In April, the commercial court of Brussels rendered a decision in a case brought by 33 concert promoters against the Belgian collecting society SABAM. In 2017, SABAM tried to increase the royalties paid by concert promoters for public performance of musical works at their concerts. The price increase was substantial, up to 37% for some concert promoters, supposedly to match royalties paid in other EU countries.
33 Belgian concert promoters challenged the price increase, taking legal action against the collecting society for abuse of a dominant position.
The Brussels court agreed that SABAM has a monopoly in the Belgian market as concert promoters have almost no other choice than concluding an agreement with SABAM to clear the copyrights for the concerts the promoters organize in Belgium.
The court also agreed that the price increase was not justified on economic grounds and constituted an abuse. Increasing the royalties because of higher royalties abroad was found to be arbitrary.
The court, moreover, found that calculating royalties according to concert promoters’ turnover is not justified either. An increase in turnover may be for reasons unrelated to the copyright-protected works of SABAM members, such as extra security costs or investment in “animation and decoration”. These costs are included in the ticket price and produce a higher turnover, but they should not have an impact on the royalties claimed by SABAM. On the contrary, at some festivals, such as the famous Tomorrowland, the music is only a (small) part of the total experience, so the royalties should instead decrease, the court said.
The court also examined the three different tariffs that SABAM applies if less than 1/3, less than 2/3 or more than 2/3 of the works played during the concerts are registered with SABAM. Those three tariffs do not meet the standard of precise identification imposed by the Court of Justice of the EU in the STIM case (C-52/07).
Following the court decision, SABAM must devise a tariff plan based on objective, economic criteria. Meanwhile, consumers will not have to pay more for their concert and festival tickets this summer.
Brussels Court of Commerce, 12 April 2018, A/17/02033
Tom Heremans, Managing Partner, tom.heremans@cms-db.com
Florence Van Damme, Senior Associate, florence.vandamme@cms-db.com
