Q 1: What is Copyright?

A: Copyright is a legal concept, which, while respecting and protecting the rights of creators/owners in their works, also contributes to the cultural and economic development of nations.  The Copyright Act of 1987 grants creators/owners private property rights to control the use of their works in Malaysia including via broadcast and public performance.  It follows that the buying of a cassette/CD does not give the buyer an automatic right to broadcast or play the same in public unless consent or licence is first obtained from the copyright owner.

Q 2: What are Collecting Societies?

A:  Due to the unique and pervasive nature of music, individual rights owners are materially unable to monitor and licence all uses of their music on their own, and neither is it practical for music users to seek specific permission from each and every rights owner for use of music.

A long and internationally established solution to this is by collective management which is the exercise of copyright by organisation acting collectively in the interests and on behalf of the owners of rights.  Collecting Societies accordingly form an important link between rights owners and users of copyrighted music.

Q 3: What are the Collecting Societies in Malaysia?

A:  In Malaysia, the music rights owners have formed the following Collecting Societies:

Name:   Public Performance Malaysia Sdn Bhd [“PPM”] (173608-V) 
Year of Incorporation:  1988 
Members: Recording Companies
Works Represented: Sound, Music Video and Karaoke Recordings
Website: www.ppm.org.my

Name: Music Authors Copyright Protection Bhd  [“MACP”] (186403-X)
Year of Incorporation:  1989   
Members: Composers, Lyricists and Publishers
Works Represented: Musical Works
Website: www.macp.com.my

Name: Performers and Artistes Rights (M) Sdn Bhd[“PRISM”](542747M)
Year of Incorporation: 2001 
Members: Recording Artistes and Musicians
Works Represented: Performances embodied in Sound Recordings
Website: www.prism.org.my

Q 4:Does the government of Malaysia recognise these Collecting Societies?

A: The Government of Malaysia recognises these Collecting Societies as legally constituted Collecting Societies in Malaysia.

Q 5: What is meant by “Public Performance”?

A: Public performance is the playing of music in public.  If one plays music in a public area or business premises where it can be heard by employees or members of the public, then it becomes a public performance, in which case one has to obtain a prior licence from the collecting societies.

Q 6: What entitlement does a public performance licence provide?

A: If one has obtained a public performance licence, he has the right to publicly perform music contained in various legal original formats such as Cassette, CD, VCD, DVD and computer Hard Disc.  The licence also covers the playing of music which is broadcast through Radio and TV. 

Q 7: When one has bought an original Cassette or CD, does he need to pay again for the public performance?

A: The price one pays for a Cassette or CD is for his private & domestic use only; it does not cover a public performance licence.  Therefore if he wants to use it in a public place or business premises he has to obtain a licence from the respective Collecting Societies.

Q 8: If one plays only Radio, TV, Satellite or Internet broadcasts in his office or shop, does he still need a public performance licence?

A: The music contained in the broadcasts is protected by copyright.  As such, playing of broadcast programmes in one’s commercial premises for his employees or members of the public will require a licence.

Q 9: What if one does not get the requisite licence?

A: If one publicly plays copyrighted music without the prior permission or licence from the Collecting Societies / copyright owners, he is liable for copyright infringement under the Copyright Act of 1987 and will risk legal action being taken against him.

Q10: Is there any compulsion in paying royalties to the Collecting Societies?

A:  Use of music is strictly voluntarily and not compulsory.  The law does not force anyone to play music in public.  However when music is played in public, the users have to pay royalty to the Collecting Societies / copyright owners. . 

Q11: Does one have to pay royalties when the playing of music is not primarily for making money?

A: The law does not specify the purpose of playing music.  As long as it is classified as public performance, one has to pay royalties.  It follows that businesses which are not making money out of playing music (e.g. barber shops, saloons, boutiques or coffee shops) must pay royalties to the Collecting Societies / copyright owners.

Q 12:  How are the rates fixed?

A:    As copyright is a private property right, the copyright owners will determine their own rates.  In determining the rates, the copyright owners will normally see how essential music is to users.  For example, where music is the prime revenue generator for users as in the case of Karaoke or Disco outlets, the rates are naturally higher.  If usage of music is optional as in the case of Restaurants or Hair Salons, the rates will be lower.

Q 13:    Do collecting societies give discounts?

A: The Collecting Societies give special volume based discounts when negotiated by trade associations on behalf of their members, for example, Karaoke, hotel and shopping complex associations.   Many users belonging to these trade associations have been enjoying discounted tariffs since 1990.

Q 14:  Why can’t the government fix the rates?

A:  Copyright is a private right belonging to the right holders.  It is the right holders who decide the rates.  Governments as a matter of principle respect private  rights and do not  interfere by fixing the rates. 

