Fees for Electronic Recordation and Notices of Intention To Obtain a Compulsory License, 52221-52224 [2017-24526]
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Federal Register / Vol. 82, No. 217 / Monday, November 13, 2017 / Rules and Regulations
pertaining to a copyright’’ pursuant to
§ 201.4, but the Office will not index the
document as a notice of termination.
(C) In any case where an author
agreed, prior to January 1, 1978, to a
grant of a transfer or license of rights in
a work that was not created until on or
after January 1, 1978, a notice of
termination of a grant under section 203
of title 17 may be recorded if it recites,
as the date of execution, the date on
which the work was created.
(2) Paper submission procedure—(i)
Process. A copy of a notice of
termination may be submitted for
recordation by sending it to the
appropriate address in § 201.1(c) or to
such other address as the Office may
specify, accompanied by a cover sheet,
the statement of service, and the proper
fee.
(ii) Cover sheet required. Submission
of a copy of a notice of termination must
be accompanied by a completed
Recordation Notice of Termination
Cover Sheet (Form TCS), available on
the Copyright Office Web site. Remitters
must follow all instructions provided by
the Office in completing Form TCS,
including by providing all requested
indexing information. Form TCS may be
used to provide the statement of service
and to make any of the certifications
required by this paragraph (f). Form TCS
will not be considered part of the
recorded notice, but will be used by the
Office for examination, indexing, and
other administrative purposes. The
Office may reject any notice submitted
for recordation that includes an
improperly prepared cover sheet.
(iii) Return receipt. If a remitter
includes two copies of a properly
completed Form TCS indicating that a
return receipt is requested, as well as a
self-addressed, postage-paid envelope,
the remitter will receive a date-stamped
return receipt attached to the extra copy
acknowledging the Copyright Office’s
receipt of the enclosed submission. The
completed copies of Form TCS and the
self-addressed, postage-paid envelope
must be included in the same package
as the submitted notice. A return receipt
confirms the Office’s receipt of the
submission as of the date indicated, but
does not establish eligibility for, or the
date of, recordation.
(iv) Remitter certification. The
remitter must certify that he or she has
appropriate authority to submit the
notice for recordation and that all
information submitted to the Office by
the remitter is true, accurate, and
complete to the best of the remitter’s
knowledge.
(3) Date of recordation. The date of
recordation is the date when all of the
elements required for recordation,
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including the prescribed fee and, if
required, the statement of service, have
been received in the Copyright Office.
After recordation, the notice, including
any accompanying statement, is
returned to the sender with a certificate
of recordation.
(4) Effect of recordation. The fact that
the Office has recorded a notice is not
a determination by the Office of the
notice’s validity or legal effect.
Recordation of a notice of termination
by the Copyright Office is without
prejudice to any party claiming that the
legal or formal requirements for
effectuating termination (including the
requirements pertaining to service and
recordation of the notice of termination)
have not been met, including before a
court of competent jurisdiction.
(5) Reliance on remitter-provided
information. The Copyright Office will
rely on the certifications submitted with
a notice and the information provided
by the remitter on Form TCS and, if
provided, in an accompanying
statement of service. The Office will not
necessarily confirm the accuracy of such
certifications or information against the
submitted notice.
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Dated: October 25, 2017.
Karyn Temple Claggett,
Acting Register of Copyrights and Director
of the U.S. Copyright Office.
Carla D. Hayden,
Librarian of Congress.
[FR Doc. 2017–24527 Filed 11–9–17; 8:45 am]
BILLING CODE 1410–30–P
LIBRARY OF CONGRESS
Copyright Office
37 CFR Part 201
[Docket No. 2017–17]
Fees for Electronic Recordation and
Notices of Intention To Obtain a
Compulsory License
U.S. Copyright Office, Library
of Congress.
ACTION: Final rule.
AGENCY:
The U.S. Copyright Office is
publishing a final rule establishing a
separate, lower filing fee for recording
documents when they are submitted
with an electronic title list. Separately,
the Office is noting a policy change,
effective on the same date as the final
rule, to require the payment of fees for
the filing of all notices of intention to
obtain a compulsory license to make
and distribute phonorecords, including
SUMMARY:
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those that are filed in the Office after
failed delivery to the copyright owner.
DATES: Effective December 18, 2017.
FOR FURTHER INFORMATION CONTACT:
Sarang V. Damle, General Counsel and
Associate Register of Copyrights, by
email at sdam@loc.gov, or Jason E.
Sloan, Attorney-Advisor, by email at
jslo@loc.gov. Each can be contacted by
telephone by calling (202) 707–8350.
SUPPLEMENTARY INFORMATION:
I. New Recordation Fee for Electronic
Title Lists
A. Background
This final rule adjusts U.S. Copyright
Office fees in accordance with 17 U.S.C.
