issued under paragraph (10) regarding report-
ing and payments. 
‘‘(B) LIMITATION ON LIABILITY.—A dig-
ital music provider that reports activity and 
makes payments under this paragraph for an 
activity under this paragraph shall not be sub-
ject to an action for copyright infringement al-
leging violation of reproduction or distribution 
rights to the extent such action is based on ac-
tivity so reported for which all payments due 
have been made. 
‘‘(7) LICENSE NOT TRANSFERABLE.—A license 
granted to a digital music provider under this sub-
section may not be transferred to any other person 
or entity. 
‘‘(8) ROYALTY RATES AND TERMS.— 
‘‘(A) RATES
AND
TERMS
IN
EFFECT.— 
Rates and terms in effect under subsection (c) 
on the effective date of the Section 115 Reform 
Act of 2006 for any activity for which a license 
is available under this section shall continue to 
apply to that activity on and after that date 
until a new rate is determined under subsection 
(c) and chapter 8. 
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‘‘(B) PAYMENT.—Licensees under this 
subsection shall make payments of royalties to 
the designated agents at rates and terms as di-
rected by the Copyright Royalty Judges. 
‘‘(C) RATES
AND
TERMS
FOR
NEW
LI-
CENSE ACTIVITIES.— 
‘‘(i) IN
GENERAL.—Not later than 
July 1, 2007, the Copyright Royalty 
Judges shall initiate a ratemaking pro-
ceeding, pursuant to the procedures set 
forth in chapter 8, to determine a final 
rate and terms for any activity for which 
a license is available under this subsection 
if— 
‘‘(I) a final rate and terms have 
not been established for the activity as 
of that date; or 
‘‘(II) the activity is not the sub-
ject of a proceeding to set a final rate 
and terms under subsection (c) that is 
pending before the Copyright Royalty 
Judges on that date. 
‘‘(ii) 
PENDING
PROCEEDINGS.—In 
any case in which a proceeding is pending 
before the Copyright Royalty Judges, on 
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July 1, 2007, to determine final rates and 
terms under subsection (c) for any activity 
for which a license is available under this 
subsection, the Copyright Royalty Judges 
may expand and adjust the schedule of the 
proceeding to cover rates and terms for 
any activity described in clause (i), in lieu 
of initiating a proceeding under clause (i) 
with respect to that activity, if so expand-
ing and adjusting the schedule of the pro-
ceeding will not unduly prejudice any party 
to the proceeding and will not delay the 
final determination of rates and terms by 
the Copyright Royalty Judges by more 
than 90 days. 
‘‘(iii) PARTICIPATION OF DESIGNATED 
AGENTS.—All designated agents, and any 
other parties who have a significant inter-
est, within the meaning of section 804(a), 
in the applicable royalty rate, are entitled 
to participate in a proceeding under this 
subparagraph relating to activities licensed 
under this subsection. 
‘‘(D) INTERIM RATES.— 
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‘‘(i) IN GENERAL.—For any activity 
for which a license is available under this 
subsection and for which a rate and terms 
have not been determined under subsection 
(c), a digital music provider shall, upon fil-
ing a valid application with the relevant 
designated agent, have a license under this 
subsection to engage in the activity, sub-
ject to clause (ii). 
‘‘(ii) INTERIM RATES AND TERMS.— 
Upon the filing of an application under 
clause (i)— 
‘‘(I) the digital music provider 
and the designated agent may nego-
tiate an interim rate and terms that 
will apply to the activity under the li-
cense; or 
‘‘(II) the digital music provider 
or the designated agent, or both, may 
apply 
to 
the 
Copyright 
Royalty 
Judges for an interim rate and terms, 
in which case— 
‘‘(aa) the Copyright Royalty 
Judges shall, not later than 15 
days after the application is 
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