vol. 72, No. 217 / Friday, November 9, 2007 / Proposed Rules
Paperwork Reduction Act of 1995 (44
U.S.C. 3501–3520.).
power and responsibilities between the
Federal Government and Indian tribes.
Federalism
Energy Effects
We have analyzed this proposed rule
under Executive Order 13211, Actions
Concerning Regulations That
Significantly Affect Energy Supply,
Distribution, or Use. We have
determined that it is not a ‘‘significant
energy action’’ under that order because
it is not a ‘‘significant regulatory action’’
under Executive Order 12866 and is not
likely to have a significant adverse effect
on the supply, distribution, or use of
energy. The Administrator of the Office
of Information and Regulatory Affairs
has not designated it as a significant
energy action. Therefore, it does not
require a Statement of Energy Effects
under Executive Order 13211.
A rule has implications for federalism
under Executive Order 13132,
Federalism, if it has a substantial direct
effect on State or local governments and
would either preempt State law or
impose a substantial direct cost of
compliance on them. We have analyzed
this proposed rule under that Order and
have determined that it does not have
implications for federalism.
Unfunded Mandates Reform Act
The Unfunded Mandates Reform Act
of 1995 (2 U.S.C. 1531–1538) requires
Federal agencies to assess the effects of
their discretionary regulatory actions. In
particular, the Act addresses actions
that may result in the expenditure by a
State, local, or tribal government, in the
aggregate, or by the private sector of
$100,000,000 or more in any one year.
Though this proposed rule will not
result in such an expenditure, we do
discuss the effects of this rule elsewhere
in this preamble.
Taking of Private Property
This proposed rule would not affect a
taking of private property or otherwise
have taking implications under
Executive Order 12630, Governmental
Actions and Interference with
Constitutionally Protected Property
Rights.
Civil Justice Reform
This proposed rule meets applicable
standards in sections 3(a) and 3(b)(2) of
Executive Order 12988, Civil Justice
Reform, to minimize litigation,
eliminate ambiguity, and reduce
burden.
Protection of Children
We have analyzed this proposed rule
under Executive Order 13045,
Protection of Children from
Environmental Health Risks and Safety
Risks. This rule is not an economically
significant rule and would not create an
environmental risk to health or risk to
safety that might disproportionately
affect children.
sroberts on PROD1PC70 with PROPOSALS
Indian Tribal Governments
This proposed rule does not have
tribal implications under Executive
Order 13175, Consultation and
Coordination with Indian Tribal
Governments, because it would not have
a substantial direct effect on one or
more Indian tribes, on the relationship
between the Federal Government and
Indian tribes, or on the distribution of
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Technical Standards
The National Technology Transfer
and Advancement Act (NTTAA) (15
U.S.C. 272 note) directs agencies to use
voluntary consensus standards in their
regulatory activities unless the agency
provides Congress, through the Office of
Management and Budget, with an
explanation of why using these
standards would be inconsistent with
applicable law or otherwise impractical.
Voluntary consensus standards are
technical standards (e.g., specifications
of materials, performance, design, or
operation; test methods; sampling
procedures; and related management
systems practices) that are developed or
adopted by voluntary consensus
standards bodies.
This proposed rule does not use
technical standards. Therefore, we did
not consider the use of voluntary
consensus standards.
Environment
We have analyzed this proposed rule
under Commandant Instruction
M16475.lD and Department of
Homeland Security Management
Directive 5100.1, which guide the Coast
Guard in complying with the National
Environmental Policy Act of 1969
(NEPA)(42 U.S.C. 4321–4370f), and
have made a preliminary determination
that there are no factors in this case that
would limit the use of a categorical
exclusion under section 2.B.2 of the
Instruction. Therefore, we believe that
this rule should be categorically
excluded, under figure 2–1, (32)(e), of
the Instruction, from further
environmental documentation. Under
figure 2–1, paragraph (32)(e), an
‘‘Environmental Analysis Check List’’ or
‘‘Categorical Exclusion Determination’’
is not required for this rule. Comments
on this section will be considered before
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we make the final decision on whether
to categorically exclude this rule from
further environmental review.
List of Subjects in 33 CFR Part 117
Bridges.
For the reasons discussed in the
preamble, the Coast Guard proposes to
amend 33 CFR part 117 as follows:
PART 117—DRAWBRIDGE
OPERATION REGULATIONS
1. The authority citation for part 117
continues to read as follows:
Authority: 33 U.S.C. 499; 33 CFR 1.05–1(g);
Department of Homeland Security Delegation
No. 0170.1.
2. § 117.433 is revised to read as
follows:
§ 117.433
Bonfouca Bayou.
The draw of the S433 Bridge, mile 7.0,
at Slidell, shall open on signal, except
that from 6 p.m. to 6 a.m., the draw
shall open on signal if at least 2 hours
notice is given. On Monday through
Friday, except Federal holidays, the
draw need not open for the passage of
vessels from 7 a.m. to 8 a.m. and from
1:45 p.m. to 2:45 p.m.
Dated: October 29, 2007.
Joel R. Whitehead,
Rear Admiral, U.S. Coast Guard Commander,
Eighth Coast Guard District.
[FR Doc. E7–21884 Filed 11–8–07; 8:45 am]
BILLING CODE 4910–15–P
LIBRARY OF CONGRESS
Copyright Royalty Board
37 CFR Part 383
[Docket No. 2005–5 CRB DTNSRA]
Digital Performance Right in Sound
Recordings and Ephemeral
Recordings for a New Subscription
Service
Copyright Royalty Board,
Library of Congress.