708. Section 708(a) specifies that ‘‘[f]ees
shall be paid to the Register of
Copyrights’’ for services, including a set
of specified services enumerated in
paragraphs (1) through (11) of that
subsection.1 This includes, as relevant
here, fees for ‘‘the recordation, as
provided by section 205, of a transfer of
copyright ownership or other
document.’’ 2 Fees for this service and
the other services specifically
enumerated in section 708(a)(1)–(9) are
to be set forth in a proposed schedule
that is sent to Congress 120 days before
the adjusted fees can take effect.3 The
fee may go into effect after the end of
that period unless ‘‘a law is enacted
stating in substance that the Congress
does not approve the schedule.’’ 4
Before proposing new fees for the
services enumerated in (1) through (9),
the Register must conduct a study of the
Office’s costs and must consider the
timing of any fee adjustments and the
Office’s authority to use the fees
consistent with the Office’s budget.5
Section 708(b) further provides that the
Register may adjust these fees to ‘‘not
more than that necessary to cover the
reasonable costs incurred by the
Copyright Office for . . . [such
services], plus a reasonable inflation
adjustment to account for any estimated
increase in costs.’’ 6 Finally, section
708(b) also mandates that the ‘‘[f]ees [so]
established . . . shall be fair and
equitable and give due consideration to
1 17
U.S.C. 708(a).
at 708(a)(4).
3 Id. at 708(b)(5).
4 Id. Section 708(a) also authorizes the Register to
fix fees for other services not enumerated in section
708(a)(1)–(9), such as the cost of preparing copies
of Office records. Id. at 708(a). The fees for these
additional Office services, as well as fees for the
filing of cable and satellite statements of account
under paragraphs (10) and (11) of section 708(a),
need not be submitted to Congress, but are instead
established by the Register of Copyrights by
regulation based on the Office’s costs. Id.
5 Id. at 708(b)(1).
6 Id. at 708(b)(2).
2 Id.
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Federal Register / Vol. 82, No. 217 / Monday, November 13, 2017 / Rules and Regulations
the objectives of the copyright
system.’’ 7
B. Cost Study
Pursuant to section 708, the Office
submitted a proposed fee schedule and
analysis to Congress on August 18,
2017.8 That study and this final rule
implementing the fee it proposed
concern a single Copyright Office
service: The recording of documents
accompanied by electronic title lists,
i.e., lists of certain indexing information
about the works to which such
documents pertain.9
Since 1870, the Copyright Office has
recorded documents pertaining to works
under copyright, such as assignments,
licenses, and grants of security interests.
Under the Copyright Act, recordation of
such documents is voluntary, but
provides certain legal entitlements, such
as constructive notice of the facts stated
in the recorded document when certain
conditions are met.10 Thus, the Office
has an important interest in ensuring
that the public record of copyright
transactions is as timely, complete, and
accurate as possible.
In general, the recordation process is
still paper based, and Office staff
manually transcribe information from
documents into an electronic format to
permit indexing in the Office’s public
catalog. Among the information that
must be indexed are the titles of and
related information for copyrighted
works associated with the document
submitted for recordation, which are
typically presented in a list appended to
the document, referred to informally as
a ‘‘title appendix.’’ A title appendix
associated with a document can include
hundreds, or even thousands, of titles.
The manual entry of information from
title appendices is a significant
contributor to long processing times in
the Office’s Recordation Section. In
2014, to gain efficiencies, the Office
promulgated a new rule permitting
documents submitted for recordation to
be accompanied by an electronic title
list in the form of an Excel
at 708(b)(4).
study is available on the Office’s Web site
at https://www.copyright.gov/policy/feestudy2017/
fee-study-2017.pdf.
9 Examples of such indexing information can
include the types of works, the titles of the works
(including alternate titles), their respective
registration numbers, and authorship information.
10 17 U.S.C. 205(c) (‘‘Recordation of a document
in the Copyright Office gives all persons
constructive notice of the facts stated in the
recorded document, but only if—(1) the document,
or material attached to it, specifically identifies the
work to which it pertains so that, after the
document is indexed by the Register of Copyrights,
it would be revealed by a reasonable search under
the title or registration number of the work; and (2)
registration has been made for the work.’’).
spreadsheet.11 Document recordation
fees, however, were last adjusted before
the introduction of electronic title lists.
Thus, the Office has never set a separate
fee for recording documents with such
lists, and currently charges the same
recordation fee regardless of whether
the document has an electronic title list.
As a result, the Office’s cost study
proposed implementing a separate,
reduced filing fee for groups of
additional titles provided in an
electronic title list that accompanies a
document submitted for recordation.
The fee adjustment implemented by this
final rule only pertains to that fee. The
Office is not adjusting the baseline
document recordation fee of $105 at this
time; that fee will remain the same for
recordations made both with and
without electronic title lists. Nor is the
Office adjusting the fee for groups of
additional titles when an electronic title
list is not used. Proposals for those fees
will be included in a comprehensive
study of all Copyright Office costs and
fees expected to be submitted to
Congress next year.
The fee-setting methodology
employed by the study used activitybased costing principles which comply
with standards set for federal
managerial accounting 12 and with
guidance for fee setting as published by
the Office of Management and Budget
Circular A–25 Revised: User Charges,13
and the Government Accountability
Office.14 Under the approach, total costs
for the entire recordation function were
used to develop a time-based multiplier,
which was then used to calculate the
cost of the individual activities for
recording the information contained in
electronic title lists. The total cost of
completing an electronic title list
transaction was determined by
aggregating the cost of each individual
activity.
