H. R. 1551 

One Hundred Fifteenth Congress 

of the 

United States of America 

AT THE SECOND SESSION 

Begun and held at the City of Washington on Wednesday, 

the third day of January, two thousand and eighteen 

An Act 

To modernize copyright law, and for other purposes. 

Be it enacted by the Senate and House of Representatives of 

the United States of America in Congress assembled, 

SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

(a) SHORT TITLE.—This Act may be cited as the ‘‘Orrin G. 

Hatch–Bob Goodlatte Music Modernization Act’’. 

(b) TABLE OF CONTENTS.—The table of contents for this Act 

is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Customs user fees. 

TITLE I—MUSIC LICENSING MODERNIZATION 

Sec. 101. Short title. 

Sec. 102. Blanket license for digital uses and mechanical licensing collective. 

Sec. 103. Amendments to section 114. 

Sec. 104. Random assignment of rate court proceedings. 

Sec. 105. Performing rights society consent decrees. 

Sec. 106. Effective date. 

TITLE II—CLASSICS PROTECTION AND ACCESS 

Sec. 201. Short title. 

Sec. 202. Unauthorized use of pre-1972 sound recordings. 

TITLE III—ALLOCATION FOR MUSIC PRODUCERS 

Sec. 301. Short title. 

Sec. 302. Payment of statutory performance royalties. 

Sec. 303. Effective date. 

TITLE IV—SEVERABILITY 

Sec. 401. Severability. 

SEC. 2. CUSTOMS USER FEES. 

Section 13031(j)(3)(A) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)(A)) is amended by 

striking ‘‘October 13, 2027’’ and inserting ‘‘October 20, 2027’’. 

TITLE I—MUSIC LICENSING 

MODERNIZATION 

SEC. 101. SHORT TITLE. 

This title may be cited as the ‘‘Musical Works Modernization 

Act’’. 
H. R. 1551—2 

SEC. 102. BLANKET LICENSE FOR DIGITAL USES AND MECHANICAL 

LICENSING COLLECTIVE. 

(a) AMENDMENT.—Section 115 of title 17, United States Code, 

is amended— 

(1) in subsection (a)— 

(A) in the subsection heading, by inserting ‘‘IN GEN- ERAL’’ after ‘‘AVAILABILITY AND SCOPE OF COMPULSORY

LICENSE’’; 

(B) by striking paragraph (1) and inserting the following: 

‘‘(1) ELIGIBILITY FOR COMPULSORY LICENSE.— ‘‘(A) CONDITIONS FOR COMPULSORY LICENSE.—A person 

may by complying with the provisions of this section obtain 

a compulsory license to make and distribute phonorecords 

of a nondramatic musical work, including by means of 

digital phonorecord delivery. A person may obtain a 

compulsory license only if the primary purpose in making 

phonorecords of the musical work is to distribute them 

to the public for private use, including by means of digital 

phonorecord delivery, and— 

‘‘(i) phonorecords of such musical work have previously been distributed to the public in the United 

States under the authority of the copyright owner of 

the work, including by means of digital phonorecord 

delivery; or 

‘‘(ii) in the case of a digital music provider seeking 

to make and distribute digital phonorecord deliveries 

of a sound recording embodying a musical work under 

a compulsory license for which clause (i) does not 

apply— 

‘‘(I) the first fixation of such sound recording 

was made under the authority of the musical work 

copyright owner, and the sound recording copyright owner has the authority of the musical work 

copyright owner to make and distribute digital 

phonorecord deliveries embodying such work to 

the public in the United States; and 

‘‘(II) the sound recording copyright owner, or 

the authorized distributor of the sound recording 

copyright owner, has authorized the digital music 

provider to make and distribute digital phonorecord deliveries of the sound recording to the 

public in the United States. 

‘‘(B) DUPLICATION OF SOUND RECORDING.—A person 

may not obtain a compulsory license for the use of the 

work in the making of phonorecords duplicating a sound 

recording fixed by another, including by means of digital 

phonorecord delivery, unless— 

‘‘(i) such sound recording was fixed lawfully; and 

‘‘(ii) the making of the phonorecords was authorized by the owner of the copyright in the sound 

recording or, if the sound recording was fixed before 

February 15, 1972, by any person who fixed the sound 

recording pursuant to an express license from the 

owner of the copyright in the musical work or pursuant 

to a valid compulsory license for use of such work 

in a sound recording.’’; and 
H. R. 1551—3 

(C) in paragraph (2), by striking ‘‘A compulsory license’’ 

and inserting ‘‘MUSICAL ARRANGEMENT.—A compulsory 

license’’; 

(2) by striking subsection (b) and inserting the following: 

‘‘(b) PROCEDURES TO OBTAIN A COMPULSORY LICENSE.— 

‘‘(1) PHONORECORDS OTHER THAN DIGITAL PHONORECORD

DELIVERIES.—A person who seeks to obtain a compulsory license 

under subsection (a) to make and distribute phonorecords of 

a musical work other than by means of digital phonorecord 

delivery shall, before, or not later than 30 calendar days after, 

making, and before distributing, any phonorecord of the work, 

serve notice of intention to do so on the copyright owner. 

If the registration or other public records of the Copyright 

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 with 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. 

‘‘(2) DIGITAL PHONORECORD DELIVERIES.—A person who 

seeks to obtain a compulsory license under subsection (a) to 

make and distribute phonorecords of a musical work by means 

of digital phonorecord delivery— 

‘‘(A) prior to the license availability date, shall, before, 

or not later than 30 calendar days after, first making 

any such digital phonorecord delivery, serve a notice of 

intention to do so on the copyright owner (but may not 

file the notice with the Copyright Office, even if the public 

records of the Office do not identify the owner or the 

owner’s address), and such notice shall comply, in form, 

content, and manner of service, with requirements that 

the Register of Copyrights shall prescribe by regulation; 

or 

‘‘(B) on or after the license availability date, shall, 

before making any such digital phonorecord delivery, follow 

the procedure described in subsection (d)(2), except as provided in paragraph (3). 

‘‘(3) RECORD COMPANY INDIVIDUAL DOWNLOAD LICENSES.— 

Notwithstanding paragraph (2)(B), a record company may, on 

or after the license availability date, obtain an individual 

download license in accordance with the notice requirements 

described in paragraph (2)(A) (except for the requirement that 

notice occur prior to the license availability date). A record 

company that obtains an individual download license as permitted under this paragraph shall provide statements of 

account and pay royalties as provided in subsection (c)(2)(I). 

‘‘(4) FAILURE TO OBTAIN LICENSE.— 

‘‘(A) PHONORECORDS OTHER THAN DIGITAL PHONORECORD DELIVERIES.—In the case of phonorecords made 

and distributed other than by means of digital phonorecord 

delivery, the failure to serve or file the notice of intention 

required by paragraph (1) forecloses the possibility of a 

compulsory license under paragraph (1). In the absence 

of a voluntary license, the failure to obtain a compulsory 

license renders the making and distribution of 
H. R. 1551—4 

phonorecords actionable as acts of infringement under section 501 and subject to the remedies provided by sections 

502 through 506. 

‘‘(B) DIGITAL PHONORECORD DELIVERIES.— 

‘‘(i) IN GENERAL.—In the case of phonorecords made 

and distributed by means of digital phonorecord 

delivery: 

‘‘(I) The failure to serve the notice of intention 

required by paragraph (2)(A) or paragraph (3), as 

applicable, forecloses the possibility of a compulsory license under such paragraph. 

‘‘(II) The failure to comply with paragraph 

(2)(B) forecloses the possibility of a blanket license 

for a period of 3 years after the last calendar 

day on which the notice of license was required 

to be submitted to the mechanical licensing collective under such paragraph. 

‘‘(ii) EFFECT OF FAILURE.—In either case described 

in subclause (I) or (II) of clause (i), in the absence 

of a voluntary license, the failure to obtain a compulsory license renders the making and distribution of 

phonorecords by means of digital phonorecord delivery 

actionable as acts of infringement under section 501 

and subject to the remedies provided by sections 502 

through 506.’’; 

(3) by amending subsection (c) to read as follows: 

‘‘(c) GENERAL CONDITIONS APPLICABLE TO COMPULSORY

LICENSE.— 

‘‘(1) ROYALTY PAYABLE UNDER COMPULSORY LICENSE.— 

‘‘(A) IDENTIFICATION REQUIREMENT.—To be entitled to 

receive royalties under a compulsory license obtained under 

subsection (b)(1) the copyright owner must be identified 

in the registration or other public records of the Copyright 

Office. The owner is entitled to royalties for phonorecords 

made and distributed after being so identified, but is not 

entitled to recover for any phonorecords previously made 

and distributed. 

‘‘(B) ROYALTY FOR PHONORECORDS OTHER THAN DIGITAL

PHONORECORD DELIVERIES.—Except as provided by 

subparagraph (A), for every phonorecord made and distributed under a compulsory license under subsection (a) other 

than by means of digital phonorecord delivery, with respect 

to each work embodied in the phonorecord, the royalty 

shall be the royalty prescribed under subparagraphs (D) 

through (F), paragraph (2)(A), and chapter 8. For purposes 

of this subparagraph, a phonorecord is considered ‘distributed’ if the person exercising the compulsory license has 

voluntarily and permanently parted with its possession. 

‘‘(C) ROYALTY FOR DIGITAL PHONORECORD DELIVERIES.— For every digital phonorecord delivery of a musical work 

made under a compulsory license under this section, the 

royalty payable shall be the royalty prescribed under subparagraphs (D) through (F), paragraph (2)(A), and chapter 

8. 

‘‘(D) AUTHORITY TO NEGOTIATE.—Notwithstanding any 

provision of the antitrust laws, any copyright owners of 

nondramatic musical works and any persons entitled to 
H. R. 1551—5 

obtain a compulsory license under subsection (a) may negotiate and agree upon the terms and rates of royalty payments under this section and the proportionate division 

of fees paid among copyright owners, and may designate 

common agents on a nonexclusive basis to negotiate, agree 

to, pay or receive such royalty payments. Such authority 

to negotiate the terms and rates of royalty payments 

includes, but is not limited to, the authority to negotiate 

the year during which the royalty rates prescribed under 

this subparagraph, subparagraphs (E) and (F), paragraph 

(2)(A), and chapter 8 shall next be determined. 

‘‘(E) DETERMINATION OF REASONABLE RATES AND

TERMS.—Proceedings under chapter 8 shall determine 

reasonable rates and terms of royalty payments for the 

activities specified by this section during the period beginning with the effective date of such rates and terms, but 

not earlier than January 1 of the second year following 

the year in which the petition requesting the proceeding 

is filed, and ending on the effective date of successor rates 

and terms, or such other period as the parties may agree. 

Any copyright owners of nondramatic musical works and 

any persons entitled to obtain a compulsory license under 

subsection (a) may submit to the Copyright Royalty Judges 

licenses covering such activities. The parties to each proceeding shall bear their own costs. 

‘‘(F) SCHEDULE OF REASONABLE RATES.—The schedule 

of reasonable rates and terms determined by the Copyright 

Royalty Judges shall, subject to paragraph (2)(A), be 

binding on all copyright owners of nondramatic musical 

works and persons entitled to obtain a compulsory license 

under subsection (a) during the period specified in subparagraph (E), such other period as may be determined pursuant to subparagraphs (D) and (E), or such other period 

as the parties may agree. The Copyright Royalty Judges 

shall establish rates and terms that most clearly represent 

the rates and terms that would have been negotiated in 

the marketplace between a willing buyer and a willing 

seller. In determining such rates and terms for digital 

phonorecord deliveries, the Copyright Royalty Judges shall 

base their decision on economic, competitive, and programming information presented by the parties, including— 

‘‘(i) whether use of the compulsory licensee’s 

service may substitute for or may promote the sales 

of phonorecords or otherwise may interfere with or 

may enhance the musical work copyright owner’s other 

streams of revenue from its musical works; and 

‘‘(ii) the relative roles of the copyright owner and 

the compulsory licensee in the copyrighted work and 

the service made available to the public with respect 

to the relative creative contribution, technological contribution, capital investment, cost, and risk. 

‘‘(2) ADDITIONAL TERMS AND CONDITIONS.— ‘‘(A) VOLUNTARY LICENSES AND CONTRACTUAL ROYALTY

RATES.— ‘‘(i) IN GENERAL.—License agreements voluntarily 

negotiated at any time between one or more copyright 

owners of nondramatic musical works and one or more 
H. R. 1551—6 

persons entitled to obtain a compulsory license under 

subsection (a) shall be given effect in lieu of any determination by the Copyright Royalty Judges. Subject 

to clause (ii), the royalty rates determined pursuant 

to subparagraphs (E) and (F) of paragraph (1) shall 

be given effect as to digital phonorecord deliveries in 

lieu of any contrary royalty rates specified in a contract 

pursuant to which a recording artist who is the author 

of a nondramatic musical work grants a license under 

that person’s exclusive rights in the musical work 

under paragraphs (1) and (3) of section 106 or commits 

another person to grant a license in that musical work 

under paragraphs (1) and (3) of section 106, to a person 

desiring to fix in a tangible medium of expression 

a sound recording embodying the musical work. 

‘‘(ii) APPLICABILITY.—The second sentence of clause 

(i) shall not apply to— 

‘‘(I) a contract entered into on or before June 

22, 1995, and not modified thereafter for the purpose of reducing the royalty rates determined 

pursuant to subparagraphs (E) and (F) of paragraph (1) or of increasing the number of musical 

works within the scope of the contract covered 

by the reduced rates, except if a contract entered 

into on or before June 22, 1995, is modified thereafter for the purpose of increasing the number 

of musical works within the scope of the contract, 

any contrary royalty rates specified in the contract 

shall be given effect in lieu of royalty rates determined pursuant to subparagraphs (E) and (F) of 

paragraph (1) for the number of musical works 

within the scope of the contract as of June 22, 

1995; and 

‘‘(II) a contract entered into after the date 

that the sound recording is fixed in a tangible 

medium of expression substantially in a form 

intended for commercial release, if at the time 

the contract is entered into, the recording artist 

retains the right to grant licenses as to the musical 

work under paragraphs (1) and (3) of section 106. 

‘‘(B) SOUND RECORDING INFORMATION.—Except as provided in section 1002(e), a digital phonorecord delivery 

licensed under this paragraph shall be accompanied by 

the information encoded in the sound recording, if any, 

by or under the authority of the copyright owner of that 

sound recording, that identifies the title of the sound 

recording, the featured recording artist who performs on 

the sound recording, and related information, including 

information concerning the underlying musical work and 

its writer. 

‘‘(C) INFRINGEMENT REMEDIES.— 

‘‘(i) IN GENERAL.—A digital phonorecord delivery 

of a sound recording is actionable as an act of infringement under section 501, and is fully subject to the 

remedies provided by sections 502 through 506, 

unless— 
H. R. 1551—7 

‘‘(I) the digital phonorecord delivery has been 

authorized by the sound recording copyright 

owner; and 

‘‘(II) the entity making the digital phonorecord 

delivery has obtained a compulsory license under 

subsection (a) or has otherwise been authorized 

by the musical work copyright owner, or by a 

record company pursuant to an individual 

download license, to make and distribute 

phonorecords of each musical work embodied in 

the sound recording by means of digital phonorecord delivery. 

‘‘(ii) OTHER REMEDIES.—Any cause of action under 

this subparagraph shall be in addition to those available to the owner of the copyright in the nondramatic 

musical work under subparagraph (J) and section 

106(4) and the owner of the copyright in the sound 

recording under section 106(6). 

‘‘(D) LIABILITY OF SOUND RECORDING OWNERS.—The 

liability of the copyright owner of a sound recording for 

infringement of the copyright in a nondramatic musical 

work embodied in the sound recording shall be determined 

in accordance with applicable law, except that the owner 

of a copyright in a sound recording shall not be liable 

for a digital phonorecord delivery by a third party if the 

owner of the copyright in the sound recording does not 

license the distribution of a phonorecord of the nondramatic 

musical work. 

‘‘(E) RECORDING DEVICES AND MEDIA.—Nothing in section 1008 shall be construed to prevent the exercise of 

the rights and remedies allowed by this paragraph, 

subparagraph (J), and chapter 5 in the event of a digital 

phonorecord delivery, except that no action alleging 

infringement of copyright may be brought under this title 

against a manufacturer, importer or distributor of a digital 

audio recording device, a digital audio recording medium, 

an analog recording device, or an analog recording medium, 

or against a consumer, based on the actions described 

in such section. 

‘‘(F) PRESERVATION OF RIGHTS.—Nothing in this section 

annuls or limits— 

‘‘(i) the exclusive right to publicly perform a sound 

recording or the musical work embodied therein, 

including by means of a digital transmission, under 

paragraphs (4) and (6) of section 106; 

‘‘(ii) except for compulsory licensing under the 

conditions specified by this section, the exclusive rights 

to reproduce and distribute the sound recording and 

the musical work embodied therein under paragraphs 

(1) and (3) of section 106, including by means of a 

digital phonorecord delivery; or 

‘‘(iii) any other rights under any other provision 

of section 106, or remedies available under this title, 

as such rights or remedies exist before, on, or after 

the date of enactment of the Digital Performance Right 

in Sound Recordings Act of 1995. 
H. R. 1551—8 

‘‘(G) EXEMPT TRANSMISSIONS AND RETRANSMISSIONS.— 

The provisions of this section concerning digital phonorecord deliveries shall not apply to any exempt transmissions or retransmissions under section 114(d)(1). The 

exemptions created in section 114(d)(1) do not expand or 

reduce the rights of copyright owners under paragraphs 

(1) through (5) of section 106 with respect to such transmissions and retransmissions. 

‘‘(H) DISTRIBUTION BY RENTAL, LEASE, OR LENDING.— 

A compulsory license obtained under subsection (b)(1) to 

make and distribute phonorecords includes the right of 

the maker of such a phonorecord to distribute or authorize 

distribution of such phonorecord, other than by means of 

a digital phonorecord delivery, by rental, lease, or lending 

(or by acts or practices in the nature of rental, lease, 

or lending). With respect to each nondramatic musical work 

embodied in the phonorecord, the royalty shall be a proportion of the revenue received by the compulsory licensee 

from every such act of distribution of the phonorecord 

under this clause equal to the proportion of the revenue 

received by the compulsory licensee from distribution of 

the phonorecord under subsection (a)(1)(A)(ii)(II) that is 

payable by a compulsory licensee under that clause and 

under chapter 8. The Register of Copyrights shall issue 

regulations to carry out the purpose of this subparagraph. 

‘‘(I) PAYMENT OF ROYALTIES AND STATEMENTS OF

ACCOUNT.—Except as provided in paragraphs (4)(A)(i) and 

(10)(B) of subsection (d), royalty payments shall be made 

on or before the twentieth day of each month and shall 

include all royalties for the month next preceding. Each 

monthly payment shall be made under oath and shall 

comply with requirements that the Register of Copyrights 

shall prescribe by regulation. The Register shall also prescribe regulations under which detailed cumulative annual 

statements of account, certified by a certified public 

accountant, shall be filed for every compulsory license 

under subsection (a). The regulations covering both the 

monthly and the annual statements of account shall prescribe the form, content, and manner of certification with 

respect to the number of records made and the number 

of records distributed. 

‘‘(J) NOTICE OF DEFAULT AND TERMINATION OF COMPULSORY LICENSE.—In the case of a license obtained under 

paragraph (1), (2)(A), or (3) of subsection (b), if the copyright owner does not receive the monthly payment and 

the monthly and annual statements of account when due, 

the owner may give written notice to the licensee that, 

unless the default is remedied not later than 30 days 

after the date on which the notice is sent, the compulsory 

license will be automatically terminated. Such termination 

renders either the making or the distribution, or both, 

of all phonorecords for which the royalty has not been 

paid, actionable as acts of infringement under section 501 

and fully subject to the remedies provided by sections 502 

through 506. In the case of a license obtained under subsection (b)(2)(B), license authority under the compulsory 
H. R. 1551—9 

license may be terminated as provided in subsection 

(d)(4)(E).’’; 

(4) by amending subsection (d) to read as follows: 

‘‘(d) BLANKET LICENSE FOR DIGITAL USES, MECHANICAL

LICENSING COLLECTIVE, AND DIGITAL LICENSEE COORDINATOR.— 

‘‘(1) BLANKET LICENSE FOR DIGITAL USES.— 

‘‘(A) IN GENERAL.—A digital music provider that qualifies for a compulsory license under subsection (a) may, 

by complying with the terms and conditions of this subsection, obtain a blanket license from copyright owners 

through the mechanical licensing collective to make and 

distribute digital phonorecord deliveries of musical works 

through one or more covered activities. 