ACTION: Notice of proposed rulemaking.
AGENCY:
SUMMARY: The Copyright Royalty Judges
are publishing for comment proposed
regulations that set the rates and terms
for the use of sound recordings in
transmissions made by new
subscription services and for the making
of ephemeral recordings necessary for
the facilitation of such transmissions for
the period commencing from the
inception of the new subscription
service through December 31, 2010.
DATES: Comments and objections, if any,
are due no later than December 10,
2007.
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Federal Register / Vol. 72, No. 217 / Friday, November 9, 2007 / Proposed Rules
Comments and objections
may be sent electronically to
crb@loc.gov. In the alternative, send an
original, five copies and an electronic
copy on a CD either by mail or hand
delivery. Please do not use multiple
means of transmission. Comments and
objections may not be delivered by an
overnight delivery service other than the
U.S. Postal Service Express Mail. If by
mail (including overnight delivery),
comments and objections must be
addressed to: Copyright Royalty Board,
P.O. Box 70977, Washington, DC 20024–
0977. If hand delivered by a private
party, comments and objections must be
brought to the Copyright Office Public
Information Office, Library of Congress,
James Madison Memorial Building,
Room LM–401, 101 Independence
Avenue, SE., Washington, DC 20559–
6000. If delivered by a commercial
courier, comments and objections must
be delivered between 8:30 a.m. and 4
p.m. to the Congressional Courier
Acceptance Site located at 2nd and D
Street, NE., Washington, DC, and the
envelope must be addressed to:
Copyright Royalty Board, Library of
Congress, James Madison Memorial
Building, LM–403, 101 Independence
Avenue, SE., Washington, DC 20559–
6000.
ADDRESSES:
FOR FURTHER INFORMATION CONTACT:
Richard Strasser, Senior Attorney, or
Gina Giuffreda, Attorney-Advisor, by
telephone at (202) 707–7658 or e-mail at
crb@loc.gov.
SUPPLEMENTARY INFORMATION:
sroberts on PROD1PC70 with PROPOSALS
Background
In 1995, Congress enacted the Digital
Performance Right in Sound Recordings
Act of 1995 (‘‘DPRA’’), Public Law 104–
39, which created an exclusive right for
copyright owners of sound recordings,
subject to certain limitations, to perform
publicly the sound recordings by means
of certain digital audio transmissions.
Among the limitations on the
performance right was the creation of a
new compulsory license for nonexempt
noninteractive digital subscription
transmissions. 17 U.S.C. 114(f).
Section 114 was later amended with
the passage of the Digital Millennium
Copyright Act of 1998 (‘‘DMCA’’ or ‘‘the
Act’’), Public Law 105–304, to cover
additional digital audio transmissions.
These include transmissions made by
‘‘new subscription services.’’ For
purposes of the section 114 license, a
‘‘new subscription service’’ is ‘‘a service
that performs sound recordings by
means of noninteractive subscription
digital audio transmissions and that is
not a preexisting subscription service or
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a preexisting satellite digital audio radio
service.’’ 17 U.S.C. 114(j)(8).
In addition to expanding the current
section 114 license, the DMCA also
created a new statutory license to allow
for the making of ephemeral
reproductions for the purpose of
facilitating certain digital audio
transmissions, including those made by
new subscription services. 17 U.S.C.
112(e).
To initiate a proceeding to establish
rates and terms for those transmissions
made by a new subscription service,
either a copyright owner of sound
recordings or a new subscription service
must file a petition with the Copyright
Royalty Judges (‘‘Judges’’). The petition
must indicate that a new subscription
service on which sound recordings are
performed is or is about to become
operational, for the purpose of
determining reasonable terms and rates
of royalty payments for the new
subscription service for the period
commencing with the inception of such
new subscription service and ending on
the date on which the most recent
royalty rates and terms for preexisting
subscription digital audio transmission
services or preexisting satellite digital
audio radio services expire or such
other period as the parties may agree. 17
U.S.C. 114(f)(2)(C).
On October 31, 2005, pursuant to
section 114(f)(2)(C), XM Satellite Radio,
Inc. (‘‘XM’’) filed with the Judges a
Petition to Initiate and Schedule
Proceeding for a New Type of
Subscription Service for a ‘‘new type of
subscription service [which] performs
sound recordings on digital audio
channels programmed by the licensee
for transmission by a satellite television
distribution service to its residential
customers, where the audio channels
are bundled with television channels as
part of a ‘basic’ package of service and
not for a separate fee.’’ XM Petition at
1. The petition noted that this new
subscription service was to commence
on or about November 15, 2005. Id.
On December 5, 2005, pursuant to 17
U.S.C. 804(b)(3)(C)(ii), the Copyright
Royalty Judges published a notice in the
Federal Register announcing
commencement of the proceeding to set
rates and terms for royalty payments
under sections 114 and 112 for the
activities of the new subscription
service described in the XM Petition
and requesting interested parties to
submit their petitions to participate. 70
FR 72471 (December 5, 2005). Petitions
to participate in this proceeding were
received from Sirius Satellite Radio, Inc.
(‘‘Sirius’’), XM, MTV Networks
(‘‘MTV’’), and SoundExchange, Inc.
