The long-time practice, known as La Rueda (“The Wheel”), concerns the broadcast of low-quality, cookie-cutter pieces of music, often arrangements of classical works which are in the public domain, on overnight television programs, generating royalties for those credited as authors (which have allegedly included phantom composers using false names) and for publishers owned by the television stations themselves, who split the royalties on the tracks. The music included what has been described as “barely audible” or “inaudible” background music. Police raided SGAE headquarters last year after a continuing investigation into La Rueda in which 18 people were detained.
World Intellectual Property Organization (WIPO) arbitration intended to put a stop to La Rueda practices in a decision last July, by establishing a limit on the rights to be distributed to the lucrative but sparsely-viewed over-night slots to between 10 and 20%, and barring “inaudible background music” from being eligible for distribution rights.
In its statement on Monday, the ICMP noted that that SGAE was "rejecting the decision of the WIPO Arbitration Panel to which it is bound."
But in an email to Billboard on Tuesday, SGAE representatives countered that the WIPO decision had in fact been "annulled" at the end of May by a decision in Madrid Superior Court that decided in favor of television publishing group Grupo Editorial Telecinco and Música Aparte – the publishing arm of Atresmedia, which owns Spain’s Antena 3 station, companies which had challenged the WIPO decision.
“Thus the solution to limit returns to between 10% and 20% is no longer valid,” said SGAE’s statement, which also cautioned against “falling into the confusion that any music broadcast at night could be fraudulent.”
The ICMP’s harsh statement came after a report issued in late May by the International Confederation of Societies of Authors and Composers (CISAC), acting on a complaint against SGAE that ICMP made in February.
In the report, a three-person review team found that “SGAE’s attempts to address the distortion and inequity caused by “La Rueda” has been insufficient, and the reviewers had “serious concerns” about conflicts of interest in the governance of SGAE.
The CISAC reviewers wrote that SGAE "should enter a program under CISAC’s supervision" to address recommendations that included correcting imbalances in distribution results and preventing the "gaming” of distribution rules.
At a General Assembly on June 21 in Madrid, SGAE members are slated to vote on proposed changes to the organization’s statutes.
A group of SGAE members have requested that impartial observers oversee the voting, suggesting those observers might be appointed by Spain’s Ministry of Culture.
In a Tweet on Tuesday, SGAE Vice President Javier Losada Calvo called that idea “absurd.”