[Federal Register Volume 90, Number 94 (Friday, May 16, 2025)]
[Proposed Rules]
[Pages 20982-20985]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-08631]
-----------------------------------------------------------------------
LIBRARY OF CONGRESS
Copyright Royalty Board
37 CFR Part 380
[Docket No 23-CRB-0012-WR (2026-2030)]
Determination of Rates and Terms for Digital Performance of Sound
Recordings and Making of Ephemeral Copies To Facilitate Those
Performances (Web VI)
AGENCY: Copyright Royalty Board (CRB), Library of Congress.
ACTION: Proposed rule related to public broadcasters (radio).
-----------------------------------------------------------------------
SUMMARY: The Copyright Royalty Judges are publishing for comment
proposed regulations governing the rates and terms for the digital
performance of sound recordings by certain public radio stations and
for the making of ephemeral recordings necessary for the facilitation
of such transmissions for the period commencing January 1, 2026, and
ending on December 31, 2030.
DATES: Comments and objections, if any, are due June 16, 2025.
ADDRESSES: You may submit comments using eCRB, the Copyright Royalty
Board's online electronic filing application, at https://app.crb.gov/.
Instructions: To send your comment through eCRB, if you don't have
a user account, you will first need to register for an account and wait
for your registration to be approved. Approval of user accounts is only
available during business hours. Once you have an approved account, you
can only sign in and file your comment after setting up multi-factor
authentication, which can be done at any time of day. All comments must
include the Copyright Royalty Board name and the docket number for this
proposed rule. All properly filed comments will appear without change
in eCRB at https://app.crb.gov, including any personal information
provided.
Docket: For access to the docket to read submitted background
documents or comments, go to eCRB, the Copyright Royalty Board's
electronic filing and case management system, at https://app.crb.gov/,
and search for docket number 23-CRB-0012-WR (2026-2030).
FOR FURTHER INFORMATION CONTACT: Anita Brown, CRB Program Specialist,
at (202) 707-7658 or [email protected].
SUPPLEMENTARY INFORMATION:
Background
Section 114 of the Copyright Act, title 17 of the United States
Code, provides a statutory license that allows for the public
performance of sound recordings by means of a digital audio
transmission by, among others, eligible nonsubscription transmission
services. 17 U.S.C. 114(f). For purposes of the section 114 license, an
``eligible nonsubscription transmission'' is a noninteractive digital
audio transmission that does not require a subscription for receiving
the transmission. The transmission must also be made as part of a
service that provides audio programming consisting in whole or in part
of performances of sound recordings the purpose of which is to provide
audio or other entertainment programming, but not to sell, advertise,
or promote particular goods or services. See 17 U.S.C. 114(j)(6).
Services using the section 114 license may need to make one or more
temporary or ``ephemeral'' copies of a sound recording to facilitate
the transmission of that recording. The section 112 statutory license
allows for the making of these ephemeral reproductions. 17 U.S.C.
112(e).
Chapter 8 of the Copyright Act requires the Copyright Royalty
Judges (``Judges'') to conduct proceedings every five years to
determine the rates and terms for the sections 114 and 112 statutory
licenses. 17 U.S.C. 801(b)(1), 804(b)(3)(A). The current proceeding
commenced in January 2024 for rates and terms that will become
effective on January 1, 2026, and end on December 31, 2030. Pursuant to
section 804(b)(3)(A), the Judges published in the Federal Register a
notice commencing the proceeding and requesting that
[[Page 20983]]
interested parties submit their petitions to participate. 89 FR 812
(Jan. 5, 2024). SoundExchange, Inc. (``SoundExchange''), National
Public Radio, Inc. (``NPR''), and the Corporation for Public
Broadcasting (``CPB'') \1\ each filed Petitions to Participate, as did
others.
---------------------------------------------------------------------------
\1\ NPR and CPB are participating on behalf of themselves, NPR's
member and affiliated stations, and all public radio stations and
entities eligible to receive funding from CPB. Public Broadcasting
Entities Petition to Participate at 1 (Feb. 5, 2024).
---------------------------------------------------------------------------
On April 18, 2025, the Judges received a joint motion stating that
SoundExchange, NPR, and CPB (``Settling Parties'') had reached a
partial settlement regarding rates and terms for certain internet
transmissions and related ephemeral recordings made by NPR, American
Public Media, Public Radio International, Public Radio Exchange, and
certain public radio stations (``Public Broadcasters'') for 2026-2030
and seeking approval of that partial settlement. Joint Motion to Adopt
Partial Settlement, Docket No. 23-CRB-0012-WR (2026-2030).