Cost studies of this type are typically
retrospective, using actual data from a
fiscal year that has concluded. This
study used actual data from fiscal year
2016, but the methodology was applied
prospectively against a planned new
7 Id.
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8 The
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11 See 79 FR 55633 (Sept. 17, 2014) (codified at
37 CFR 201.4(c)(4)).
12 This includes the Federal Accounting
Standards Advisory Board’s Managerial Cost
Accounting Concepts and Standards for the Federal
Government, which promotes activity-based costing
for calculating the cost of providing services. See
Fed. Accounting Standards Advisory Bd., Statement
of Federal Financial Accounting Standards No. 4:
Managerial Cost Accounting Concepts and
Standards for the Federal Government (1995).
13 See Office of Mgmt. and Budget, Circular No.
A–25 Revised: User Charges, Whitehouse.gov,
https://www.whitehouse.gov/omb/circulars_a025
(last visited Aug. 13, 2017).
14 See U.S. Gov’t Accountability Office, Federal
User Fees: A Design Guide (GAO–08–386SP) (2008).
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service. This prospective approach was
used because, concurrent with the
effective date of this rule, the Office is
implementing a new, more efficient
process for providing this service than
the one currently employed. This
methodology was reviewed and
validated by an independent consulting
firm.
The new fee for documents submitted
with electronic title lists to be
implemented by this final rule is as
follows:
1 to 50 additional titles: $60
51 to 500 additional titles: $225
501 to 1,000 additional titles: $390
1,001 to 10,000 additional titles: $555
10,001 or more additional titles: $5,550
In the analysis submitted to Congress,
the Office determined that while use of
electronic title lists can significantly
increase the Office’s processing
efficiency, remitters had little incentive
to use them. Thus, the Office proposed,
and is now instituting, a fee for using
electronic title lists that is generally
lower than the current fee for
recordations made without them. The
lower fee is being adopted primarily to
incentivize use of electronic title lists
for documents with more than ten
additional titles 15 in an effort to
increase administrative efficiency and to
offer a less expensive avenue to
obtaining the benefits of recording a
document with the Copyright Office.
In considering the fairness, equity,
and objectives of the copyright system,
the Office believes that offering
recordation services for a lower fee,
where remitters have done the work to
create an electronic title list, should
result in a wider range of remitters
submitting documents and may also
result in existing remitters submitting
additional or updated documents with
more frequency than they might
otherwise. Receipt of additional
recorded documents should result in
greater copyright ownership data being
incorporated into the Office’s records,
which furthers the Office’s mission and
benefits the public at large.
In its analysis, the Office also
determined that as compared to
manually indexing documents, where
more titles generally means more
processing time and higher costs, when
an electronic title list is used,
processing time is typically more
constant. However, in further evaluating
the fairness, equity, and objectives of
the copyright system, the Office has
15 Though documents with ten or fewer
additional titles may be submitted with an
electronic title list, the final rule will deliver fee
savings to remitters where documents have more
than ten additional titles.
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Federal Register / Vol. 82, No. 217 / Monday, November 13, 2017 / Rules and Regulations
decided to adopt a tiered pricing
structure based on the number of titles
to which the document pertains. Under
this scheme, larger filers submitting
documents with a larger number of titles
pay a higher fee for the added benefit
they receive (when the fee is viewed on
a per-title basis) to offset the lower total
fee for smaller filers with fewer titles.
The first four tiers of the proposed
schedule increase incrementally based
on the total number of additional titles
submitted. The reason for the larger
jump between the fourth and fifth tiers
is because of the significant added costs
to the Office to process documents with
10,000 or more titles, caused by current
system limitations.
The Office notes that the proposed fee
schedule will be revisited as part of a
comprehensive study of all Office costs
and fees to be completed next year. As
discussed above, the goal of the
proposed fee schedule is primarily to
incentivize use of electronic title lists.
To do that, the proposed fee offers a
discount from the ordinary recordation
fee of $35 per group of ten additional
titles. When the full fee study examines
all Office costs and evaluates an
appropriate fee to record a document
without an electronic title list in light of
current costs, it is possible that fee will
increase, in which case it is also
possible that the fee being adopted for
using an electronic title list may be
adjusted upward as well to ensure
adequate cost recovery.
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C. Effective Date
Congress’s 120-day review period
under 17 U.S.C. 708(b)(5) began after the
Office submitted the proposed fee
schedule and analysis on August 18,
2017. If no law is enacted stating in
substance that Congress does not
approve of the proposed recordation fee
during such time, the fee will be
instituted pursuant to this final rule,
effective December 18, 2017.
II. Notices of Intention
Though not related to the abovediscussed cost study or final rule, the
Office is taking this opportunity to
provide public notice that it will
implement a policy change regarding
fees for notices of intention to obtain a
compulsory license to make and
distribute phonorecords (‘‘NOIs’’).
Under the Copyright Act, section 115
establishes a compulsory license,
whereby anyone may make and
distribute phonorecords of nondramatic
musical works, subject to certain terms
and conditions, and upon paying
royalties when applicable. To obtain a
compulsory license, a licensee must
serve an NOI on the relevant copyright
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owner in the form and manner specified
by Copyright Office regulations.16
In two circumstances, however, an
NOI can be filed with the Copyright
Office rather than the copyright owner.