‘‘(B) INCLUDED ACTIVITIES.—A blanket license— 

‘‘(i) covers all musical works (or shares of such 

works) available for compulsory licensing under this 

section for purposes of engaging in covered activities, 

except as provided in subparagraph (C); 

‘‘(ii) includes the making and distribution of server, 

intermediate, archival, and incidental reproductions of 

musical works that are reasonable and necessary for 

the digital music provider to engage in covered activities licensed under this subsection, solely for the purpose of engaging in such covered activities; and 

‘‘(iii) does not cover or include any rights or uses 

other than those described in clauses (i) and (ii). 

‘‘(C) OTHER LICENSES.—A voluntary license for covered 

activities entered into by or under the authority of 1 or 

more copyright owners and 1 or more digital music providers, or authority to make and distribute permanent 

downloads of a musical work obtained by a digital music 

provider from a sound recording copyright owner pursuant 

to an individual download license, shall be given effect 

in lieu of a blanket license under this subsection with 

respect to the musical works (or shares thereof) covered 

by such voluntary license or individual download authority 

and the following conditions apply: 

‘‘(i) Where a voluntary license or individual 

download license applies, the license authority provided 

under the blanket license shall exclude any musical 

works (or shares thereof) subject to the voluntary 

license or individual download license. 

‘‘(ii) An entity engaged in covered activities under 

a voluntary license or authority obtained pursuant to 

an individual download license that is a significant 

nonblanket licensee shall comply with paragraph 

(6)(A). 

‘‘(iii) The rates and terms of any voluntary license 

shall be subject to the second sentence of clause (i) 

and clause (ii) of subsection (c)(2)(A) and paragraph 

(9)(C), as applicable. 

‘‘(D) PROTECTION AGAINST INFRINGEMENT ACTIONS.— A digital music provider that obtains and complies with 

the terms of a valid blanket license under this subsection 

shall not be subject to an action for infringement of the 

exclusive rights provided by paragraphs (1) and (3) of section 106 under this title arising from use of a musical 
H. R. 1551—10 

work (or share thereof) to engage in covered activities 

authorized by such license, subject to paragraph (4)(E). 

‘‘(E) OTHER REQUIREMENTS AND CONDITIONS APPLY.— 

Except as expressly provided in this subsection, each 

requirement, limitation, condition, privilege, right, and 

remedy otherwise applicable to compulsory licenses under 

this section shall apply to compulsory blanket licenses 

under this subsection. 

‘‘(2) AVAILABILITY OF BLANKET LICENSE.— 

‘‘(A) PROCEDURE FOR OBTAINING LICENSE.—A digital 

music provider may obtain a blanket license by submitting 

a notice of license to the mechanical licensing collective 

that specifies the particular covered activities in which 

the digital music provider seeks to engage, as follows: 

‘‘(i) The notice of license shall comply in form and 

substance with requirements that the Register of Copyrights shall establish by regulation. 

‘‘(ii) Unless rejected in writing by the mechanical 

licensing collective not later than 30 calendar days 

after the date on which the mechanical licensing collective receives the notice, the blanket license shall be 

effective as of the date on which the notice of license 

was sent by the digital music provider, as shown by 

a physical or electronic record. 

‘‘(iii) A notice of license may only be rejected by 

the mechanical licensing collective if— 

‘‘(I) the digital music provider or notice of 

license does not meet the requirements of this 

section or applicable regulations, in which case 

the requirements at issue shall be specified with 

reasonable particularity in the notice of rejection; 

or 

‘‘(II) the digital music provider has had a 

blanket license terminated by the mechanical 

licensing collective during the 3-year period preceding the date on which the mechanical licensing 

collective receives the notice pursuant to paragraph (4)(E). 

‘‘(iv) If a notice of license is rejected under clause 

(iii)(I), the digital music provider shall have 30 calendar days after receipt of the notice of rejection to 

cure any deficiency and submit an amended notice 

of license to the mechanical licensing collective. If the 

deficiency has been cured, the mechanical licensing 

collective shall so confirm in writing, and the license 

shall be effective as of the date that the original notice 

of license was provided by the digital music provider. 

‘‘(v) A digital music provider that believes a notice 

of license was improperly rejected by the mechanical 

licensing collective may seek review of such rejection 

in an appropriate district court of the United States. 

The district court shall determine the matter de novo 

based on the record before the mechanical licensing 

collective and any additional evidence presented by 

the parties. 

‘‘(B) BLANKET LICENSE EFFECTIVE DATE.—Blanket 

licenses shall be made available by the mechanical licensing 
H. R. 1551—11 

collective on and after the license availability date. No 

such license shall be effective prior to the license availability date. 

‘‘(3) MECHANICAL LICENSING COLLECTIVE.— 

‘‘(A) IN GENERAL.—The mechanical licensing collective 

shall be a single entity that— 

‘‘(i) is a nonprofit entity, not owned by any other 

entity, that is created by copyright owners to carry 

out responsibilities under this subsection; 

‘‘(ii) is endorsed by, and enjoys substantial support 

from, musical work copyright owners that together represent the greatest percentage of the licensor market 

for uses of such works in covered activities, as measured over the preceding 3 full calendar years; 

‘‘(iii) is able to demonstrate to the Register of Copyrights that the entity has, or will have prior to the 

license availability date, the administrative and 

technological capabilities to perform the required functions of the mechanical licensing collective under this 

subsection and that is governed by a board of directors 

in accordance with subparagraph (D)(i); and 

‘‘(iv) has been designated by the Register of Copyrights, with the approval of the Librarian of Congress 

pursuant to section 702, in accordance with subparagraph (B). 

‘‘(B) DESIGNATION OF MECHANICAL LICENSING COLLECTIVE.— 

‘‘(i) INITIAL DESIGNATION.—Not later than 270 days 

after the enactment date, the Register of Copyrights 

shall initially designate the mechanical licensing collective as follows: 

‘‘(I) Not later than 90 calendar days after the 

enactment date, the Register shall publish notice 

in the Federal Register soliciting information to 

assist in identifying the appropriate entity to serve 

as the mechanical licensing collective, including 

the name and affiliation of each member of the 

board of directors described under subparagraph 

(D)(i) and each committee established pursuant 

to clauses (iii), (iv), and (v) of subparagraph (D). 

‘‘(II) After reviewing the information requested 

under subclause (I) and making a designation, the 

Register shall publish notice in the Federal Register setting forth— 

‘‘(aa) the identity of and contact information for the mechanical licensing collective; 

and 

‘‘(bb) the reasons for the designation. 

‘‘(ii) PERIODIC REVIEW OF DESIGNATION.—Following 

the initial designation of the mechanical licensing 

collective, the Register shall, every 5 years, beginning 

with the fifth full calendar year to commence after 

the initial designation, publish notice in the Federal 

Register in the month of January soliciting information 

concerning whether the existing designation should be 

continued, or a different entity meeting the criteria 

described in clauses (i) through (iii) of subparagraph 
H. R. 1551—12 

(A) shall be designated. Following publication of such 

notice, the Register shall— 

‘‘(I) after reviewing the information submitted 

and conducting additional proceedings as appropriate, publish notice in the Federal Register of 

a continuing designation or new designation of 

the mechanical licensing collective, as the case 

may be, and the reasons for such a designation, 

with any new designation to be effective as of 

the first day of a month that is not less than 

6 months and not longer than 9 months after 

the date on which the Register publishes the 

notice, as specified by the Register; and 

‘‘(II) if a new entity is designated as the 

mechanical licensing collective, adopt regulations 

to govern the transfer of licenses, funds, records, 

data, and administrative responsibilities from the 

existing mechanical licensing collective to the new 

entity. 

‘‘(iii) CLOSEST ALTERNATIVE DESIGNATION.—If the 

Register is unable to identify an entity that fulfills 

each of the qualifications set forth in clauses (i) through 

(iii) of subparagraph (A), the Register shall designate 

the entity that most nearly fulfills such qualifications 

for purposes of carrying out the responsibilities of the 

mechanical licensing collective. 

‘‘(C) AUTHORITIES AND FUNCTIONS.— 

‘‘(i) IN GENERAL.—The mechanical licensing collective is authorized to perform the following functions, 

subject to more particular requirements as described 

in this subsection: 

‘‘(I) Offer and administer blanket licenses, 

including receipt of notices of license and reports 

of usage from digital music providers. 

‘‘(II) Collect and distribute royalties from digital music providers for covered activities. 

‘‘(III) Engage in efforts to identify musical 

works (and shares of such works) embodied in 

particular sound recordings, and to identify and 

locate the copyright owners of such musical works 

(and shares of such works). 

‘‘(IV) Maintain the musical works database 

and other information relevant to the administration of licensing activities under this section. 

‘‘(V) Administer a process by which copyright 

owners can claim ownership of musical works (and 

shares of such works), and a process by which 

royalties for works for which the owner is not 

identified or located are equitably distributed to 

known copyright owners. 

‘‘(VI) Administer collections of the administrative assessment from digital music providers and 

significant nonblanket licensees, including receipt 

of notices of nonblanket activity. 

‘‘(VII) Invest in relevant resources, and 

arrange for services of outside vendors and others, 
H. R. 1551—13 

to support the activities of the mechanical licensing 

collective. 

‘‘(VIII) Engage in legal and other efforts to 

enforce rights and obligations under this subsection, including by filing bankruptcy proofs of 

claims for amounts owed under licenses, and acting 

in coordination with the digital licensee coordinator. 

‘‘(IX) Initiate and participate in proceedings 

before the Copyright Royalty Judges to establish 

the administrative assessment under this subsection. 

‘‘(X) Initiate and participate in proceedings 

before the Copyright Office with respect to activities under this subsection. 

‘‘(XI) Gather and provide documentation for 

use in proceedings before the Copyright Royalty 

Judges to set rates and terms under this section. 

‘‘(XII) Maintain records of the activities of the 

mechanical licensing collective and engage in and 

respond to audits described in this subsection. 

‘‘(XIII) Engage in such other activities as may 

be necessary or appropriate to fulfill the responsibilities of the mechanical licensing collective 

under this subsection. 

‘‘(ii) RESTRICTIONS CONCERNING LICENSING AND

ADMINISTRATIVE ACTIVITIES.—With respect to the 

administration of licenses, except as provided in 

clauses (i) and (iii) and subparagraph (E)(v), the 

mechanical licensing collective may only— 

‘‘(I) issue blanket licenses pursuant to subsection (d)(1); and 

‘‘(II) administer blanket licenses for reproduction or distribution rights in musical works for 

covered activities, including collecting and distributing royalties, pursuant to blanket licenses. 

‘‘(iii) ADDITIONAL ADMINISTRATIVE ACTIVITIES.— Subject to paragraph (11)(C), the mechanical licensing 

collective may also administer, including by collecting 

and distributing royalties, voluntary licenses issued 

by, or individual download licenses obtained from, 

copyright owners only for reproduction or distribution 

rights in musical works for covered activities, for which 

the mechanical licensing collective shall charge reasonable fees for such services. 

‘‘(iv) RESTRICTION ON LOBBYING.—The mechanical 

licensing collective may not engage in government lobbying activities, but may engage in the activities 

described in subclauses (IX), (X), and (XI) of clause 

(i). 

‘‘(D) GOVERNANCE.— ‘‘(i) BOARD OF DIRECTORS.—The mechanical 

licensing collective shall have a board of directors consisting of 14 voting members and 3 nonvoting members, 

as follows: 

‘‘(I) Ten voting members shall be representatives of music publishers— 
H. R. 1551—14 

‘‘(aa) to which songwriters have assigned 

exclusive rights of reproduction and distribution of musical works with respect to covered 

activities; and 

‘‘(bb) none of which may be owned by, 

or under common control with, any other board 

member. 

‘‘(II) Four voting members shall be professional 

songwriters who have retained and exercise exclusive rights of reproduction and distribution with 

respect to covered activities with respect to musical 

works they have authored. 

‘‘(III) One nonvoting member shall be a representative of the nonprofit trade association of 

music publishers that represents the greatest 

percentage of the licensor market for uses of 

musical works in covered activities, as measured 

for the 3-year period preceding the date on which 

the member is appointed. 

‘‘(IV) One nonvoting member shall be a representative of the digital licensee coordinator, provided that a digital licensee coordinator has been 

designated pursuant to paragraph (5)(B). Otherwise, the nonvoting member shall be the nonprofit 

trade association of digital licensees that represents the greatest percentage of the licensee 

market for uses of musical works in covered activities, as measured over the preceding 3 full calendar 

years. 

‘‘(V) One nonvoting member shall be a representative of a nationally recognized nonprofit 

trade association whose primary mission is 

advocacy on behalf of songwriters in the United 

States. 

‘‘(ii) BYLAWS.— 

‘‘(I) ESTABLISHMENT.—Not later than 1 year 

after the date on which the mechanical licensing 

collective is initially designated by the Register 

of Copyrights under subparagraph (B)(i), the collective shall establish bylaws to determine issues 

relating to the governance of the collective, 

including, but not limited to— 

‘‘(aa) the length of the term for each 

member of the board of directors; 

‘‘(bb) the staggering of the terms of the 

members of the board of directors; 

‘‘(cc) a process for filling a seat on the 

board of directors that is vacated before the 

end of the term with respect to that seat; 

‘‘(dd) a process for electing a member to 

the board of directors; and 

‘‘(ee) a management structure for daily 

operation of the collective. 

‘‘(II) PUBLIC AVAILABILITY.—The mechanical 

licensing collective shall make the bylaws established under subclause (I) available to the public. 
H. R. 1551—15 

‘‘(iii) BOARD MEETINGS.—The board of directors 

shall meet not less frequently than biannually and 

discuss matters pertinent to the operations of the 

mechanical licensing collective, including the mechanical licensing collective budget. 

‘‘(iv) OPERATIONS ADVISORY COMMITTEE.—The 

board of directors of the mechanical licensing collective 

shall establish an operations advisory committee consisting of not fewer than 6 members to make recommendations to the board of directors concerning the 

operations of the mechanical licensing collective, 

including the efficient investment in and deployment 

of information technology and data resources. Such 

committee shall have an equal number of members 

of the committee who are— 

‘‘(I) musical work copyright owners who are 

appointed by the board of directors of the mechanical licensing collective; and 

‘‘(II) representatives of digital music providers 

who are appointed by the digital licensee coordinator. 

‘‘(v) UNCLAIMED ROYALTIES OVERSIGHT COMMITTEE.—The board of directors of the mechanical 

licensing collective shall establish and appoint an 

unclaimed royalties oversight committee consisting of 

10 members, 5 of which shall be musical work copyright owners and 5 of which shall be professional songwriters whose works are used in covered activities. 

‘‘(vi) DISPUTE RESOLUTION COMMITTEE.—The board 

of directors of the mechanical licensing collective shall 

establish and appoint a dispute resolution committee 

that shall— 

‘‘(I) consist of not fewer than 6 members; and 

‘‘(II) include an equal number of representatives of musical work copyright owners and professional songwriters. 

‘‘(vii) MECHANICAL LICENSING COLLECTIVE ANNUAL

REPORT.— 

‘‘(I) IN GENERAL.—Not later than June 30 of 

each year commencing after the license availability 

date, the mechanical licensing collective shall post, 

and make available online for a period of not less 

than 3 years, an annual report that sets forth 

information regarding— 

‘‘(aa) the operational and licensing practices of the collective; 

‘‘(bb) how royalties are collected and 

distributed; 

‘‘(cc) budgeting and expenditures; 

‘‘(dd) the collective total costs for the preceding calendar year; 

‘‘(ee) the projected annual mechanical 

licensing collective budget; 

‘‘(ff) aggregated royalty receipts and payments; 
H. R. 1551—16 

‘‘(gg) expenses that are more than 10 percent of the annual mechanical licensing collective budget; and 

‘‘(hh) the efforts of the collective to locate 

and identify copyright owners of unmatched 

musical works (and shares of works). 

‘‘(II) SUBMISSION.—On the date on which the 

mechanical licensing collective posts each report 

required under subclause (I), the collective shall 

provide a copy of the report to the Register of 

Copyrights. 

‘‘(viii) INDEPENDENT OFFICERS.—An individual 

serving as an officer of the mechanical licensing collective may not, at the same time, also be an employee 

or agent of any member of the board of directors of 

the collective or any entity represented by a member 

of the board of directors, as described in clause (i). 

‘‘(ix) OVERSIGHT AND ACCOUNTABILITY.— 

‘‘(I) IN GENERAL.—The mechanical licensing 

collective shall— 

‘‘(aa) ensure that the policies and practices 

of the collective are transparent and accountable; 

‘‘(bb) identify a point of contact for publisher inquiries and complaints with timely 

redress; and 

‘‘(cc) establish an anti-comingling policy 

for funds not collected under this section and 

royalties collected under this section. 

‘‘(II) AUDITS.— 

‘‘(aa) IN GENERAL.—Beginning in the 

fourth full calendar year that begins after the 

initial designation of the mechanical licensing 

collective by the Register of Copyrights under 

subparagraph (B)(i), and in every fifth calendar year thereafter, the collective shall 

retain a qualified auditor that shall— 

‘‘(AA) examine the books, records, and 

operations of the collective; 

‘‘(BB) prepare a report for the board 

of directors of the collective with respect 

to the matters described in item (bb); and 

‘‘(CC) not later than December 31 of 

the year in which the qualified auditor 

is retained, deliver the report described 

in subitem (BB) to the board of directors 

of the collective. 

‘‘(bb) MATTERS ADDRESSED.—Each report 

prepared under item (aa) shall address the 

implementation and efficacy of procedures of 

the mechanical licensing collective— 

‘‘(AA) for the receipt, handling, and 

distribution of royalty funds, including 

any amounts held as unclaimed royalties; 

‘‘(BB) to guard against fraud, abuse, 

waste, and the unreasonable use of funds; 

and 
H. R. 1551—17 

‘‘(CC) to protect the confidentiality of 

financial, proprietary, and other sensitive 

information. 

‘‘(cc) PUBLIC AVAILABILITY.—With respect 

to each report prepared under item (aa), the 

mechanical licensing collective shall— 

‘‘(AA) submit the report to the Register of Copyrights; and 

‘‘(BB) make the report available to 

the public. 

‘‘(E) MUSICAL WORKS DATABASE.— 

‘‘(i) ESTABLISHMENT AND MAINTENANCE OF DATABASE.—The mechanical licensing collective shall establish and maintain a database containing information 

relating to musical works (and shares of such works) 

and, to the extent known, the identity and location 

of the copyright owners of such works (and shares 

thereof) and the sound recordings in which the musical 

works are embodied. In furtherance of maintaining 

such database, the mechanical licensing collective shall 

engage in efforts to identify the musical works 

embodied in particular sound recordings, as well as 

to identify and locate the copyright owners of such 

works (and shares thereof), and update such data as 

appropriate. 

‘‘(ii) MATCHED WORKS.—With respect to musical 

works (and shares thereof) that have been matched 

to copyright owners, the musical works database shall 

include— 

‘‘(I) the title of the musical work; 

‘‘(II) the copyright owner of the work (or share 

thereof), and the ownership percentage of that 

owner; 

‘‘(III) contact information for such copyright 

owner; 

‘‘(IV) to the extent reasonably available to the 

mechanical licensing collective— 

‘‘(aa) the international standard musical 

work code for the work; and 

‘‘(bb) identifying information for sound 

recordings in which the musical work is 

embodied, including the name of the sound 

recording, featured artist, sound recording 

copyright owner, producer, international 

standard recording code, and other information commonly used to assist in associating 

sound recordings with musical works; and 

‘‘(V) such other information as the Register 

of Copyrights may prescribe by regulation. 

