The German Music Publishers Assn. (DMV) is enlisting its members for support as it urges IFPI Germany to cancel its controversial proposal to reduce the mechanical royalty rate on sound recordings.
As previously reported, the German chapter of the IFPI went to the country’s Patent and Brand Office in January and applied for the mechanical royalty rate to be slashed to 5.6% from 9.009% of the PPD (published price to dealers), effective Jan. 1. Approval hinges on an arbitration tribunal decision that may take up to five years.
In a sign of solidarity with authors, DMV has issued an anti-rate cut petition, signed by composers, lyricists and arrangers. DMV president Dagmar Sikorski-Grossmann says the document will be issued to the media and “influential politicians” in Germany and Europe, “asking them to help prevent a group of companies with a dominant market position from ruining the existences of composers, lyricists, arrangers and music publishers.”
DMV has also issued a letter to IFPI Germany chairman Gerd Gebhardt explaining the petition.
DMV representatives met today (March 1) in Hamburg. Jenny Vacher, CEO of the International Confederation of Music Publishers (ICMP), the Paris-based global trade association for music publishers, commented after the meeting: “A near-to-50% decrease of the rate is outrageous.”
The difference between the previously agreed-upon mechanical rate of 9.009% and the new rate of 5.6% will be held in an escrow account by the record companies until a final agreement is reached. Sources estimate that GEMA’s 60,000 members and their publishers could end up losing more than €200 million ($248 million) over five years if the new rate is confirmed.