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The Judges set the schedule for the
proceeding for both the direct and
rebuttal phases of the proceeding,
including the dates for the filing of the
written statements and the dates for oral
testimony for each phase. Subsequent to
the presentation of the direct phase of
their case and the filing of their written
rebuttal statements, but prior to the oral
presentation of their rebuttal witnesses,
the parties informed the Judges that they
had ‘‘reached full agreement on all
issues in this litigation’’ and that ‘‘there
are no more issues to try.’’ Transcript of
September 10, 2007, at p. 5. They also
stated that the settlement agreement
would be submitted to the Judges for
approval and adoption pursuant to 17
U.S.C. 801(b)(7)(A). Id. at 6. The
proposed rates and terms codifying the
settlement agreement were filed on
October 30, 2007.
Section 801(b)(7)(A) allows for the
adoption of rates and terms negotiated
by ‘‘some or all of the participants in a
proceeding at any time during the
proceeding’’ provided they are
submitted to the Copyright Royalty
Judges for approval. This section
provides that in such event:
(i) the Copyright Royalty Judges shall
provide to those that would be bound by the
terms, rates, or other determination set by
any agreement in a proceeding to determine
royalty rates an opportunity to comment on
the agreement and shall provide to
participants in the proceeding under section
803(b)(2) that would be bound by the terms,
rates, or other determination set by the
agreement an opportunity to comment on the
agreement and object to its adoption as a
basis for statutory terms and rates; and
(ii) the Copyright Royalty Judges may
decline to adopt the agreement as a basis for
statutory terms and rates for participants that
are not parties to the agreement, if any
participant described in clause (i) objects to
the agreement and the Copyright Royalty
Judges conclude, based on the record before
them if one exists, that the agreement does
not provide a reasonable basis for setting
statutory terms or rates.
17 U.S.C. 801(b)(7)(A). Rates and terms
adopted pursuant to this provision are
binding on all copyright owners of
sound recordings and new subscription
services performing the sound
recordings on digital audio channels
programmed by the licensee for
transmission by a satellite television
distribution service to its residential
customers where the audio channels are
bundled with television channels as
part of a ‘‘basic’’ package of service and
not for a separate fee.
The parties have agreed and proposed
that the terms governing the activities of
a new subscription service under
sections 114 and 112 as described
herein shall be the same, unless
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otherwise specified, as those to be
determined by the Judges in the current
proceeding to set rates and terms for the
subscription transmissions and the
reproduction of ephemeral recordings
by preexisting satellite digital audio
radio services, Docket No. 2006–1 CRB
DSTRA. The Judges will render their
determination in that proceeding by
mid-December.
The parties proposing the fee
structure and fees set forth herein have
agreed that the fee structure and fees
shall not be offered into evidence, relied
upon, considered as precedent, or
otherwise taken into account in (i) the
proceeding in Docket No. 2006–1 CRB
DSTRA to set rates and fees for the
public performance of sound recordings
or the reproduction of ephemeral
phonorecords via preexisting satellite
digital audio radio services, or (ii) in the
immediately following proceeding to
adopt successor rates and terms for
preexisting satellite digital audio radio
services.
As discussed above, the public may
comment and object to any or all of the
proposed regulations contained in this
notice of proposed rulemaking. Those
who do comment and object, however,
must be prepared to participate in
further proceedings in this docket to
establish rates and terms for the
activities of the new subscription
services described herein under the
section 112 and 114 licenses.
List of Subject in 37 CFR Part 383
Copyright, Digital audio
transmissions, Performance right, Sound
recordings.
Proposed Regulations
For the reasons set forth in the
preamble, the Copyright Royalty Judges
propose to add part 383 to Chapter III
of title 37 of the Code of Federal
Regulations to read as follows:
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PART 383—RATES AND TERMS FOR
SUBSCRIPTION TRANSMISSIONS AND
THE REPRODUCTION OF EPHEMERAL
RECORDINGS BY NEW
SUBSCRIPTION SERVICES
Sec.
383.1 General.
383.2 Definitions.
383.3 Royalty fees for public performance
of sound recordings and the making of
ephemeral recordings.
383.4 Terms for making payment of royalty
fees.
Authority: 17 U.S.C. 112(e), 114, and
801(b)(1).
§ 383.1
General.
(a) Scope. This part 383 establishes
rates and terms of royalty payments for
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the public performance of sound
recordings in certain digital
transmissions by Licensees in
accordance with the provisions of 17
U.S.C. 114, and the making of certain
ephemeral recordings by Licensees in
accordance with the provisions of 17
U.S.C. 112(e), during the period
commencing from the inception of the
Licensees’ Services and continuing
through December 31, 2010.
(b) Legal compliance. Licensees
relying upon the statutory licenses set
forth in 17 U.S.C. 112 and 114 shall
comply with the requirements of those
sections and the rates and terms of this
part.
(c) Relationship to voluntary
agreements. Notwithstanding the
royalty rates and terms established in
this part, the rates and terms of any
license agreements entered into by
Copyright Owners and Licensees shall
apply in lieu of the rates and terms of
this part to transmissions within the
scope of such agreements.
§ 383.2
Definitions.
For purposes of this part, the
following definitions shall apply:
(a) Applicable Period is the period for
which a particular payment to the
designated collection and distribution
organization is due.
(b) Bundled Contracts means
contracts between the Licensee and a
Provider in which the Service is not the
only content licensed by the Licensee to
the Provider.
(c) Copyright Owner is a sound
recording copyright owner who is
entitled to receive royalty payments
under 17 U.S.C. 112(e) or 114(g).
(d) License Period means the period
commencing from the inception of the
Licensees’ Services and continuing
through December 31, 2010.