‘‘(iii) UNMATCHED WORKS.—With respect to 

unmatched musical works (and shares of works) in 

the database, the musical works database shall 

include— 

‘‘(I) to the extent reasonably available to the 

mechanical licensing collective— 

‘‘(aa) the title of the musical work; 
H. R. 1551—18 

‘‘(bb) the ownership percentage for which 

an owner has not been identified; 

‘‘(cc) if a copyright owner has been identified but not located, the identity of such owner 

and the ownership percentage of that owner; 

‘‘(dd) identifying information for sound 

recordings in which the work is embodied, 

including sound recording name, featured 

artist, sound recording copyright owner, producer, international standard recording code, 

and other information commonly used to assist 

in associating sound recordings with musical 

works; and 

‘‘(ee) any additional information reported 

to the mechanical licensing collective that may 

assist in identifying the work; and 

‘‘(II) such other information relating to the 

identity and ownership of musical works (and 

shares of such works) as the Register of Copyrights 

may prescribe by regulation. 

‘‘(iv) SOUND RECORDING INFORMATION.—Each 

musical work copyright owner with any musical work 

listed in the musical works database shall engage in 

commercially reasonable efforts to deliver to the 

mechanical licensing collective, including for use in 

the musical works database, to the extent such 

information is not then available in the database, 

information regarding the names of the sound 

recordings in which that copyright owner’s musical 

works (or shares thereof) are embodied, to the extent 

practicable. 

‘‘(v) ACCESSIBILITY OF DATABASE.—The musical 

works database shall be made available to members 

of the public in a searchable, online format, free of 

charge. The mechanical licensing collective shall make 

such database available in a bulk, machine-readable 

format, through a widely available software application, to the following entities: 

‘‘(I) Digital music providers operating under 

the authority of valid notices of license, free of 

charge. 

‘‘(II) Significant nonblanket licensees in 

compliance with their obligations under paragraph 

(6), free of charge. 

‘‘(III) Authorized vendors of the entities 

described in subclauses (I) and (II), free of charge. 

‘‘(IV) The Register of Copyrights, free of charge 

(but the Register shall not treat such database 

or any information therein as a Government 

record). 

‘‘(V) Any other person or entity for a fee not 

to exceed the marginal cost to the mechanical 

licensing collective of providing the database to 

such person or entity. 

‘‘(vi) ADDITIONAL REQUIREMENTS.—The Register of 

Copyrights shall establish requirements by regulations 
H. R. 1551—19 

to ensure the usability, interoperability, and usage 

restrictions of the musical works database. 

‘‘(F) NOTICES OF LICENSE AND NONBLANKET ACTIVITY.— 

‘‘(i) NOTICES OF LICENSES.—The mechanical 

licensing collective shall receive, review, and confirm 

or reject notices of license from digital music providers, 

as provided in paragraph (2)(A). The collective shall 

maintain a current, publicly accessible list of blanket 

licenses that includes contact information for the 

licensees and the effective dates of such licenses. 

‘‘(ii) NOTICES OF NONBLANKET ACTIVITY.—The 

mechanical licensing collective shall receive notices of 

nonblanket activity from significant nonblanket 

licensees, as provided in paragraph (6)(A). The collective shall maintain a current, publicly accessible list 

of notices of nonblanket activity that includes contact 

information for significant nonblanket licensees and 

the dates of receipt of such notices. 

‘‘(G) COLLECTION AND DISTRIBUTION OF ROYALTIES.— 

‘‘(i) IN GENERAL.—Upon receiving reports of usage 

and payments of royalties from digital music providers 

for covered activities, the mechanical licensing collective shall— 

‘‘(I) engage in efforts to— 

‘‘(aa) identify the musical works embodied 

in sound recordings reflected in such reports, 

and the copyright owners of such musical 

works (and shares thereof); 

‘‘(bb) confirm uses of musical works subject to voluntary licenses and individual 

download licenses, and the corresponding pro 

rata amounts to be deducted from royalties 

that would otherwise be due under the blanket 

license; and 

‘‘(cc) confirm proper payment of royalties 

due; 

‘‘(II) distribute royalties to copyright owners 

in accordance with the usage and other information contained in such reports, as well as the 

ownership and other information contained in the 

records of the collective; and 

‘‘(III) deposit into an interest-bearing account, 

as provided in subparagraph (H)(ii), royalties that 

cannot be distributed due to— 

‘‘(aa) an inability to identify or locate a 

copyright owner of a musical work (or share 

thereof); or 

‘‘(bb) a pending dispute before the dispute 

resolution committee of the mechanical 

licensing collective. 

‘‘(ii) OTHER COLLECTION EFFORTS.—Any royalties 

recovered by the mechanical licensing collective as a 

result of efforts to enforce rights or obligations under 

a blanket license, including through a bankruptcy proceeding or other legal action, shall be distributed to 

copyright owners based on available usage information 

and in accordance with the procedures described in 
H. R. 1551—20 

subclauses (I) and (II) of clause (i), on a pro rata 

basis in proportion to the overall percentage recovery 

of the total royalties owed, with any pro rata share 

of royalties that cannot be distributed deposited in 

an interest-bearing account as provided in subparagraph (H)(ii). 

‘‘(H) HOLDING OF ACCRUED ROYALTIES.— 

‘‘(i) HOLDING PERIOD.—The mechanical licensing 

collective shall hold accrued royalties associated with 

particular musical works (and shares of works) that 

remain unmatched for a period of not less than 3 

years after the date on which the funds were received 

by the mechanical licensing collective, or not less than 

3 years after the date on which the funds were accrued 

by a digital music provider that subsequently transferred such funds to the mechanical licensing collective 

pursuant to paragraph (10)(B), whichever period 

expires sooner. 

‘‘(ii) INTEREST-BEARING ACCOUNT.—Accrued royalties for unmatched works (and shares thereof) shall 

be maintained by the mechanical licensing collective 

in an interest-bearing account that earns monthly 

interest— 

‘‘(I) at the Federal, short-term rate; and 

‘‘(II) that accrues for the benefit of copyright 

owners entitled to payment of such accrued royalties. 

‘‘(I) MUSICAL WORKS CLAIMING PROCESS.—When a copyright owner of an unmatched work (or share of a work) 

has been identified and located in accordance with the 

procedures of the mechanical licensing collective, the collective shall— 

‘‘(i) update the musical works database and the 

other records of the collective accordingly; and 

‘‘(ii) provided that accrued royalties for the musical 

work (or share thereof) have not yet been included 

in a distribution pursuant to subparagraph (J)(i), pay 

such accrued royalties and a proportionate amount 

of accrued interest associated with that work (or share 

thereof) to the copyright owner, accompanied by a 

cumulative statement of account reflecting usage of 

such work and accrued royalties based on information 

provided by digital music providers to the mechanical 

licensing collective. 

‘‘(J) DISTRIBUTION OF UNCLAIMED ACCRUED ROYAL- TIES.— ‘‘(i) DISTRIBUTION PROCEDURES.—After the expiration of the prescribed holding period for accrued royalties provided in subparagraph (H)(i), the mechanical 

licensing collective shall distribute such accrued royalties, along with a proportionate share of accrued 

interest, to copyright owners identified in the records 

of the collective, subject to the following requirements, 

and in accordance with the policies and procedures 

established under clause (ii): 

‘‘(I) The first such distribution shall occur on 

or after January 1 of the second full calendar 
H. R. 1551—21 

year to commence after the license availability 

date, with not less than 1 such distribution to 

take place during each calendar year thereafter. 

‘‘(II) Copyright owners’ payment shares for 

unclaimed accrued royalties for particular 

reporting periods shall be determined in a transparent and equitable manner based on data indicating the relative market shares of such copyright 

owners as reflected in reports of usage provided 

by digital music providers for covered activities 

for the periods in question, including, in addition 

to usage data provided to the mechanical licensing 

collective, usage data provided to copyright owners 

under voluntary licenses and individual download 

licenses for covered activities, to the extent such 

information is available to the mechanical 

licensing collective. In furtherance of the determination of equitable market shares under this 

subparagraph— 

‘‘(aa) the mechanical licensing collective 

may require copyright owners seeking distributions of unclaimed accrued royalties to 

provide, or direct the provision of, information 

concerning the usage of musical works under 

voluntary licenses and individual download 

licenses for covered activities; and 

‘‘(bb) the mechanical licensing collective 

shall take appropriate steps to safeguard the 

confidentiality and security of usage, financial, 

and other sensitive data used to compute 

market shares in accordance with the confidentiality provisions prescribed by the Register of Copyrights under paragraph (12)(C). 

‘‘(ii) ESTABLISHMENT OF DISTRIBUTION POLICIES.— 

The unclaimed royalties oversight committee established under subparagraph (D)(v) shall establish policies and procedures for the distribution of unclaimed 

accrued royalties and accrued interest in accordance 

with this subparagraph, including the provision of 

usage data to copyright owners to allocate payments 

and credits to songwriters pursuant to clause (iv), subject to the approval of the board of directors of the 

mechanical licensing collective. 

‘‘(iii) PUBLIC NOTICE OF UNCLAIMED ACCRUED

ROYALTIES.—The mechanical licensing collective 

shall— 

‘‘(I) maintain a publicly accessible online 

facility with contact information for the collective 

that lists unmatched musical works (and shares 

of works), through which a copyright owner may 

assert an ownership claim with respect to such 

a work (and a share of such a work); 

‘‘(II) engage in diligent, good-faith efforts to 

publicize, throughout the music industry— 
H. R. 1551—22 

‘‘(aa) the existence of the collective and 

the ability to claim unclaimed accrued royalties for unmatched musical works (and shares 

of such works) held by the collective; 

‘‘(bb) the procedures by which copyright 

owners may identify themselves and provide 

contact, ownership, and other relevant 

information to the collective in order to receive 

payments of accrued royalties; 

‘‘(cc) any transfer of accrued royalties for 

musical works under paragraph (10)(B), not 

later than 180 days after the date on which 

the transfer is received; and 

‘‘(dd) any pending distribution of 

unclaimed accrued royalties and accrued 

interest, not less than 90 days before the date 

on which the distribution is made; and 

‘‘(III) as appropriate, participate in music 

industry conferences and events for the purpose 

of publicizing the matters described in subclause 

(II). 

‘‘(iv) SONGWRITER PAYMENTS.—Copyright owners 

that receive a distribution of unclaimed accrued royalties and accrued interest shall pay or credit a portion 

to songwriters (or the authorized agents of songwriters) 

on whose behalf the copyright owners license or administer musical works for covered activities, in accordance 

with applicable contractual terms, but notwithstanding 

any agreement to the contrary— 

‘‘(I) such payments and credits to songwriters 

shall be allocated in proportion to reported usage 

of individual musical works by digital music providers during the reporting periods covered by the 

distribution from the mechanical licensing collective; and 

‘‘(II) in no case shall the payment or credit 

to an individual songwriter be less than 50 percent 

of the payment received by the copyright owner 

attributable to usage of musical works (or shares 

of works) of that songwriter. 

‘‘(K) DISPUTE RESOLUTION.—The dispute resolution 

committee established under subparagraph (D)(vi) shall 

establish policies and procedures— 

‘‘(i) for copyright owners to address in a timely 

and equitable manner disputes relating to ownership 

interests in musical works licensed under this section 

and allocation and distribution of royalties by the 

mechanical licensing collective, subject to the approval 

of the board of directors of the mechanical licensing 

collective; 

‘‘(ii) that shall include a mechanism to hold disputed funds in accordance with the requirements 

described in subparagraph (H)(ii) pending resolution 

of the dispute; and 

‘‘(iii) except as provided in paragraph (11)(D), that 

shall not affect any legal or equitable rights or remedies available to any copyright owner or songwriter 
H. R. 1551—23 

concerning ownership of, and entitlement to royalties 

for, a musical work. 

‘‘(L) VERIFICATION OF PAYMENTS BY MECHANICAL

LICENSING COLLECTIVE.— 

‘‘(i) VERIFICATION PROCESS.—A copyright owner 

entitled to receive payments of royalties for covered 

activities from the mechanical licensing collective may, 

individually or with other copyright owners, conduct 

an audit of the mechanical licensing collective to verify 

the accuracy of royalty payments by the mechanical 

licensing collective to such copyright owner, as follows: 

‘‘(I) A copyright owner may audit the mechanical licensing collective only once in a year for 

any or all of the 3 calendar years preceding the 

year in which the audit is commenced, and may 

not audit records for any calendar year more than 

once. 

‘‘(II) The audit shall be conducted by a qualified auditor, who shall perform the audit during 

the ordinary course of business by examining the 

books, records, and data of the mechanical 

licensing collective, according to generally accepted 

auditing standards and subject to applicable confidentiality requirements prescribed by the Register of Copyrights under paragraph (12)(C). 

‘‘(III) The mechanical licensing collective shall 

make such books, records, and data available to 

the qualified auditor and respond to reasonable 

requests for relevant information, and shall use 

commercially reasonable efforts to facilitate access 

to relevant information maintained by third parties. 

‘‘(IV) To commence the audit, any copyright 

owner shall file with the Copyright Office a notice 

of intent to conduct an audit of the mechanical 

licensing collective, identifying the period of time 

to be audited, and shall simultaneously deliver 

a copy of such notice to the mechanical licensing 

collective. The Register of Copyrights shall cause 

the notice of audit to be published in the Federal 

Register not later than 45 calendar days after 

the date on which the notice is received. 

‘‘(V) The qualified auditor shall determine the 

accuracy of royalty payments, including whether 

an underpayment or overpayment of royalties was 

made by the mechanical licensing collective to each 

auditing copyright owner, except that, before providing a final audit report to any such copyright 

owner, the qualified auditor shall provide a tentative draft of the report to the mechanical 

licensing collective and allow the mechanical 

licensing collective a reasonable opportunity to 

respond to the findings, including by clarifying 

issues and correcting factual errors. 

‘‘(VI) The auditing copyright owner or owners 

shall bear the cost of the audit. In case of an 

underpayment to any copyright owner, the 
H. R. 1551—24 

mechanical licensing collective shall pay the 

amounts of any such underpayment to such 

auditing copyright owner, as appropriate. In case 

of an overpayment by the mechanical licensing 

collective, the mechanical licensing collective may 

debit the account of the auditing copyright owner 

or owners for such overpaid amounts, or such 

owner or owners shall refund overpaid amounts 

to the mechanical licensing collective, as appropriate. 

‘‘(ii) ALTERNATIVE VERIFICATION PROCEDURES.— 

Nothing in this subparagraph shall preclude a copyright owner and the mechanical licensing collective 

from agreeing to audit procedures different from those 

described in this subparagraph, except that a notice 

of the audit shall be provided to and published by 

the Copyright Office as described in clause (i)(IV). 

‘‘(M) RECORDS OF MECHANICAL LICENSING COLLECTIVE.— 

‘‘(i) RECORDS MAINTENANCE.—The mechanical 

licensing collective shall ensure that all material 

records of the operations of the mechanical licensing 

collective, including those relating to notices of license, 

the administration of the claims process of the mechanical licensing collective, reports of usage, royalty payments, receipt and maintenance of accrued royalties, 

royalty distribution processes, and legal matters, are 

preserved and maintained in a secure and reliable 

manner, with appropriate commercially reasonable 

safeguards against unauthorized access, copying, and 

disclosure, and subject to the confidentiality requirements prescribed by the Register of Copyrights under 

paragraph (12)(C) for a period of not less than 7 years 

after the date of creation or receipt, whichever occurs 

later. 

‘‘(ii) RECORDS ACCESS.—The mechanical licensing 

collective shall provide prompt access to electronic and 

other records pertaining to the administration of a 

copyright owner’s musical works upon reasonable written request of the owner or the authorized representative of the owner. 

‘‘(4) TERMS AND CONDITIONS OF BLANKET LICENSE.—A 

blanket license is subject to, and conditioned upon, the following 

requirements: 

‘‘(A) ROYALTY REPORTING AND PAYMENTS.— ‘‘(i) MONTHLY REPORTS AND PAYMENT.—A digital 

music provider shall report and pay royalties to the 

mechanical licensing collective under the blanket 

license on a monthly basis in accordance with clause 

(ii) and subsection (c)(2)(I), except that the monthly 

reporting shall be due on the date that is 45 calendar 

days, rather than 20 calendar days, after the end of 

the monthly reporting period. 

‘‘(ii) DATA TO BE REPORTED.—In reporting usage 

of musical works to the mechanical licensing collective, 

a digital music provider shall provide usage data for 

musical works used under the blanket license and 
H. R. 1551—25 

usage data for musical works used in covered activities 

under voluntary licenses and individual download 

licenses. In the report of usage, the digital music provider shall— 

‘‘(I) with respect to each sound recording 

embodying a musical work— 

‘‘(aa) provide identifying information for 

the sound recording, including sound recording 

name, featured artist, and, to the extent 

acquired by the digital music provider in 

connection with its use of sound recordings 

of musical works to engage in covered activities, including pursuant to subparagraph (B), 

sound recording copyright owner, producer, 

international standard recording code, and 

other information commonly used in the 

industry to identify sound recordings and 

match them to the musical works the sound 

recordings embody; 

‘‘(bb) to the extent acquired by the digital 

music provider in the metadata provided by 

sound recording copyright owners or other 

licensors of sound recordings in connection 

with the use of sound recordings of musical 

works to engage in covered activities, 

including pursuant to subparagraph (B), provide information concerning authorship and 

ownership of the applicable rights in the 

musical work embodied in the sound recording 

(including each songwriter, publisher name, 

and respective ownership share) and the international standard musical work code; and 

‘‘(cc) provide the number of digital phonorecord deliveries of the sound recording, 

including limited downloads and interactive 

streams; 

‘‘(II) identify and provide contact information 

for all musical work copyright owners for works 

embodied in sound recordings as to which a voluntary license, rather than the blanket license, 

is in effect with respect to the uses being reported; 

and 

‘‘(III) provide such other information as the 

Register of Copyrights shall require by regulation. 

‘‘(iii) FORMAT AND MAINTENANCE OF REPORTS.— 

Reports of usage provided by digital music providers 

to the mechanical licensing collective shall be in a 

machine-readable format that is compatible with the 

information technology systems of the mechanical 

licensing collective and meets the requirements of regulations adopted by the Register of Copyrights. The 

Register shall also adopt regulations setting forth 

requirements under which records of use shall be maintained and made available to the mechanical licensing 

collective by digital music providers engaged in covered 

activities under a blanket license. 
H. R. 1551—26 

‘‘(iv) ADOPTION OF REGULATIONS.—The Register of 

Copyrights shall adopt regulations— 

‘‘(I) setting forth requirements under which 

records of use shall be maintained and made available to the mechanical licensing collective by digital music providers engaged in covered activities 

under a blanket license; and 

‘‘(II) regarding adjustments to reports of usage 

by digital music providers, including mechanisms 

to account for overpayment and underpayment of 

royalties in prior periods. 

‘‘(B) COLLECTION OF SOUND RECORDING INFORMATION.— 

A digital music provider shall engage in good-faith, 

commercially reasonable efforts to obtain from sound 

recording copyright owners and other licensors of sound 

recordings made available through the service of such digital music provider information concerning— 

‘‘(i) sound recording copyright owners, producers, 

international standard recording codes, and other 

information commonly used in the industry to identify 

sound recordings and match them to the musical works 

the sound recordings embody; and 

‘‘(ii) the authorship and ownership of musical 

works, including songwriters, publisher names, ownership shares, and international standard musical work 

codes. 

‘‘(C) PAYMENT OF ADMINISTRATIVE ASSESSMENT.—A digital music provider and any significant nonblanket licensee 

shall pay the administrative assessment established under 

paragraph (7)(D) in accordance with this subsection and 

applicable regulations. 

‘‘(D) VERIFICATION OF PAYMENTS BY DIGITAL MUSIC PROVIDERS.— 

‘‘(i) VERIFICATION PROCESS.—The mechanical 

licensing collective may conduct an audit of a digital 

music provider operating under the blanket license 

to verify the accuracy of royalty payments by the digital 

music provider to the mechanical licensing collective 

as follows: 

‘‘(I) The mechanical licensing collective may 

commence an audit of a digital music provider 

not more frequently than once in any 3-calendaryear period to cover a verification period of not 

more than the 3 full calendar years preceding the 

date of commencement of the audit, and such audit 

may not audit records for any such 3-year 

verification period more than once. 

‘‘(II) The audit shall be conducted by a qualified auditor, who shall perform the audit during 

the ordinary course of business by examining the 

books, records, and data of the digital music provider, according to generally accepted auditing 

standards and subject to applicable confidentiality 

requirements prescribed by the Register of Copyrights under paragraph (12)(C). 

