Russia's Largest Collection Society Asks Putin for Help

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Red Square in Moscow, Russia. 

Embattled Russian collecting society RAO has sent a letter to President Vladimir Putin, urging him to step in and put a government-controlled media company in charge of the organization.

"The decision was made by RAO's board," the organization's spokesperson tells Billboard. "It is a necessary step, as we've been facing administrative and financial issues."

"We need support and council, and we can't think of a better supporter and counselor than the government," the spokesperson continued.

RAO, Russia's sole state-approved authors' rights collection society, and also its largest, has been under pressure since former general director Sergei Fedotov was arrested in late June on suspicion of funneling money out of the organization.

Fedotov's arrest triggered a new wave of criticism against RAO, which has long been accused of insufficient transparency. Advocates of state control over copyright fee collection have also used the situation to step up their lobbying activities.

In the midst of the controversy, another local collection society, RSP, which until recently was closely associated with RAO, broke ties with the latter organization several months ago. The falling out with RSP, which collects a one-percent tax on imports of electronic devices that can be used for copying content, resulted in RAO's losing access to some of the cash it had sitting in RSP's bank account.

According to the RAO's spokesperson, the organization now can't access about 1 billion ($16 million), and it hopes the government's interference will help to resolve the issue. Still, she added that, despite all the problems, the RAO is operating normally, and its total collection in 2016 is to be around 4 billion ($65 million).

"We are also working on technical improvements and are planning to launch online access for rights holders some time in early 2017," she concluded.

Meanwhile, state-run media companies that could assume control of RAO include broadcasters VGTRK, Channel One and National Media Group, owned by Putin's long-time friend Yuri Kovalchuk.