First, if the public records of the
Copyright Office do not identify the
copyright owner and include an address
at which notice can be served, the NOI
can instead be filed with the Office.17
These ‘‘unidentified NOIs’’ can be filed
electronically or in paper hard copy,
though a discounted fee is offered for
electronic submissions.18
Second, if the NOI is sent to the last
address for the copyright owner shown
by the Office’s records, but is returned
to the sender because the copyright
owner was no longer located at that
address or refused to accept delivery,
the Office’s regulations permit the
‘‘original Notice as sent’’ to be filed with
the Office, along with a ‘‘brief statement
that the Notice was sent to the last
address for the copyright owner shown
by the records of the Copyright Office
but was returned,’’ and may also ‘‘be
accompanied by appropriate evidence
that it was mailed to, or that delivery by
reputable courier service was attempted
at, that address.’’ 19 Typically, for these
‘‘returned-to-sender NOIs,’’ the Office
receives the NOI in the original mailing
envelope marked with a return to sender
label. The Office does not currently
have any mechanism for accepting these
NOIs electronically.20
The Office’s regulations used to
explicitly state that no filing fee would
be charged for returned-to-sender NOIs,
while such a fee would be charged for
the unidentified NOIs.21 But in 2001,
the Office issued a notice of proposed
rulemaking seeking to remove this
limitation, as ‘‘[t]he cost to the Office of
processing the filing of a Notice of
Intention is the same whether the
copyright owner is not identified in the
records of the Office or the copyright
owner is no longer located at the
address shown in the records of the
Office or has refused to accept
delivery.’’22 The Office believed that the
16 See
generally 37 CFR 201.18.
U.S.C. 115(b)(1).
18 37 CFR 201.3(e)(1).
19 Id. § 201.18(f)(2).
20 See id.
21 Compare 37 CFR 201.18(e)(1) (2003) (‘‘Notices
of Intention submitted for filing shall be
accompanied by the fee specified in § 201.3(e).’’)
with id. § 201.18(e)(3) (‘‘No filing fee will be
required in the case of Notices filed under this
paragraph.’’).
22 66 FR 45241, 45243 (Aug. 28, 2001); see also
69 FR 11566, 11572 (Mar. 11, 2004) (additional,
related notice of proposed rulemaking reiterating
that ‘‘the Office intends to amend its rules to
require a filing fee in each instance where the
Notice is filed with the Copyright Office without
17 17
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52223
same filing fee ‘‘should be charged in
both cases.’’23 The final rule, effective in
2004, adopted that proposal, repealing
the regulatory language that had
expressly prohibited charging a fee.24
Consistent with this rulemaking, the
Copyright Office’s fee schedule does not
distinguish between different types of
NOIs.25
In practice, however, and in part due
to the extremely low volume of
returned-to-sender NOIs the Office
received in the years following adoption
of the 2004 rule, the Office abstained
from imposing the established fee. In
recent years, however, the volume of
returned-to-sender NOIs has increased
sharply. Last year the Office received
over 800 such NOIs, and this year the
Office has received over 2,000 to date.
Each of these NOIs must be individually
and manually processed. Because of this
increased burden, the Office can no
longer afford to forbear from the
collection of fees. Accordingly, this
document announces a policy change
that will be implemented on December
18, 2017: Any returned-to-sender NOIs
received in the Office on or after that
date must be accompanied by the same
filing fee applicable to other paper-filed
NOIs, which is currently $75 plus $20
per group of one to ten additional
titles.26 The Office is publicly
announcing this policy change in
advance to give remitters of returned-tosender NOIs time to adjust their
practices.
List of Subjects in 37 CFR Part 201
Copyright, General provisions.
Final Regulations
For the reasons set forth in the
preamble, the Copyright Office amends
37 CFR part 201 as follows:
PART 201—GENERAL PROVISIONS
1. The authority citation for part 201
continues to read as follows:
■
Authority: 17 U.S.C. 702.
2. Amend § 201.3 by revising
paragraph (c)(16) to read as follows:
■
§ 201.3 Fees for registration, recordation,
and related services, special services, and
services performed by the Licensing
Division.
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regard to the licensee’s reason for filing the Notice
with the Office’’).
23 66 FR at 45243; see also 69 FR at 11572.
24 69 FR 34578, 34583 (June 22, 2004).
25 See 37 CFR 201.3(e)(1) (establishing a fee for
‘‘[r]ecordation of a notice of intention to make and
distribute phonorecords’’ without differentiation).
26 See id.
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Registration, recordation and related services
Fees
($)
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(16) Recordation of a document, including a notice of intention to enforce
Single title .....................................................................................................................................................................................
Additional titles (per group of 1 to 10 titles) .................................................................................................................................
Additional titles provided in an electronic title list
1 to 50 additional titles ..........................................................................................................................................................
51 to 500 additional titles ......................................................................................................................................................
501 to 1,000 additional titles .................................................................................................................................................
1,001 to 10,000 additional titles ............................................................................................................................................
10,001 or more additional titles .............................................................................................................................................
Correction of online Public Catalog data due to erroneous electronic title submission (per title) ...............................................
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105
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Dated: October 24, 2017.
Karyn Temple Claggett,
Acting Register of Copyrights and Director
of the U.S. Copyright Office.
Approved by:
Carla D. Hayden,
Librarian of Congress.
[FR Doc. 2017–24526 Filed 11–9–17; 8:45 am]
BILLING CODE 1410–30–P
LIBRARY OF CONGRESS
Copyright Office
37 CFR Part 202
[Docket No. 2017–8]
Secure Tests
U.S. Copyright Office, Library
of Congress.
ACTION: Interim rule with request for
comments.