(e) Licensee is a person that has
obtained statutory licenses under 17
U.S.C. 112 and 114, and the
implementing regulations, to make
digital audio transmissions as part of a
Service (as defined in paragraph (h) of
this section), and ephemeral recordings
for use in facilitating such
transmissions.
(f) Provider means a ‘‘multichannel
video programming distributor’’ as that
term is defined in 47 CFR 76.1000(e);
notwithstanding such definition, for
purposes of this part, a Provider shall
include only a distributor of
programming to televisions, such as a
cable or satellite television provider.
(g) Revenue. (1) ‘‘Revenue’’ means all
monies and other considerations, paid
or payable, recognizable during the
Applicable Period as revenue by the
Licensee consistent with Generally
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Accepted Accounting Principles
(‘‘GAAP’’) and the Licensee’s past
practices, which is derived by the
Licensee from the operation of the
Service and shall be comprised of the
following:
(i) Revenues recognizable by Licensee
from Licensee’s Providers and directly
from residential U.S. subscribers for
Licensee’s Service;
(ii) Licensee’s advertising revenues
recognizable from the Service (as
billed), or other monies received from
sponsors of the Service if any, less
advertising agency commissions not to
exceed 15% of those fees incurred to a
recognized advertising agency not
owned or controlled by Licensee;
(iii) Revenues recognizable for the
provision of time on the Service to any
third party;
(iv) Revenues recognizable from the
sale of time to Providers of paid
programming, such as infomercials, on
the Service;
(v) Where merchandise, service, or
anything of value is receivable by
Licensee in lieu of cash consideration
for the use of Licensee’s Service, the fair
market value thereof or Licensee’s
prevailing published rate, whichever is
less;
(vi) Monies or other consideration
recognizable as revenue by Licensee
from Licensee’s Providers, but not
including revenues recognizable by
Licensee’s Providers from others and
not accounted for by Licensee’s
Providers to Licensee, for the provision
of hardware for the Service by anyone
and used in connection with the
Service;
(vii) Monies or other consideration
recognizable as revenue for any
references to or inclusion of any product
or service on the Service; and
(viii) Bad debts recovered regarding
paragraphs (g)(1)(i) through (vii) of this
section.
(2) ‘‘Revenue’’ shall include such
payments as set forth in paragraphs
(g)(1)(i) through (viii) of this section to
which Licensee is entitled but which are
paid or payable to a parent, subsidiary,
division, or affiliate of Licensee, in lieu
of payment to Licensee but not
including payments to Licensee’s
Providers for the Service. Licensee shall
be allowed a deduction from ‘‘Revenue’’
as defined in paragraph (g)(1) of this
section for bad debts actually written off
during the reporting period.
(h) A Service is a non-interactive
(consistent with the definition of
‘‘interactive service’’ in 17 U.S.C.
114(j)(7)) audio-only subscription
service (including accompanying
information and graphics related to the
audio) that is transmitted to residential
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Federal Register / Vol. 72, No. 217 / Friday, November 9, 2007 / Proposed Rules
subscribers of a television service
through a Provider which is marketed as
and is in fact primarily a video service
where
(1) Subscribers do not pay a separate
fee for audio channels,
(2) The audio channels are delivered
by digital audio transmissions through a
technology that is incapable of tracking
the individual sound recordings
received by any particular consumer.
(3) However, paragraph (h)(2) of this
section shall not apply to the Licensee’s
current contracts with Providers that are
in effect as of the effective date of this
part if such Providers become capable in
the future of tracking the individual
sound recordings received by any
particular consumer, provided that the
audio channels continued to be
delivered to Subscribers by digital audio
transmissions and the Licensee remains
incapable of tracking the individual
sound recordings received by any
particular consumer.
(i) Subscriber means every residential
subscriber to the underlying service of
the Provider who receives Licensee’s
Service in the United States for all or
any part of a month; provided, however,
that for any Licensee that is not able to
track the number of subscribers on a
per-day basis, ‘‘Subscribers’’ shall be
calculated based on the average of the
number of subscribers on the last day of
the preceding month and the last day of
the applicable month, unless the Service
is paid by the Provider based on end-ofmonth numbers, in which event
‘‘Subscribers’’ shall be counted based on
end-of-month data.
(j) Stand-Alone Contracts means
contracts between the Licensee and a
Provider in which the only content
licensed to the Provider is the Service.
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§ 383.3 Royalty fees for public
performances of sound recordings and the
making of ephemeral recordings.
(a) Royalty rates. Royalty rates for the
public performance of sound recordings
by eligible digital transmissions made
over a Service pursuant to 17 U.S.C.
114, and for ephemeral recordings of
sound recordings made pursuant to 17
U.S.C. 112 to facilitate such
transmissions, are as follows. Each
Licensee will pay, with respect to
content covered by the License that is
provided via the Service of each such
Licensee:
(1) For Stand-Alone Contracts, the
greater of:
(i) 15% of Revenue, or
(ii) The following monthly minimum
payment per Subscriber to the Service of
such Licensee—
(A) From inception through 2006:
$0.0075
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(B) 2007: $0.0075
(C) 2008: $0.0075
(D) 2009: $0.0125
(E) 2010: $0.0150 and
(2) For Bundled Contracts, the greater
of:
(i) 15% of Revenue allocated to reflect
the objective value of the Licensee’s
Service, or
(ii) The following monthly minimum
payment per Subscriber to the Service of
such Licensee:
(A) From inception through 2006:
$0.0220
(B) 2007: $0.0220
(C) 2008: $0.0220
(D) 2009: $0.0220
(E) 2010: $0.0250
(b) Minimum fee. Each Licensee will
pay an annual, non-refundable
minimum fee of one hundred thousand
dollars ($100,000), payable on January
31 of each calendar year in which the
Service is provided pursuant to the
section 112 and 114 statutory licenses,
but payable pursuant to the applicable
regulations for all years 2007 and
earlier. Such fee shall be recoupable and
credited against royalties due in the
calendar year in which it is paid.
