[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3688 Introduced in House (IH)]

112th CONGRESS
  1st Session
                                H. R. 3688

To amend the copyright law to secure the rights of artists of works of 
      visual art to provide for royalties, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           December 15, 2011

  Mr. Nadler introduced the following bill; which was referred to the 
                       Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
To amend the copyright law to secure the rights of artists of works of 
      visual art to provide for royalties, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Equity for Visual Artists Act of 
2011''.

SEC. 2. DEFINITIONS.

    Section 101 of title 17, United States Code, is amended by--
            (1) inserting after the definition of ``architectural 
        work'' the following:
        ``For purposes of section 106(b), `auction' means a public sale 
        run by an entity that sells to the highest bidder works of 
        visual art in which the cumulative amount of such works sold 
        during the previous year is more than $25,000,000 and does not 
        solely conduct the sale of visual art by the entity on the 
        Internet.'';
            (2) inserting after the definition of ``proprietor'' and 
        prior to the definition of ``pseudonymous work'' the following:
        ``For purposes of section 106(b), `price' is the aggregate of 
        all installments paid in cash or in-kind by or on behalf of a 
        purchaser for a work as the result of auction of that work.'';
            (3) inserting at the end of the definition of 
        ``Publication'' the following: ``For purposes of section 
        106(b), in the case of a work of visual art as defined in this 
        section, a publication does not include photographic 
        reproductions or other images of the work, including castings 
        of a sculptural work, made or distributed prior to January 1, 
        1978, in connection with the exhibition of such work by a 
        gallery or museum, whether for purposes of sale of the original 
        work, or in connection with any publication authorized by a 
        gallery or museum in possession of the work regardless of 
        whether such publication was with the consent of the author. In 
        no other circumstances is a work of visual art considered to 
        have been published prior to January 1, 1978, unless such 
        publication has been authorized by the express written consent 
        of the author of such work.'';
            (4) inserting after the definition of ``registration'' and 
        prior to the definition of ``sound recordings'' the following:
        ``For purposes of sections 106(b) and 701(b)(5), `sale' means 
        transfer of ownership or physical possession of a work as the 
        result of the auction of that work.''; and
            (5) amending paragraph (1) of the definition of a ``work of 
        visual art'' to read as follows:
            ``(1) a painting, drawing, print, sculpture, or photograph, 
        existing either in the original embodiment or in a limited 
        edition of 200 copies or fewer that bear the signature or other 
        identifying mark of the author and are consecutively numbered 
        by the author, or, in the case of a sculpture in multiple cast, 
        carved, or fabricated sculptures of 200 or fewer that are 
        consecutively numbered by the author and bear the signature or 
        other identifying mark of the author; or''.

SEC. 3. EXCLUSIVE RIGHTS.

    Section 106 of title 17, United States Code, is amended by--
            (1) inserting ``(a)'' before ``Subject to sections 107 
        through 122''; and
            (2) adding at the end the following:
    ``(b)(1) In this subsection, the term `net royalty' means the 
royalty amount collected less administrative expenses of the visual 
artists' collecting society. In no case shall the administrative 
expenses of the visual artists' collecting society subtracted from the 
royalty amount collected exceed 18 percent.
    ``(2) Whenever a work of visual art is sold as the result of 
auction of that work by someone other than the artist who is the author 
of the work, the entity that collects the money or other consideration 
paid for the sale of the work shall, within 90 days of collecting such 
money or other consideration, pay out of the proceeds of the sale a 
royalty equal to 7 percent of the price. Such royalty shall be paid to 
a visual artists' collecting society. The collecting society shall 
distribute, no fewer than 4 times per year, 50 percent of the net 
royalty to the artist or his or her successor as copyright owner. After 
payment to the artist or his or her successor as copyright owner, the 
remaining 50 percent of the net royalty shall be deposited into an 
escrow account established by the collecting society for the purposes 
of funding purchases by nonprofit art museums in the United States of 
works of visual art authored by living artists domiciled in the United 
States. The right to receive such royalty and the obligation to deposit 
the remaining share of sale proceeds into the escrow account provided 
in this subsection may not be waived by the artist or his successor as 
copyright owner. Failure of the entity collecting the money or other 
consideration resulting from the sale of the work to pay the royalty 
provided under this section shall constitute an infringement of 
copyright. Any such infringement shall be subject to the payment of 
statutory damages under section 504.
    ``(3) Paragraph (2) shall not apply to the sale of a work for a 
gross sales price of less than $10,000, or in exchange for property 
with a fair market value of less than $10,000.''.