On April 25, 2025, the Judges issued Order 46 To File
Certification or Provide Settlement Agreements, Docket No. 23-CRB-
0012-WR (2026-2030), which instructed the Settling Parties to
certify that the Motion and the Proposed Regulations annexed to the
Motion represent the full agreement of the Settling Parties, i.e.,
that there are no other related agreements and no other clauses.
Order 46 further ordered that if such other agreements or clauses
exist, the Settling Parties shall file them.
Order 46 at 2.
On April 30, 2025, the Settling Parties filed a Joint Response
stating that ``[t]he Proposed Regulations constituted the Settling
Parties' complete agreement concerning statutory rates and terms. See
17 U.S.C. 801(b)(7)(A). However, as is customary in any litigation
settlement, the Settling Parties also agreed on procedures for filing
and announcing their settlement, which were set forth in a Public
Broadcaster Settlement Agreement entered into between SoundExchange and
NPR/CPB as of April 16, 2025 (``Settlement Agreement'').'' Joint
Response of SoundExchange Inc., National Public Radio, Inc., and the
Corporation for Public Broadcasting to Order 46. Docket No. 23-CRB-
0012-WR (2026-2030) (``Joint Response''). Each of the Settling Parties
certified that ``the only other agreement between the Parties related
to the Settlement is the Settlement Agreement.'' Joint Response at 2.
The Settlement Agreement is attached to the Joint Response as Exhibit D
and ``includes, at Paragraph 20, a merger clause, reflecting that the
entirety of the Settling Parties' agreement is encompassed in the
Settlement Agreement.'' Joint Response at 2.
Based upon the Judges' review of the Joint Response, its
attachments, and the related submissions referenced therein, the Judges
find no reason to doubt that Exhibit D to the Joint Response
constitutes ``the agreement'' for purposes of Section 801(b)(7)(A).
Exhibit D may be found on pages 15-43 of the Joint Response (eCRB no.
57679). The Judges hereby publish the Proposed Regulations and request
comments from the public.\2\
---------------------------------------------------------------------------
\2\ The docket for this proceeding, including documents
referenced in this document, may be accessed via the Electronic
filing system eCRB at https://app.crb.gov and perform a case search
for docket 23-CRB-0012-WR (2026-2030).
---------------------------------------------------------------------------
Statutory Timing of Adoption of Rates and Terms
Section 801(b)(7)(A) of the Copyright Act authorizes the Judges to
adopt royalty 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 Judges for approval. The Judges must
provide ``an opportunity to comment on the agreement'' to participants
and non-participants in the rate proceeding who ``would be bound by the
terms, rates, or other determination set by any agreement . . . .'' 17
U.S.C. 801(b)(7)(A)(i). Participants in the proceeding may also
``object to [the agreement's] adoption as a basis for statutory terms
and rates.'' Id.
The Judges ``may decline to adopt the agreement as a basis for
statutory terms and rates for participants that are not parties to the
agreement,'' only ``if any participant [in the proceeding] objects to
the agreement and the [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)(ii), or where the negotiated agreement includes provisions
that are contrary to the provisions of the applicable license(s) or
otherwise contrary to statutory law. See Scope of the Copyright Royalty
Judges Authority to Adopt Confidentiality Requirements upon Copyright
Owners within a Voluntarily Negotiated License Agreement, 78 FR 47421,
47422 (Aug. 5, 2013), citing 74 FR 4537, 4540 (Jan. 26, 2009).
Any rates and terms adopted pursuant to this provision would be
binding on all copyright owners of sound recordings and public
broadcasters performing the sound recordings for the license period
2026-2030.
Proposed Adjustments to Rates and Terms
The Settlement continues the structure of previous settlements
between the parties, while increasing the payment to be made by CPB.
Joint Motion at 3. Because the Settlement applies only to a closed
group of licensees, and has only a single payor (CPB), the Settlement
is being submitted to the Judges for adoption as a statutory rate and
terms only so that it will be binding on all artists and copyright
owners, including those that are not members of SoundExchange. Joint
Motion at 3. The parties have agreed to continue their prior reporting
arrangements but have not included the details of those arrangements in
the Settlement, which, they believe, is consistent with guidance that
the Judges have provided. Joint Motion at 3-4. The parties have styled
their proposed regulations as a replacement subpart D to appear in the
Judges' regulations at 37 CFR part 380 and have set forth in proposed
new subpart D only regulatory provisions specific to Public
Broadcasters, on the assumption that the generally applicable
provisions in subpart A will apply to Public Broadcasters to the extent
consistent with subpart D. Joint Motion at 7, Exhibit A.