‘‘(III) The digital music provider shall make 

such books, records, and data available to the 
H. R. 1551—27 

qualified auditor and respond to reasonable 

requests for relevant information, and shall use 

commercially reasonable efforts to provide access 

to relevant information maintained with respect 

to a digital music provider by third parties. 

‘‘(IV) To commence the audit, the mechanical 

licensing collective shall file with the Copyright 

Office a notice of intent to conduct an audit of 

the digital music provider, identifying the period 

of time to be audited, and shall simultaneously 

deliver a copy of such notice to the digital music 

provider. The Register of Copyrights shall cause 

the notice of audit to be published in the Federal 

Register not later than 45 calendar days after 

the date on which notice is received. 

‘‘(V) The qualified auditor shall determine the 

accuracy of royalty payments, including whether 

an underpayment or overpayment of royalties was 

made by the digital music provider to the mechanical licensing collective, except that, before providing a final audit report to the mechanical 

licensing collective, the qualified auditor shall provide a tentative draft of the report to the digital 

music provider and allow the digital music provider a reasonable opportunity to respond to the 

findings, including by clarifying issues and correcting factual errors. 

‘‘(VI) The mechanical licensing collective shall 

pay the cost of the audit, unless the qualified 

auditor determines that there was an underpayment by the digital music provider of not less 

than 10 percent, in which case the digital music 

provider shall bear the reasonable costs of the 

audit, in addition to paying the amount of any 

underpayment to the mechanical licensing collective. In case of an overpayment by the digital 

music provider, the mechanical licensing collective 

shall provide a credit to the account of the digital 

music provider. 

‘‘(VII) A digital music provider may not assert 

section 507 or any other Federal or State statute 

of limitations, doctrine of laches or estoppel, or 

similar provision as a defense to a legal action 

arising from an audit under this subparagraph 

if such legal action is commenced not more than 

6 years after the commencement of the audit that 

is the basis for such action. 

‘‘(ii) ALTERNATIVE VERIFICATION PROCEDURES.— 

Nothing in this subparagraph shall preclude the 

mechanical licensing collective and a digital music provider from agreeing to audit procedures different from 

those described in this subparagraph, except that a 

notice of the audit shall be provided to and published 

by the Copyright Office as described in clause (i)(IV). 

‘‘(E) DEFAULT UNDER BLANKET LICENSE.— 
H. R. 1551—28 

‘‘(i) CONDITIONS OF DEFAULT.—A digital music provider shall be in default under a blanket license if 

the digital music provider— 

‘‘(I) fails to provide 1 or more monthly reports 

of usage to the mechanical licensing collective 

when due; 

‘‘(II) fails to make a monthly royalty or late 

fee payment to the mechanical licensing collective 

when due, in all or material part; 

‘‘(III) provides 1 or more monthly reports of 

usage to the mechanical licensing collective that, 

on the whole, is or are materially deficient as 

a result of inaccurate, missing, or unreadable data, 

where the correct data was available to the digital 

music provider and required to be reported under 

this section and applicable regulations; 

‘‘(IV) fails to pay the administrative assessment as required under this subsection and 

applicable regulations; or 

‘‘(V) after being provided written notice by the 

mechanical licensing collective, refuses to comply 

with any other material term or condition of the 

blanket license under this section for a period of 

not less than 60 calendar days. 

‘‘(ii) NOTICE OF DEFAULT AND TERMINATION.—In 

case of a default by a digital music provider, the 

mechanical licensing collective may proceed to terminate the blanket license of the digital music provider 

as follows: 

‘‘(I) The mechanical licensing collective shall 

provide written notice to the digital music provider 

describing with reasonable particularity the 

default and advising that unless such default is 

cured not later than 60 calendar days after the 

date of the notice, the blanket license will automatically terminate at the end of that period. 

‘‘(II) If the digital music provider fails to 

remedy the default before the end of the 60-day 

period described in subclause (I), the license shall 

terminate without any further action on the part 

of the mechanical licensing collective. Such termination renders the making of all digital phonorecord deliveries of all musical works (and shares 

thereof) covered by the blanket license for which 

the royalty or administrative assessment has not 

been paid actionable as acts of infringement under 

section 501 and subject to the remedies provided 

by sections 502 through 506. 

‘‘(iii) NOTICE TO COPYRIGHT OWNERS.—The mechanical licensing collective shall provide written notice 

of any termination under this subparagraph to copyright owners of affected works. 

‘‘(iv) REVIEW BY FEDERAL DISTRICT COURT.—A digital music provider that believes a blanket license was 

improperly terminated by the mechanical licensing 

collective may seek review of such termination in an 

appropriate district court of the United States. The 
H. R. 1551—29 

district court shall determine the matter de novo based 

on the record before the mechanical licensing collective 

and any additional supporting evidence presented by 

the parties. 

‘‘(5) DIGITAL LICENSEE COORDINATOR.— 

‘‘(A) IN GENERAL.—The digital licensee coordinator 

shall be a single entity that— 

‘‘(i) is a nonprofit, not owned by any other entity, 

that is created to carry out responsibilities under this 

subsection; 

‘‘(ii) is endorsed by and enjoys substantial support 

from digital music providers and significant nonblanket 

licensees that together represent the greatest percentage of the licensee market for uses of musical works 

in covered activities, as measured over the preceding 

3 calendar years; 

‘‘(iii) is able to demonstrate that it has, or will 

have prior to the license availability date, the administrative capabilities to perform the required functions 

of the digital licensee coordinator under this subsection; and 

‘‘(iv) has been designated by the Register of Copyrights, with the approval of the Librarian of Congress 

pursuant to section 702, in accordance with subparagraph (B). 

‘‘(B) DESIGNATION OF DIGITAL LICENSEE COORDINATOR.— 

‘‘(i) INITIAL DESIGNATION.—The Register of Copyrights shall initially designate the digital licensee 

coordinator not later than 270 days after the enactment 

date, in accordance with the same procedure described 

for designation of the mechanical licensing collective 

in paragraph (3)(B)(i). 

‘‘(ii) PERIODIC REVIEW OF DESIGNATION.—Following 

the initial designation of the digital licensee coordinator, the Register of Copyrights shall, every 5 years, 

beginning with the fifth full calendar year to commence 

after the initial designation, determine whether the 

existing designation should be continued, or a different 

entity meeting the criteria described in clauses (i) 

through (iii) of subparagraph (A) should be designated, 

in accordance with the same procedure described for 

the mechanical licensing collective in paragraph 

(3)(B)(ii). 

‘‘(iii) INABILITY TO DESIGNATE.—If the Register of 

Copyrights is unable to identify an entity that fulfills 

each of the qualifications described in clauses (i) 

through (iii) of subparagraph (A) to serve as the digital 

licensee coordinator, the Register may decline to designate a digital licensee coordinator. The determination 

of the Register not to designate a digital licensee 

coordinator shall not negate or otherwise affect any 

provision of this subsection except to the limited extent 

that a provision references the digital licensee coordinator. In such case, the reference to the digital licensee 

coordinator shall be without effect unless and until 

a new digital licensee coordinator is designated. 
H. R. 1551—30 

‘‘(C) AUTHORITIES AND FUNCTIONS.— 

‘‘(i) IN GENERAL.—The digital licensee coordinator 

is authorized to perform the following functions, subject 

to more particular requirements as described in this 

subsection: 

‘‘(I) Establish a governance structure, criteria 

for membership, and any dues to be paid by its 

members. 

‘‘(II) Engage in efforts to enforce notice and 

payment obligations with respect to the administrative assessment, including by receiving information from and coordinating with the mechanical 

licensing collective. 

‘‘(III) Initiate and participate in proceedings 

before the Copyright Royalty Judges to establish 

the administrative assessment under this subsection. 

‘‘(IV) Initiate and participate in proceedings 

before the Copyright Office with respect to activities under this subsection. 

‘‘(V) Gather and provide documentation for use 

in proceedings before the Copyright Royalty Judges 

to set rates and terms under this section. 

‘‘(VI) Maintain records of its activities. 

‘‘(VII) Assist in publicizing the existence of 

the mechanical licensing collective and the ability 

of copyright owners to claim royalties for 

unmatched musical works (and shares of works) 

through the collective. 

‘‘(VIII) Engage in such other activities as may 

be necessary or appropriate to fulfill its responsibilities under this subsection. 

‘‘(ii) RESTRICTION ON LOBBYING.—The digital 

licensee coordinator may not engage in government 

lobbying activities, but may engage in the activities 

described in subclauses (III), (IV), and (V) of clause 

(i). 

‘‘(iii) ASSISTANCE WITH PUBLICITY FOR UNCLAIMED

ROYALTIES.—The digital licensee coordinator shall 

make reasonable, good-faith efforts to assist the 

mechanical licensing collective in the efforts of the 

collective to locate and identify copyright owners of 

unmatched musical works (and shares of such works) 

by encouraging digital music providers to publicize the 

existence of the collective and the ability of copyright 

owners to claim unclaimed accrued royalties, including 

by— 

‘‘(I) posting contact information for the collective at reasonably prominent locations on digital 

music provider websites and applications; and 

‘‘(II) conducting in-person outreach activities 

with songwriters. 

‘‘(6) REQUIREMENTS FOR SIGNIFICANT NONBLANKET

LICENSEES.— 

‘‘(A) IN GENERAL.— ‘‘(i) NOTICE OF ACTIVITY.—Not later than 45 calendar days after the license availability date, or 45 
H. R. 1551—31 

calendar days after the end of the first full calendar 

month in which an entity initially qualifies as a significant nonblanket licensee, whichever occurs later, a 

significant nonblanket licensee shall submit a notice 

of nonblanket activity to the mechanical licensing 

collective. The notice of nonblanket activity shall 

comply in form and substance with requirements that 

the Register of Copyrights shall establish by regulation, 

and a copy shall be made available to the digital 

licensee coordinator. 

‘‘(ii) REPORTING AND PAYMENT OBLIGATIONS.—The 

notice of nonblanket activity submitted to the mechanical licensing collective shall be accompanied by a 

report of usage that contains the information described 

in paragraph (4)(A)(ii), as well as any payment of the 

administrative assessment required under this subsection and applicable regulations. Thereafter, subject 

to clause (iii), a significant nonblanket licensee shall 

continue to provide monthly reports of usage, accompanied by any required payment of the administrative 

assessment, to the mechanical licensing collective. Such 

reports and payments shall be submitted not later 

than 45 calendar days after the end of the calendar 

month being reported. 

‘‘(iii) DISCONTINUATION OF OBLIGATIONS.—An 

entity that has submitted a notice of nonblanket 

activity to the mechanical licensing collective that has 

ceased to qualify as a significant nonblanket licensee 

may so notify the collective in writing. In such case, 

as of the calendar month in which such notice is provided, such entity shall no longer be required to provide 

reports of usage or pay the administrative assessment, 

but if such entity later qualifies as a significant nonblanket licensee, such entity shall again be required 

to comply with clauses (i) and (ii). 

‘‘(B) REPORTING BY MECHANICAL LICENSING COLLECTIVE

TO DIGITAL LICENSEE COORDINATOR.— ‘‘(i) MONTHLY REPORTS OF NONCOMPLIANT

LICENSEES.—The mechanical licensing collective shall 

provide monthly reports to the digital licensee coordinator setting forth any significant nonblanket licensees 

of which the collective is aware that have failed to 

comply with subparagraph (A). 

‘‘(ii) TREATMENT OF CONFIDENTIAL INFORMATION.— 

The mechanical licensing collective and digital licensee 

coordinator shall take appropriate steps to safeguard 

the confidentiality and security of financial and other 

sensitive data shared under this subparagraph, in 

accordance with the confidentiality requirements prescribed by the Register of Copyrights under paragraph 

(12)(C). 

‘‘(C) LEGAL ENFORCEMENT EFFORTS.— ‘‘(i) FEDERAL COURT ACTION.—Should the mechanical licensing collective or digital licensee coordinator 

become aware that a significant nonblanket licensee 

has failed to comply with subparagraph (A), either 

may commence an action in an appropriate district 
H. R. 1551—32 

court of the United States for damages and injunctive 

relief. If the significant nonblanket licensee is found 

liable, the court shall, absent a finding of excusable 

neglect, award damages in an amount equal to three 

times the total amount of the unpaid administrative 

assessment and, notwithstanding anything to the contrary in section 505, reasonable attorney’s fees and 

costs, as well as such other relief as the court determines appropriate. In all other cases, the court shall 

award relief as appropriate. Any recovery of damages 

shall be payable to the mechanical licensing collective 

as an offset to the collective total costs. 

‘‘(ii) STATUTE OF LIMITATIONS FOR ENFORCEMENT

ACTION.—Any action described in this subparagraph 

shall be commenced within the time period described 

in section 507(b). 

‘‘(iii) OTHER RIGHTS AND REMEDIES PRESERVED.— 

The ability of the mechanical licensing collective or 

digital licensee coordinator to bring an action under 

this subparagraph shall in no way alter, limit or negate 

any other right or remedy that may be available to 

any party at law or in equity. 

‘‘(7) FUNDING OF MECHANICAL LICENSING COLLECTIVE.— 

‘‘(A) IN GENERAL.—The collective total costs shall be 

funded by— 

‘‘(i) an administrative assessment, as such assessment is established by the Copyright Royalty Judges 

pursuant to subparagraph (D) from time to time, to 

be paid by— 

‘‘(I) digital music providers that are engaged, 

in all or in part, in covered activities pursuant 

to a blanket license; and 

‘‘(II) significant nonblanket licensees; and 

‘‘(ii) voluntary contributions from digital music providers and significant nonblanket licensees as may be 

agreed with copyright owners. 

‘‘(B) VOLUNTARY CONTRIBUTIONS.— ‘‘(i) AGREEMENTS CONCERNING CONTRIBUTIONS.— Except as provided in clause (ii), voluntary contributions by digital music providers and significant nonblanket licensees shall be determined by private negotiation and agreement, and the following conditions 

apply: 

‘‘(I) The date and amount of each voluntary 

contribution to the mechanical licensing collective 

shall be documented in a writing signed by an 

authorized agent of the mechanical licensing collective and the contributing party. 

‘‘(II) Such agreement shall be made available 

as required in proceedings before the Copyright 

Royalty Judges to establish or adjust the administrative assessment in accordance with applicable 

statutory and regulatory provisions and rulings 

of the Copyright Royalty Judges. 

‘‘(ii) TREATMENT OF CONTRIBUTIONS.—Each voluntary contribution described in clause (i) shall be 

treated for purposes of an administrative assessment 
H. R. 1551—33 

proceeding as an offset to the collective total costs 

that would otherwise be recovered through the 

administrative assessment. Any allocation or reallocation of voluntary contributions between or among individual digital music providers or significant nonblanket 

licensees shall be a matter of private negotiation and 

agreement among such parties and outside the scope 

of the administrative assessment proceeding. 

‘‘(C) INTERIM APPLICATION OF ACCRUED ROYALTIES.— 

In the event that the administrative assessment, together 

with any funding from voluntary contributions as provided 

in subparagraphs (A) and (B), is inadequate to cover current collective total costs, the collective, with approval of 

its board of directors, may apply unclaimed accrued royalties on an interim basis to defray such costs, subject to 

future reimbursement of such royalties from future collections of the assessment. 

‘‘(D) DETERMINATION OF ADMINISTRATIVE ASSESSMENT.— 

‘‘(i) ADMINISTRATIVE ASSESSMENT TO COVER

COLLECTIVE TOTAL COSTS.—The administrative assessment shall be used solely and exclusively to fund the 

collective total costs. 

‘‘(ii) SEPARATE PROCEEDING BEFORE COPYRIGHT

ROYALTY JUDGES.—The amount and terms of the 

administrative assessment shall be determined and 

established in a separate and independent proceeding 

before the Copyright Royalty Judges, according to the 

procedures described in clauses (iii) and (iv). The 

administrative assessment determined in such proceeding shall— 

‘‘(I) be wholly independent of royalty rates and 

terms applicable to digital music providers, which 

shall not be taken into consideration in any 

manner in establishing the administrative assessment; 

‘‘(II) be established by the Copyright Royalty 

Judges in an amount that is calculated to defray 

the reasonable collective total costs; 

‘‘(III) be assessed based on usage of musical 

works by digital music providers and significant 

nonblanket licensees in covered activities under 

both compulsory and nonblanket licenses; 

‘‘(IV) may be in the form of a percentage of 

royalties payable under this section for usage of 

musical works in covered activities (regardless of 

whether a different rate applies under a voluntary 

license), or any other usage-based metric reasonably calculated to equitably allocate the collective 

total costs across digital music providers and 

significant nonblanket licensees engaged in covered activities, and shall include as a component 

a minimum fee for all digital music providers and 

significant nonblanket licensees; and 

‘‘(V) take into consideration anticipated future 

collective total costs and collections of the administrative assessment, including, as applicable— 
H. R. 1551—34 

‘‘(aa) any portion of past actual collective 

total costs of the mechanical licensing collective not funded by previous collections of the 

administrative assessment or voluntary contributions because such collections or contributions together were insufficient to fund such 

costs; 

‘‘(bb) any past collections of the administrative assessment and voluntary contributions that exceeded past actual collective total 

costs, resulting in a surplus; and 

‘‘(cc) the amount of any voluntary contributions by digital music providers or significant nonblanket licensees in relevant periods, 

described in subparagraphs (A) and (B) of 

paragraph (7). 

‘‘(iii) INITIAL ADMINISTRATIVE ASSESSMENT.—The 

procedure for establishing the initial administrative 

assessment shall be as follows: 

‘‘(I) Not later than 270 days after the enactment date, the Copyright Royalty Judges shall 

commence a proceeding to establish the initial 

administrative assessment by publishing a notice 

in the Federal Register seeking petitions to participate. 

‘‘(II) The mechanical licensing collective and 

digital licensee coordinator shall participate in the 

proceeding described in subclause (I), along with 

any interested copyright owners, digital music providers or significant nonblanket licensees that 

have notified the Copyright Royalty Judges of their 

desire to participate. 

‘‘(III) The Copyright Royalty Judges shall 

establish a schedule for submission by the parties 

of information that may be relevant to establishing 

the administrative assessment, including actual 

and anticipated collective total costs of the 

mechanical licensing collective, actual and anticipated collections from digital music providers and 

significant nonblanket licensees, and documentation of voluntary contributions, as well as a 

schedule for further proceedings, which shall 

include a hearing, as the Copyright Royalty Judges 

determine appropriate. 

‘‘(IV) The initial administrative assessment 

shall be determined, and such determination shall 

be published in the Federal Register by the Copyright Royalty Judges, not later than 1 year after 

commencement of the proceeding described in this 

clause. The determination shall be supported by 

a written record. The initial administrative assessment shall be effective as of the license availability 

date, and shall continue in effect unless and until 

an adjusted administrative assessment is established pursuant to an adjustment proceeding under 

clause (iv). 
H. R. 1551—35 

‘‘(iv) ADJUSTMENT OF ADMINISTRATIVE ASSESSMENT.—The administrative assessment may be 

adjusted by the Copyright Royalty Judges periodically, 

in accordance with the following procedures: 

‘‘(I) Not earlier than 1 year after the most 

recent publication of a determination of the 

administrative assessment by the Copyright Royalty Judges, the mechanical licensing collective, 

the digital licensee coordinator, or one or more 

interested copyright owners, digital music providers, or significant nonblanket licensees, may 

file a petition with the Copyright Royalty Judges 

in the month of May to commence a proceeding 

to adjust the administrative assessment. 

‘‘(II) Notice of the commencement of such proceeding shall be published in the Federal Register 

in the month of June following the filing of any 

petition, with a schedule of requested information 

and additional proceedings, as described in clause 

(iii)(III). The mechanical licensing collective and 

digital licensee coordinator shall participate in 

such proceeding, along with any interested copyright owners, digital music providers, or significant 

nonblanket licensees that have notified the Copyright Royalty Judges of their desire to participate. 

‘‘(III) The determination of the adjusted 

administrative assessment, which shall be supported by a written record, shall be published in 

the Federal Register during June of the calendar 

year following the commencement of the proceeding. The adjusted administrative assessment 

shall take effect January 1 of the year following 

such publication. 

