APRA won’t have to make sweeping structural changes to the way it does its business anytime soon after Australia’s competition watchdog conditionally sanctioned the society’s powerful music licensing position.
Though APRA isn’t entirely in the clear. In a draft decision published Tuesday, The Australian Competition and Consumer Commission (ACCC) describes APRA as a “virtual monopoly” and calls for a “plain English guide” to its licensing systems and to make improvements to its dispute resolution process. The conditions would also require APRA to launch an education campaign for its “licence back” and “opt out” facilities, which allow the society’s members to enter into direct licensing arrangements with users for their works.
The ACCC had announced in 2010 it wanted APRA to streamline its royalty processes to better enable composers to deal directly with music users, and invited feedback on its plans.
The ACCC’s latest challenge on APRA drew a surprising volume of feedback. Dozens of submissions rolled-in from venue operators, trade bodies and licensees, including documents from the likes of Australian Hotels Association, Nightlife Music Video, Live Performance Australia and Totem Onelove Group. Some were particularly scathing, and sources say there were others that were kept off the public record.
After weighing-up the evidence, the ACCC says it considers that the “public benefit test has been met” and it has proposed authorization for a further three years, provided its conditions are met.
ACCC Commissioner Dr Jill Walker notes that the authority “accepts that APRA’s arrangements provide users with transaction cost savings by providing instantaneous access to APRA’s entire repertoire. The exclusivity of APRA’s arrangements also results in enforcement and monitoring efficiencies.”
On the other hand, she explains, “as a virtual monopoly, APRA has significant market power in relation to its dealings with users and its arrangements can also create inefficiencies for its members.”
APRA’s arrangements were first authorized by the Australian Competition Tribunal in 1999. The ACCC reauthorized the arrangements in 2006 and conditionally reauthorized them in 2010; APRA’s existing authorization expires on Oct. 31.
The competition authority is now seeking submissions on the draft decision — including on the conditions – before coming to a final decision.