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[Federal Register Volume 78, Number 248 (Thursday, December 26, 2013)]
[Proposed Rules]
[Page 78309]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-30777]

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LIBRARY OF CONGRESS

U.S. Copyright Office

37 CFR Parts 201 and 210

[Docket No. 2012-7]

Mechanical and Digital Phonorecord Delivery Compulsory License

AGENCY: U.S. Copyright Office, Library of Congress.

ACTION: Request for additional comments.

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SUMMARY: The U.S. Copyright Office (``Office'' or ``Copyright Office'') 
of the Library of Congress requests additional public comments on 
clarifying the terms in the Monthly and Annual Statements of Account 
for the making and distribution of phonorecords.

DATES: Additional comments on the proposed rule published July 27, 2012 
(77 FR 44179), must be received in the Office of the General Counsel of 
the Copyright Office no later than 5 p.m. Eastern Daylight Time (EDT) 
on January 30, 2014. Reply comments must be received no later than 5 
p.m. EDT on February 14, 2014.

ADDRESSES: The Copyright Office strongly prefers that comments be 
submitted electronically. A comment submission page is posted on the 
Copyright Office Web site at http://www.copyright.gov/docs/section115/soa/comments/. The Web site interface requires submitters to complete a 
form specifying name and other required information, and to upload 
comments as an attachment. To meet accessibility standards, all 
comments must be uploaded in a single file in either the Portable 
Document File (PDF) format that contains searchable, accessible text 
(not an image); Microsoft Word; WordPerfect; Rich Text Format (RTF); or 
ASCII text file format (not a scanned document). The maximum file size 
is 6 megabytes (MB). The name of the submitter and organization should 
appear on both the form and the face of the comments. All comments will 
be posted publicly on the Copyright Office Web site exactly as they are 
received, along with names and organizations if provided. If electronic 
submission of comments is not feasible, please contact the Copyright 
Office at (202) 707-8380 for special instructions.

FOR FURTHER INFORMATION CONTACT: William Roberts, Senior Counsel to the 
Register of Copyrights, or Stephen Ruwe, Attorney Advisor, Copyright 
GC/I&R, P.O. Box 70400, Washington, DC 20024. Telephone: (202) 707-
8380. Telefax: (202) 707-8366.

SUPPLEMENTARY INFORMATION: On July 27, 2012, the Copyright Office 
published a notice of proposed rulemaking (``NPRM'') and request for 
comments concerning new regulations that would amend the requirements 
for reporting Monthly and Annual Statements of Account for the making 
and distribution of phonorecords under the compulsory license, 17 
U.S.C. 115, to bring the regulations up to date to accommodate certain 
rates and terms proposed by the Copyright Royalty Judges (``Judges'') 
that provided for a multi-step process for calculating royalties for 
certain new services, including limited offerings, mixed service 
bundles, paid locker services and purchased content locker services. 
Mechanical and Digital Phonorecord Delivery Compulsory License; Notice 
of proposed rulemaking, 77 FR 44179, July 27, 2012.
    The NPRM noted that the existing regulations addressing Statements 
of Account are designed to address flat penny rates, such as those that 
are still applicable for the making and distribution of physical 
phonorecords, permanent digital downloads and ringtones. The Office 
also observed that the current regulations do not specifically 
accommodate the more complex methods for calculating the royalties 
contained in the Judges' May 17, 2012 proposed rule, announced in the 
context of the Judges' royalty rate adjustment proceeding in Docket No. 
2011-3 CRB Phonorecords II. See, 77 FR 29259, May 17, 2012. In order to 
address this concern, the Copyright Office, acting under the authority 
set forth in 17 U.S.C. 115(c)(5), initiated a rulemaking to amend the 
Statement of Account provisions. In large part, the proposed 
regulations incorporate by reference the methodology adopted by the 
Judges in their 2009 determination, which are mirrored in the 
regulations adopting new rates and terms for the current licensing 
period. However, the NPRM identified a number of issues associated with 
the new rate structure that require careful consideration before 
adoption. See, 77 FR at 44181-185.
    In response to joint motions by several parties requesting more 
time to provide input, the Office decided to extend the comment and 
reply comment periods. Mechanical and Digital Phonorecord Delivery 
Compulsory License; Notice of proposed rulemaking: Extension of comment 
and reply comment periods. 77 FR 55783, Sept. 11, 2012; Mechanical and 
Digital Phonorecord Delivery Compulsory License; Extension of reply 
comment periods. 77 FR 68075, Nov. 15, 2012. The Office withheld 
further action in this rulemaking pending the Judges' adoption of final 
rates and terms.
    On November 13, 2013, the Judges issued final rates and terms for 
the section 115 license. Adjustment of Determination of Compulsory 
License Rates for Mechanical and Digital Phonorecord, Final rule. 78 FR 
67938, Nov. 13, 2013. The final rates and terms differed from the 2012 
proposed rates and terms in certain respects, due in part to actions 
taken by the Judges. Specifically, the Judges referred material 
questions of law to the Register of Copyrights concerning their 
authority to adopt certain terms relating to statements of account. 
Order Referring Material Questions of Law and Setting Briefing Schedule 
(March 27, 2013). The Judges also referred novel material questions of 
substantive law to the Register concerning their authority to adopt 
certain terms. Order Referring Novel Questions of Law and Setting 
Briefing Schedule (May 17, 2013). In light of the Register's timely 
responses to these referred questions, the Judges declined to adopt 
certain terms contained in the May 17, 2012 proposed rule. Adjustment 
of Determination of Compulsory License Rates for Mechanical and Digital 
Phonorecord. Final rule. 78 FR 67938, Nov. 13, 2013.
    The Office finds that the conclusion of the recent proceeding and 
adoption of new rates and terms for the current licensing period may be 
pertinent to the issues raised in this rulemaking. Likewise, due to the 
passage of time since the issuance of the NPRM, marketplace 
developments and changes in business models may be relevant to the 
amendment of the regulations. Consequently, the Office has decided to 
extend an opportunity for such additional comments and supporting 
information. Interested parties are strongly encouraged to offer 
information and/or documentation to support arguments or conclusions 
offered in their comments. Any additional comments must be received in 
the Office of the General Counsel of the Copyright Office no later than 
January 30, 2014, and reply comments no later than February 14, 2014.

    Dated: December 17, 2013.
Maria A. Pallante,
Register of Copyrights.
[FR Doc. 2013-30777 Filed 12-24-13; 8:45 am]
BILLING CODE 1410-30-P
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