New Class Licensing Scheme for the regulation of collective management organisations

1     The Ministry of Law (MinLaw) and the Intellectual Property Office of Singapore (IPOS) today published the subsidiary legislation for a new collective management organisation (CMO) class licensing scheme in the Gazette, which will come into operation on 1 May 2024. This subsidiary legislation, the Copyright (Collective Management Organisations) Regulations 2023 (“Regulations”), is made pursuant to the Copyright Act 2021.

2     CMOs perform a critical role in the creative sector and the economy by facilitating efficient rights clearance through systematic and cost-effective licensing solutions. In Singapore, CMOs represent thousands of rights owners, including songwriters, composers, lyricists, record labels, authors, publishers, and filmmakers.

3     The class licensing scheme seeks to achieve a well-functioning collective management ecosystem by raising standards of transparency, accountability, efficiency, and good governance among CMOs. The scheme applies a light-touch model of regulation targeted at critical areas only, while leaving CMOs the flexibility to operate within those boundaries. The scheme does not interfere in the fees that CMOs charge for the use of the material they manage; CMOs remain free to determine such fees.

4     Under this scheme, every CMO is automatically subject to a mandatory class licence and must comply with all applicable licence conditions. Since the scheme operates automatically, there is no need to register or pay any fee to be a CMO.

5     IPOS, as the regulator of the scheme, is empowered to take regulatory actions against CMOs and their officers for breach of licence conditions, including issuing regulatory directions, imposing financial penalties or ordering CMOs to cease their collective management business. CMOs and their officers have a right to be heard at every stage of the regulatory action process, including a final appeal to the Minister for Law.

6     The Regulations set out the licence conditions that CMOs must comply with as well as procedural matters relating to the regulation of CMOs. The Regulations incorporate feedback received by MinLaw and IPOS during the public consultation exercise conducted from 7 November 2022 to 4 January 2023¹.

7     A summary of the key licence conditions is outlined in the Annex.

Implementation of the Class Licensing Scheme

8     CMOs are given a six-month notice period from 31 October 2023 to adjust their operations so that they will be in compliance with the class licensing scheme when it takes effect on 1 May 2024.

9     Once in force, the scheme will strengthen Singapore’s copyright regime and benefit all key stakeholders in our collective management ecosystem:

   a. for the CMO’s members, which include individual creators, the scheme will empower members with a set of key rights, including a right to vary or terminate their mandates to their CMOs and a right to participate in the operations of their CMOs. It will also ensure that members receive regular income distributions from their CMOs and that these distributions are properly accounted for.

   b. for the CMO’s users, which include individual consumers, businesses and institutions, the scheme will allow them to make informed decisions and give them greater certainty and efficiency when licensing from CMOs. Should disputes arise, the scheme will require CMOs to act in good faith and reasonably when dealing with the disputes.

   c. for CMOs, the scheme provides a clear set of rules without unnecessarily increasing compliance efforts and costs. In the future, IPOS will also develop, in collaboration with the industry, best practice notes such as recommendations, illustrations, and templates, which will further encourage and help CMOs to meet industry and international standards.

¹ A summary of the key changes made to the consultation draft of the CMO Regulations issued on 7 November 2022 can be found at: www.go.gov.sg/cmoregulations.

MINISTRY OF LAW

INTELLECTUAL PROPERTY OFFICE OF SINGAPORE

31 October 2023

For enquiries, please contact:

Amelia Leong (Ms)
Email: Amelia_LEONG@mlaw.gov.sg

Jenny Kwok (Ms)
Email: Jenny_KWOK@ipos.gov.sg

Annex - Summary of Key Licence Conditions