Those who would be bound by the terms, rates, or other
determination set by the agreement may comment on, and any participants
in the Web VI proceeding that would be bound by the terms, rates, or
other determination set by the agreement may object to, any or all of
the proposed regulations contained in this document. Such comments and
objections must be submitted no later than June 16, 2025.
List of Subjects in 37 CFR Part 380
Copyright, Sound recordings, Webcasters.
Proposed Regulations
For the reasons set forth in the preamble, the Copyright Royalty
Board proposes to amend 37 CFR part 380 as follows:
PART 380--RATES AND TERMS FOR TRANSMISSIONS BY ELIGIBLE
NONSUBSCRIPTION SERVICES AND NEW SUBSCRIPTION SERVICES AND FOR THE
MAKING OF EPHEMERAL REPRODUCTIONS TO FACILITATE THOSE TRANSMISSIONS
0
1. The authority citation for part 380 continues to read as follows:
Authority: 17 U.S.C. 112(e), 114(f), 804(b)(3).
[[Page 20984]]
0
2. Revise subpart D to read as follows:
Subpart D--Public Broadcasters
Sec.
380.30 Definitions.
380.31 Royalty fees for the public performance of sound recordings
and for ephemeral recordings.
380.32 Terms for making payment of royalty fees and statements of
account.
Sec. 380.30 Definitions.
For purposes of this subpart, the following definitions apply:
Authorized website is any website operated by or on behalf of any
Public Broadcaster that is accessed by website Users through a Uniform
Resource Locator (``URL'') owned by such Public Broadcaster and through
which website Performances are made by such Public Broadcaster.
CPB is the Corporation for Public Broadcasting.
Music ATH is Aggregate Tuning Hours of website Performances of
sound recordings of musical works.
NPR is National Public Radio, Inc.
Originating Public Radio Station is a noncommercial terrestrial
radio broadcast station that--
(1) Is licensed as such by the Federal Communications Commission;
(2) Originates programming and is not solely a repeater station;
(3) Is a member or affiliate of NPR, American Public Media, Public
Radio International, or Public Radio Exchange, a member of the National
Federation of Community Broadcasters, or another public radio station
that is qualified to receive funding from CPB pursuant to its criteria;
(4) Qualifies as a ``noncommercial webcaster'' under 17 U.S.C.
114(f)(4)(E)(i); and
(5) Either--
(i) Offers website Performances only as part of the mission that
entitles it to be exempt from taxation under section 501 of the
Internal Revenue Code of 1986 (26 U.S.C. 501); or
(ii) In the case of a governmental entity (including a Native
American Tribal governmental entity), is operated exclusively for
public purposes.
Person is a natural person, a corporation, a limited liability
company, a partnership, a trust, a joint venture, any governmental
authority or any other entity or organization.
Public Broadcasters are NPR, American Public Media, Public Radio
International, and Public Radio Exchange, and up to 530 Originating
Public Radio Stations as named by CPB. CPB shall notify SoundExchange
annually of the eligible Originating Public Radio Stations to be
considered Public Broadcasters per this definition (subject to the
numerical limitations set forth in this definition). The number of
Originating Public Radio Stations treated per this definition as Public
Broadcasters shall not exceed 530 for a given year without
SoundExchange's express written approval, except that CPB shall have
the option to increase the number of Originating Public Radio Stations
that may be considered Public Broadcasters as provided in Sec.
380.31(d).
Side Channel is any internet-only program available on an
Authorized website or an archived program on such Authorized website
that, in either case, conforms to all applicable requirements under 17
U.S.C. 114.
Term is the period January 1, 2026, through December 31, 2030.
Website is a site located on the World Wide Web that can be located
by a website User through a principal URL.
Website Performances are all public performances by means of
digital audio transmissions of sound recordings, including the
transmission of any portion of any sound recording, made through an
Authorized website in accordance with all requirements of 17 U.S.C.