‘‘(v) ADOPTION OF VOLUNTARY AGREEMENTS.—In 

lieu of reaching their own determination based on 

evaluation of relevant data, the Copyright Royalty 

Judges shall approve and adopt a negotiated agreement 

to establish the amount and terms of the administrative assessment that has been agreed to by the mechanical licensing collective and the digital licensee coordinator (or if none has been designated, interested digital 

music providers and significant nonblanket licensees 

representing more than half of the market for uses 

of musical works in covered activities), except that 

the Copyright Royalty Judges shall have the discretion 

to reject any such agreement for good cause shown. 

An administrative assessment adopted under this 

clause shall apply to all digital music providers and 

significant nonblanket licensees engaged in covered 

activities during the period the administrative assessment is in effect. 

‘‘(vi) CONTINUING AUTHORITY TO AMEND.—The 

Copyright Royalty Judges shall retain continuing 

authority to amend a determination of an administrative assessment to correct technical or clerical errors, 

or modify the terms of implementation, for good cause, 
H. R. 1551—36 

with any such amendment to be published in the Federal Register. 

‘‘(vii) APPEAL OF ADMINISTRATIVE ASSESSMENT.— 

The determination of an administrative assessment 

by the Copyright Royalty Judges shall be appealable, 

not later than 30 calendar days after publication in 

the Federal Register, to the Court of Appeals for the 

District of Columbia Circuit by any party that fully 

participated in the proceeding. The administrative 

assessment as established by the Copyright Royalty 

Judges shall remain in effect pending the final outcome 

of any such appeal, and the mechanical licensing collective, digital licensee coordinator, digital music providers, and significant nonblanket licensees shall 

implement appropriate financial or other measures not 

later than 90 days after any modification of the assessment to reflect and account for such outcome. 

‘‘(viii) REGULATIONS.—The Copyright Royalty 

Judges may adopt regulations to govern the conduct 

of proceedings under this paragraph. 

‘‘(8) ESTABLISHMENT OF RATES AND TERMS UNDER BLANKET

LICENSE.— 

‘‘(A) RESTRICTIONS ON RATESETTING PARTICIPATION.— 

Neither the mechanical licensing collective nor the digital 

licensee coordinator shall be a party to a proceeding 

described in subsection (c)(1)(E), except that the mechanical 

licensing collective or the digital licensee coordinator may 

gather and provide financial and other information for 

the use of a party to such a proceeding and comply with 

requests for information as required under applicable statutory and regulatory provisions and rulings of the Copyright 

Royalty Judges. 

‘‘(B) APPLICATION OF LATE FEES.—In any proceeding 

described in subparagraph (A) in which the Copyright Royalty Judges establish a late fee for late payment of royalties 

for uses of musical works under this section, such fee 

shall apply to covered activities under blanket licenses, 

as follows: 

‘‘(i) Late fees for past due royalty payments shall 

accrue from the due date for payment until payment 

is received by the mechanical licensing collective. 

‘‘(ii) The availability of late fees shall in no way 

prevent a copyright owner or the mechanical licensing 

collective from asserting any other rights or remedies 

to which such copyright owner or the mechanical 

licensing collective may be entitled under this title. 

‘‘(C) INTERIM RATE AGREEMENTS IN GENERAL.—For any 

covered activity for which no rate or terms have been 

established by the Copyright Royalty Judges, the mechanical licensing collective and any digital music provider may 

agree to an interim rate and terms for such activity under 

the blanket license, and any such rate and terms— 

‘‘(i) shall be treated as nonprecedential and not 

cited or relied upon in any ratesetting proceeding 

before the Copyright Royalty Judges or any other tribunal; and 
H. R. 1551—37 

‘‘(ii) shall automatically expire upon the establishment of a rate and terms for such covered activity 

by the Copyright Royalty Judges, under subsection 

(c)(1)(E). 

‘‘(D) ADJUSTMENTS FOR INTERIM RATES.—The rate and 

terms established by the Copyright Royalty Judges for 

a covered activity to which an interim rate and terms 

have been agreed under subparagraph (C) shall supersede 

the interim rate and terms and apply retroactively to the 

inception of the activity under the blanket license. In such 

case, not later than 90 days after the effective date of 

the rate and terms established by the Copyright Royalty 

Judges— 

‘‘(i) if the rate established by the Copyright Royalty 

Judges exceeds the interim rate, the digital music provider shall pay to the mechanical licensing collective 

the amount of any underpayment of royalties due; 

or 

‘‘(ii) if the interim rate exceeds the rate established 

by the Copyright Royalty Judges, the mechanical 

licensing collective shall credit the account of the digital music provider for the amount of any overpayment 

of royalties due. 

‘‘(9) TRANSITION TO BLANKET LICENSES.— 

‘‘(A) SUBSTITUTION OF BLANKET LICENSE.—On the 

license availability date, a blanket license shall, without 

any interruption in license authority enjoyed by such digital 

music provider, be automatically substituted for and supersede any existing compulsory license previously obtained 

under this section by the digital music provider from a 

copyright owner to engage in 1 or more covered activities 

with respect to a musical work, except that such substitution shall not apply to any authority obtained from a 

record company pursuant to a compulsory license to make 

and distribute permanent downloads unless and until such 

record company terminates such authority in writing to 

take effect at the end of a monthly reporting period, with 

a copy to the mechanical licensing collective. 

‘‘(B) EXPIRATION OF EXISTING LICENSES.—Except to the 

extent provided in subparagraph (A), on and after the 

license availability date, licenses other than individual 

download licenses obtained under this section for covered 

activities prior to the license availability date shall no 

longer continue in effect. 

‘‘(C) TREATMENT OF VOLUNTARY LICENSES.—A voluntary license for a covered activity in effect on the license 

availability date will remain in effect unless and until 

the voluntary license expires according to the terms of 

the voluntary license, or the parties agree to amend or 

terminate the voluntary license. In a case where a voluntary license for a covered activity entered into before 

the license availability date incorporates the terms of this 

section by reference, the terms so incorporated (but not 

the rates) shall be those in effect immediately prior to 

the license availability date, and those terms shall continue 
H. R. 1551—38 

to apply unless and until such voluntary license is terminated or amended, or the parties enter into a new voluntary 

license. 

‘‘(D) FURTHER ACCEPTANCE OF NOTICES FOR COVERED

ACTIVITIES BY COPYRIGHT OFFICE.—On and after the enactment date— 

‘‘(i) the Copyright Office shall no longer accept 

notices of intention with respect to covered activities; 

and 

‘‘(ii) notices of intention filed before the enactment 

date will no longer be effective or provide license 

authority with respect to covered activities, except that, 

before the license availability date, there shall be no 

liability under section 501 for the reproduction or distribution of a musical work (or share thereof) in covered 

activities if a valid notice of intention was filed for 

such work (or share) before the enactment date. 

‘‘(10) PRIOR UNLICENSED USES.— 

‘‘(A) LIMITATION ON LIABILITY IN GENERAL.—A copyright 

owner that commences an action under section 501 on 

or after January 1, 2018, against a digital music provider 

for the infringement of the exclusive rights provided by 

paragraph (1) or (3) of section 106 arising from the 

unauthorized reproduction or distribution of a musical work 

by such digital music provider in the course of engaging 

in covered activities prior to the license availability date, 

shall, as the copyright owner’s sole and exclusive remedy 

against the digital music provider, be eligible to recover 

the royalty prescribed under subsection (c)(1)(C) and 

chapter 8, from the digital music provider, provided that 

such digital music provider can demonstrate compliance 

with the requirements of subparagraph (B), as applicable. 

In all other cases the limitation on liability under this 

subparagraph shall not apply. 

‘‘(B) REQUIREMENTS FOR LIMITATION ON LIABILITY.— 

The following requirements shall apply on the enactment 

date and through the end of the period that expires 90 

days after the license availability date to digital music 

providers seeking to avail themselves of the limitation on 

liability described in subparagraph (A): 

‘‘(i) Not later than 30 calendar days after first 

making a particular sound recording of a musical work 

available through its service via one or more covered 

activities, or 30 calendar days after the enactment 

date, whichever occurs later, a digital music provider 

shall engage in good-faith, commercially reasonable 

efforts to identify and locate each copyright owner of 

such musical work (or share thereof). Such required 

matching efforts shall include the following: 

‘‘(I) Good-faith, commercially reasonable 

efforts to obtain from the owner of the corresponding sound recording made available 

through the digital music provider’s service the 

following information: 

‘‘(aa) Sound recording name, featured 

artist, sound recording copyright owner, producer, international standard recording code, 
H. R. 1551—39 

and other information commonly used in the 

industry to identify sound recordings and 

match them to the musical works they 

embody. 

‘‘(bb) Any available musical work ownership information, including each songwriter 

and publisher name, percentage ownership 

share, and international standard musical 

work code. 

‘‘(II) Employment of 1 or more bulk electronic 

matching processes that are available to the digital 

music provider through a third-party vendor on 

commercially reasonable terms, except that a digital music provider may rely on its own bulk electronic matching process if that process has 

capabilities comparable to or better than those 

available from a third-party vendor on commercially reasonable terms. 

‘‘(ii) The required matching efforts shall be 

repeated by the digital music provider not less than 

once per month for so long as the copyright owner 

remains unidentified or has not been located. 

‘‘(iii) If the required matching efforts are successful 

in identifying and locating a copyright owner of a 

musical work (or share thereof) by the end of the 

calendar month in which the digital music provider 

first makes use of the work, the digital music provider 

shall provide statements of account and pay royalties 

to such copyright owner in accordance with this section 

and applicable regulations. 

‘‘(iv) If the copyright owner is not identified or 

located by the end of the calendar month in which 

the digital music provider first makes use of the work, 

the digital music provider shall accrue and hold royalties calculated under the applicable statutory rate in 

accordance with usage of the work, from initial use 

of the work until the accrued royalties can be paid 

to the copyright owner or are required to be transferred 

to the mechanical licensing collective, as follows: 

‘‘(I) Accrued royalties shall be maintained by 

the digital music provider in accordance with generally accepted accounting principles. 

‘‘(II) If a copyright owner of an unmatched 

musical work (or share thereof) is identified and 

located by or to the digital music provider before 

the license availability date, the digital music provider shall— 

‘‘(aa) not later than 45 calendar days after 

the end of the calendar month during which 

the copyright owner was identified and 

located, pay the copyright owner all accrued 

royalties, such payment to be accompanied by 

a cumulative statement of account that 

includes all of the information that would have 

been provided to the copyright owner had the 

digital music provider been providing monthly 

statements of account to the copyright owner 
H. R. 1551—40 

from initial use of the work in accordance 

with this section and applicable regulations, 

including the requisite certification under subsection (c)(2)(I); 

‘‘(bb) beginning with the accounting period 

following the calendar month in which the 

copyright owner was identified and located, 

and for all other accounting periods prior to 

the license availability date, provide monthly 

statements of account and pay royalties to 

the copyright owner as required under this 

section and applicable regulations; and 

‘‘(cc) beginning with the monthly royalty 

reporting period commencing on the license 

availability date, report usage and pay royalties for such musical work (or share thereof) 

for such reporting period and reporting periods 

thereafter to the mechanical licensing collective, as required under this subsection and 

applicable regulations. 

‘‘(III) If a copyright owner of an unmatched 

musical work (or share thereof) is not identified 

and located by the license availability date, the 

digital music provider shall— 

‘‘(aa) not later than 45 calendar days after 

the license availability date, transfer all 

accrued royalties to the mechanical licensing 

collective, such payment to be accompanied 

by a cumulative statement of account that 

includes all of the information that would have 

been provided to the copyright owner had the 

digital music provider been serving monthly 

statements of account on the copyright owner 

from initial use of the work in accordance 

with this section and applicable regulations, 

including the requisite certification under subsection (c)(2)(I), and accompanied by an additional certification by a duly authorized officer 

of the digital music provider that the digital 

music provider has fulfilled the requirements 

of clauses (i) and (ii) of subparagraph (B) but 

has not been successful in locating or identifying the copyright owner; and 

‘‘(bb) beginning with the monthly royalty 

reporting period commencing on the license 

availability date, report usage and pay royalties for such musical work (or share thereof) 

for such period and reporting periods thereafter to the mechanical licensing collective, as 

required under this subsection and applicable 

regulations. 

‘‘(v) A digital music provider that complies with 

the requirements of this subparagraph with respect 

to unmatched musical works (or shares of works) shall 

not be liable for or accrue late fees for late payments 

of royalties for such works until such time as the 

digital music provider is required to begin paying 
H. R. 1551—41 

monthly royalties to the copyright owner or the 

mechanical licensing collective, as applicable. 

‘‘(C) ADJUSTED STATUTE OF LIMITATIONS.—Notwithstanding anything to the contrary in section 507(b), with 

respect to any claim of infringement of the exclusive rights 

provided by paragraphs (1) and (3) of section 106 against 

a digital music provider arising from the unauthorized 

reproduction or distribution of a musical work by such 

digital music provider in the course of engaging in covered 

activities that accrued not more than 3 years prior to 

the license availability date, such action may be commenced 

not later than the later of— 

‘‘(i) 3 years after the date on which the claim 

accrued; or 

‘‘(ii) 2 years after the license availability date. 

‘‘(D) OTHER RIGHTS AND REMEDIES PRESERVED.—Except 

as expressly provided in this paragraph, nothing in this 

paragraph shall be construed to alter, limit, or negate 

any right or remedy of a copyright owner with respect 

to unauthorized use of a musical work. 

‘‘(11) LEGAL PROTECTIONS FOR LICENSING ACTIVITIES.— 

‘‘(A) EXEMPTION FOR COMPULSORY LICENSE ACTIVITIES.—The antitrust exemption described in subsection 

(c)(1)(D) shall apply to negotiations and agreements 

between and among copyright owners and persons entitled 

to obtain a compulsory license for covered activities, and 

common agents acting on behalf of such copyright owners 

or persons, including with respect to the administrative 

assessment established under this subsection. 

‘‘(B) LIMITATION ON COMMON AGENT EXEMPTION.—Notwithstanding the antitrust exemption provided in subsection (c)(1)(D) and subparagraph (A) of this paragraph 

(except for the administrative assessment referenced in 

such subparagraph (A) and except as provided in paragraph 

(8)(C)), neither the mechanical licensing collective nor the 

digital licensee coordinator shall serve as a common agent 

with respect to the establishment of royalty rates or terms 

under this section. 

‘‘(C) ANTITRUST EXEMPTION FOR ADMINISTRATIVE ACTIVI- TIES.—Notwithstanding any provision of the antitrust laws, 

copyright owners and persons entitled to obtain a compulsory license under this section may designate the mechanical licensing collective to administer voluntary licenses 

for the reproduction or distribution of musical works in 

covered activities on behalf of such copyright owners and 

persons, subject to the following conditions: 

‘‘(i) Each copyright owner shall establish the royalty rates and material terms of any such voluntary 

license individually and not in agreement, combination, 

or concert with any other copyright owner. 

‘‘(ii) Each person entitled to obtain a compulsory 

license under this section shall establish the royalty 

rates and material terms of any such voluntary license 

individually and not in agreement, combination, or 

concert with any other digital music provider. 

‘‘(iii) The mechanical licensing collective shall 

maintain the confidentiality of the voluntary licenses 
H. R. 1551—42 

in accordance with the confidentiality provisions prescribed by the Register of Copyrights under paragraph 

(12)(C). 

‘‘(D) LIABILITY FOR GOOD-FAITH ACTIVITIES.—The 

mechanical licensing collective shall not be liable to any 

person or entity based on a claim arising from its goodfaith administration of policies and procedures adopted 

and implemented to carry out the responsibilities described 

in subparagraphs (J) and (K) of paragraph (3), except to 

the extent of correcting an underpayment or overpayment 

of royalties as provided in paragraph (3)(L)(i)(VI), but the 

collective may participate in a legal proceeding as a stakeholder party if the collective is holding funds that are 

the subject of a dispute between copyright owners. For 

purposes of this subparagraph, the term ‘good-faith 

administration’ means administration in a manner that 

is not grossly negligent. 

‘‘(E) PREEMPTION OF STATE PROPERTY LAWS.—The 

holding and distribution of funds by the mechanical 

licensing collective in accordance with this subsection shall 

supersede and preempt any State law (including common 

law) concerning escheatment or abandoned property, or 

any analogous provision, that might otherwise apply. 

‘‘(F) RULE OF CONSTRUCTION.—Except as expressly provided in this subsection, nothing in this subsection shall 

negate or limit the ability of any person to pursue an 

action in Federal court against the mechanical licensing 

collective or any other person based upon a claim arising 

under this title or other applicable law. 

‘‘(12) REGULATIONS.— 

‘‘(A) ADOPTION BY REGISTER OF COPYRIGHTS AND COPYRIGHT ROYALTY JUDGES.—The Register of Copyrights may 

conduct such proceedings and adopt such regulations as 

may be necessary or appropriate to effectuate the provisions 

of this subsection, except for regulations concerning proceedings before the Copyright Royalty Judges to establish 

the administrative assessment, which shall be adopted by 

the Copyright Royalty Judges. 

‘‘(B) JUDICIAL REVIEW OF REGULATIONS.—Except as provided in paragraph (7)(D)(vii), regulations adopted under 

this subsection shall be subject to judicial review pursuant 

to chapter 7 of title 5. 

‘‘(C) PROTECTION OF CONFIDENTIAL INFORMATION.—The 

Register of Copyrights shall adopt regulations to provide 

for the appropriate procedures to ensure that confidential, 

private, proprietary, or privileged information contained 

in the records of the mechanical licensing collective and 

digital licensee coordinator is not improperly disclosed or 

used, including through any disclosure or use by the board 

of directors or personnel of either entity, and specifically 

including the unclaimed royalties oversight committee and 

the dispute resolution committee of the mechanical 

licensing collective. 

‘‘(13) SAVINGS CLAUSES.— ‘‘(A) LIMITATION ON ACTIVITIES AND RIGHTS COVERED.— This subsection applies solely to uses of musical works 

subject to licensing under this section. The blanket license 
H. R. 1551—43 

shall not be construed to extend or apply to activities 

other than covered activities or to rights other than the 

exclusive rights of reproduction and distribution licensed 

under this section, or serve or act as the basis to extend 

or expand the compulsory license under this section to 

activities and rights not covered by this section on the 

day before the enactment date. 

‘‘(B) RIGHTS OF PUBLIC PERFORMANCE NOT AFFECTED.— 

The rights, protections, and immunities granted under this 

subsection, the data concerning musical works collected 

and made available under this subsection, and the definitions under subsection (e) shall not extend to, limit, or 

otherwise affect any right of public performance in a 

musical work.’’; and 

(5) by adding at the end the following: 

‘‘(e) DEFINITIONS.—As used in this section: 

‘‘(1) ACCRUED INTEREST.—The term ‘accrued interest’ means 

interest accrued on accrued royalties, as described in subsection 

(d)(3)(H)(ii). 

‘‘(2) ACCRUED ROYALTIES.—The term ‘accrued royalties’ 

means royalties accrued for the reproduction or distribution 

of a musical work (or share thereof) in a covered activity, 

calculated in accordance with the applicable royalty rate under 

this section. 

‘‘(3) ADMINISTRATIVE ASSESSMENT.—The term ‘administrative assessment’ means the fee established pursuant to subsection (d)(7)(D). 

‘‘(4) AUDIT.—The term ‘audit’ means a royalty compliance 

examination to verify the accuracy of royalty payments, or 

the conduct of such an examination, as applicable. 

‘‘(5) BLANKET LICENSE.—The term ‘blanket license’ means 

a compulsory license described in subsection (d)(1)(A) to engage 

in covered activities. 

‘‘(6) COLLECTIVE TOTAL COSTS.—The term ‘collective total 

costs’— 

‘‘(A) means the total costs of establishing, maintaining, 

and operating the mechanical licensing collective to fulfill 

its statutory functions, including— 

‘‘(i) startup costs; 

‘‘(ii) financing, legal, audit, and insurance costs; 

‘‘(iii) investments in information technology, infrastructure, and other long-term resources; 

‘‘(iv) outside vendor costs; 

‘‘(v) costs of licensing, royalty administration, and 

enforcement of rights; 

‘‘(vi) costs of bad debt; and 

‘‘(vii) costs of automated and manual efforts to 

identify and locate copyright owners of musical works 

(and shares of such musical works) and match sound 

recordings to the musical works the sound recordings 

embody; and 

‘‘(B) does not include any added costs incurred by the 

mechanical licensing collective to provide services under 

voluntary licenses. 