§ 383.4 Terms for making payment of
royalty fees.
(a) Subject to the provisions of this
section, terms governing timing and due
dates of royalty payments, late fees,
statements of account, audit and
verification of royalty payments and
distributions, cost of audit and
verification, record retention
requirements, treatment of Licensees’
confidential information, distribution of
royalties, unclaimed funds, designation
and definition of the collection and
distribution organization, and any
definitions for applicable terms not
defined herein and not otherwise
inapplicable shall be those adopted by
the Copyright Royalty Judges for
subscription transmissions and the
reproduction of ephemeral recordings
by preexisting satellite digital audio
radio services in Docket No. 2006–1
CRB DSTRA (‘‘the SDARS Proceeding’’).
(b) Without prejudice to any
applicable notice and recordkeeping
provisions, statements of account shall
not require reports of performances.
(c) If the Copyright Royalty Judges
adopt reports of use regulations in the
SDARS Proceeding, those regulations, if
any, shall govern Licensees’ obligations
to report sound recordings used
pursuant to this part, except that
Licensees also shall report to
SoundExchange which channels are
transmitted by their respective
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63535
Providers for all past, current and future
periods. In the event that the Copyright
Royalty Judges do not adopt reports of
use regulations in the SDARS
Proceeding, then reports of use provided
by XM Satellite Radio Inc. (‘‘XM’’) and
Sirius Satellite Radio Inc. (‘‘Sirius’’) for
their use of sound recordings on their
preexisting satellite digital audio radio
services (as defined in 17 U.S.C.
114(j)(10)) shall be deemed to satisfy
XM’s and Sirius’ obligations to report
sound recordings used pursuant to this
part, and MTV Networks shall provide
census reporting, retroactive to the
inception of its Service.
Dated: November 6, 2007.
James Scott Sledge,
Chief Copyright Royalty Judge.
[FR Doc. E7–22044 Filed 11–8–07; 8:45 am]
BILLING CODE 1410–72–P
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR Part 82
[EPA–HQ–OAR–2006–5065; FRL–8493–4]
RIN 2060–AO32
Protection of Stratospheric Ozone:
Revision of Refrigerant Recovery and
Recycling Equipment Standards
Environmental Protection
Agency (EPA).
ACTION: Proposed rule.
AGENCY:
SUMMARY: The Environmental Protection
Agency (EPA) is proposing to update
motor vehicle refrigerant recovery and
recycling equipment standards. Under
Clean Air Act Section 609, motor
vehicle air-conditioning (MVAC)
refrigerant handling equipment must be
certified by the Administrator or an
independent organization approved by
the Administrator and, at a minimum,
must be as stringent as the standards of
the Society of Automotive Engineers
(SAE) in effect as of the date of the
enactment of the Clean Air Act
Amendments of 1990. In 1997, EPA
promulgated regulations that required
the use of SAE Standard J2210, HFC–
134a Recycling Equipment for Mobile
Air Conditioning Systems for
certification of MVAC refrigerant
handling equipment. SAE has replaced
Standard J2210 with J2788, Recovery/
Recycle and Recovery/Recycle/
Recharging Equipment for HFC–134a
Refrigerant. To avoid confusion, EPA is
updating its reference to include the
new SAE standards. This action reflects
a change in industry standard practice.
This action proposes to revise the EPA
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]]>Agencies
[Federal Register Volume 72, Number 217 (Friday, November 9, 2007)]
[Proposed Rules]
[Pages 63532-63535]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-22044]
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LIBRARY OF CONGRESS
Copyright Royalty Board
37 CFR Part 383
[Docket No. 2005-5 CRB DTNSRA]
Digital Performance Right in Sound Recordings and Ephemeral
Recordings for a New Subscription Service
AGENCY: Copyright Royalty Board, Library of Congress.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Copyright Royalty Judges are publishing for comment
proposed regulations that set the rates and terms for the use of sound
recordings in transmissions made by new subscription services and for
the making of ephemeral recordings necessary for the facilitation of
such transmissions for the period commencing from the inception of the
new subscription service through December 31, 2010.
DATES: Comments and objections, if any, are due no later than December
10, 2007.
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ADDRESSES: Comments and objections may be sent electronically to
crb@loc.gov. In the alternative, send an original, five copies and an
electronic copy on a CD either by mail or hand delivery. Please do not
use multiple means of transmission. Comments and objections may not be
delivered by an overnight delivery service other than the U.S. Postal
Service Express Mail. If by mail (including overnight delivery),
comments and objections must be addressed to: Copyright Royalty Board,
P.O. Box 70977, Washington, DC 20024-0977. If hand delivered by a
private party, comments and objections must be brought to the Copyright
Office Public Information Office, Library of Congress, James Madison
Memorial Building, Room LM-401, 101 Independence Avenue, SE.,
Washington, DC 20559-6000. If delivered by a commercial courier,
comments and objections must be delivered between 8:30 a.m. and 4 p.m.
to the Congressional Courier Acceptance Site located at 2nd and D
Street, NE., Washington, DC, and the envelope must be addressed to:
Copyright Royalty Board, Library of Congress, James Madison Memorial
Building, LM-403, 101 Independence Avenue, SE., Washington, DC 20559-
6000.