SEC. 4. NOTICE OF COPYRIGHT.

    Section 401 of title 17, United States Code, is amended by adding 
at the end the following:
    ``(e) Non Applicability to Works of Visual Art.--The provisions of 
this section shall not apply to a work of visual art.''.

SEC. 5. COPYRIGHT OFFICE.

    Section 701(b) of title 17, United States Code, is amended by--
            (1) redesignating paragraph (5) as paragraph (6); and
            (2) inserting after paragraph (4) the following:
            ``(5) Issue regulations governing visual artists' 
        collecting societies pursuant to section 106(b), which shall, 
        at a minimum--
                    ``(A) establish a process by which entities would 
                be determined to be and designated as visual artists' 
                collecting societies;
                    ``(B) require that a visual artists' collecting 
                society authorized to administer royalty collections 
                and distributions under this title shall have had prior 
                experience in licensing the copyrights of authors of 
                works of visual art in the United States, or have been 
                authorized by no fewer than 10,000 authors of works of 
                visual art, either directly or by virtue of reciprocal 
                agreements with foreign collecting societies, to 
                license the rights granted under section 106;
                    ``(C) exclude any entity from being considered a 
                visual artists' collecting society where, after having 
                been designated a visual artists' collecting society, 
                the royalties collected for at least 5 consecutive 
                years have not been distributed directly to authors 
                after deduction of administrative expenses;
                    ``(D) establish the methodology and procedures 
                pursuant to which visual artists' collecting societies 
                shall make grants to nonprofit museums for the purchase 
                of works with the escrow funds provided in this 
                section, after notice and opportunity to comment, 
                including--
                            ``(i) the criteria to be used by the visual 
                        artists' collecting societies for application 
                        by nonprofit art museums for the purchase of 
                        works out of the funds held in escrow for that 
                        purpose by such societies;
                            ``(ii) the amount of the maximum grant for 
                        the purchase of an individual work of visual 
                        art;
                            ``(iii) the maximum amount that may be 
                        granted to a nonprofit museum; and
                            ``(iv) criteria for the award of grants 
                        when the amounts requested exceed the total 
                        amount of funds held in escrow;
                    ``(E) require that each such society provide the 
                Register of Copyrights with an annual audit of royalty 
                funds collected under section 106(b)(1) that includes 
                the total amount received from the sales of works of 
                visual art, the total amount paid in distributions to 
                artists or, if deceased, to their successors as owners 
                of copyright, and the total amount paid in grants to 
                each nonprofit museum for the purchase of works of 
                visual art; and
                    ``(F) make publicly available an annual report to 
                the Congress setting forth the total amount of 
                royalties received by each visual artists' collecting 
                society and the amount disbursed to each nonprofit art 
                museum receiving a grant or grants from the escrow 
                funds established by each visual artists' collecting 
                society.
        Except as necessary for the report to Congress required 
        pursuant to subparagraph (F), the Register of Copyrights shall 
        not disclose any confidential or proprietary information 
        provided to it in the annual audits made available pursuant to 
        this section.''.

SEC. 6. COPYRIGHT OFFICE FEES.

    Section 708(a) of title 17, United States Code, is amended--
            (1) by redesignating paragraphs (10) and (11) as paragraphs 
        (11) and (12), respectively;
            (2) by inserting after paragraph (9) the following:
            ``(10) for expenses associated with carrying out its 
        responsibilities under section 701(b)(5), provided that such 
        fees shall be paid out of the total royalty payments received 
        by collecting societies pursuant to section 106(b), before 
        deduction of such societies' administrative expenses; and 
        provided further, that following the initial rulemaking 
        necessary to carry out its obligations under section 701(b)(5), 
        such fees shall not exceed 5 percent of the total annual amount 
        of royalties received by such collecting societies;''; and
            (3) in the matter following paragraph (12), as so 
        redesignated, in the second sentence, by striking ``(10) and 
        (11)'' and inserting ``(11) and (12)''.

SEC. 7. EFFECTIVE DATE.

    This Act and the amendments made by this Act shall take effect on 
the date that is 1 year after the date of enactment of this Act.
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