‘‘(7) COVERED ACTIVITY.—The term ‘covered activity’ means 

the activity of making a digital phonorecord delivery of a 

musical work, including in the form of a permanent download, 
H. R. 1551—44 

limited download, or interactive stream, where such activity 

qualifies for a compulsory license under this section. 

‘‘(8) DIGITAL MUSIC PROVIDER.—The term ‘digital music provider’ means a person (or persons operating under the authority 

of that person) that, with respect to a service engaged in 

covered activities— 

‘‘(A) has a direct contractual, subscription, or other 

economic relationship with end users of the service, or, 

if no such relationship with end users exists, exercises 

direct control over the provision of the service to end users; 

‘‘(B) is able to fully report on any revenues and consideration generated by the service; and 

‘‘(C) is able to fully report on usage of sound recordings 

of musical works by the service (or procure such reporting). 

‘‘(9) DIGITAL LICENSEE COORDINATOR.—The term ‘digital 

licensee coordinator’ means the entity most recently designated 

pursuant to subsection (d)(5). 

‘‘(10) DIGITAL PHONORECORD DELIVERY.—The term ‘digital 

phonorecord delivery’ means each individual delivery of a 

phonorecord by digital transmission of a sound recording that 

results in a specifically identifiable reproduction by or for any 

transmission recipient of a phonorecord of that sound recording, 

regardless of whether the digital transmission is also a public 

performance of the sound recording or any musical work 

embodied therein, and includes a permanent download, a limited download, or an interactive stream. A digital phonorecord 

delivery does not result from a real-time, noninteractive 

subscription transmission of a sound recording where no reproduction of the sound recording or the musical work embodied 

therein is made from the inception of the transmission through 

to its receipt by the transmission recipient in order to make 

the sound recording audible. A digital phonorecord delivery 

does not include the digital transmission of sounds accompanying a motion picture or other audiovisual work as defined 

in section 101. 

‘‘(11) ENACTMENT DATE.—The term ‘enactment date’ means 

the date of the enactment of the Musical Works Modernization 

Act. 

‘‘(12) INDIVIDUAL DOWNLOAD LICENSE.—The term ‘individual download license’ means a compulsory license obtained 

by a record company to make and distribute, or authorize 

the making and distribution of, permanent downloads 

embodying a specific individual musical work. 

‘‘(13) INTERACTIVE STREAM.—The term ‘interactive stream’ 

means a digital transmission of a sound recording of a musical 

work in the form of a stream, where the performance of the 

sound recording by means of such transmission is not exempt 

under section 114(d)(1) and does not in itself, or as a result 

of a program in which it is included, qualify for statutory 

licensing under section 114(d)(2). An interactive stream is a 

digital phonorecord delivery. 

‘‘(14) INTERESTED.—The term ‘interested’, as applied to a 

party seeking to participate in a proceeding under subsection 

(d)(7)(D), is a party as to which the Copyright Royalty Judges 

have not determined that the party lacks a significant interest 

in such proceeding. 
H. R. 1551—45 

‘‘(15) LICENSE AVAILABILITY DATE.—The term ‘license availability date’ means January 1 following the expiration of the 

2-year period beginning on the enactment date. 

‘‘(16) LIMITED DOWNLOAD.—The term ‘limited download’ 

means a digital transmission of a sound recording of a musical 

work in the form of a download, where such sound recording 

is accessible for listening only for a limited amount of time 

or specified number of times. 

‘‘(17) MATCHED.—The term ‘matched’, as applied to a 

musical work (or share thereof), means that the copyright owner 

of such work (or share thereof) has been identified and located. 

‘‘(18) MECHANICAL LICENSING COLLECTIVE.—The term 

‘mechanical licensing collective’ means the entity most recently 

designated as such by the Register of Copyrights under subsection (d)(3). 

‘‘(19) MECHANICAL LICENSING COLLECTIVE BUDGET.—The 

term ‘mechanical licensing collective budget’ means a statement 

of the financial position of the mechanical licensing collective 

for a fiscal year or quarter thereof based on estimates of 

expenditures during the period and proposals for financing 

those expenditures, including a calculation of the collective 

total costs. 

‘‘(20) MUSICAL WORKS DATABASE.—The term ‘musical works 

database’ means the database described in subsection (d)(3)(E). 

‘‘(21) NONPROFIT.—The term ‘nonprofit’ means a nonprofit 

created or organized in a State. 

‘‘(22) NOTICE OF LICENSE.—The term ‘notice of license’ 

means a notice from a digital music provider provided under 

subsection (d)(2)(A) for purposes of obtaining a blanket license. 

‘‘(23) NOTICE OF NONBLANKET ACTIVITY.—The term ‘notice 

of nonblanket activity’ means a notice from a significant nonblanket licensee provided under subsection (d)(6)(A) for purposes of notifying the mechanical licensing collective that the 

licensee has been engaging in covered activities. 

‘‘(24) PERMANENT DOWNLOAD.—The term ‘permanent 

download’ means a digital transmission of a sound recording 

of a musical work in the form of a download, where such 

sound recording is accessible for listening without restriction 

as to the amount of time or number of times it may be accessed. 

‘‘(25) QUALIFIED AUDITOR.—The term ‘qualified auditor’ 

means an independent, certified public accountant with experience performing music royalty audits. 

‘‘(26) RECORD COMPANY.—The term ‘record company’ means 

an entity that invests in, produces, and markets sound 

recordings of musical works, and distributes such sound 

recordings for remuneration through multiple sales channels, 

including a corporate affiliate of such an entity engaged in 

distribution of sound recordings. 

‘‘(27) REPORT OF USAGE.—The term ‘report of usage’ means 

a report reflecting an entity’s usage of musical works in covered 

activities described in subsection (d)(4)(A). 

‘‘(28) REQUIRED MATCHING EFFORTS.—The term ‘required 

matching efforts’ means efforts to identify and locate copyright 

owners of musical works as described in subsection (d)(10)(B)(i). 

‘‘(29) SERVICE.—The term ‘service’, as used in relation to 

covered activities, means any site, facility, or offering by or 
H. R. 1551—46 

through which sound recordings of musical works are digitally 

transmitted to members of the public. 

‘‘(30) SHARE.—The term ‘share’, as applied to a musical 

work, means a fractional ownership interest in such work. 

‘‘(31) SIGNIFICANT NONBLANKET LICENSEE.—The term 

‘significant nonblanket licensee’— 

‘‘(A) means an entity, including a group of entities 

under common ownership or control that, acting under 

the authority of one or more voluntary licenses or individual download licenses, offers a service engaged in covered activities, and such entity or group of entities— 

‘‘(i) is not currently operating under a blanket 

license and is not obligated to provide reports of usage 

reflecting covered activities under subsection (d)(4)(A); 

‘‘(ii) has a direct contractual, subscription, or other 

economic relationship with end users of the service 

or, if no such relationship with end users exists, exercises direct control over the provision of the service 

to end users; and 

‘‘(iii) either— 

‘‘(I) on any day in a calendar month, makes 

more than 5,000 different sound recordings of 

musical works available through such service; or 

‘‘(II) derives revenue or other consideration 

in connection with such covered activities greater 

than $50,000 in a calendar month, or total revenue 

or other consideration greater than $500,000 

during the preceding 12 calendar months; and 

‘‘(B) does not include— 

‘‘(i) an entity whose covered activity consists solely 

of free-to-the-user streams of segments of sound 

recordings of musical works that do not exceed 90 

seconds in length, are offered only to facilitate a 

licensed use of musical works that is not a covered 

activity, and have no revenue directly attributable to 

such streams constituting the covered activity; or 

‘‘(ii) a ‘public broadcasting entity’ as defined in 

section 118(f). 

‘‘(32) SONGWRITER.—The term ‘songwriter’ means the 

author of all or part of a musical work, including a composer 

or lyricist. 

‘‘(33) STATE.—The term ‘State’ means each State of the 

United States, the District of Columbia, and each territory 

or possession of the United States. 

‘‘(34) UNCLAIMED ACCRUED ROYALTIES.—The term 

‘unclaimed accrued royalties’ means accrued royalties eligible 

for distribution under subsection (d)(3)(J). 

‘‘(35) UNMATCHED.—The term ‘unmatched’, as applied to 

a musical work (or share thereof), means that the copyright 

owner of such work (or share thereof) has not been identified 

or located. 

‘‘(36) VOLUNTARY LICENSE.—The term ‘voluntary license’ 

means a license for use of a musical work (or share thereof) 

other than a compulsory license obtained under this section.’’. 

(b) TECHNICAL AND CONFORMING AMENDMENTS TO SECTION

801.—Section 801(b) of title 17, United States Code, is amended— 

(1) by redesignating paragraph (8) as paragraph (9); and 
H. R. 1551—47 

(2) by inserting after paragraph (7) the following: 

‘‘(8) To determine the administrative assessment to be paid 

by digital music providers under section 115(d). The provisions 

of section 115(d) shall apply to the conduct of proceedings 

by the Copyright Royalty Judges under section 115(d) and 

not the procedures described in this section, or section 803, 

804, or 805.’’. 

(c) EFFECTIVE DATE OF AMENDED RATE SETTING STANDARD.— 

The amendments made by subsection (a)(3) and section 103(g)(2) 

shall apply to any proceeding before the Copyright Royalty Judges 

that is commenced on or after the date of the enactment of this 

Act. 

(d) TECHNICAL AND CONFORMING AMENDMENTS TO TITLE 37, 

PART 385 OF THE CODE OF FEDERAL REGULATIONS.—Not later than 

270 days after the date of enactment of this Act, the Copyright 

Royalty Judges shall amend the regulations for section 115 of 

title 17, United States Code, in part 385 of title 37, Code of Federal 

Regulations, to conform the definitions used in such part to the 

definitions of the same terms described in section 115(e) of title 

17, United States Code, as added by subsection (a). In so doing, 

the Copyright Royalty Judges shall make adjustments to the language of the regulations as necessary to achieve the same purpose 

and effect as the original regulations with respect to the rates 

and terms previously adopted by the Copyright Royalty Judges. 

(e) COPYRIGHT OFFICE ACTIVITIES.—The Register of Copyrights 

shall engage in public outreach and educational activities— 

(1) regarding the amendments made by subsection (a) to 

section 115 of title 17, United States Code, including the responsibilities of the mechanical licensing collective designated under 

those amendments; 

(2) which shall include educating songwriters and other 

interested parties with respect to the process established under 

section 115(d)(3)(C)(i)(V) of title 17, United States Code, as 

added by subsection (a), by which— 

(A) a copyright owner may claim ownership of musical 

works (and shares of such works); and 

(B) royalties for works for which the owner is not 

identified or located shall be equitably distributed to known 

copyright owners; and 

(3) which the Register shall make available online. 

(f) UNCLAIMED ROYALTIES STUDY AND RECOMMENDATIONS.— 

(1) IN GENERAL.—Not later than 2 years after the date 

on which the Register of Copyrights initially designates the 

mechanical licensing collective under section 115(d)(3)(B)(i) of 

title 17, United States Code, as added by subsection (a)(4), 

the Register, in consultation with the Comptroller General of 

the United States, and after soliciting and reviewing comments 

and relevant information from music industry participants and 

other interested parties, shall submit to the Committee on 

the Judiciary of the Senate and the Committee on the Judiciary 

of the House of Representatives a report that recommends 

best practices that the collective may implement in order to— 

(A) identify and locate musical work copyright owners 

with unclaimed accrued royalties held by the collective; 

(B) encourage musical work copyright owners to claim 

the royalties of those owners; and 

(C) reduce the incidence of unclaimed royalties. 
H. R. 1551—48 

(2) CONSIDERATION OF RECOMMENDATIONS.—The mechanical licensing collective shall carefully consider, and give 

substantial weight to, the recommendations submitted by the 

Register of Copyrights under paragraph (1) when establishing 

the procedures of the collective with respect to the— 

(A) identification and location of musical work copyright owners; and 

(B) distribution of unclaimed royalties. 

SEC. 103. AMENDMENTS TO SECTION 114. 

(a) UNIFORM RATE STANDARD.—Section 114(f) of title 17, United 

States Code, is amended— 

(1) by striking paragraphs (1) and (2) and inserting the 

following: 

‘‘(1)(A) Proceedings under chapter 8 shall determine reasonable rates and terms of royalty payments for transmissions 

subject to statutory licensing under subsection (d)(2) during 

the 5-year period beginning on January 1 of the second year 

following the year in which the proceedings are to be commenced pursuant to subparagraph (A) or (B) of section 804(b)(3), 

as the case may be, or such other period as the parties may 

agree. The parties to each proceeding shall bear their own 

costs. 

‘‘(B) The schedule of reasonable rates and terms determined 

by the Copyright Royalty Judges shall, subject to paragraph 

(2), be binding on all copyright owners of sound recordings 

and entities performing sound recordings affected by this paragraph during the 5-year period specified in subparagraph (A), 

or such other period as the parties may agree. Such rates 

and terms shall distinguish among the different types of services then in operation and shall include a minimum fee for 

each such type of service, such differences to be based on 

criteria including the quantity and nature of the use of sound 

recordings and the degree to which use of the service may 

substitute for or may promote the purchase of phonorecords 

by consumers. The Copyright Royalty Judges shall establish 

rates and terms that most clearly represent the rates and 

terms that would have been negotiated in the marketplace 

between a willing buyer and a willing seller. In determining 

such rates and terms, the Copyright Royalty Judges— 

‘‘(i) shall base their decision on economic, competitive, 

and programming information presented by the parties, 

including— 

‘‘(I) whether use of the service may substitute for 

or may promote the sales of phonorecords or otherwise 

may interfere with or may enhance the sound recording 

copyright owner’s other streams of revenue from the 

copyright owner’s sound recordings; and 

‘‘(II) the relative roles of the copyright owner and 

the transmitting entity in the copyrighted work and 

the service made available to the public with respect 

to relative creative contribution, technological contribution, capital investment, cost, and risk; and 

‘‘(ii) may consider the rates and terms for comparable 

types of audio transmission services and comparable circumstances under voluntary license agreements. 
H. R. 1551—49 

‘‘(C) The procedures under subparagraphs (A) and (B) shall 

also be initiated pursuant to a petition filed by any sound 

recording copyright owner or any transmitting entity indicating 

that a new type of service on which sound recordings are 

performed is or is about to become operational, for the purpose 

of determining reasonable terms and rates of royalty payments 

with respect to such new type of service for the period beginning 

with the inception of such new type of service and ending 

on the date on which the royalty rates and terms for eligible 

nonsubscription services and new subscription services, or preexisting subscription services and preexisting satellite digital 

audio radio services, as the case may be, most recently determined under subparagraph (A) or (B) and chapter 8 expire, 

or such other period as the parties may agree.’’; and 

(2) by redesignating paragraphs (3), (4), and (5) as paragraphs (2), (3), and (4), respectively. 

(b) REPEAL.—Subsection (i) of section 114 of title 17, United 

States Code, is repealed. 

(c) USE IN MUSICAL WORK PROCEEDINGS.— 

(1) IN GENERAL.—License fees payable for the public 

performance of sound recordings under section 106(6) of title 

17, United States Code, shall not be taken into account in 

any administrative, judicial, or other governmental proceeding 

to set or adjust the royalties payable to musical work copyright 

owners for the public performance of their works except in 

such a proceeding to set or adjust royalties for the public 

performance of musical works by means of a digital audio 

transmission other than a transmission by a broadcaster, and 

may be taken into account only with respect to such digital 

audio transmission. 

(2) DEFINITIONS.—In this subsection: 

(A) TRANSMISSION BY A BROADCASTER.—The term 

‘‘transmission by a broadcaster’’ means a nonsubscription 

digital transmission made by a terrestrial broadcast station 

on its own behalf, or on the behalf of a terrestrial broadcast 

station under common ownership or control, that is not 

part of an interactive service or a music-intensive service 

comprising the transmission of sound recordings customized for or customizable by recipients or service users. 

(B) TERRESTRIAL BROADCAST STATION.—The term 

‘‘terrestrial broadcast station’’ means a terrestrial, overthe-air radio or television broadcast station, including an 

FM translator (as defined in section 74.1201 of title 47, 

Code of Federal Regulations, and licensed as such by the 

Federal Communications Commission) whose primary business activities are comprised of, and whose revenues are 

generated through, terrestrial, over-the-air broadcast transmissions, or the simultaneous or substantially-simultaneous digital retransmission by the terrestrial, over-theair broadcast station of its over-the-air broadcast transmissions. 

(d) RULE OF CONSTRUCTION.—Subsection (c)(2) shall not be 

given effect in interpreting provisions of title 17, United States 

Code. 

(e) USE IN SOUND RECORDING PROCEEDINGS.—The repeal of 

section 114(i) of title 17, United States Code, by subsection (b) 

shall not be taken into account in any proceeding to set or adjust 
H. R. 1551—50 

the rates and fees payable for the use of sound recordings under 

section 112(e) or 114(f) of such title that is pending on, or commenced on or after, the date of enactment of this Act. 

(f) DECISIONS AND PRECEDENTS NOT AFFECTED.—The repeal 

of section 114(i) of title 17, United States Code, by subsection 

(b) shall not have any effect upon the decisions, or the precedents 

established or relied upon, in any proceeding to set or adjust the 

rates and fees payable for the use of sound recordings under section 

112(e) or 114(f) of such title before the date of enactment of this 

Act. 

(g) TECHNICAL AND CONFORMING AMENDMENTS.— 

(1) SECTION 114.—Section 114(f) of title 17, United States 

Code, as amended by subsection (a), is further amended in 

paragraph (4)(C), as so redesignated, in the first sentence, 

by striking ‘‘under paragraph (4)’’ and inserting ‘‘under paragraph (3)’’. 

(2) SECTION 801.—Section 801(b) of title 17, United States 

Code, is amended— 

(A) in paragraph (1), by striking ‘‘The rates applicable’’ 

and all that follows though ‘‘prevailing industry practices.’’; 

and 

(B) in paragraph (7)(B), by striking ‘‘114(f)(3)’’ and 

inserting ‘‘114(f)(2)’’. 

(3) SECTION 803.—Section 803(c)(2)(E)(i)(II) of title 17, 

United States Code, is amended— 

(A) by striking ‘‘or 114(f)(2)(C)’’; and 

(B) by striking ‘‘114(f)(4)(B)’’ and inserting 

‘‘114(f)(3)(B)’’. 

(4) SECTION 804.—Section 804(b)(3)(C) of title 17, United 

States Code, is amended— 

(A) in clause (i), by striking ‘‘and 114(f)(2)(C)’’; 

(B) in clause (iii)(II), by striking ‘‘114(f)(4)(B)(ii)’’ and 

inserting ‘‘114(f)(3)(B)(ii)’’; and 

(C) in clause (iv), by striking ‘‘or 114(f)(2)(C), as the 

case may be’’. 

(h) EFFECTIVE DATE OF AMENDED RATE SETTING STANDARD.— 

The amendments made by subsection (a)(1) shall apply to any 

proceeding before the Copyright Royalty Judges that is commenced 

on or after the date of the enactment of this Act. 

(i) TIMING OF RATE DETERMINATIONS.—Section 804(b)(3)(B) of 

title 17, United States Code, is amended, in the third sentence, 

by inserting the following after ‘‘fifth calendar year’’: ‘‘, except 

that—(i) with respect to preexisting subscription services, the terms 

and rates finally determined for the rate period ending on December 

31, 2022, shall remain in effect through December 31, 2027, and 

there shall be no proceeding to determine terms and rates for 

preexisting subscription services for the period beginning on 

January 1, 2023, and ending on December 31, 2027; and’’ ‘‘(ii) 

with respect to pre-existing satellite digital audio radio services, 

the terms and rates set forth by the Copyright Royalty Judges 

on December 14, 2017, in their initial determination for the rate 

period ending on December 31, 2022, shall be in effect through 

December 31, 2027, without any change based on a rehearing 

under section 803(c)(2) and without the possibility of appeal under 

section 803(d), and there shall be no proceeding to determine terms 

and rates for preexisting satellite digital audio radio services for 
H. R. 1551—51 

the period beginning on January 1, 2023, and ending on December 

31, 2027’’. 

SEC. 104. RANDOM ASSIGNMENT OF RATE COURT PROCEEDINGS. 