FOR FURTHER INFORMATION CONTACT: Richard Strasser, Senior Attorney, or
Gina Giuffreda, Attorney-Advisor, by telephone at (202) 707-7658 or e-
mail at crb@loc.gov.
SUPPLEMENTARY INFORMATION:
Background
In 1995, Congress enacted the Digital Performance Right in Sound
Recordings Act of 1995 (``DPRA''), Public Law 104-39, which created an
exclusive right for copyright owners of sound recordings, subject to
certain limitations, to perform publicly the sound recordings by means
of certain digital audio transmissions. Among the limitations on the
performance right was the creation of a new compulsory license for
nonexempt noninteractive digital subscription transmissions. 17 U.S.C.
114(f).
Section 114 was later amended with the passage of the Digital
Millennium Copyright Act of 1998 (``DMCA'' or ``the Act''), Public Law
105-304, to cover additional digital audio transmissions. These include
transmissions made by ``new subscription services.'' For purposes of
the section 114 license, a ``new subscription service'' is ``a service
that performs sound recordings by means of noninteractive subscription
digital audio transmissions and that is not a preexisting subscription
service or a preexisting satellite digital audio radio service.'' 17
U.S.C. 114(j)(8).
In addition to expanding the current section 114 license, the DMCA
also created a new statutory license to allow for the making of
ephemeral reproductions for the purpose of facilitating certain digital
audio transmissions, including those made by new subscription services.
17 U.S.C. 112(e).
To initiate a proceeding to establish rates and terms for those
transmissions made by a new subscription service, either a copyright
owner of sound recordings or a new subscription service must file a
petition with the Copyright Royalty Judges (``Judges''). The petition
must indicate that a new subscription service on which sound recordings
are performed is or is about to become operational, for the purpose of
determining reasonable terms and rates of royalty payments for the new
subscription service for the period commencing with the inception of
such new subscription service and ending on the date on which the most
recent royalty rates and terms for preexisting subscription digital
audio transmission services or preexisting satellite digital audio
radio services expire or such other period as the parties may agree. 17
U.S.C. 114(f)(2)(C).
On October 31, 2005, pursuant to section 114(f)(2)(C), XM Satellite
Radio, Inc. (``XM'') filed with the Judges a Petition to Initiate and
Schedule Proceeding for a New Type of Subscription Service for a ``new
type of subscription service [which] performs sound recordings on
digital audio channels programmed by the licensee for transmission by a
satellite television distribution service to its residential customers,
where the audio channels are bundled with television channels as part
of a `basic' package of service and not for a separate fee.'' XM
Petition at 1. The petition noted that this new subscription service
was to commence on or about November 15, 2005. Id.
On December 5, 2005, pursuant to 17 U.S.C. 804(b)(3)(C)(ii), the
Copyright Royalty Judges published a notice in the Federal Register
announcing commencement of the proceeding to set rates and terms for
royalty payments under sections 114 and 112 for the activities of the
new subscription service described in the XM Petition and requesting
interested parties to submit their petitions to participate. 70 FR
72471 (December 5, 2005). Petitions to participate in this proceeding
were received from Sirius Satellite Radio, Inc. (``Sirius''), XM, MTV
Networks (``MTV''), and SoundExchange, Inc.
The Judges set the schedule for the proceeding for both the direct
and rebuttal phases of the proceeding, including the dates for the
filing of the written statements and the dates for oral testimony for
each phase. Subsequent to the presentation of the direct phase of their
case and the filing of their written rebuttal statements, but prior to
the oral presentation of their rebuttal witnesses, the parties informed
the Judges that they had ``reached full agreement on all issues in this
litigation'' and that ``there are no more issues to try.'' Transcript
of September 10, 2007, at p. 5. They also stated that the settlement
agreement would be submitted to the Judges for approval and adoption
pursuant to 17 U.S.C. 801(b)(7)(A). Id. at 6. The proposed rates and
terms codifying the settlement agreement were filed on October 30,
2007.
Section 801(b)(7)(A) allows for the adoption of rates and terms
negotiated by ``some or all of the participants in a proceeding at any
time during the proceeding'' provided they are submitted to the
Copyright Royalty Judges for approval. This section provides that in
such event:
(i) the Copyright Royalty Judges shall provide to those that
would be bound by the terms, rates, or other determination set by
any agreement in a proceeding to determine royalty rates an
opportunity to comment on the agreement and shall provide to
participants in the proceeding under section 803(b)(2) that would be
bound by the terms, rates, or other determination set by the
agreement an opportunity to comment on the agreement and object to
its adoption as a basis for statutory terms and rates; and
(ii) the Copyright Royalty Judges may decline to adopt the
agreement as a basis for statutory terms and rates for participants
that are not parties to the agreement, if any participant described
in clause (i) objects to the agreement and the Copyright Royalty
Judges conclude, based on the record before them if one exists, that
the agreement does not provide a reasonable basis for setting
statutory terms or rates.
17 U.S.C. 801(b)(7)(A). Rates and terms adopted pursuant to this
provision are binding on all copyright owners of sound recordings and
new subscription services performing the sound recordings on digital
audio channels programmed by the licensee for transmission by a
satellite television distribution service to its residential customers
where the audio channels are bundled with television channels as part
of a ``basic'' package of service and not for a separate fee.
