PROPOSED TARIFF
Filed with the Copyright Board by SOCAN on 2022-10-15 pursuant to subsection 67(1) of the Copyright Act
Proposed Tariff Title: SOCAN Tariff 22.D.3, Allied Audiovisual Services (2024-2026)
For the communication to the public by telecommunication of musical or dramatico-musical works
Effective Period: 2024-01-01 – 2026-12-31
SOCAN TARIFF 22.D.3, ALLIED AUDIOVISUAL SERVICES (2024-2026) Proposed statement of royalties to be collected by the Society of Composers, Authors and Music Publishers of Canada (SOCAN) in compensation for the communication to the public by telecommunication, in Canada, of musical or dramatico-musical works forming part of its repertoire, which, where applicable, includes the making available of such works to the public by telecommunication in a way that allows a member of the public to have access to them from a place and at a time individually chosen by that member of the public.
Tariff No. 22.D.3 ALLIED AUDIOVISUAL SERVICES TARIFF Application 1. (1) This tariff sets the royalties to be paid for the communication to the public by telecommunication of works in SOCAN’s repertoire, which, where applicable, includes the making available of such works to the public by telecommunication in a way that allows a member of the public to have access to a work from a place and at a time individually chosen by that member of the public, or to authorize the communication and/or making available, as the context may require, in connection with the operation of an allied audiovisual service and its authorized distributors during the years 2024 to 2026.
(2) Except as provided for herein, this tariff does not apply to uses covered by other applicable SOCAN tariffs, certified or proposed, including those relating to:
(a) Commercial Television Broadcasting (Tariff 2.A);
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
(b) Transmission of Pay, Specialty and other Television Services by Distribution Undertakings — Television (Tariff 17);
(c) Online Music Services (Tariff 22.A); (d) Online Audiovisual Services and User-Generated Content Services (Tariffs 22.D.1 and 22.D.2); and
(e) Internet - Game Services (Tariff 22.G). Definitions 2. In this tariff, “additional information” means, in respect of each musical work contained in a file, the following information, if available:
(a) the musical work’s unique identifier assigned by an allied audiovisual service; (b) the title of the musical work; (c) the name of each author of the musical work; (d) the name of each performer or group to whom the sound recording contained in the file is credited;
(e) the name of the person who released the sound recording contained in the file; (f) the International Standard Recording Code (ISRC) assigned to the sound recording; (g) if the sound recording is or has been released in physical format as part of an album, the name, identifier, product catalogue number and the Universal Product Code (UPC) ass igned to the album, together with the associated disc and track numbers;
(h) the name of the music publisher associated with the musical work; (i) the International Standard Musical Work Code (ISWC) assigned to the musical work; (j) the Global Release Identifier (GRid) assigned to the musical work and, if applicable, the GRid of the album in which the musical work was released;
(k) the running time of the musical work, in minutes and seconds; and (l) any alternative title used to designate the musical work or sound recording; («
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
renseignements additionnels ») “allied audiovisual service” means an audiovisual service analogous to, and operated in conjunction with, by or in support of, the operations of a conventional service or a BDU licensed under SOCAN Tariff 2.A or Tariff 17, the content of which is duplicative, complementary or adjunct to the content offered by the conventional service or BDU; (« service audiovisuel allié »)
“audiovisual service” means a service that delivers streams of audiovisual works to end-users over the Internet, and includes a hybrid service; (« service audiovisuel »)
“AV ratio” means, based on Internet-related revenue or usage data available to the licensee, (i) the ratio of AV SOCAN revenue to Internet-related revenue, or, if that ratio cannot be determined based on the revenue data available to the licensee, (ii) the ratio of AV usage to all usage, or, if that ratio cannot be determined based on the usage data available to the licensee, (iii) 100 per cent; (« ratio AV »)
“AV SOCAN revenue” means Internet-related revenue arising from AV usage other than non-SOCAN AV usage; (« revenus AV SOCAN »)
“AV usage” means usage that allows a person to hear an audiovisual work; (« utilisation AV ») “BDU” means a distribution undertaking as def ined in the Broadcasting Act, S.C. 1991, c. 11; (« EDR »)
