German Clubs Shut Down in Protest of New GEMA Tariffs
German Clubs Shut Down in Protest of New GEMA Tariffs

A note on Berlin's Berghain nightclub's website against GEMA's new fees encourages supporters to sign a petition.

BERLIN - More than 2,000 German discotheque owners are protesting against a new tariff structure implemented by the German collections society GEMA. It is feared that with the new fees, more than 100,000 jobs could be lost, according to club promoters. The "Piraten-Partei" (Pirate Party) and more than a dozen associations of discotheques and restaurants organized a large demonstration with more than 6,000 people in front of the Frannz Club in the Kulturbrauerei center in Berlin on Monday (June 25) to demonstrate against GEMA's tariff increases of up to 1,000 percent.

Inside the Kulturbrauerei more than 1,000 composers, librettists and music publishers were attending a GEMA summer party. The protesters carried banners with the slogan "Gemeinsam gegen GEMAinheiten" "Together against GEMA dirty tricks".

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Despite the protestors best efforts, the dispute continues to escalate. On Saturday, June 30 Germany's more than 2,000 discotheques are planning to pull the plug for five minutes at 23.55 in order to raise awareness of the issue.

In a statement to Billboard Norbert Thormann and Michael Teufele, the directors of the internationally renowned Club Berghain in Berlin, said: "The new tariffs mean that we discotheques would have to pay more than 1,400 percent to GEMA, which would put the very existence of many clubs at risk. If this change in the tariff actually becomes reality in 2013, the club landscape will change dramatically. There will be a huge increase in admission charges with an end result that many guests will no longer be able to afford to go clubbing."

After more than 20 years, GEMA is planning to change the tariff structure for discotheques in late December. Instead of 12 tariffs there will now only be two.

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Lorenz Schmid, GEMA director in Hamburg, toold Billboard that, "In Italy, France or Switzerland and many other countries in Europe it has long been standard practice for discotheques to pay 10 percent of their admission charges to the collection society. The new tariffs are reasonable. It's quite logical that after such a long time there must be an end to clubs and discotheques paying a very favorable flat rate. We believe that ten percent of gross ticket sales is an appropriate charge and in this way we want our tariffs to be based on a flat rate tied to the cash benefits linked to the size of the facility and the admission charge."

Today many discotheques pay 30 or 40 euros a day for music to play all night.

Frank Dostal, President of the association of librettists and a member of the GEMA Supervisory Board said that, "There are discotheques that make EUR 25,000 with tickets sales at the door in one evening. Of this amount we only want a lousy EUR 2,500. When the price of beer goes up, do they start a p.r. campaign against the beer supplier? No, they just pay up."

Olaf Möller, Chairman of the Berlin Club Commission, said in a statement that the GEMA tariffs also mean that in the case of an event lasting longer than five hours the tariff would increase by another 50 percent and then by a further 50 percent every three hours. That would mean man after-hours parties and performances by DJs or bands would no longer be affordable."

The German Patents and Trade Marks Office in Munich will be looking into the legality of the new GEMA tariffs as part of arbitration proceedings that will last until the middle of next year. In spite of this, however, the new GEMA tariff will still have to be paid as of January 1, 2013. The monies will then be held in trust by a general counsel until a decision is made. If discotheques then refuse to pay, the venue could be shuttered.

The German association of discotheques and dance clubs in Berlin reports that the more than 2,000 discotheques and clubs in Germany generate annual revenues of more than EUR 800 million. Stephan Büttner, Director of the association said they may have to take the tough route through the courts. Not all of us are able to deposit the money required."

A petition has surfaced on the Internet with the name "Against the 2013 tariff reform - GEMA loses sense of proportion" More than 150,000 supports from across Germany have signed on the web and are appealing to the politicians to take action against this "ruinous" GEMA tariff policy.

Bruno Kramm, a member of the leadership of the new "Piraten-Partei", which is already represented in several regional parliaments and is expected to do very well in the elections to the German Bundestag in autumn 2013, is already taking political action: "We've had enough. It's not just that for decades GEMA has shown a complete lack of transparency and established an unfair and uncontrollable distribution model for GEMA royalties for authors, now it is also actively bringing about the death of the club culture. This tariff reform means nothing less than that many discotheques will be forced out of business."

Billboard spoke with several German discotheque owners to get their opinions on the GEMA's new tariff structure:

Marc Klejbors from "Klejbors" in Eschweiler: "In our case the GEMA charges would increase by 500 percent. At the moment we pay EUR 40,000 a year and as of 2013 EUR 200,000. This puts the jobs of 140 employees at risk."

Sigurd Sierig, Ziegelei in Groß Weden, which opens once a week: "In the past we paid EUR 25,000 a year and this will not change when the new tariffs come into force. For us the new system is fairer."

Philipp Freund, "Booker im Docks", Hamburg: "We will have to pass on the increases to our partners and increase admission prices. Our fear is that illegal events will increase."

Wolfgang Weier, "Airport" in Würzburg
: "The discotheque might become uneconomical then and after 29 years we might have to close. This would affect 200 employees. One alternative would be to charge no admission at all and drastically increase the price of drinks instead. Then GEMA would collect EUR 190,000 a year from us instead of EUR 25,000."