The parties have agreed and proposed that the terms governing the
activities of a new subscription service under sections 114 and 112 as
described herein shall be the same, unless
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otherwise specified, as those to be determined by the Judges in the
current proceeding to set rates and terms for the subscription
transmissions and the reproduction of ephemeral recordings by
preexisting satellite digital audio radio services, Docket No. 2006-1
CRB DSTRA. The Judges will render their determination in that
proceeding by mid-December.
The parties proposing the fee structure and fees set forth herein
have agreed that the fee structure and fees shall not be offered into
evidence, relied upon, considered as precedent, or otherwise taken into
account in (i) the proceeding in Docket No. 2006-1 CRB DSTRA to set
rates and fees for the public performance of sound recordings or the
reproduction of ephemeral phonorecords via preexisting satellite
digital audio radio services, or (ii) in the immediately following
proceeding to adopt successor rates and terms for preexisting satellite
digital audio radio services.
As discussed above, the public may comment and object to any or all
of the proposed regulations contained in this notice of proposed
rulemaking. Those who do comment and object, however, must be prepared
to participate in further proceedings in this docket to establish rates
and terms for the activities of the new subscription services described
herein under the section 112 and 114 licenses.
List of Subject in 37 CFR Part 383
Copyright, Digital audio transmissions, Performance right, Sound
recordings.
Proposed Regulations
For the reasons set forth in the preamble, the Copyright Royalty
Judges propose to add part 383 to Chapter III of title 37 of the Code
of Federal Regulations to read as follows:
PART 383--RATES AND TERMS FOR SUBSCRIPTION TRANSMISSIONS AND THE
REPRODUCTION OF EPHEMERAL RECORDINGS BY NEW SUBSCRIPTION SERVICES
Sec.
383.1 General.
383.2 Definitions.
383.3 Royalty fees for public performance of sound recordings and
the making of ephemeral recordings.
383.4 Terms for making payment of royalty fees.
Authority: 17 U.S.C. 112(e), 114, and 801(b)(1).
Sec. 383.1 General.
(a) Scope. This part 383 establishes rates and terms of royalty
payments for the public performance of sound recordings in certain
digital transmissions by Licensees in accordance with the provisions of
17 U.S.C. 114, and the making of certain ephemeral recordings by
Licensees in accordance with the provisions of 17 U.S.C. 112(e), during
the period commencing from the inception of the Licensees' Services and
continuing through December 31, 2010.
(b) Legal compliance. Licensees relying upon the statutory licenses
set forth in 17 U.S.C. 112 and 114 shall comply with the requirements
of those sections and the rates and terms of this part.
(c) Relationship to voluntary agreements. Notwithstanding the
royalty rates and terms established in this part, the rates and terms
of any license agreements entered into by Copyright Owners and
Licensees shall apply in lieu of the rates and terms of this part to
transmissions within the scope of such agreements.
Sec. 383.2 Definitions.
For purposes of this part, the following definitions shall apply:
(a) Applicable Period is the period for which a particular payment
to the designated collection and distribution organization is due.
(b) Bundled Contracts means contracts between the Licensee and a
Provider in which the Service is not the only content licensed by the
Licensee to the Provider.
(c) Copyright Owner is a sound recording copyright owner who is
entitled to receive royalty payments under 17 U.S.C. 112(e) or 114(g).
(d) License Period means the period commencing from the inception
of the Licensees' Services and continuing through December 31, 2010.
(e) Licensee is a person that has obtained statutory licenses under
17 U.S.C. 112 and 114, and the implementing regulations, to make
digital audio transmissions as part of a Service (as defined in
paragraph (h) of this section), and ephemeral recordings for use in
facilitating such transmissions.
(f) Provider means a ``multichannel video programming distributor''
as that term is defined in 47 CFR 76.1000(e); notwithstanding such
definition, for purposes of this part, a Provider shall include only a
distributor of programming to televisions, such as a cable or satellite
television provider.
(g) Revenue. (1) ``Revenue'' means all monies and other
considerations, paid or payable, recognizable during the Applicable
Period as revenue by the Licensee consistent with Generally Accepted
Accounting Principles (``GAAP'') and the Licensee's past practices,
which is derived by the Licensee from the operation of the Service and
shall be comprised of the following:
(i) Revenues recognizable by Licensee from Licensee's Providers and
directly from residential U.S. subscribers for Licensee's Service;
(ii) Licensee's advertising revenues recognizable from the Service
(as billed), or other monies received from sponsors of the Service if
any, less advertising agency commissions not to exceed 15% of those
fees incurred to a recognized advertising agency not owned or
controlled by Licensee;
(iii) Revenues recognizable for the provision of time on the
Service to any third party;
(iv) Revenues recognizable from the sale of time to Providers of
paid programming, such as infomercials, on the Service;
(v) Where merchandise, service, or anything of value is receivable
by Licensee in lieu of cash consideration for the use of Licensee's
Service, the fair market value thereof or Licensee's prevailing
published rate, whichever is less;
(vi) Monies or other consideration recognizable as revenue by
Licensee from Licensee's Providers, but not including revenues
recognizable by Licensee's Providers from others and not accounted for
by Licensee's Providers to Licensee, for the provision of hardware for
the Service by anyone and used in connection with the Service;
(vii) Monies or other consideration recognizable as revenue for any
references to or inclusion of any product or service on the Service;
and
(viii) Bad debts recovered regarding paragraphs (g)(1)(i) through
(vii) of this section.