Q 15:  Are there exemptions to the paying of royalty?

A: There are several exceptions to the general requirements of having to pay royalties for public performance of music.

(a) Statutory Exemptions

The law provides numerous exemptions from the paying of royalties. For example, automatic exemptions for music users are available under Section 13(2)(k) of the Copyright Act 1987, if all 3  conditions are satisfied, i.e. when music is played by  :
• a non-profit making club or institution; and
• where no admission fee is charged; and
• when playing of music is for charitable or educational purposes only.

In the event all 3 conditions are not met, music users will not qualify for these exemptions.

(b) Other Exemptions

There are also other exemptions where the music users need not pay royalties, e.g.

1) Playing of music not represented by the Collecting Societies (subject to written consent from the individual rights owners);
2) Playing of music that has fallen into public domain  i.e. music for which copyright has expired (beyond the protection period of 50 years from date of publication or life of the author plus 50 years);
3) Playing of music that has been contributed free for the welfare of society.

(c) Voluntary Exemptions

The Collecting Societies have also granted voluntary exemptions to small businesses on their own accord, such as hawkers, individual taxi owners and places of worship.  Based on Government records, all Collecting Societies have agreed to waive collecting royalties from “Traditional Coffee Shops” with one TV/Radio and “Home Appliances Dealers” who use songs for testing appliances in the presence of their customers only.  In order to be legally binding, businesses must apply for exemptions from the Collecting Societies as required under Section 27(3) of the Act.  All other music users especially small businesses, based on individual merits, may also apply to the Collecting Societies for exemptions.

Q 16:   How much transparency is there in the Collecting Societies?

A: There is much transparency within the Collecting Societies. The Government has ensured that all Collecting Societies are required by the Companies Act 1965 to submit their annual audited accounts to the Registrar of Companies.  Anyone interested in the Collecting Societies’ accounts may obtain certified true copies of the audited accounts from Suruhanjaya Syarikat Malaysia (Companies Commission of Malaysia).  The Collecting Societies also report their annual collections to the Government whenever requested.

Q 17:  How can one identify the rights owners from a Cassette or CD?

A:  Section 26(4) of the Copyright Act 1987 states clearly that the name of the recording company, the name of composer/lyricist and/or name of the artistes found on a CD or Cassette shall be presumed by law to be  the copyright owner unless the contrary is proved.  It is common knowledge that every legitimate original CD or cassette will have the name and address of the copyright owner printed on its cover.  CDs or Cassettes that do not contain such details are almost always pirated copies.

Q 18:  What are the avenues available for dispute settlement for music users?

A:   Aggrieved music users have several recourses, among which are the following:-

1.  Negotiate with or approach the Collecting Societies directly;
2. Seek proper legal advice from Copyright lawyers;
3. Approach the Ministry of Domestic Trade and Consumer Affairs (“MDTCA”) or Intellectual Property Corporation of Malayia (“MyIPO”) directly for clarification;
4. Raise issues via trade associations at the MDTCA Minister’s Annual Dialogue Session with the private sectors;
5. Refer any disputes over royalty tariffs to the Copyright Tribunal, which is provided for under the Copyright Act 1987.
6. File a case in the Malaysian High Court for interpretation on “points of law” which are not clear to them.

Q 19:  What is the Copyright Tribunal?

A:  The Copyright Tribunal consists of members appointed by Minister of MDTCA as provided by Copyright Act 1987, and has two main functions:

(a) Approves applications for translation of foreign works into the national language; and
(b) Settles disputes between Collecting Societies and users of music.

The Tribunal only determines rates and its decisions  are final. An   appeal to the High Court may be made only on “points of law” but not on the decisions of the Tribunal.

Q20: Has there been any complaints lodged against the Collecting Societies to the Ministry, MyIPO or the Tribunal?

A:    Since the setting up of the Collecting Societies, there has not been a single case lodged against the Collecting Societies.  Members of the public have only sought clarifications from the MDTCA and MyIPO on the legal rights, roles and functions of these Collecting Societies.  Other than seeking clarifications, there have been no official complaint(s) against these bodies.

Q 21: What do the Collecting Societies do with the royalties collected?

A: As non-profit making organisation the Collecting Societies will distribute all royalties collected to the copyright owners every year after deducting actual administration cost of the Collecting Societies.

Q 22:  How do the Collecting Societies contribute the society?

A:  Firstly, the royalties received by the rights holders act as strong incentives for them to be creative in further development of the music industry.  This enriches culture in our society.  From royalties collected, Collecting Societies have set up funds such as Music Development Funds to promote a higher standard of local music compositions, and develop songwriting skills and promote local music overseas.  Collecting Societies also spend substantial sum of money annually, to assist the Government in combating music piracy in Malaysia.