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[Federal Register Volume 77, Number 230 (Thursday, November 29, 2012)]
[Rules and Regulations]
[Pages 71101-71104]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-28906]

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LIBRARY OF CONGRESS

Copyright Office

37 CFR Part 201

[Docket No. RM 2012-4]

Electronic Filing in the Copyright Office of Notices of Intention 
To Obtain a Section 115 Compulsory License

AGENCY: Copyright Office, Library of Congress.

ACTION: Final rule.

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SUMMARY: The Copyright Office is amending its regulations for filing 
Notices of Intention to obtain a Section 115 compulsory license with 
the Copyright Office to provide an option for electronically filing 
notices. By law, such notices may be filed in the Office only when the 
public records of the Copyright Office do not identify the copyright 
owner of the musical work and include an address at which notice can be 
served. In addition, the Copyright Office is amending its regulations 
to clarify the rules for filing physical Notices of Intention, to 
clarify that it does not examine Notices of Intention filed with the 
Office for legal sufficiency, and to include a Privacy Act Advisory 
Statement.

DATES: Effective January 14, 2013.

FOR FURTHER INFORMATION CONTACT: Tanya Sandros, Deputy General Counsel, 
Copyright GC/I&R, P.O. Box 70400, Washington, DC 20024. Telephone: 
(202) 707-8380. Telefax: (202) 707-8366. All prior Federal Register 
notices and comments in this docket are available at: http://www.copyright.gov/laws/rulemaking.html.

SUPPLEMENTARY INFORMATION: 

Background

    Section 115 of the Copyright Act provides that ``[w]hen 
phonorecords of a nondramatic musical work have been distributed to the 
public in the United States under the authority of the copyright owner, 
any other person * * * may, by complying with the provisions of this 
section, obtain a compulsory license to make and distribute 
phonorecords of the work.'' 17 U.S.C. 115(a)(1).
    Included among the conditions that must be met to use the Section 
115 compulsory license is the requirement that a person who wishes to 
obtain a compulsory license ``shall, before or within thirty days after 
making, and before distributing any phonorecords of the work, serve 
notice of intention to do so on the copyright owner. If the

[[Page 71102]]

