Music Copyright Society to Pay 13.3 Million Shillings to Kenyan Artists

In a recent public notice, the Music Copyright Society of Kenya (MCSK) announced that it would be distributing royalties from radio and television distribution class as per the distribution rules of the society effective from tomorrow Tuesday February 28th 2012 until June 2012.

The royalties to be distributed are from the radio and television stations which have paid and submitted properly documented log sheets from July 1st 2010 to June 30th 2011. The Society will also use
log sheets generated from its own media monitoring software.

Out of a total of Kshs 16,636,366.00 received from Broadcasters, 20% (Kshs 3,327,273.20) has been deducted to cater for administrative costs leaving 80%, a balance of Kshs 13,309,092.80 to be distributed.

However MCSK clarified that the royalties payable were on actual use of music as per the playlist (scientific distribution), as such only members whose music was played or appeared in the playlist would be contacted.

Comment:

IPKenya notes the continued loud silence coming from the Kenya Copyright Board (KECOBO) over the current status of MCSK as a collecting society and whether in fact MCSK’s application for a license to operate as such in the 2011-2012 year was granted or rejected. For the moment, MCSK appears to be playing to KECOBO’s tune by incorporating digital technologies into its operations, using print media to publicise its activities and most importantly, strictly adhering to the 70:30 ratio for distribution as royalties and administrative costs respectively.

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9 thoughts on “Music Copyright Society to Pay 13.3 Million Shillings to Kenyan Artists

  1. How then is the Regulatory body silent? Just yesterday there were qualms as to whether the royalties paid to artists was below the minimum allowed (see the Business Daily Article here http://t.co/0TFrVJH4). That being said, I am glad that they decreased administrative costs deductions to 20% from the cut off allowed of 30%. Hoping that they can account for the same, but that’s another story altogether. We need KECOBO to clarify the situation; to inform us of the resolve reached in its dispute with MSCK. IMHO the court order allowing MCSK to continue collecting royalties between April 2011 to date should have been appealed really!

  2. Collection is one thing, distribution is another. What we are now hearing is that MCSK is distributing monies collected in the 2010-2011 financial year. What we dont know is whether, at this present point in time, KeCoBo has allowed MCSK to collect.

    As you know, since the 2010-2011 financial year, there was the court case which we are now hearing will end up being settled out of court. In the meantime, MCSK’s license expired late last year and IPKenya reported that MCSK had applied for a fresh license under new stringent conditions from KeCoBo.

    Last I checked KeCoBo was still deliberating over whether MCSK should be licensed or not. In the meantime, public notices by MCSK such as the ones in the media are giving music users the impression that MCSK has already been licensed.

    IPKenya is also aware that KeCoBo had received several letters from organisations appealing for MCSK not to be given a CMO license until all outstanding dues and other monies were paid out to those concerned.

    IPKenya believes that the regulatory body must come out clearly and tell Kenyans whether or not MCSK has been re-awarded a CMO license and if so, under what conditions.
    In this connection, it remains to be seen whether or not KeCoBo will spearhead the formation of an independent Copyright Tribunal as envisaged under section 48 of the Copyright Act which would ideally be best placed to deal with such matters and other future cases that may arise.

  3. I would love to see what that settlement would entail, as it seems the same has been overtaken by practical events.

    First, the MCSK has already collected royalties for the 2010-2011 financial year in fact the April court order ALLOWED them to continue to do so.

    Second, it would hinge on distribution as to whether the court order stipulated that the money collected by MCSK should be held in trust pending out of court settlement of the dispute or not? If not then the court order basically endorsed MCSK to continue normal functions.

    Regarding the 2012 license would the court settlement also indicate conditions that MCSK are to adhere to in order to get a licence for the year 2012?

    Further how does KECOBO settle with a rogue MCSK? Is that in the best interests of the copyright owners? How is a settlement regulation of the industry anyway don’t they HAVE to adhere to the regulations?

    As KECOBO remains silent on what their stance is, MCSK continues to collect royalties and distribute the same at its own discretion which effectively means there is no regulation on the ground.

