[Federal Register Volume 84, Number 56 (Friday, March 22, 2019)]
[Rules and Regulations]
[Pages 10685-10687]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-05548]


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LIBRARY OF CONGRESS

U.S. Copyright Office

37 CFR Parts 201, 203, and 210

[Docket No. 2018-10]


Notices of Intention and Statements of Account Under Compulsory 
License To Make and Distribute Phonorecords of Musical Works

AGENCY: U.S. Copyright Office, Library of Congress.

ACTION: Final rule.

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SUMMARY: The U.S. Copyright Office is issuing final regulations 
pursuant to the Musical Works Modernization Act, title I of the Orrin 
G. Hatch-Bob Goodlatte Music Modernization Act. This rule adopts 
previously issued interim regulations as final. The interim rule 
amended the Office's prior regulations pertaining to the compulsory 
license to make and distribute phonorecords of musical works so as to 
conform the prior regulations to the new law, including with respect to 
the operation of notices of intention and statements of account. In 
addition to adopting the interim rule as final, this final rule makes 
further technical changes to update cross-references to regulations 
that were recently amended by the Copyright Royalty Judges.

DATES: Effective March 22, 2019.

FOR FURTHER INFORMATION CONTACT: Regan A. Smith, General Counsel and 
Associate Register of Copyrights, by email at [email protected], 
Steve Ruwe, Assistant General Counsel, by email at [email protected], 
or Jason E. Sloan, Assistant General Counsel, by email at 
[email protected]. Each can be contacted by telephone by calling (202) 
707-8350.

SUPPLEMENTARY INFORMATION: On October 11, 2018, the president signed 
into law the Orrin G. Hatch-Bob Goodlatte Music Modernization Act 
(``MMA'') which, among other things, substantially modified the 
compulsory ``mechanical'' license for making and distributing 
phonorecords of nondramatic musical works available under 17 U.S.C. 
115.\1\ On December 7, 2018, the Copyright Office published in the 
Federal Register an interim rule amending the Office's section 115-
related regulations to harmonize them with the MMA's requirements, and 
to make other minor technical updates.\2\ The amendments largely 
concerned statements of account and notices of

[[Page 10686]]

intention to obtain a compulsory license. The Office did not receive 
any comments from the public in response to the interim rule. As a 
result, the Office is adopting the amendments promulgated through the 
interim rule as final without change.
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    \1\ Public Law 115-264, 132 Stat. 3676 (2018).
    \2\ 83 FR 63061 (Dec. 7, 2018).
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    In addition to adopting the interim rule as final, the final rule 
makes further technical changes to update cross-references to 
regulations that were recently amended by the Copyright Royalty Judges 
(``CRJs''). On February 5, 2019, the CRJs published in the Federal 
Register a final determination in In re Determination of Royalty Rates 
and Terms for Making and Distributing Phonorecords (Phonorecords III), 
Docket No. 16-CRB-0003-PR (2018-2022).\3\ The CRJs' final determination 
amended 37 CFR part 385, which contains regulations setting forth the 
rates and terms of royalty payments for use of the section 115 license. 
The CRJs' changes have rendered obsolete some of the cross-references 
to part 385 contained in the Copyright Office's regulations governing 
statements of account under the section 115 license, and the final rule 
updates the relevant cross-references.
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    \3\ 84 FR 1918 (Feb. 5, 2019).
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    Because the updates are technical and non-substantive changes that 
do not ``alter the rights or interests of parties,'' they are not 
subject to the notice and comment requirements of the Administrative 
Procedure Act.\4\ Furthermore, the Office finds good cause that 
providing notice and comment is ``impracticable'' and ``contrary to the 
public interest'' in this instance because the CRJs' new regulations 
are already effective, and delaying removal of the obsolete cross-
references in the Office's regulations may cause confusion among those 
parties required to serve statements of account under the compulsory 
license.\5\ For these same reasons, the Office finds it appropriate to 
make the final rule effective upon publication.\6\
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    \4\ See Nat'l Mining Ass'n v. McCarthy, 758 F.3d 243, 250 (DC 
Cir. 2014); 5 U.S.C. 553(b) (notice and comment not required for 
``interpretative rules, general statements of policy, or rules of 
agency organization, procedure, or practice'').
    \5\ See 5 U.S.C. 553(b).
    \6\ See id. at 553(d).
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List of Subjects

37 CFR Part 201

    Copyright, General provisions.

37 CFR Part 203

    Freedom of information.

37 CFR Part 210

    Copyright, Phonorecords, Recordings.

Final Regulations

    For the reasons set forth above, the Copyright Office adopts the 
interim rule amending 37 CFR parts 201, 203, and 210 which was 
published at 83 FR 63061 on December 7, 2018, as final with the 
following changes:

PART 210--COMPULSORY LICENSE FOR MAKING AND DISTRIBUTING PHYSICAL 
AND DIGITAL PHONORECORDS OF NONDRAMATIC MUSICAL WORKS

0
1. The authority citation for part 210 continues to read as follows:

    Authority: 17 U.S.C. 115, 702.