registration or other public records of the Copyright Office 
(``Copyright Office'' or ``Office'') do not identify the copyright 
owner and include an address at which notice can be served, it shall be 
sufficient to file the notice of intention in the Copyright Office. The 
notice shall comply, in form, content, and manner of service, with 
requirements that the Register of Copyrights shall prescribe by 
regulation.'' 17 U.S.C. 115(b)(1).
    In 2004, the Copyright Office amended 37 CFR 201.18, the 
regulations governing Notices of Intention to obtain a Section 115 
compulsory license (``Notices''), in order to make the license more 
functional. 69 FR 34578 (June 22, 2004). Among the 2004 amendments to 
37 CFR 201.18 was a provision that allowed that a Notice ``may 
designate any number of nondramatic musical works, provided that the 
copyright owner of each designated work or, in the case of any work 
having more than one copyright owner, any one of the copyright owners 
is the same and that the information required under paragraphs 
(d)(1)(i) through (iv) of this section does not vary [i.e., name and 
contact information of licensee; name and contact information of 
primary entity making and distributing phonorecords, and information 
concerning yearly accounting periods]. For purposes of this section, a 
Notice which lists multiple works shall be considered a composite 
filing of multiple Notices and fees shall be paid accordingly if filed 
in the Copyright Office under paragraph (f) of this section (i.e., a 
separate fee, in the amount set forth in Sec.  201.3(e)(1), shall be 
paid for each work listed in the Notice).'' 37 CFR 201.18(a)(4). The 
2004 amendments also allowed licensees to serve Notices directly on 
copyright owners or designated agents by means of an electronic 
transmission when the copyright owner or designated agent has a written 
public policy that it can accommodate such submissions. 37 CFR 
201.18(a)(7).
    Earlier in the 2004 rulemaking process the Office also considered 
whether to allow a licensee to file a Notice in the Office in an 
electronic format. The Office determined that it was not prepared to 
accept electronically filed Notices because it did not have in place 
the systems that would accommodate such filings. However, the Office 
anticipated that such filings would be accepted in the future. The 
Office did provide that in the case where the licensee intends to 
license a high volume of nondramatic musical works under Section 115 
and would endure significant hardships if required to submit the 
Notices under the standard practices, the licensee may contact the 
Licensing Division of the Copyright Office to inquire whether special 
arrangements could be made for submission of the Notice electronically. 
69 FR 11566, 11570 (March 11, 2004).
    The Office is aware of a growing need for an electronic filing 
system for filing Section 115 Notices with the Copyright Office because 
of the large number of works being used under the compulsory license 
where service of the Notice cannot be made effectively on the copyright 
owner. To meet this need, the Office is now preparing to accept 
specific types of electronically filed Notices addressing multiple 
nondramatic musical works. Hence, the Office is amending its 
regulations in Sec.  201.18 by providing for use of an online system 
for submission of Notices covering multiple nondramatic musical works.
    In its Notice of Proposed Rulemaking published in May 2012, the 
Copyright Office proposed a number of changes to the regulations 
governing the filing of Section 115 Notices. 77 FR 31237 (May 25, 
2012). First, the Office proposed to clarify its rules for submission 
of Notices in paper form that contain multiple titles of nondramatic 
musical works. The proposal noted that, while in practice the Office 
does accept and process Notices with multiple titles in the case where 
no copyright owner of any of the works can be identified, the 
regulations do not specifically contemplate this situation. Thus, the 
Office proposed to amend its regulations to clarify that a Notice filed 
in a paper format may list multiple works in a single Notice when any 
of the following circumstances apply: In the case where no copyright 
owner can be identified from the Copyright Office records for any of 
the works listed in the Notice; in the case where the copyright owner 
of each work listed in the Notice is the same and the records of the 
Copyright Office do not include an address at which notice can be 
served; or for works having more than one copyright owner, in the case 
where the works listed in the Notice share a common copyright owner and 
the records of the Copyright Office do not include an address at which 
notice can be served on any of the copyright owners for the subject 
works. The Office proposed to maintain these distinctions for the paper 
filings at this time because they provide more concise information to 
the public reviewing the Notices and facilitates the recordkeeping 
process for the Office.
    The Office also proposed to amend the regulations so that Notices 
addressing multiple nondramatic musical works may be submitted 
electronically as XML files, regardless of whether the copyright owner 
of each designated work is the same, provided that the Notice does not 
include a nondramatic musical work when the identity and address of at 
least one of its copyright owners may be found in the public record of 
the Copyright Office. Fees for such electronic Notices, the Office 
proposed, would have to be paid through a Copyright Office deposit 
account (pursuant to Sec.  201.6(b) of the Copyright Office 
regulations), at least during the introductory period of the online 
filing process. Use of a deposit account will allow the Office to make 
any necessary fee payments immediately and it avoids the need to solve 
the technological and security issues associated with providing a 
credit card payment in this first iteration of the system.
    Further to the question of the processing of electronic Section 115 
Notices, the Copyright Office proposed not to require an electronic 
signature during the initial rollout of the filing process, though it 
did note plans to add an electronic signature requirement in later 
versions of the system. Under the initial rollout, because the fee for 
Notice must be paid through a deposit account, the online system will 
be able to use the deposit account information to reasonably verify and 
authenticate the identity of the person submitting and validating 
Notices.
    The Copyright Office, in its May 25, 2012 notice of proposed 
rulemaking also proposed two additional amendments. The first of these 
would clarify that the Office does not examine Notices for legal 
sufficiency, would encourage filers to take care to comply with all the 
statutory and regulatory requirements pertaining to such Notices, and 
would note that the Office will notify a prospective licensee when a 
Notice is not accompanied by payment of the required fee. The second 
additional amendment would add a Privacy Act Advisory Statement in 
Sec.  201.18, which would fulfill the Office's obligation to notify the 
public that Notices with personally identifying information filed with 
the Office become public records.

Comments

    The Office received two comments in response to its notice of 
proposed rulemaking. One, from Attorney Chris Garvey, supported the 
proposal to permit the electronic submission of section 115 Notices. 
The other, from Public Knowledge (``PK''), also supported the 
electronic filing proposal, along with making further suggestions. PK 
proposed that electronically filed

[[Page 71103]]

Notices should be permitted for single nondramatic musical works, and 
that the Office should ``hasten to build the capacity to authenticate 
licensees and receive payment information without deposit accounts.'' 
This latter measure, PK maintained, would result in long-term reduced 
transaction costs. PK also suggested that the Office ``implement a 
searchable, electronic Notice database for public use'' in order to 
minimize transaction costs between copyright owners and licensees, and 
avoid the hourly fee that the Copyright Office charges for searches of 
non-public-facing records.