114, from servers used by a Public Broadcaster (provided that the
Public Broadcaster controls the content of all materials transmitted by
the server), or by a contractor authorized pursuant to Sec. 380.31(g),
that consist of either the retransmission of a Public Broadcaster's
over-the-air terrestrial radio programming or the digital transmission
of nonsubscription Side Channels that are programmed and controlled by
the Public Broadcaster; provided, however, that a Public Broadcaster
may limit access to an Authorized website, or a portion thereof, or any
content made available thereon or functionality thereof, solely to
website Users who are contributing members of a Public Broadcaster.
This term does not include digital audio transmissions made by any
other means.
Website Users are all those who access or receive website
Performances or who access any Authorized website.
Sec. 380.31 Royalty fees for the public performance of sound
recordings and for ephemeral recordings.
(a) Royalty fees. The total license fee for all website
Performances by Public Broadcasters during each year of the Term, up to
the total Music ATH limit set forth in paragraph (b) of this section,
and Ephemeral Recordings made by Public Broadcasters solely to
facilitate such website Performances, shall be as follows (the
``License Fee''), unless additional payments are required as described
in paragraph (d) of this section:
(1) 2026: $950,000;
(2) 2027: $975,000;
(3) 2028: $1,000,000;
(4) 2029: $1,025,000; and
(5) 2030: $1,050,000.
(b) ATH limit. The total Music ATH limit is 310,000,000 Music ATH
per year.
(c) Calculation of License Fee. It is understood that the License
Fee includes:
(1) An annual minimum fee for each Public Broadcaster for each year
during the Term;
(2) Additional usage fees for certain Public Broadcasters; and
(3) A discount that reflects the administrative convenience to the
Collective (for purposes of this subpart, the term ``Collective''
refers to SoundExchange, Inc.) of receiving consolidated reporting of
usage in accordance with Sec. 380.32(b) that covers a large number of
separate entities and annual lump sum payments that cover a large
number of separate entities, as well as the predictability, time value
of money and protection from bad debt that arises from being paid in
advance.
(d) Increase in Public Broadcasters. If the total number of
Originating Public Radio Stations that wish to make website
Performances in any calendar year exceeds the number of such
Originating Public Radio Stations considered Public Broadcasters in the
relevant year, and the excess Originating Public Radio Stations do not
wish to pay royalties for such website Performances apart from this
subpart, CPB may elect by written notice to the Collective to increase
the number of Originating Public Radio Stations considered Public
Broadcasters in the relevant year effective as of the date of the
notice. To the extent of any such elections, CPB shall make an
additional payment to the Collective for each calendar year or part
thereof it elects to have an additional Originating Public Radio
Station considered a Public Broadcaster, in the amount of the annual
minimum fee applicable to Noncommercial Webcasters under subpart B of
this part for each additional Originating Public Radio Station per
year. Such payment shall accompany the notice electing to have an
additional Originating Public Radio Station considered a Public
Broadcaster.
(e) Ephemeral Recordings royalty fees; allocation between Ephemeral
Recordings and performance royalty fees. The Collective must credit 5%
of all royalty payments under this subpart as payment for Ephemeral
Recordings and credit the remaining 95% to section
[[Page 20985]]
114 royalties. All Ephemeral Recordings that a Licensee makes which are
necessary and commercially reasonable for making noninteractive digital
transmissions are included in the 5%.
(f) Effect of non-performance by any Public Broadcaster. In the
event that any Public Broadcaster violates any of the material
provisions of 17 U.S.C. 112(e) or 114 or this subpart that it is
required to perform, the remedies of the Collective shall be specific
to that Public Broadcaster only, and shall include, without limitation,
termination of that Public Broadcaster's right to be treated as a
Public Broadcaster per this paragraph (f) upon written notice to CPB.
The Collective and Copyright Owners also shall have whatever rights may
be available to them against that Public Broadcaster under applicable
law. The Collective's remedies for such a breach or failure by an
individual Public Broadcaster shall not include termination of the
rights of other Public Broadcasters to be treated as Public
Broadcasters per this paragraph (f), except that if CPB fails to pay
the License Fee or otherwise fails to perform any of the material
provisions of this subpart, or such a breach or failure by a Public
Broadcaster results from CPB's inducement, and CPB does not cure such
breach or failure within 30 days after receiving notice thereof from
the Collective, then the Collective may terminate the right of all
Public Broadcasters to be treated as Public Broadcasters per this
paragraph (f) upon written notice to CPB. In such a case, a prorated
portion of the License Fee for the remainder of the Term (to the extent
paid by CPB) shall, after deduction of any damages payable to the
Collective by virtue of the breach or failure, be credited to statutory
royalty obligations of Public Broadcasters to the Collective for the
Term as specified by CPB.