Section 137 of title 28, United States Code, is amended— 

(1) by striking ‘‘The business’’ and inserting ‘‘(a) IN GEN- ERAL.—The business’’; and 

(2) by adding at the end the following: 

‘‘(b) RANDOM ASSIGNMENT OF RATE COURT PROCEEDINGS.— ‘‘(1) IN GENERAL.— ‘‘(A) DEFINITION.—In this paragraph, the term ‘performing rights society’ has the meaning given the term 

in section 101 of title 17. 

‘‘(B) DETERMINATION OF LICENSE FEE.—Except as provided in subparagraph (C), in the case of any performing 

rights society subject to a consent decree, any application 

for the determination of a license fee for the public performance of music in accordance with the applicable consent 

decree shall be made in the district court with jurisdiction 

over that consent decree and randomly assigned to a judge 

of that district court according to the rules of that court 

for the division of business among district judges, provided 

that any such application shall not be assigned to— 

‘‘(i) a judge to whom continuing jurisdiction over 

any performing rights society for any performing rights 

society consent decree is assigned or has previously 

been assigned; or 

‘‘(ii) a judge to whom another proceeding concerning an application for the determination of a 

reasonable license fee is assigned at the time of the 

filing of the application. 

‘‘(C) EXCEPTION.—Subparagraph (B) does not apply to 

an application to determine reasonable license fees made 

by individual proprietors under section 513 of title 17. 

‘‘(2) RULE OF CONSTRUCTION.—Nothing in paragraph (1) 

shall modify the rights of any party to a consent decree or 

to a proceeding to determine reasonable license fees, to make 

an application for the construction of any provision of the 

applicable consent decree. Such application shall be referred 

to the judge to whom continuing jurisdiction over the applicable 

consent decree is currently assigned. If any such application 

is made in connection with a rate proceeding, such rate proceeding shall be stayed until the final determination of the 

construction application. Disputes in connection with a rate 

proceeding about whether a licensee is similarly situated to 

another licensee shall not be subject to referral to the judge 

with continuing jurisdiction over the applicable consent 

decree.’’. 

SEC. 105. PERFORMING RIGHTS SOCIETY CONSENT DECREES. 

(a) DEFINITION.—In this section, the term ‘‘performing rights 

society’’ has the meaning given the term in section 101 of title 

17, United States Code. 

(b) NOTIFICATION OF REVIEW.— 

(1) IN GENERAL.—The Department of Justice shall provide 

timely briefings upon request of any Member of the Committee 

on the Judiciary of the Senate and the Committee on the 

Judiciary of the House of Representatives regarding the status 
H. R. 1551—52 

of a review in progress of a consent decree between the United 

States and a performing rights society. 

(2) CONFIDENTIALITY AND DELIBERATIVE PROCESS.—In 

accordance with applicable rules relating to confidentiality and 

agency deliberative process, the Department of Justice shall 

share with such Members of Congress detailed and timely 

information and pertinent documents related to the consent 

decree review. 

(c) ACTION BEFORE MOTION TO TERMINATE.— 

(1) IN GENERAL.—Before filing with the appropriate district 

court of the United States a motion to terminate a consent 

decree between the United States and a performing rights 

society, including a motion to terminate a consent decree after 

the passage of a specified period of time, the Department of 

Justice shall— 

(A) notify Members of Congress and committees of 

Congress described in subsection (b); and 

(B) provide to such Members of Congress and committees information regarding the impact of the proposed 

termination on the market for licensing the public performance of musical works should the motion be granted. 

(2) NOTIFICATION.— 

(A) IN GENERAL.—During the notification described in 

paragraph (1), and not later than a reasonable time before 

the date on which the Department of Justice files with 

the appropriate district court of the United States a motion 

to terminate a consent decree between the United States 

and a performing rights society, the Department of Justice 

should submit to the chairmen and ranking members of 

the Committee on the Judiciary of the Senate and the 

Committee on the Judiciary of the House of Representatives 

a written notification of the intent of the Department of 

Justice to file the motion. 

(B) CONTENTS.—The notification provided in subparagraph (A) shall include a written report to the chairmen 

and ranking members of the Committee on the Judiciary 

of Senate and the Committee on the Judiciary of the House 

of Representatives setting forth— 

(i) an explanation of the process used by the 

Department of Justice to review the consent decree; 

(ii) a summary of the public comments received 

by the Department of Justice during the review by 

the Department; and 

(iii) other information provided to Congress under 

paragraph (1)(B). 

(d) SCOPE.—This section applies only to a consent decree 

between the United States and a performing rights society. 

SEC. 106. EFFECTIVE DATE. 

This title, and the amendments made by this title, shall take 

effect on the date of enactment of this Act. 
H. R. 1551—53 

TITLE II—CLASSICS PROTECTION AND 

ACCESS 

SEC. 201. SHORT TITLE. 

This title may be cited as the ‘‘Classics Protection and Access 

Act’’. 

SEC. 202. UNAUTHORIZED USE OF PRE-1972 SOUND RECORDINGS. 

(a) PREEMPTION OF STATE LAW RIGHTS; PROTECTION FOR

UNAUTHORIZED USE.—Title 17, United States Code, is amended— 

(1) in section 301, by striking subsection (c) and inserting 

the following: 

‘‘(c) Notwithstanding the provisions of section 303, and in 

accordance with chapter 14, no sound recording fixed before February 15, 1972, shall be subject to copyright under this title. With 

respect to sound recordings fixed before February 15, 1972, the 

preemptive provisions of subsection (a) shall apply to activities 

that are commenced on and after the date of enactment of the 

Classics Protection and Access Act. Nothing in this subsection may 

be construed to affirm or negate the preemption of rights and 

remedies pertaining to any cause of action arising from the nonsubscription broadcast transmission of sound recordings under the 

common law or statutes of any State for activities that do not 

qualify as covered activities under chapter 14 undertaken during 

the period between the date of enactment of the Classics Protection 

and Access Act and the date on which the term of prohibition 

on unauthorized acts under section 1401(a)(2) expires for such 

sound recordings. Any potential preemption of rights and remedies 

related to such activities undertaken during that period shall apply 

in all respects as it did the day before the date of enactment 

of the Classics Protection and Access Act.’’; and 

(2) by adding at the end the following: 

‘‘CHAPTER 14—UNAUTHORIZED USE OF PRE-1972 SOUND 

RECORDINGS 

‘‘Sec. 

‘‘1401. Unauthorized use of pre-1972 sound recordings. 

‘‘§ 1401. Unauthorized use of pre-1972 sound recordings 

‘‘(a) IN GENERAL.— 

‘‘(1) UNAUTHORIZED ACTS.—Anyone who, on or before the 

last day of the applicable transition period under paragraph 

(2), and without the consent of the rights owner, engages in 

covered activity with respect to a sound recording fixed before 

February 15, 1972, shall be subject to the remedies provided 

in sections 502 through 505 and 1203 to the same extent 

as an infringer of copyright or a person that engages in 

unauthorized activity under chapter 12. 

‘‘(2) TERM OF PROHIBITION.— 

‘‘(A) IN GENERAL.—The prohibition under paragraph 

(1)— 

‘‘(i) subject to clause (ii), shall apply to a sound 

recording described in that paragraph— 

‘‘(I) through December 31 of the year that 

is 95 years after the year of first publication; and 
H. R. 1551—54 

‘‘(II) for a further transition period as prescribed under subparagraph (B) of this paragraph; 

and 

‘‘(ii) shall not apply to any sound recording after 

February 15, 2067. 

‘‘(B) TRANSITION PERIODS.— 

‘‘(i) PRE-1923 RECORDINGS.—In the case of a sound 

recording first published before January 1, 1923, the 

transition period described in subparagraph (A)(i)(II) 

shall end on December 31 of the year that is 3 years 

after the date of enactment of this section. 

‘‘(ii) 1923–1946 RECORDINGS.—In the case of a 

sound recording first published during the period 

beginning on January 1, 1923, and ending on December 

31, 1946, the transition period described in subparagraph (A)(i)(II) shall end on the date that is 5 years 

after the last day of the period described in subparagraph (A)(i)(I). 

‘‘(iii) 1947–1956 RECORDINGS.—In the case of a 

sound recording first published during the period 

beginning on January 1, 1947, and ending on December 

31, 1956, the transition period described in subparagraph (A)(i)(II) shall end on the date that is 15 years 

after the last day of the period described in subparagraph (A)(i)(I). 

‘‘(iv) POST-1956 RECORDINGS.—In the case of a 

sound recording fixed before February 15, 1972, that 

is not described in clause (i), (ii), or (iii), the transition 

period described in subparagraph (A)(i)(II) shall end 

on February 15, 2067. 

‘‘(3) RULE OF CONSTRUCTION.—For the purposes of this 

subsection, the term ‘anyone’ includes any State, any 

instrumentality of a State, and any officer or employee of 

a State or instrumentality of a State acting in the official 

capacity of the officer or employee, as applicable. 

‘‘(b) CERTAIN AUTHORIZED TRANSMISSIONS AND REPRODUC- TIONS.—A public performance by means of a digital audio transmission of a sound recording fixed before February 15, 1972, or 

a reproduction in an ephemeral phonorecord or copy of a sound 

recording fixed before February 15, 1972, shall, for purposes of 

subsection (a), be considered to be authorized and made with the 

consent of the rights owner if— 

‘‘(1) the transmission or reproduction would satisfy the 

requirements for statutory licensing under section 112(e)(1) 

or section 114(d)(2), or would be exempt under section 114(d)(1), 

as the case may be, if the sound recording were fixed on 

or after February 15, 1972; and 

‘‘(2) the transmitting entity pays the statutory royalty for 

the transmission or reproduction pursuant to the rates and 

terms adopted under sections 112(e) and 114(f), and complies 

with other obligations, in the same manner as required by 

regulations adopted by the Copyright Royalty Judges under 

sections 112(e) and 114(f) for sound recordings that are fixed 

on or after February 15, 1972, except in the case of a transmission that would be exempt under section 114(d)(1). 

‘‘(c) CERTAIN NONCOMMERCIAL USES OF SOUND RECORDINGS

THAT ARE NOT BEING COMMERCIALLY EXPLOITED.— 
H. R. 1551—55 

‘‘(1) IN GENERAL.—Noncommercial use of a sound recording 

fixed before February 15, 1972, that is not being commercially 

exploited by or under the authority of the rights owner shall 

not violate subsection (a) if— 

‘‘(A) the person engaging in the noncommercial use, 

in order to determine whether the sound recording is being 

commercially exploited by or under the authority of the 

rights owner, makes a good faith, reasonable search for, 

but does not find, the sound recording— 

‘‘(i) in the records of schedules filed in the Copyright Office as described in subsection (f)(5)(A); and 

‘‘(ii) on services offering a comprehensive set of 

sound recordings for sale or streaming; 

‘‘(B) the person engaging in the noncommercial use 

files a notice identifying the sound recording and the nature 

of the use in the Copyright Office in accordance with the 

regulations issued under paragraph (3)(B); and 

‘‘(C) during the 90-day period beginning on the date 

on which the notice described in subparagraph (B) is 

indexed into the public records of the Copyright Office, 

the rights owner of the sound recording does not, in its 

discretion, opt out of the noncommercial use by filing notice 

thereof in the Copyright Office in accordance with the 

regulations issued under paragraph (5). 

‘‘(2) RULES OF CONSTRUCTION.—For purposes of this subsection— 

‘‘(A) merely recovering costs of production and distribution of a sound recording resulting from a use otherwise 

permitted under this subsection does not itself necessarily 

constitute a commercial use of the sound recording; 

‘‘(B) the fact that a person engaging in the use of 

a sound recording also engages in commercial activities 

does not itself necessarily render the use commercial; and 

‘‘(C) the fact that a person files notice of a noncommercial use of a sound recording in accordance with the regulations issued under paragraph (3)(B) does not itself affect 

any limitation on the exclusive rights of a copyright owner 

described in section 107, 108, 109, 110, or 112(f) as applied 

to a claim under subsection (a) of this section pursuant 

to subsection (f)(1)(A) of this section. 

‘‘(3) NOTICE OF COVERED ACTIVITY.—Not later than 180 

days after the date of enactment of this section, the Register 

of Copyrights shall issue regulations that— 

‘‘(A) provide specific, reasonable steps that, if taken 

by a filer, are sufficient to constitute a good faith, reasonable search under paragraph (1)(A) to determine whether 

a recording is being commercially exploited, including the 

services that satisfy the good faith, reasonable search 

requirement under paragraph (1)(A) for purposes of the 

safe harbor described in paragraph (4)(A); and 

‘‘(B) establish the form, content, and procedures for 

the filing of notices under paragraph (1)(B). 

‘‘(4) SAFE HARBOR.— 

‘‘(A) IN GENERAL.—A person engaging in a noncommercial use of a sound recording otherwise permitted under 

this subsection who establishes that the person made a 
H. R. 1551—56 

good faith, reasonable search under paragraph (1)(A) without finding commercial exploitation of the sound recording 

by or under the authority of the rights owner shall not 

be found to be in violation of subsection (a). 

‘‘(B) STEPS SUFFICIENT BUT NOT NECESSARY.—Taking 

the specific, reasonable steps identified by the Register 

of Copyrights in the regulations issued under paragraph 

(3)(A) shall be sufficient, but not necessary, for a filer 

to satisfy the requirement to conduct a good faith, reasonable search under paragraph (1)(A) for purposes of subparagraph (A) of this paragraph. 

‘‘(5) OPTING OUT OF COVERED ACTIVITY.— 

‘‘(A) IN GENERAL.—Not later than 180 days after the 

date of enactment of this section, the Register of Copyrights 

shall issue regulations establishing the form, content, and 

procedures for the rights owner of a sound recording that 

is the subject of a notice under paragraph (1)(B) to, in 

its discretion, file notice opting out of the covered activity 

described in the notice under paragraph (1)(B) during the 

90-day period beginning on the date on which the notice 

under paragraph (1)(B) is indexed into the public records 

of the Copyright Office. 

‘‘(B) RULE OF CONSTRUCTION.—The fact that a rights 

holder opts out of a noncommercial use of a sound recording 

by filing notice thereof in the Copyright Office in accordance 

with the regulations issued under subparagraph (A) does 

not itself enlarge or diminish any limitation on the exclusive rights of a copyright owner described in section 107, 

108, 109, 110, or 112(f) as applied to a claim under subsection (a) of this section pursuant to subsection (f)(1)(A) 

of this section. 

‘‘(6) CIVIL PENALTIES FOR CERTAIN ACTS.— 

‘‘(A) FILING OF NOTICES OF NONCOMMERCIAL USE.— 

Any person who willfully engages in a pattern or practice 

of filing a notice of noncommercial use of a sound recording 

as described in paragraph (1)(B) fraudulently describing 

the use proposed, or knowing that the use proposed is 

not permitted under this subsection, shall be assessed a 

civil penalty in an amount that is not less than $250, 

and not more than $1000, for each such notice, in addition 

to any other remedies that may be available under this 

title based on the actual use made. 

‘‘(B) FILING OF OPT-OUT NOTICES.— 

‘‘(i) IN GENERAL.—Any person who files an optout notice as described in paragraph (1)(C), knowing 

that the person is not the rights owner or authorized 

to act on behalf of the rights owner of the sound 

recording to which the notice pertains, shall be 

assessed a civil penalty in an amount not less than 

$250, and not more than $1,000, for each such notice. 

‘‘(ii) PATTERN OR PRACTICE.—Any person who 

engages in a pattern or practice of making filings as 

described in clause (i) shall be assessed a civil penalty 

in an amount not less than $10,000 for each such 

filing. 

‘‘(C) DEFINITION.—For purposes of this paragraph, the 

term ‘knowing’— 
H. R. 1551—57 

‘‘(i) does not require specific intent to defraud; 

and 

‘‘(ii) with respect to information about ownership 

of the sound recording in question, means that the 

person— 

‘‘(I) has actual knowledge of the information; 

‘‘(II) acts in deliberate ignorance of the truth 

or falsity of the information; or 

‘‘(III) acts in grossly negligent disregard of 

the truth or falsity of the information. 

‘‘(d) PAYMENT OF ROYALTIES FOR TRANSMISSIONS OF PERFORMANCES BY DIRECT LICENSING OF STATUTORY SERVICES.— 

‘‘(1) IN GENERAL.—A public performance by means of a 

digital audio transmission of a sound recording fixed before 

February 15, 1972, shall, for purposes of subsection (a), be 

considered to be authorized and made with the consent of 

the rights owner if the transmission is made pursuant to a 

license agreement voluntarily negotiated at any time between 

the rights owner and the entity performing the sound recording. 

‘‘(2) PAYMENT OF ROYALTIES TO NONPROFIT COLLECTIVE

UNDER CERTAIN LICENSE AGREEMENTS.— 

‘‘(A) LICENSES ENTERED INTO ON OR AFTER DATE OF

ENACTMENT.—To the extent that a license agreement 

described in paragraph (1) entered into on or after the 

date of enactment of this section extends to a public 

performance by means of a digital audio transmission of 

a sound recording fixed before February 15, 1972, that 

meets the conditions of subsection (b)— 

‘‘(i) the licensee shall, with respect to such transmission, pay to the collective designated to distribute 

receipts from the licensing of transmissions in accordance with section 114(f), 50 percent of the performance 

royalties for that transmission due under the license; 

and 

‘‘(ii) the royalties paid under clause (i) shall be 

fully credited as payments due under the license. 

‘‘(B) CERTAIN AGREEMENTS ENTERED INTO BEFORE

ENACTMENT.—To the extent that a license agreement 

described in paragraph (1), entered into during the period 

beginning on January 1 of the year in which this section 

is enacted and ending on the day before the date of enactment of this section, or a settlement agreement with a 

preexisting satellite digital audio radio service (as defined 

in section 114(j)) entered into during the period beginning 

on January 1, 2015, and ending on the day before the 

date of enactment of this section, extends to a public 

performance by means of a digital audio transmission of 

a sound recording fixed before February 15, 1972, that 

meets the conditions of subsection (b)— 

‘‘(i) the rights owner shall, with respect to such 

transmission, pay to the collective designated to distribute receipts from the licensing of transmissions 

in accordance with section 114(f) an amount that is 

equal to the difference between— 

‘‘(I) 50 percent of the difference between— 

‘‘(aa) the rights owner’s total gross 

performance royalty fee receipts or settlement 
H. R. 1551—58 

monies received for all such transmissions covered under the license or settlement agreement, as applicable; and 

‘‘(bb) the rights owner’s total payments 

for outside legal expenses, including any payments of third-party claims, that are directly 

attributable to the license or settlement agreement, as applicable; and 

‘‘(II) the amount of any royalty receipts or 

settlement monies under the agreement that are 

distributed by the rights owner to featured and 

nonfeatured artists before the date of enactment 

of this section; and 

‘‘(ii) the royalties paid under clause (i) shall be 

fully credited as payments due under the license or 

settlement agreement, as applicable. 

‘‘(3) DISTRIBUTION OF ROYALTIES AND SETTLEMENT MONIES

BY COLLECTIVE.—The collective described in paragraph (2) shall, 

in accordance with subparagraphs (B) through (D) of section 

114(g)(2), and paragraphs (5) and (6) of section 114(g), distribute the royalties or settlement monies received under paragraph (2) under a license or settlement described in paragraph 

(2), which shall be the only payments to which featured and 

nonfeatured artists are entitled by virtue of the transmissions 

described in paragraph (2), except for settlement monies 

described in paragraph (2) that are distributed by the rights 

owner to featured and nonfeatured artists before the date of 

enactment of this section. 

‘‘(4) PAYMENT OF ROYALTIES UNDER LICENSE AGREEMENTS

ENTERED BEFORE ENACTMENT OR NOT OTHERWISE DESCRIBED

IN PARAGRAPH (2).— 

‘‘(A) IN GENERAL.—To the extent that a license agreement described in paragraph (1) entered into before the 

date of enactment of this section, or any other license 

agreement not as described in paragraph (2), extends to 

a public performance by means of a digital audio transmission of a sound recording fixed before February 15, 

1972, that meets the conditions of subsection (b), the payments made by the licensee pursuant to the license shall 

be made in accordance with the agreement. 