  4. Instituting JR against KeCoBo’s decision to deregister MCSK would not have been in the latter’s long-term interests.

    IPKenya’s understanding is that the out of court settlement was a decision taken by MCSK so as not to jeopardise it’s chances of successfully getting a fresh CMO license from KeCoBo.

    Therefore the conditions for a license are not connected with the out of court settlement per se.

    I totally agree with you that MCSK’s dealings have an air of impunity about them and big brother is definitely setting a bad example for its younger siblings especially KAMP and PRSK who also operate in the music industry.

    How to better regulate MCSK and CMOs in general is an interesting subject for further research and investigation that I hope one of our LL.M or Ph.D candidates will take up in the near future.

  5. Hi Victor ..Akinyi ..Maurice here ( mcsk ) . Following your comments . Bit of misunderstanding and thought perhaps to clear the air .
    Firstly , yes court order allowed us to continue collecting license fees and distribute royalties .
    Secondly ,rehulations and conditions for operation of Collective Management Organizations (CMO’s ) vividly set out in the Copyright Act . Also regulation on renewals of certificate of registration etc ..the JR filed basically was addressing these issues as it was our view that KECOBO did not adhere to the law while purportedly deregistering MCSK .
    Thirdly , please refer to the law and if you do find provision requiring CMO’s to operate at 30 % admin expenses , please cite this provision of law ( local or international laws ) . This is a creation of KECOBO and cannot thus be used as a legal argument .
    Finally ,how is it that MCSK is setting a bad precedent in kenya ..?
    Currently , I am in Sweden in part to share the experience and developments at MCSK .
    We are one of the only countries that is effective with general rights licensing , also known as performances in public places . In this category of licensing , collections from public service vehicles forms a large part of the collection and again this is a unique scenario in the world and I , on behalf of mcsk , have been invited to several countries to especially share in how we are able to achieve this . We are unique in this one way and again , unlike most other CMO’s a larger percentage of our collections is from performances in public places ( general rights ) , whereas most CMO’s collect a larger percentage from broadcasters , telcos etc ..where collection expenses are quite minimal . The deductions from each class of collections thus varies and as such for collections from broadcasters where minimal costs incurred , you would not need to deduct much admin costs etc ..but in the area of general rights , where the situation in kenya demands that we have to actually go out to the field in a daily basis to collect the license fees ..I would actually like to hear of an alternative way of collecting ..( and you can also refer to how kamp , prsk and even kopiken are collecting where they have also adopted our style ..) ..so not sure what you mean that we are setting bad example ..
    I have much more to share ..for example the KECOBO principle of 70-30 and what actually entails admin expenditure ..for example , when we invest in assets for the Society that will in future save on costs ie capital expenditure ( capex) , where then do you classify this ..what about depreciation on assets ..bank charges which rise as you pay more members through the bank …all admin expenditure right Victor ..? What about when you hold seminars for members ..annual general meeting and you pay out fare to members ..? Admin expenditure right ..? What about when members pass on and we make contribution to the funera etc . What about when members fall sick and we provide funds for medical treatment ..perhaps you should consult with KECOBO and see how they want us to treat these expenditure …and see the rationale for 70-30 .

    I am also part of an African committee comprised of Societies (cmo’s) within africa and part of the international confederation of societies for authors and composers ( cisac) that has been appointed to look into the budgets for CMO’s and the preferred ratio for operating ( rather the permissible expenditure ) ..we should be presenting our paper at the next African committee meeting and I think this will now be the guiding principle in future …for now Victor , show me where KECOBO ascertained that we should operate at 70-30 ..
    Got to go now ..Arsenal game bout to start ..talk again after here your initial views ..

  6. Thanks Maurice for your comment. I would like to discuss these issues with you further. I have sent you an email to request a face to face interview with you at your earliest convenience. Hoping to hear from you soon.

  7. I appreciate the efforts mcsk is undertaking to uplift artist members,but come clear why stations like wi-mwaro fm. royalties have never been distributed since its inception and royal media is known for royalties sub mission.

  8. its within public domain that mcsk has adapted scientfic distribution,thanks to technolgy but what criteria is used to distribute millions colleted from public places.how is it done scientifically.

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