(g) Use of contractors. The right to rely on this subpart is
limited to Public Broadcasters, except that a Public Broadcaster may
employ the services of a third Person to provide the technical services
and equipment necessary to deliver website Performances on behalf of
such Public Broadcaster, but only through an Authorized website. Any
agreement between a Public Broadcaster and any third Person for such
services shall:
(1) Obligate such third Person to provide all such services in
accordance with all applicable provisions of the statutory licenses and
this subpart;
(2) Specify that such third Person shall have no right to make
website Performances or any other performances or Ephemeral Recordings
on its own behalf or on behalf of any Person or entity other than a
Public Broadcaster through the Public Broadcaster's Authorized website
by virtue of its services for the Public Broadcaster, including in the
case of Ephemeral Recordings, pre-encoding or otherwise establishing a
library of sound recordings that it offers to a Public Broadcaster or
others for purposes of making performances, but instead must obtain all
necessary licenses from the Collective, the copyright owner or another
duly authorized Person, as the case may be;
(3) Specify that such third Person shall have no right to grant any
sublicenses under the statutory licenses; and
(4) Provide that the Collective is an intended third-party
beneficiary of all such obligations with the right to enforce a breach
thereof against such third Person.
Sec. 380.32 Terms for making payment of royalty fees and statements
of account.
(a) Payment to the Collective. Except as provided in paragraphs
(a)(1) through (3) of this section, CPB shall pay the License Fee to
the Collective in the annual installments specified in Sec. 380.31(a),
which shall be due in advance on December 31, 2025, and annually
thereafter through December 31, 2029.
(1) CPB inability to pay. If, due to a significant decrease in U.S.
government funding for CPB as compared to years prior to the Term, CPB
reasonably concludes that it is impossible for CPB to pay the License
Fee for a particular year during the Term, CPB may by written notice to
the Collective prior to December 1 of the preceding year nominate NPR
or a third party to pay the License Fee for such year. In such a case,
if by December 15 of the preceding year, NPR or such third party agrees
by written notice to the Collective to assume CPB's obligation to pay
the License Fee for such year, NPR or such third party shall do so by
December 31 of the preceding year.
(2) Dissolution of CPB. If CPB ceases to exist, and if NPR or any
successor to CPB's mission or other third party agrees by written
notice to the Collective to assume CPB's obligation to pay the License
Fee for the remaining years of the Term, NPR or such successor shall do
so by December 31 preceding each remaining year of the Term. In such a
case, NPR or such successor or other third party shall exercise all the
rights of CPB under this subpart (e.g., identifying the eligible
Originating Public Radio Stations to be considered Public
Broadcasters), and must exercise all the responsibilities of CPB under
this subpart (e.g., providing reporting in accordance with paragraph
(b) of this section).
(3) Consequence of nonpayment. If the Collective does not receive
the License Fee for any year of the Term by December 31 of the
preceding year, then the provisions of this subpart shall be
unavailable to Public Broadcasters for such year, and any Public
Broadcaster making website Performances and related Ephemeral
Recordings during such year must pay appliable royalty fees, and comply
with applicable statutory license terms, under subparts A and B of this
part, except that if the Copyright Royalty Judges have adopted pursuant
to 17 U.S.C. 801(b)(7)(A) a lower per-Performance rate for
Nonsubscription transmissions by some other group of Licensees during
such year, such lower per-Performance rate will apply to website
Performances by Public Broadcasters during such year in any situation
in which a per-Performance royalty is payable under subparts A and B of
this part.
(b) Reporting. CPB and Public Broadcasters shall submit reports of
use and other information concerning website Performances as agreed
upon with the Collective.
(c) Terms in general. Subject to the provisions of this subpart,
terms governing late fees, distribution of royalties by the Collective,
unclaimed funds, record retention requirements, treatment of Licensees'
confidential information, audit of royalty payments and distributions,
and any definitions for applicable terms not defined in this subpart
shall be those set forth in subpart A of this part.
Dated: May 12, 2025.
Christina L. Shifton,
Interim Chief Copyright Royalty Judge.
[FR Doc. 2025-08631 Filed 5-15-25; 8:45 am]
BILLING CODE 1410-72-P