AGENCY:
The U.S. Copyright Office is
issuing an update to its interim rule,
issued June 12, 2017, governing
registration of secure tests. Based on the
initial comments received on that
interim rule, the Office has determined
that there is an immediate need to
establish a new group registration
option for secure test questions and
answers and other related materials
(referred to as ‘‘test items’’) that are
stored in an electronic database, test
bank, or other medium of expression.
This interim rule incorporates most of
the same procedures that the Office
adopted in its recent interim rule on
secure tests and adds additional
procedures for group registration. To
seek a group registration, applicants will
be required to submit an online
application, upload a redacted copy of
the individual test items to the
electronic registration system, and
complete and submit a brief
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questionnaire. If, based on the answers
to the questionnaire, the test items
appear to be eligible for the group
registration option, the Office will
contact the applicant and schedule an
appointment to deliver these materials
to the Office in person. On the
appointed date, the applicant must
bring a copy of the application and a
complete unredacted copy of the actual
test items. In addition, the applicant
must bring a redacted copy of the test
items, and a signed declaration
confirming that this copy is identical to
the redacted copy that was uploaded to
the electronic registration system. The
Office will examine each test item to
determine if it contains sufficient
copyrightable authorship. If the Office
registers the claim, the registration will
cover each test item as a separate work
of authorship, and the registration will
be effective as of the date the Office
initially received the application, filing
fee, and the redacted copy of the test
items in proper form through the
electronic registration system. To be
clear, the previous interim rule
otherwise remains in effect, and
applicants may continue to use that rule
to register individual secure tests. The
Office welcomes public comment on
both this interim rule and the June 12,
2017 interim rule.
DATES: Effective November 13, 2017.
Comments on this interim rule and the
interim rule published on June 12, 2017
(82 FR 26850), must be made in writing
and must be received by the U.S.
Copyright Office no later than December
11, 2017.
ADDRESSES: For reasons of government
efficiency, the U.S. Copyright Office is
using the regulations.gov system for the
submission and posting of public
comments in this proceeding. All
comments are therefore to be submitted
electronically through regulations.gov.
Specific instructions for submitting
comments are on the U.S. Copyright
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60
225
390
555
5,550
7
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Office Web site at https://copyright.gov/
rulemaking/securetests/. If electronic
submission of comments is not feasible
due to lack of access to a computer and/
or the internet, please contact the Office
for special instructions using the contact
information below.
FOR FURTHER INFORMATION CONTACT:
Robert J. Kasunic, Associate Register of
Copyrights and Director of Registration
Policy and Practice; Sarang Vijay Damle,
General Counsel and Associate Register
of Copyrights; Erik Bertin, Deputy
Director of Registration Policy and
Practice; or Abioye Ella Mosheim,
Attorney-Advisor, by telephone at 202–
707–8040 or by email at rkas@loc.gov,
sdam@loc.gov, ebertin@loc.gov, and
abmo@loc.gov.
SUPPLEMENTARY INFORMATION:
I. Background
A. General Provisions Regarding
Copyright Registration
Under the Copyright Act of 1976, the
U.S. Copyright Office (the ‘‘Copyright
Office’’ or ‘‘Office’’) is responsible for
registering copyright claims. See 17
U.S.C. 408. In doing so, the Office has
a statutory obligation to confirm that the
legal and formal requirements for
registration have been met, such as
confirming fixation and examining the
work for copyrightable authorship. See
17 U.S.C. 410(a) (obligating the Register
of Copyrights (the ‘‘Register’’) ‘‘after
examination’’ to ‘‘determine[ ] that . . .
the material deposited constitutes
copyrightable subject matter and that
the other legal and formal requirements
of this title have been met’’).
The Office has the further obligation
to obtain a registration deposit that is
sufficient to verify the scope of the
claim, and to provide an adequate
archival record of what was examined
and registered. Id. 408(b) (generally
requiring a ‘‘complete’’ copy of works
deposited for registration); id. 705(a)
(requiring the Register to ‘‘ensure that
E:\FR\FM\13NOR1.SGM
13NOR1
]]>Agencies
[Federal Register Volume 82, Number 217 (Monday, November 13, 2017)]
[Rules and Regulations]
[Pages 52221-52224]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-24526]
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LIBRARY OF CONGRESS
Copyright Office
37 CFR Part 201
[Docket No. 2017-17]
Fees for Electronic Recordation and Notices of Intention To
Obtain a Compulsory License
AGENCY: U.S. Copyright Office, Library of Congress.
ACTION: Final rule.
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SUMMARY: The U.S. Copyright Office is publishing a final rule
establishing a separate, lower filing fee for recording documents when
they are submitted with an electronic title list. Separately, the
Office is noting a policy change, effective on the same date as the
final rule, to require the payment of fees for the filing of all
notices of intention to obtain a compulsory license to make and
distribute phonorecords, including those that are filed in the Office
after failed delivery to the copyright owner.
DATES: Effective December 18, 2017.
FOR FURTHER INFORMATION CONTACT: Sarang V. Damle, General Counsel and
Associate Register of Copyrights, by email at sdam@loc.gov, or Jason E.
Sloan, Attorney-Advisor, by email at jslo@loc.gov. Each can be
contacted by telephone by calling (202) 707-8350.