“Canadian AV SOCAN revenue” means AV SOCAN revenue arising from Canadian usage; (« revenus AV canadiens de la SOCAN »)
“Canadian usage” means usage of a service by persons in Canada; (« utilisation canadienne ») “conventional service” means over-the-air television stations, pay and specialty services, community channels and other programming and non-programming services subject to SOCAN Tariff 2.A or 17; (« service conventionnel »)
“cue sheet” means a report containing, at minimum, the following information: the title of the audiovisual work, the title of each of the musical works embedded into the audiovisual work, the name of the author of each of the musical works, the duration of each of the musical works, and the total running time of the audiovisual work; (« rapport de contenu musical »)
“domestic ratio” means, based on Internet-related revenue or usage data available to the licensee, (i) the ratio of Canadian AV SOCAN revenue to all AV SOCAN revenue, or, if that ratio cannot be determined based on the revenue data available to the licensee, (ii) the ratio of Canadian usage
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
to all usage, or, if that ratio cannot be determined based on the usage data available to the licensee, (iii) 10 per cent; (« ratio national »)
“file” means a digital file of an audiovisual work; (« fichier ») “hybrid service” means an audiovisual service, files from which may temporarily be cached by end-users for offline viewing; (« service hybride »)
“Internet-related revenue” means all revenues generated by Internet-related activities, including membership, subscription and other access fees, amounts paid for advertising, product placement, promotion and sponsorship, net revenues from the sale of goods or services and commissions on third-party transactions, but excluding
(a) revenues that are already included in calculating royalties pursuant to another SOCAN tariff;
(b) agency commissions; (c) the fair market value of any advertising production services provided by the allied audiovisual service; and
(d) network usage and other connectivity access fees; (« recettes d’Internet ») “non-SOCAN AV usage” means AV usage that allows a person to hear an audiovisual work containing musical works for which a SOCAN licence is not required, and for which the service retains records establishing the basis upon which the service claims a SOCAN licence is not required; (« utilisation AV non-SOCAN »)
“on-demand stream” means a stream selected by the end-user and received at a place and time individually chosen by that end-users; (« transmission sur demande »)
“play” means the single delivery of a stream; (« écoute ») “production music” means music contained in interstitial programming such as commercials, public service announcements and jingles; (« musique de production »)
“quarter” means from January to March, from April to June, from July to September and from October to December; (« trimestre »)
“rate base” means (a) Canadian AV SOCAN revenue or, if not available;
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
(b) Internet-related revenue × AV ratio × domestic ratio; (« assiette tarifaire ») “stream” means a file that is intended to be copied onto a local storage medium or device only to the extent required to allow listening to or viewing of to the file at substantially the same time as when the file is received; (« transmission »)
“subscriber” means an end-user with whom an allied audiovisual service or its authorized distributor has entered into a contract for service, other than on a transactional or per-stream basis, whether for a fee, for other consideration or free of charge, including pursuant to a free subscription; (« abonné »)
“usage” means usage of a service measured by such reasonable measures of usage as are commonly and/or customarily used by the service; (« utilisation »)
“year” means a calendar year. (« année ») Royalties 3. Standard Rates (1) The royalty payable for the communication of an audiovisual program containing one or more musical works requiring a SOCAN licence shall be as follows:
(a) for a service that charges per-program fees to end-users: 3.0 per cent of the amounts paid by Canadian end-users for plays for which a SOCAN licence was required, subject to a minimum of 1.3¢ per program communicated;
(b) for a service that offers subscriptions to end-users: 3.0 per cent of the amounts paid by Canadian subscribers, subject to a minimum monthly fee of 19.5¢ per subscriber. In the case of a single, initial free trial of up to 31 days in any 12-month period offered to induce a prospective subscriber to enter into a paid subscription, there shall be no royalty fee payable; and
(c) for a service that receives Internet-related revenue in connection with its communication of audiovisual works: 3.0 per cent of the rate base.