(2) ``Revenue'' shall include such payments as set forth in
paragraphs (g)(1)(i) through (viii) of this section to which Licensee
is entitled but which are paid or payable to a parent, subsidiary,
division, or affiliate of Licensee, in lieu of payment to Licensee but
not including payments to Licensee's Providers for the Service.
Licensee shall be allowed a deduction from ``Revenue'' as defined in
paragraph (g)(1) of this section for bad debts actually written off
during the reporting period.
(h) A Service is a non-interactive (consistent with the definition
of ``interactive service'' in 17 U.S.C. 114(j)(7)) audio-only
subscription service (including accompanying information and graphics
related to the audio) that is transmitted to residential
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subscribers of a television service through a Provider which is
marketed as and is in fact primarily a video service where
(1) Subscribers do not pay a separate fee for audio channels,
(2) The audio channels are delivered by digital audio transmissions
through a technology that is incapable of tracking the individual sound
recordings received by any particular consumer.
(3) However, paragraph (h)(2) of this section shall not apply to
the Licensee's current contracts with Providers that are in effect as
of the effective date of this part if such Providers become capable in
the future of tracking the individual sound recordings received by any
particular consumer, provided that the audio channels continued to be
delivered to Subscribers by digital audio transmissions and the
Licensee remains incapable of tracking the individual sound recordings
received by any particular consumer.
(i) Subscriber means every residential subscriber to the underlying
service of the Provider who receives Licensee's Service in the United
States for all or any part of a month; provided, however, that for any
Licensee that is not able to track the number of subscribers on a per-
day basis, ``Subscribers'' shall be calculated based on the average of
the number of subscribers on the last day of the preceding month and
the last day of the applicable month, unless the Service is paid by the
Provider based on end-of-month numbers, in which event ``Subscribers''
shall be counted based on end-of-month data.
(j) Stand-Alone Contracts means contracts between the Licensee and
a Provider in which the only content licensed to the Provider is the
Service.
Sec. 383.3 Royalty fees for public performances of sound recordings
and the making of ephemeral recordings.
(a) Royalty rates. Royalty rates for the public performance of
sound recordings by eligible digital transmissions made over a Service
pursuant to 17 U.S.C. 114, and for ephemeral recordings of sound
recordings made pursuant to 17 U.S.C. 112 to facilitate such
transmissions, are as follows. Each Licensee will pay, with respect to
content covered by the License that is provided via the Service of each
such Licensee:
(1) For Stand-Alone Contracts, the greater of:
(i) 15% of Revenue, or
(ii) The following monthly minimum payment per Subscriber to the
Service of such Licensee--
(A) From inception through 2006: $0.0075
(B) 2007: $0.0075
(C) 2008: $0.0075
(D) 2009: $0.0125
(E) 2010: $0.0150 and
(2) For Bundled Contracts, the greater of:
(i) 15% of Revenue allocated to reflect the objective value of the
Licensee's Service, or
(ii) The following monthly minimum payment per Subscriber to the
Service of such Licensee:
(A) From inception through 2006: $0.0220
(B) 2007: $0.0220
(C) 2008: $0.0220
(D) 2009: $0.0220
(E) 2010: $0.0250
(b) Minimum fee. Each Licensee will pay an annual, non-refundable
minimum fee of one hundred thousand dollars ($100,000), payable on
January 31 of each calendar year in which the Service is provided
pursuant to the section 112 and 114 statutory licenses, but payable
pursuant to the applicable regulations for all years 2007 and earlier.
Such fee shall be recoupable and credited against royalties due in the
calendar year in which it is paid.
Sec. 383.4 Terms for making payment of royalty fees.
(a) Subject to the provisions of this section, terms governing
timing and due dates of royalty payments, late fees, statements of
account, audit and verification of royalty payments and distributions,
cost of audit and verification, record retention requirements,
treatment of Licensees' confidential information, distribution of
royalties, unclaimed funds, designation and definition of the
collection and distribution organization, and any definitions for
applicable terms not defined herein and not otherwise inapplicable
shall be those adopted by the Copyright Royalty Judges for subscription
transmissions and the reproduction of ephemeral recordings by
preexisting satellite digital audio radio services in Docket No. 2006-1
CRB DSTRA (``the SDARS Proceeding'').
(b) Without prejudice to any applicable notice and recordkeeping
provisions, statements of account shall not require reports of
performances.
(c) If the Copyright Royalty Judges adopt reports of use
regulations in the SDARS Proceeding, those regulations, if any, shall
govern Licensees' obligations to report sound recordings used pursuant
to this part, except that Licensees also shall report to SoundExchange
which channels are transmitted by their respective Providers for all
past, current and future periods. In the event that the Copyright
Royalty Judges do not adopt reports of use regulations in the SDARS
Proceeding, then reports of use provided by XM Satellite Radio Inc.
(``XM'') and Sirius Satellite Radio Inc. (``Sirius'') for their use of
sound recordings on their preexisting satellite digital audio radio
services (as defined in 17 U.S.C. 114(j)(10)) shall be deemed to
satisfy XM's and Sirius' obligations to report sound recordings used
pursuant to this part, and MTV Networks shall provide census reporting,
retroactive to the inception of its Service.
Dated: November 6, 2007.
James Scott Sledge,
Chief Copyright Royalty Judge.
[FR Doc. E7-22044 Filed 11-8-07; 8:45 am]
BILLING CODE 1410-72-P