SUPPLEMENTARY INFORMATION:
I. New Recordation Fee for Electronic Title Lists
A. Background
This final rule adjusts U.S. Copyright Office fees in accordance
with 17 U.S.C. 708. Section 708(a) specifies that ``[f]ees shall be
paid to the Register of Copyrights'' for services, including a set of
specified services enumerated in paragraphs (1) through (11) of that
subsection.\1\ This includes, as relevant here, fees for ``the
recordation, as provided by section 205, of a transfer of copyright
ownership or other document.'' \2\ Fees for this service and the other
services specifically enumerated in section 708(a)(1)-(9) are to be set
forth in a proposed schedule that is sent to Congress 120 days before
the adjusted fees can take effect.\3\ The fee may go into effect after
the end of that period unless ``a law is enacted stating in substance
that the Congress does not approve the schedule.'' \4\
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\1\ 17 U.S.C. 708(a).
\2\ Id. at 708(a)(4).
\3\ Id. at 708(b)(5).
\4\ Id. Section 708(a) also authorizes the Register to fix fees
for other services not enumerated in section 708(a)(1)-(9), such as
the cost of preparing copies of Office records. Id. at 708(a). The
fees for these additional Office services, as well as fees for the
filing of cable and satellite statements of account under paragraphs
(10) and (11) of section 708(a), need not be submitted to Congress,
but are instead established by the Register of Copyrights by
regulation based on the Office's costs. Id.
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Before proposing new fees for the services enumerated in (1)
through (9), the Register must conduct a study of the Office's costs
and must consider the timing of any fee adjustments and the Office's
authority to use the fees consistent with the Office's budget.\5\
Section 708(b) further provides that the Register may adjust these fees
to ``not more than that necessary to cover the reasonable costs
incurred by the Copyright Office for . . . [such services], plus a
reasonable inflation adjustment to account for any estimated increase
in costs.'' \6\ Finally, section 708(b) also mandates that the ``[f]ees
[so] established . . . shall be fair and equitable and give due
consideration to
[[Page 52222]]
the objectives of the copyright system.'' \7\
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\5\ Id. at 708(b)(1).
\6\ Id. at 708(b)(2).
\7\ Id. at 708(b)(4).
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B. Cost Study
Pursuant to section 708, the Office submitted a proposed fee
schedule and analysis to Congress on August 18, 2017.\8\ That study and
this final rule implementing the fee it proposed concern a single
Copyright Office service: The recording of documents accompanied by
electronic title lists, i.e., lists of certain indexing information
about the works to which such documents pertain.\9\
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\8\ The study is available on the Office's Web site at https://www.copyright.gov/policy/feestudy2017/fee-study-2017.pdf.
\9\ Examples of such indexing information can include the types
of works, the titles of the works (including alternate titles),
their respective registration numbers, and authorship information.
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Since 1870, the Copyright Office has recorded documents pertaining
to works under copyright, such as assignments, licenses, and grants of
security interests. Under the Copyright Act, recordation of such
documents is voluntary, but provides certain legal entitlements, such
as constructive notice of the facts stated in the recorded document
when certain conditions are met.\10\ Thus, the Office has an important
interest in ensuring that the public record of copyright transactions
is as timely, complete, and accurate as possible.
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\10\ 17 U.S.C. 205(c) (``Recordation of a document in the
Copyright Office gives all persons constructive notice of the facts
stated in the recorded document, but only if--(1) the document, or
material attached to it, specifically identifies the work to which
it pertains so that, after the document is indexed by the Register
of Copyrights, it would be revealed by a reasonable search under the
title or registration number of the work; and (2) registration has
been made for the work.'').
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In general, the recordation process is still paper based, and
Office staff manually transcribe information from documents into an
electronic format to permit indexing in the Office's public catalog.
Among the information that must be indexed are the titles of and
related information for copyrighted works associated with the document
submitted for recordation, which are typically presented in a list
appended to the document, referred to informally as a ``title
appendix.'' A title appendix associated with a document can include
hundreds, or even thousands, of titles.
The manual entry of information from title appendices is a
significant contributor to long processing times in the Office's
Recordation Section. In 2014, to gain efficiencies, the Office
promulgated a new rule permitting documents submitted for recordation
to be accompanied by an electronic title list in the form of an Excel
spreadsheet.\11\ Document recordation fees, however, were last adjusted
before the introduction of electronic title lists. Thus, the Office has
never set a separate fee for recording documents with such lists, and
currently charges the same recordation fee regardless of whether the
document has an electronic title list.
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\11\ See 79 FR 55633 (Sept. 17, 2014) (codified at 37 CFR
201.4(c)(4)).
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As a result, the Office's cost study proposed implementing a
separate, reduced filing fee for groups of additional titles provided
in an electronic title list that accompanies a document submitted for
recordation. The fee adjustment implemented by this final rule only
pertains to that fee. The Office is not adjusting the baseline document
recordation fee of $105 at this time; that fee will remain the same for
recordations made both with and without electronic title lists. Nor is
the Office adjusting the fee for groups of additional titles when an
electronic title list is not used. Proposals for those fees will be
included in a comprehensive study of all Copyright Office costs and
fees expected to be submitted to Congress next year.
