The Waterfront Partnership

Use and Exploitation

Do you have a record deal, or are you looking for one?
Do you have a publisher?
Are you registered with the MCPS, PRS and PPL?
Does your music get used in films, commercials or TV shows?
Are you trying to clear music for use in your project?

Recording Contract

As explained in our copyright section, certain acts are restricted in respect of a copyright work unless expressly authorised by the owner.

In a Recording Contract the owner of master rights will assign or licence some or all of their rights to a record company. This allows the record company to do things with the recordings that would otherwise be restricted by copyright law, for example, to make copies and to distribute such copies to the public.

Usually a Recording Contract will cover all recordings made within a specific period, and it will therefore be in place before the master rights have come into existence. Sometimes the Recording Contract will also cover recordings that existed prior to the date of the contract.

Whether you are a record company or an artist, there are many considerations to be taken into account when considering whether to enter into a particular Recording Contract. These include the following:

• When will the contract start and for how long will the artist be exclusively bound to the record company? (This period is generally referred to as the "Term" of the contract").
• Will the record company have the right to extend the term once the initial term has expired? (These extension periods are generally referred to as "Options").
• Will any recordings that existed prior to the date of the contract be covered by the contract as well as recordings made during the term?
• What rights will be transferred to the record company?
• Will the rights be assigned or licensed exclusively to the record company?
• If the deal is for an exclusive licence only, how long will the rights be granted for?
• Is there a minimum commitment on the artist? (This will often be a specific number of tracks or albums).
• Will an advance be payable to the artist? If so, how much and when will this be paid? Will it be split into instalments?
• Will the record company pay for all recording costs? If not then how will the costs be split?
• Will the advances and/or recording costs be recouped against royalties?
• Does the record company have any specific obligations to release the recordings in particular territories? If so, where and in what time frame?
• How will the artist's royalties be calculated? (e.g. as a percentage of the published dealer price or as a percentage of net receipts).
• How often will statements of account be sent to the artist? What rights will the artist have to audit the record company's accounts?
• What promotional activities (if any) will the artist be required to participate in?
• Who will be responsible for obtaining permission from any third parties who assist with the recording (e.g. a producer, session musicians, sample clearances etc.)

Distribution Agreement

In a Distribution Agreement master rights in recordings already created will be assigned or licensed to a distributor for the purpose of distributing the recordings only. Such rights may include the right to manufacture and distribute physical copies of the recording and/or may include 'digital distribution' rights (i.e. the right to distribute in a purely electronic form with no physical medium).

Distribution Agreements may grant 'exclusive' or 'non-exclusive' rights. Where exclusive rights are granted it is vital that the copyright owner can terminate the agreement if the distributor does not perform as expected. This is because the exclusive nature of the contract will mean that the copyright owner cannot engage anyone else to distribute the music on their behalf it while the contract is still in force.

Publishing Contract

In a Publishing Contract the owner of the copyright in the musical work (and, where relevant, the literary work) in the composition will assign or licence some or all of their rights to a music publisher. This allows the publisher to do things with the recordings that would otherwise be restricted by copyright law, for example, to grant licences to third parties to use the music.

Sometimes publishers will accept responsibility for exploiting the compositions in their catalogue. Other publishers simply act as administrators for the composers and songwriters, issuing licence agreements and collecting royalties.

Whether you are a music publisher or a songwriter or composer, there are many considerations to be taken into account when considering whether to enter into a particular Publishing Contract. These include the following:

• When will the contract start?
• Will the composer be required to write music only for the publisher for a specific period, or will the rights granted cover specific existing songs only?
• During what period, if any, will the composer provide their exclusive services to the music publisher? (This period is generally referred to as the "Term" of the contract").
• Will the music publisher have the right to extend the term once the initial term has expired? (These extension periods are generally referred to as "Options").
• What rights will be transferred to the music publisher?
• Will the rights be assigned or licensed exclusively to the music publisher?
• If the rights will be assigned, is there any provision for reassignment of those rights back to the composer at a later date?
• If the rights are to be licensed, what will the term of the licence be? (This is sometimes known as the rights period)
• Will an advance be payable to the composer?
• If so, how much and when will this be paid? Will it be split into instalments? Will it be recouped against royalties?
• What percentage of the following types of income will the composer receive:
  • Sheet music royalties
  • Mechanical and video royalties
  • Income from covers
  • Synchronisation fees
  • Other fee
  • Collaboration
  • Performance income
• How often will statements of account be sent to the composer? What rights will the composer have to audit the record company's accounts?