‘‘(B) ADDITIONAL PAYMENTS NOT REQUIRED.—To the 

extent that a licensee has made, or will make in the future, 

payments pursuant to a license as described in subparagraph (A), the provisions of paragraphs (2) and (3) shall 

not require any additional payments from, or additional 

financial obligations on the part of, the licensee. 

‘‘(C) RULE OF CONSTRUCTION.—Nothing in this subsection may be construed to prohibit the collective designated to distribute receipts from the licensing of transmissions in accordance with section 114(f) from administering royalty payments under any license not described 

in paragraph (2). 

‘‘(e) PREEMPTION WITH RESPECT TO CERTAIN PAST ACTS.— 

‘‘(1) IN GENERAL.—This section preempts any claim of 

common law copyright or equivalent right under the laws of 
H. R. 1551—59 

any State arising from a digital audio transmission or reproduction that is made before the date of enactment of this section 

of a sound recording fixed before February 15, 1972, if— 

‘‘(A) the digital audio transmission would have satisfied 

the requirements for statutory licensing under section 

114(d)(2) or been exempt under section 114(d)(1), or the 

reproduction would have satisfied the requirements of section 112(e)(1), as the case may be, if the sound recording 

were fixed on or after February 15, 1972; and 

‘‘(B) either— 

‘‘(i) except in the case of a transmission that would 

have been exempt under section 114(d)(1), not later 

than 270 days after the date of enactment of this 

section, the transmitting entity pays statutory royalties 

and provides notice of the use of the relevant sound 

recordings in the same manner as required by regulations adopted by the Copyright Royalty Judges for 

sound recordings that are fixed on or after February 

15, 1972, for all the digital audio transmissions and 

reproductions satisfying the requirements for statutory 

licensing under sections 112(e)(1) and 114(d)(2) during 

the 3 years before that date of enactment; or 

‘‘(ii) an agreement voluntarily negotiated between 

the rights owner and the entity performing the sound 

recording (including a litigation settlement agreement 

entered into before the date of enactment of this section) authorizes or waives liability for any such transmission or reproduction and the transmitting entity 

has paid for and reported such digital audio transmission under that agreement. 

‘‘(2) RULE OF CONSTRUCTION FOR COMMON LAW COPYRIGHT.—For purposes of paragraph (1), a claim of common 

law copyright or equivalent right under the laws of any State 

includes a claim that characterizes conduct subject to that 

paragraph as an unlawful distribution, act of record piracy, 

or similar violation. 

‘‘(3) RULE OF CONSTRUCTION FOR PUBLIC PERFORMANCE

RIGHTS.—Nothing in this section may be construed to recognize 

or negate the existence of public performance rights in sound 

recordings under the laws of any State. 

‘‘(f) LIMITATIONS ON REMEDIES.— 

‘‘(1) FAIR USE; USES BY LIBRARIES, ARCHIVES, AND EDUCATIONAL INSTITUTIONS.— 

‘‘(A) IN GENERAL.—The limitations on the exclusive 

rights of a copyright owner described in sections 107, 108, 

109, 110, and 112(f) shall apply to a claim under subsection 

(a) with respect to a sound recording fixed before February 

15, 1972. 

‘‘(B) RULE OF CONSTRUCTION FOR SECTION 108(H).—With 

respect to the application of section 108(h) to a claim under 

subsection (a) with respect to a sound recording fixed before 

February 15, 1972, the phrase ‘during the last 20 years 

of any term of copyright of a published work’ in such 

section 108(h) shall be construed to mean at any time 

after the date of enactment of this section. 
H. R. 1551—60 

‘‘(2) ACTIONS.—The limitations on actions described in section 507 shall apply to a claim under subsection (a) with respect 

to a sound recording fixed before February 15, 1972. 

‘‘(3) MATERIAL ONLINE.—Section 512 shall apply to a claim 

under subsection (a) with respect to a sound recording fixed 

before February 15, 1972. 

‘‘(4) PRINCIPLES OF EQUITY.—Principles of equity apply to 

remedies for a violation of this section to the same extent 

as such principles apply to remedies for infringement of copyright. 

‘‘(5) FILING REQUIREMENT FOR STATUTORY DAMAGES AND

ATTORNEYS’ FEES.— 

‘‘(A) FILING OF INFORMATION ON SOUND RECORDINGS.— 

‘‘(i) FILING REQUIREMENT.—Except in the case of 

a transmitting entity that has filed contact information 

for that transmitting entity under subparagraph (B), 

in any action under this section, an award of statutory 

damages or of attorneys’ fees under section 504 or 

505 may be made with respect to an unauthorized 

use of a sound recording under subsection (a) only 

if— 

‘‘(I) the rights owner has filed with the Copyright Office a schedule that specifies the title, 

artist, and rights owner of the sound recording 

and contains such other information, as practicable, as the Register of Copyrights prescribes 

by regulation; and 

‘‘(II) the use occurs after the end of the 90- 

day period beginning on the date on which the 

information described in subclause (I) is indexed 

into the public records of the Copyright Office. 

‘‘(ii) REGULATIONS.—Not later than 180 days after 

the date of enactment of this section, the Register 

of Copyrights shall issue regulations that— 

‘‘(I) establish the form, content, and procedures 

for the filing of schedules under clause (i); 

‘‘(II) provide that a person may request that 

the person receive timely notification of a filing 

described in subclause (I); and 

‘‘(III) set forth the manner in which a person 

may make a request under subclause (II). 

‘‘(B) FILING OF CONTACT INFORMATION FOR TRANSMITTING ENTITIES.— 

‘‘(i) FILING REQUIREMENT.—Not later than 30 days 

after the date of enactment of this section, the Register 

of Copyrights shall issue regulations establishing the 

form, content, and procedures for the filing of contact 

information by any entity that, as of the date of enactment of this section, performs a sound recording fixed 

before February 15, 1972, by means of a digital audio 

transmission. 

‘‘(ii) TIME LIMIT ON FILINGS.—The Register of Copyrights may accept filings under clause (i) only until 

the 180th day after the date of enactment of this 

section. 

‘‘(iii) LIMITATION ON STATUTORY DAMAGES AND

ATTORNEYS’ FEES.— 
H. R. 1551—61 

‘‘(I) LIMITATION.—An award of statutory damages or of attorneys’ fees under section 504 or 

505 may not be made against an entity that has 

filed contact information for that entity under 

clause (i) with respect to an unauthorized use by 

that entity of a sound recording under subsection 

(a) if the use occurs before the end of the 90- 

day period beginning on the date on which the 

entity receives a notice that— 

‘‘(aa) is sent by or on behalf of the rights 

owner of the sound recording; 

‘‘(bb) states that the entity is not legally 

authorized to use that sound recording under 

subsection (a); and 

‘‘(cc) identifies the sound recording in a 

schedule conforming to the requirements prescribed by the regulations issued under 

subparagraph (A)(ii). 

‘‘(II) UNDELIVERABLE NOTICES.—In any case 

in which a notice under subclause (I) is sent to 

an entity by mail or courier service and the notice 

is returned to the sender because the entity either 

is no longer located at the address provided in 

the contact information filed under clause (i) or 

has refused to accept delivery, or the notice is 

sent by electronic mail and is undeliverable, the 

90-day period under subclause (I) shall begin on 

the date of the attempted delivery. 

‘‘(C) SECTION 412.—Section 412 shall not limit an award 

of statutory damages under section 504(c) or attorneys’ 

fees under section 505 with respect to a covered activity 

in violation of subsection (a). 

‘‘(6) APPLICABILITY OF OTHER PROVISIONS.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), no 

provision of this title shall apply to or limit the remedies 

available under this section except as otherwise provided 

in this section. 

‘‘(B) APPLICABILITY OF DEFINITIONS.—Any term used 

in this section that is defined in section 101 shall have 

the meaning given that term in section 101. 

‘‘(g) APPLICATION OF SECTION 230 SAFE HARBOR.—For purposes 

of section 230 of the Communications Act of 1934 (47 U.S.C. 230), 

subsection (a) shall be considered to be a ‘law pertaining to intellectual property’ under subsection (e)(2) of such section 230. 

‘‘(h) APPLICATION TO RIGHTS OWNERS.— 

‘‘(1) TRANSFERS.—With respect to a rights owner described 

in subsection (l)(2)(B)— 

‘‘(A) subsections (d) and (e) of section 201 and section 

204 shall apply to a transfer described in subsection 

(l)(2)(B) to the same extent as with respect to a transfer 

of copyright ownership; and 

‘‘(B) notwithstanding section 411, that rights owner 

may institute an action with respect to a violation of this 

section to the same extent as the owner of an exclusive 

right under a copyright may institute an action under 

section 501(b). 
H. R. 1551—62 

‘‘(2) APPLICATION OF OTHER PROVISIONS.—The following 

provisions shall apply to a rights owner under this section 

to the same extent as any copyright owner: 

‘‘(A) Section 112(e)(2). 

‘‘(B) Section 112(e)(7). 

‘‘(C) Section 114(e). 

‘‘(D) Section 114(h). 

‘‘(i) EPHEMERAL RECORDINGS.—An authorized reproduction 

made under this section shall be subject to section 112(g) to the 

same extent as a reproduction of a sound recording fixed on or 

after February 15, 1972. 

‘‘(j) RULE OF CONSTRUCTION.—A rights owner of, or featured 

recording artist who performs on, a sound recording under this 

chapter shall be deemed to be an interested copyright party, as 

defined in section 1001, to the same extent as a copyright owner 

or featured recording artist under chapter 10. 

‘‘(k) TREATMENT OF STATES AND STATE INSTRUMENTALITIES, OFFICERS, AND EMPLOYEES.—Any State, and any instrumentality, 

officer, or employee described in subsection (a)(3), shall be subject 

to the provisions of this section in the same manner and to the 

same extent as any nongovernmental entity. 

‘‘(l) DEFINITIONS.—In this section: 

‘‘(1) COVERED ACTIVITY.—The term ‘covered activity’ means 

any activity that the copyright owner of a sound recording 

would have the exclusive right to do or authorize under section 

106 or 602, or that would violate section 1201 or 1202, if 

the sound recording were fixed on or after February 15, 1972. 

‘‘(2) RIGHTS OWNER.—The term ‘rights owner’ means— 

‘‘(A) the person that has the exclusive right to 

reproduce a sound recording under the laws of any State, 

as of the day before the date of enactment of this section; 

or 

‘‘(B) any person to which a right to enforce a violation 

of this section may be transferred, in whole or in part, 

after the date of enactment of this section, under— 

‘‘(i) subsections (d) and (e) of section 201; and 

‘‘(ii) section 204.’’. 

(b) CONFORMING AMENDMENT.—The table of chapters for title 

17, United States Code, is amended by adding at the end the 

following: 

‘‘14. Unauthorized use of pre-1972 sound recordings ........................................ 1401’’. 

TITLE III—ALLOCATION FOR MUSIC 

PRODUCERS 

SEC. 301. SHORT TITLE. 

This title may be cited as the ‘‘Allocation for Music Producers 

Act’’ or the ‘‘AMP Act’’. 

SEC. 302. PAYMENT OF STATUTORY PERFORMANCE ROYALTIES. 

(a) LETTER OF DIRECTION.—Section 114(g) of title 17, United 

States Code, is amended by adding at the end the following: 

‘‘(5) LETTER OF DIRECTION.— 

‘‘(A) IN GENERAL.—A nonprofit collective designated 

by the Copyright Royalty Judges to distribute receipts from 

the licensing of transmissions in accordance with subsection 
H. R. 1551—63 

(f) shall adopt and reasonably implement a policy that 

provides, in circumstances determined by the collective to 

be appropriate, for acceptance of instructions from a payee 

identified under subparagraph (A) or (D) of paragraph (2) 

to distribute, to a producer, mixer, or sound engineer who 

was part of the creative process that created a sound 

recording, a portion of the payments to which the payee 

would otherwise be entitled from the licensing of transmissions of the sound recording. In this section, such 

instructions shall be referred to as a ‘letter of direction’. 

‘‘(B) ACCEPTANCE OF LETTER.—To the extent that a 

collective described in subparagraph (A) accepts a letter 

of direction under that subparagraph, the person entitled 

to payment pursuant to the letter of direction shall, during 

the period in which the letter of direction is in effect 

and carried out by the collective, be treated for all purposes 

as the owner of the right to receive such payment, and 

the payee providing the letter of direction to the collective 

shall be treated as having no interest in such payment. 

‘‘(C) AUTHORITY OF COLLECTIVE.—This paragraph shall 

not be construed in such a manner so that the collective 

is not authorized to accept or act upon payment instructions 

in circumstances other than those to which this paragraph 

applies.’’. 

(b) ADDITIONAL PROVISIONS FOR RECORDINGS FIXED BEFORE

NOVEMBER 1, 1995.—Section 114(g) of title 17, United States Code, 

as amended by subsection (a), is further amended by adding at 

the end the following: 

‘‘(6) SOUND RECORDINGS FIXED BEFORE NOVEMBER 1, 1995.— 

‘‘(A) PAYMENT ABSENT LETTER OF DIRECTION.—A nonprofit collective designated by the Copyright Royalty Judges 

to distribute receipts from the licensing of transmissions 

in accordance with subsection (f) (in this paragraph referred 

to as the ‘collective’) shall adopt and reasonably implement 

a policy that provides, in circumstances determined by 

the collective to be appropriate, for the deduction of 2 

percent of all the receipts that are collected from the 

licensing of transmissions of a sound recording fixed before 

November 1, 1995, but which is withdrawn from the 

amount otherwise payable under paragraph (2)(D) to the 

recording artist or artists featured on the sound recording 

(or the persons conveying rights in the artists’ performance 

in the sound recording), and the distribution of such 

amount to 1 or more persons described in subparagraph 

(B) of this paragraph, after deduction of costs described 

in paragraph (3) or (4), as applicable, if each of the following 

requirements is met: 

‘‘(i) CERTIFICATION OF ATTEMPT TO OBTAIN A LETTER

OF DIRECTION.—The person described in subparagraph 

(B) who is to receive the distribution has certified 

to the collective, under penalty of perjury, that— 

‘‘(I) for a period of not less than 120 days, 

that person made reasonable efforts to contact the 

artist payee for such sound recording to request 

and obtain a letter of direction instructing the 

collective to pay to that person a portion of the 
H. R. 1551—64 

royalties payable to the featured recording artist 

or artists; and 

‘‘(II) during the period beginning on the date 

on which that person began the reasonable efforts 

described in subclause (I) and ending on the date 

of that person’s certification to the collective, the 

artist payee did not affirm or deny in writing 

the request for a letter of direction. 

‘‘(ii) COLLECTIVE ATTEMPT TO CONTACT ARTIST.— 

After receipt of the certification described in clause 

(i) and for a period of not less than 120 days before 

the first distribution by the collective to the person 

described in subparagraph (B), the collective attempts, 

in a reasonable manner as determined by the collective, 

to notify the artist payee of the certification made 

by the person described in subparagraph (B). 

‘‘(iii) NO OBJECTION RECEIVED.—The artist payee 

does not, as of the date that was 10 business days 

before the date on which the first distribution is made, 

submit to the collective in writing an objection to the 

distribution. 

‘‘(B) ELIGIBILITY FOR PAYMENT.—A person shall be 

eligible for payment under subparagraph (A) if the person— 

‘‘(i) is a producer, mixer, or sound engineer of 

the sound recording; 

‘‘(ii) has entered into a written contract with a 

record company involved in the creation or lawful 

exploitation of the sound recording, or with the 

recording artist or artists featured on the sound 

recording (or the persons conveying rights in the artists’ performance in the sound recording), under which 

the person seeking payment is entitled to participate 

in royalty payments that are based on the exploitation 

of the sound recording and are payable from royalties 

otherwise payable to the recording artist or artists 

featured on the sound recording (or the persons conveying rights in the artists’ performance in the sound 

recording); 

‘‘(iii) made a creative contribution to the creation 

of the sound recording; and 

‘‘(iv) submits to the collective— 

‘‘(I) a written certification stating, under penalty of perjury, that the person meets the requirements in clauses (i) through (iii); and 

‘‘(II) a true copy of the contract described in 

clause (ii). 

‘‘(C) MULTIPLE CERTIFICATIONS.—Subject to subparagraph (D), in a case in which more than 1 person described 

in subparagraph (B) has met the requirements for a distribution under subparagraph (A) with respect to a sound 

recording as of the date that is 10 business days before 

the date on which the distribution is made, the collective 

shall divide the 2 percent distribution equally among all 

such persons. 

‘‘(D) OBJECTION TO PAYMENT.—Not later than 10 business days after the date on which the collective receives 

from the artist payee a written objection to a distribution 
H. R. 1551—65 

made pursuant to subparagraph (A), the collective shall 

cease making any further payment relating to such distribution. In any case in which the collective has made 

1 or more distributions pursuant to subparagraph (A) to 

a person described in subparagraph (B) before the date 

that is 10 business days after the date on which the collective receives from the artist payee an objection to such 

distribution, the objection shall not affect that person’s 

entitlement to any distribution made before the collective 

ceases such distribution under this subparagraph. 

‘‘(E) OWNERSHIP OF THE RIGHT TO RECEIVE PAYMENTS.— 

To the extent that the collective determines that a distribution will be made under subparagraph (A) to a person 

described in subparagraph (B), such person shall, during 

the period covered by such distribution, be treated for 

all purposes as the owner of the right to receive such 

payments, and the artist payee to whom such payments 

would otherwise be payable shall be treated as having 

no interest in such payments. 

‘‘(F) ARTIST PAYEE DEFINED.—In this paragraph, the 

term ‘artist payee’ means a person, other than a person 

described in subparagraph (B), who owns the right to 

receive all or part of the receipts payable under paragraph 

(2)(D) with respect to a sound recording. In a case in 

which there are multiple artist payees with respect to 

a sound recording, an objection by 1 such payee shall 

apply only to that payee’s share of the receipts payable 

under paragraph (2)(D), and shall not preclude payment 

under subparagraph (A) from the share of an artist payee 

that does not so object.’’. 

(c) TECHNICAL AND CONFORMING AMENDMENTS.—Section 114(g) 

of title 17, United States Code, as amended by subsections (a) 

and (b), is further amended— 

(1) in paragraph (2), by striking ‘‘An agent designated’’ 

and inserting ‘‘Except as provided for in paragraph (6), a nonprofit collective designated by the Copyright Royalty Judges’’; 

(2) in paragraph (3)— 

(A) by striking ‘‘nonprofit agent designated’’ and 

inserting ‘‘nonprofit collective designated by the Copyright 

Royalty Judges’’; 

(B) by striking ‘‘another designated agent’’ and 

inserting ‘‘another designated nonprofit collective’’; and 

(C) by striking ‘‘agent’’ and inserting ‘‘collective’’ each 

subsequent place it appears; 

(3) in paragraph (4)— 

(A) by striking ‘‘designated agent’’ and inserting ‘‘nonprofit collective’’; and 

(B) by striking ‘‘agent’’ and inserting ‘‘collective’’ each 

subsequent place it appears; and 

(4) by adding at the end the following: 

‘‘(7) PREEMPTION OF STATE PROPERTY LAWS.—The holding 

and distribution of receipts under section 112 and this section 

by a nonprofit collective designated by the Copyright Royalty 

Judges in accordance with this subsection and regulations 

adopted by the Copyright Royalty Judges, or by an independent 

administrator pursuant to subparagraphs (B) and (C) of section 

114(g)(2), shall supersede and preempt any State law (including 
H. R. 1551—66 

common law) concerning escheatment or abandoned property, 

or any analogous provision, that might otherwise apply.’’. 

SEC. 303. EFFECTIVE DATE. 

(a) IN GENERAL.—Except as provided in subsection (b), this 

title and the amendments made by this title shall take effect 

on the date of enactment of this Act. 

(b) DELAYED EFFECTIVE DATE.—Paragraphs (5)(B) and (6)(E) 

of section 114(g) of title 17, United States Code, as added by 

section 302, shall take effect on January 1, 2020. 

TITLE IV—SEVERABILITY 

SEC. 401. SEVERABILITY. 

If any provision of this Act or any amendment made by this 

Act, or any application of such provision or amendment to any 

person or circumstance, is held to be unconstitutional, the 

remainder of the provisions of this Act and the amendments made 

by this Act, and the application of the provision or amendment 

to any other person or circumstance, shall not be affected. 

Speaker of the House of Representatives. 

Vice President of the United States and

President of the Senate.