The fee-setting methodology employed by the study used activity-
based costing principles which comply with standards set for federal
managerial accounting \12\ and with guidance for fee setting as
published by the Office of Management and Budget Circular A-25 Revised:
User Charges,\13\ and the Government Accountability Office.\14\ Under
the approach, total costs for the entire recordation function were used
to develop a time-based multiplier, which was then used to calculate
the cost of the individual activities for recording the information
contained in electronic title lists. The total cost of completing an
electronic title list transaction was determined by aggregating the
cost of each individual activity.
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\12\ This includes the Federal Accounting Standards Advisory
Board's Managerial Cost Accounting Concepts and Standards for the
Federal Government, which promotes activity-based costing for
calculating the cost of providing services. See Fed. Accounting
Standards Advisory Bd., Statement of Federal Financial Accounting
Standards No. 4: Managerial Cost Accounting Concepts and Standards
for the Federal Government (1995).
\13\ See Office of Mgmt. and Budget, Circular No. A-25 Revised:
User Charges, Whitehouse.gov, https://www.whitehouse.gov/omb/circulars_a025 (last visited Aug. 13, 2017).
\14\ See U.S. Gov't Accountability Office, Federal User Fees: A
Design Guide (GAO-08-386SP) (2008).
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Cost studies of this type are typically retrospective, using actual
data from a fiscal year that has concluded. This study used actual data
from fiscal year 2016, but the methodology was applied prospectively
against a planned new service. This prospective approach was used
because, concurrent with the effective date of this rule, the Office is
implementing a new, more efficient process for providing this service
than the one currently employed. This methodology was reviewed and
validated by an independent consulting firm.
The new fee for documents submitted with electronic title lists to
be implemented by this final rule is as follows:
1 to 50 additional titles: $60
51 to 500 additional titles: $225
501 to 1,000 additional titles: $390
1,001 to 10,000 additional titles: $555
10,001 or more additional titles: $5,550
In the analysis submitted to Congress, the Office determined that while
use of electronic title lists can significantly increase the Office's
processing efficiency, remitters had little incentive to use them.
Thus, the Office proposed, and is now instituting, a fee for using
electronic title lists that is generally lower than the current fee for
recordations made without them. The lower fee is being adopted
primarily to incentivize use of electronic title lists for documents
with more than ten additional titles \15\ in an effort to increase
administrative efficiency and to offer a less expensive avenue to
obtaining the benefits of recording a document with the Copyright
Office.
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\15\ Though documents with ten or fewer additional titles may be
submitted with an electronic title list, the final rule will deliver
fee savings to remitters where documents have more than ten
additional titles.
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In considering the fairness, equity, and objectives of the
copyright system, the Office believes that offering recordation
services for a lower fee, where remitters have done the work to create
an electronic title list, should result in a wider range of remitters
submitting documents and may also result in existing remitters
submitting additional or updated documents with more frequency than
they might otherwise. Receipt of additional recorded documents should
result in greater copyright ownership data being incorporated into the
Office's records, which furthers the Office's mission and benefits the
public at large.
In its analysis, the Office also determined that as compared to
manually indexing documents, where more titles generally means more
processing time and higher costs, when an electronic title list is
used, processing time is typically more constant. However, in further
evaluating the fairness, equity, and objectives of the copyright
system, the Office has
[[Page 52223]]
decided to adopt a tiered pricing structure based on the number of
titles to which the document pertains. Under this scheme, larger filers
submitting documents with a larger number of titles pay a higher fee
for the added benefit they receive (when the fee is viewed on a per-
title basis) to offset the lower total fee for smaller filers with
fewer titles. The first four tiers of the proposed schedule increase
incrementally based on the total number of additional titles submitted.
The reason for the larger jump between the fourth and fifth tiers is
because of the significant added costs to the Office to process
documents with 10,000 or more titles, caused by current system
limitations.
The Office notes that the proposed fee schedule will be revisited
as part of a comprehensive study of all Office costs and fees to be
completed next year. As discussed above, the goal of the proposed fee
schedule is primarily to incentivize use of electronic title lists. To
do that, the proposed fee offers a discount from the ordinary
recordation fee of $35 per group of ten additional titles. When the
full fee study examines all Office costs and evaluates an appropriate
fee to record a document without an electronic title list in light of
current costs, it is possible that fee will increase, in which case it
is also possible that the fee being adopted for using an electronic
title list may be adjusted upward as well to ensure adequate cost
recovery.
C. Effective Date
Congress's 120-day review period under 17 U.S.C. 708(b)(5) began
after the Office submitted the proposed fee schedule and analysis on
August 18, 2017. If no law is enacted stating in substance that
Congress does not approve of the proposed recordation fee during such
time, the fee will be instituted pursuant to this final rule, effective
December 18, 2017.
II. Notices of Intention
Though not related to the above-discussed cost study or final rule,
the Office is taking this opportunity to provide public notice that it
will implement a policy change regarding fees for notices of intention
to obtain a compulsory license to make and distribute phonorecords
(``NOIs'').
Under the Copyright Act, section 115 establishes a compulsory
license, whereby anyone may make and distribute phonorecords of
nondramatic musical works, subject to certain terms and conditions, and
upon paying royalties when applicable. To obtain a compulsory license,
a licensee must serve an NOI on the relevant copyright owner in the
form and manner specified by Copyright Office regulations.\16\
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\16\ See generally 37 CFR 201.18.