Sec.  210.16  [Amended]

0
2. Amend Sec.  210.16 as follows:
0
a. In paragraph (b)(8):
0
i. In the first sentence, remove ``records of any promotional uses of 
the copyright owner's works that are required to be maintained or 
provided under Sec.  385.14 or Sec.  385.24 of this title, or other 
applicable provision, including, where applicable, records required to 
be maintained or provided by any third parties that were authorized by 
the compulsory licensee to engage in promotional uses during'' and add 
in its place ``records of any promotional or free trial uses of the 
copyright owner's works that are required to be maintained or provided 
under applicable provisions of part 385 of this title, or any other 
provisions, including, where applicable, records required to be 
maintained or provided by any third parties that were authorized by the 
compulsory licensee to engage in such uses during''.
0
ii. In the second sentence, remove ``subject to the promotional royalty 
rate provided in Sec.  385.14 or Sec.  385.24 of this title, or any 
similar promotional royalty rate of zero'' and add in its place 
``subject to any promotional or free trial royalty rate of zero''.
0
b. In paragraph (c)(1), remove ``subject to part 385, subpart A of this 
title or any other provisions requiring'' and add in its place 
``subject to applicable provisions of part 385 of this title, or any 
other provisions, requiring''.
0
c. In paragraph (c)(2), remove ``subject to part 385, subparts B or C 
of this title, or any other provisions requiring computation of 
applicable royalties on a percentage-rate basis, include a detailed and 
step-by-step accounting of the calculation of royalties under Sec.  
385.12, Sec.  385.22, or other provisions of part 385 of this title as 
applicable, sufficient'' and add in its place ``subject to applicable 
provisions of part 385 of this title, or any other provisions, 
requiring computation of applicable royalties on a percentage-rate 
basis, include a detailed and step-by-step accounting of the 
calculation of royalties under applicable provisions of part 385 of 
this title, sufficient''.
0
d. In paragraph (d)(2), remove ``subject to part 385, subpart A of this 
title, or any other applicable royalties computed on a'' and add in its 
place ``subject to applicable provisions of part 385 of this title, or 
any other provisions, requiring computation of applicable royalties on 
a''.
0
e. In paragraph (d)(2)(v), remove ``set forth in Sec.  385.3 or other 
provisions of part 385 of this title as applicable'' and add in its 
place ``set forth in applicable provisions of part 385 of this title''.
0
f. In paragraph (d)(3), remove ``subject to part 385, subparts B or C 
of this title, or any other applicable royalties computed on a 
percentage-rate basis, the amount of the royalty payment shall be 
calculated as provided in Sec.  385.12, Sec.  385.22, or other 
provisions of part 385 of this title as applicable'' and add in its 
place ``subject to applicable provisions of part 385 of this title, or 
any other provisions, requiring computation of applicable royalties on 
a percentage-rate basis, the amount of the royalty payment shall be 
calculated as provided in applicable provisions of part 385 of this 
title''.
0
g. In paragraph (d)(3)(ii), remove ``as described in Sec.  
385.12(b)(4), Sec.  385.22(b)(3), or any similar provisions of part 385 
of this title as applicable, an'' and add in its place ``as described 
in applicable provisions of part 385 of this title, an''.


Sec.  210.17  [Amended]

0
3. Amend Sec.  210.17 as follows:
0
a. In paragraph (c)(6), remove ``pursuant to part 385, subparts B or C 
of this title, or any other provision requiring computation of 
applicable royalties on a percentage-rate basis, calculations showing 
in detail how the royalty was computed (for these purposes, the 
applicable royalty as specified in part 385, subpart A of this title 
shall'' and add in its place ``pursuant to applicable provisions of 
part 385 of this title, or any other provisions, requiring computation 
of applicable royalties on a percentage-rate basis, calculations 
showing in detail how the royalty was computed (for these purposes, the 
applicable royalty as specified in applicable provisions of part 385 of 
this title, or any other provisions, requiring computation of 
applicable royalties on a cents-per-unit basis shall''.
0
b. In paragraph (d)(1), remove ``subject to part 385, subpart A of this 
title, or any other provision requiring'' and add

[[Page 10687]]

in its place ``subject to applicable provisions of part 385 of this 
title, or any other provisions, requiring''.
0
c. In paragraph (d)(2)(i), remove ``subject to part 385, subparts B or 
C of this title, or any other provision requiring'' and add in its 
place ``subject to applicable provisions of part 385 of this title, or 
any other provisions, requiring''.

    Dated: March 11, 2019.
Karyn A. Temple,
Acting Register of Copyrights and Director of the U.S. Copyright 
Office.
    Approved by:
Carla D. Hayden,
Librarian of Congress.
[FR Doc. 2019-05548 Filed 3-21-19; 8:45 am]
 BILLING CODE 1410-30-P