Discussion

    The Office is in agreement with PK in its goal of further improving 
the functionality of the Office's electronic system ``to simplify the 
Section 115 process for licensees, copyright owners, and the Office 
itself.'' The Office believes that the amendments detailed above are an 
interim step towardsmeeting this goal. The Office also notes that of 
the three PK proposals, one is already encompassed in the amendments 
and the other two will be instituted as part of the upgrades to the 
Office's technical infrastructure.
    Regarding the ability of a person to electronically file a Notice 
for a single nondramatic musical work, the text of the amendments to 
Sec.  201.18(a)(4) states that such a Notice ``may designate multiple 
nondramatic musical works.'' The use of the word ``may'' indicates that 
multiple works need not be designated, and that an electronic Notice 
may be filed for a single work as well. However, a person who files an 
electronic Section 115 Notice during this initial rollout phase must be 
enrolled in the Office's deposit account program. In order to 
accommodate a filer of a Notice identifying only one or a few titles 
who does not have a deposit account, the Office intends in the future 
to upgrade the online filing system to require an electronic signature 
and to accept additional payment options such as credit card payments. 
At the moment, however, the focus is on offering a mechanism for filing 
Notices with large numbers of titles in a manner that can easily be 
administered by the Office at this time.
    Regarding PK's desire for a public database of Section 115 Notices, 
the Office acknowledges that while the search capability of the 
electronically filed Notices will not be directly available to the 
public for technical reasons, this will only be the case during the 
initial rollout of the service, and that future upgrades to the system 
will include a searchable database.
    This Final Rule makes one change to the proposed amendments not 
suggested by the commenters. In new Sec.  201.18(a)(4)(iii), the phrase 
``in electronic format'' in the first sentence is replaced with 
``through its electronic filing system.'' This change merely clarifies 
the subject of the subsection.

Pilot Program

    While the Office is amending its regulations to accept electronic 
filing of the Section 115 Notices of Intent to Obtain a Compulsory 
License, it needs to fully test the system before making it available 
to the public for actual, valid submissions of Notices. Thus, members 
of the public are invited to participate in a Beta test of the proposed 
electronic system. Parties wishing to participate in Beta testing 
should contact Tracie Coleman in the Licensing Division of the 
Copyright Office at 202-707-3600, tmau@loc.gov. The Beta testing will 
require participants to upload ``test'' Notices to the Beta version of 
the electronic system to ensure proper functionality. ``Test'' Notices 
uploaded during the Beta testing phase will not require the submission 
of a filing fee, and they will not have any legal effect or otherwise 
be considered valid for licensing purposes. The Beta testing will be 
limited to selected participants until system testing is complete. 
Testing is expected to be completed by the time the rule becomes 
effective.

List of Subjects in 37 CFR Part 201

    Copyright, General provisions.

Final Regulations

    In consideration of the foregoing, the Copyright Office amends 37 
CFR part 201 as follows:

PART 201--GENERAL PROVISIONS

0
1. The authority citation for part 201 continues to read as follows:

    Authority:  17 U.S.C. 702.

0
2. Amend Sec.  201.4(a)(1)(iii) by removing ``Original, signed 
notices'' at the beginning of the paragraph and adding ``Notices'' in 
its place.

0
3. Amend Sec.  201.18 as follows:
0
a. By revising paragraph (a)(4);
0
b. By adding paragraph (e)(5);
0
c. By redesignating paragraph (g) paragraph (h);
0
d. By adding a new paragraph (g); and
0
e. By adding paragraph (i).
    The additions and revisions read as follows:

Sec.  201.18  Notice of intention to obtain a compulsory license for 
making and distributing phonorecords of nondramatic musical works.