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In two circumstances, however, an NOI can be filed with the
Copyright Office rather than the copyright owner. First, if the public
records of the Copyright Office do not identify the copyright owner and
include an address at which notice can be served, the NOI can instead
be filed with the Office.\17\ These ``unidentified NOIs'' can be filed
electronically or in paper hard copy, though a discounted fee is
offered for electronic submissions.\18\
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\17\ 17 U.S.C. 115(b)(1).
\18\ 37 CFR 201.3(e)(1).
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Second, if the NOI is sent to the last address for the copyright
owner shown by the Office's records, but is returned to the sender
because the copyright owner was no longer located at that address or
refused to accept delivery, the Office's regulations permit the
``original Notice as sent'' to be filed with the Office, along with a
``brief statement that the Notice was sent to the last address for the
copyright owner shown by the records of the Copyright Office but was
returned,'' and may also ``be accompanied by appropriate evidence that
it was mailed to, or that delivery by reputable courier service was
attempted at, that address.'' \19\ Typically, for these ``returned-to-
sender NOIs,'' the Office receives the NOI in the original mailing
envelope marked with a return to sender label. The Office does not
currently have any mechanism for accepting these NOIs
electronically.\20\
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\19\ Id. Sec. 201.18(f)(2).
\20\ See id.
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The Office's regulations used to explicitly state that no filing
fee would be charged for returned-to-sender NOIs, while such a fee
would be charged for the unidentified NOIs.\21\ But in 2001, the Office
issued a notice of proposed rulemaking seeking to remove this
limitation, as ``[t]he cost to the Office of processing the filing of a
Notice of Intention is the same whether the copyright owner is not
identified in the records of the Office or the copyright owner is no
longer located at the address shown in the records of the Office or has
refused to accept delivery.''\22\ The Office believed that the same
filing fee ``should be charged in both cases.''\23\ The final rule,
effective in 2004, adopted that proposal, repealing the regulatory
language that had expressly prohibited charging a fee.\24\ Consistent
with this rulemaking, the Copyright Office's fee schedule does not
distinguish between different types of NOIs.\25\
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\21\ Compare 37 CFR 201.18(e)(1) (2003) (``Notices of Intention
submitted for filing shall be accompanied by the fee specified in
Sec. 201.3(e).'') with id. Sec. 201.18(e)(3) (``No filing fee will
be required in the case of Notices filed under this paragraph.'').
\22\ 66 FR 45241, 45243 (Aug. 28, 2001); see also 69 FR 11566,
11572 (Mar. 11, 2004) (additional, related notice of proposed
rulemaking reiterating that ``the Office intends to amend its rules
to require a filing fee in each instance where the Notice is filed
with the Copyright Office without regard to the licensee's reason
for filing the Notice with the Office'').
\23\ 66 FR at 45243; see also 69 FR at 11572.
\24\ 69 FR 34578, 34583 (June 22, 2004).
\25\ See 37 CFR 201.3(e)(1) (establishing a fee for
``[r]ecordation of a notice of intention to make and distribute
phonorecords'' without differentiation).
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In practice, however, and in part due to the extremely low volume
of returned-to-sender NOIs the Office received in the years following
adoption of the 2004 rule, the Office abstained from imposing the
established fee. In recent years, however, the volume of returned-to-
sender NOIs has increased sharply. Last year the Office received over
800 such NOIs, and this year the Office has received over 2,000 to
date. Each of these NOIs must be individually and manually processed.
Because of this increased burden, the Office can no longer afford to
forbear from the collection of fees. Accordingly, this document
announces a policy change that will be implemented on December 18,
2017: Any returned-to-sender NOIs received in the Office on or after
that date must be accompanied by the same filing fee applicable to
other paper-filed NOIs, which is currently $75 plus $20 per group of
one to ten additional titles.\26\ The Office is publicly announcing
this policy change in advance to give remitters of returned-to-sender
NOIs time to adjust their practices.
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\26\ See id.
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List of Subjects in 37 CFR Part 201
Copyright, General provisions.
Final Regulations
For the reasons set forth in the preamble, the Copyright Office
amends 37 CFR part 201 as follows:
PART 201--GENERAL PROVISIONS
0
1. The authority citation for part 201 continues to read as follows:
Authority: 17 U.S.C. 702.
0
2. Amend Sec. 201.3 by revising paragraph (c)(16) to read as follows:
Sec. 201.3 Fees for registration, recordation, and related services,
special services, and services performed by the Licensing Division.
* * * * *
(c) * * *
[[Page 52224]]
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Registration, recordation and related services Fees ($)
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* * * * * * *
(16) Recordation of a document, including a notice of ..............
intention to enforce
Single title........................................ 105
Additional titles (per group of 1 to 10 titles)..... 35
Additional titles provided in an electronic title
list
1 to 50 additional titles....................... 60
51 to 500 additional titles..................... 225
501 to 1,000 additional titles.................. 390
1,001 to 10,000 additional titles............... 555
10,001 or more additional titles................ 5,550
Correction of online Public Catalog data due to 7
erroneous electronic title submission (per title)..
* * * * * * *
------------------------------------------------------------------------
* * * * *
Dated: October 24, 2017.
Karyn Temple Claggett,
Acting Register of Copyrights and Director of the U.S. Copyright
Office.
Approved by:
Carla D. Hayden,
Librarian of Congress.
[FR Doc. 2017-24526 Filed 11-9-17; 8:45 am]
BILLING CODE 1410-30-P