    (a) * * *
    (4) A Notice of Intention shall be served or filed for nondramatic 
musical works embodied, or intended to be embodied, in phonorecords 
made under the compulsory license. For purposes of this section and 
subject to subparagraphs (ii) and (iii), a Notice filed with the 
Copyright Office which lists multiple works shall be considered a 
single Notice and fees shall be paid in accordance with the fee 
schedule set forth in Sec.  201.3(e)(1) if filed in the Copyright 
Office under paragraph (f)(3) of this section. Payment of the 
applicable fees for a Notice submitted electronically under this 
paragraph shall be made through a deposit account established under 
Sec.  201.6(b).
    (i) Except as provided for in paragraph (a)(7), a Notice of 
Intention served on a copyright owner or agent of a copyright owner may 
designate any number of nondramatic musical works provided that that 
the information required under paragraphs (d)(1)(i) through (iv) of 
this section does not vary and that the copyright owner of each 
designated work is the same, or in the case of any work having more 
than one copyright owner, that any one of the copyright owners is the 
same and is the copyright owner served.
    (ii) A Notice of Intention filed in the Copyright Office in paper 
form may designate any number of nondramatic musical works provided 
that that the information required under paragraphs (d)(1)(i) through 
(iv) of this section does not vary, and that the copyright owner of 
each designated work (or, in the case of works having more than one 
copyright owner, any one of the copyright owners) is the same and the 
registration records or other public records of the Copyright Office do 
not identify the copyright owner(s) of such work(s) and include an 
address for any such owner(s) at which notice can be served. For 
purposes of this subparagraph, in the case of works having more than 
one copyright owner, a single Notice must identify an actual person or 
entity as the common copyright owner; the common copyright owner may 
not be identified as ``unknown.'' However, a single Notice may include 
multiple works for which no copyright owners can be identified for any 
of the listed works.
    (iii) A Notice of Intention filed in the Copyright Office through 
its electronic filing system may designate multiple nondramatic musical 
works, regardless of whether the copyright owner of each designated 
work (or, in the case of any work having more than one copyright owner, 
any one of the copyright owners) is the same, provided that the 
information required under paragraphs

[[Page 71104]]

(d)(1)(i) through (iv) of this section does not vary, and that for any 
designated work, the records of the Copyright Office do not include an 
address at which notice can be served.
* * * * *
    (e) * * *
    (5) If the Notice is filed in the Office electronically, the person 
or entity intending to obtain the compulsory license or a duly 
authorized agent of such person or entity shall, rather than signing 
the Notice, attest that he or she has the appropriate authority of the 
licensee, including any related entities listed, if applicable, to 
submit the electronically filed Notice on behalf of the licensee.
* * * * *
    (g) Filing date and legal sufficiency of Notices. The Copyright 
Office will notify a prospective licensee when a Notice was not 
accompanied by payment of the required fee. Notices shall be deemed 
filed as of the date the Office receives both the Notice and the fee, 
if applicable. If the prospective licensee fails to remit the required 
fee, the Notice will be deemed not to have been filed with the Office. 
However, the Copyright Office does not review Notices for legal 
sufficiency or interpret the content of any Notice filed with the 
Copyright Office under this section. Furthermore, the Copyright Office 
does not screen Notices for errors or discrepancies and it does not 
generally correspond with a prospective licensee about the sufficiency 
of a Notice. If any issue (other than an issue related to fees) arises 
as to whether a Notice filed in the Copyright Office is sufficient as a 
matter of law under this section, that issue shall be determined not by 
the Copyright Office, but shall be subject to a determination of legal 
sufficiency by a court of competent jurisdiction. Prospective licensees 
are therefore cautioned to review and scrutinize Notices to assure 
their legal sufficiency before filing them in the Copyright Office.
* * * * *
    (i) Privacy Act Advisory Statement. The authority for receiving the 
personally identifying information included within a Notice of 
Intention to obtain a compulsory license is found in 17 U.S.C. 115 and 
Sec.  201.18. Personally identifying information is any personal 
information that can be used to identify or trace an individual, such 
as name, address or telephone numbers. Furnishing the information set 
forth in Sec.  201.18 is voluntary. However, if the information is not 
furnished, it may affect the sufficiency of Notice of Intention to 
obtain a compulsory license and may not entitle the prospective 
licensee to the benefits available under 17 U.S.C. 115. The principal 
uses of the requested information are the establishment and maintenance 
of a public record of the Notices of Intention to obtain a compulsory 
license received in the Licensing Division of the Copyright Office. 
Other routine uses include public inspection and copying, preparation 
of public indexes, preparation of public catalogs of copyright records 
including online catalogs, and preparation of search reports upon 
request.

    Dated: September 21, 2012.
Maria A. Pallante,
Register of Copyrights.
James H. Billington,
The Librarian of Congress.
[FR Doc. 2012-28906 Filed 11-28-12; 8:45 am]
BILLING CODE 1410-30-P
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