(2) A service with revenues from more than one of the categories in paragraphs 4(1)(a), (b) and (c) shall pay royalties in accordance with each applicable subparagraph, but the calculation in paragraph (c) shall exclude any fees charged to end-users pursuant to paragraphs (a) and (b), and the related usage.
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
(3) A service with no revenue shall pay an annual fee of $25.00. Low Music Use Rates 4. (1) Notwithstanding section 3, the royalty rate is 1.5 per cent if the allied audiovisual service’s transmissions of audiovisual works contain musical works for which a licence from SOCAN is required, excluding production music, that in total account for less than 20 per cent of the overall time of the transmissions, and the service keeps and makes available to SOCAN, upon request, records sufficient to demonstrate this calculation for 90 days after a month in which the low music use rate is paid.
(2) Subject to the audit provisions in section 10, an allied audiovisual service may avail itself of the lower royalty rate set out in subsection (1) above without keeping the records required by that subsection if
(a) the conventional service with which the allied audiovisual service is allied requires a licence from SOCAN, excluding production music, for less than 20 per cent of the conventional service’s total air time and keeps and makes available to SOCAN, upon request, complete recordings of its last 90 broadcast days; and
(b) the content and usage patterns of the allied audiovisual service are substantially similar to the conventional service with which it is allied.
Reporting Requirements Service Identification 5. (1) No later than the earlier of 30 days after the end of the first month during which an allied audiovisual service communicates a file requiring a SOCAN licence and the day before the service first makes such a file available to the public, the allied audiovisual service shall provide to SOCAN the following information:
(a) the name of the person who operates the allied audiovisual service, including: (i) if a corporation, its name and a mention of its jurisdiction of incorporation, (ii) if a sole proprietorship, the name of the proprietor, (iii) if a partnership, the names of each partner, and (iv) in any event, the names of the principal officers or operators of the allied audiovisual
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
service, together with any other trade name under which the allied audiovisual service carries on business;
(b) the address of its principal place of business; (c) the name, address and email of the persons to be contacted for the purposes of notice, for the exchange of data and for the purposes of invoicing, and payment of royalties;
(d) the name and address of any authorized distributor; and (e) the Uniform Resource Locator (URL) of each website and the name of each application or platform at or through which the allied audiovisual service is or will be offered, as applicable.
Sales and Music Use Reporting (2) No later than 30 days after the end of each month, each allied audiovisual service shall provide to SOCAN a report setting out for that month, in relation to each file that was delivered as a stream, the following information, if available:
(a) the title of the program and/or series, the year of production, episode name, number, season and running time, and any other information that would assist SOCAN in identifying the file;
(b) the number of plays of each file; (c) the number of plays of all files; (d) the International Standard Audiovisual Number (ISAN) assigned to the file; (e) in the case of a translated program, the title in the language of its original production; and (f) the additional information. (3) No later than 30 days after the end of each month, each allied audiovisual service shall also provide to SOCAN a report setting out for that month
(a) for allied audiovisual services that charge per-program fees to end-users, the total amount paid by Canadian end-users for plays for which a SOCAN licence was required;
(b) for allied audiovisual services with subscribers, (i) the number of subscribers to the service at the end of the month,
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
(ii) the total amounts paid by subscribers to the service during that month, (iii) the number of subscribers provided with free trial subscriptions, and (iv) the total number of plays of all files by subscribers provided with free trial subscriptions; (c) for allied audiovisual services that are required to pay royalties pursuant to paragraph 3(1)(c) above,
(i) the service’s Internet-related revenue, (ii) if the service’s rate base for the month was its Canadian AV SOCAN revenue, then its (1) Canadian AV SOCAN revenue, (2) AV SOCAN revenue, (3) AV SOCAN usage, (4) AV usage, (5) Canadian usage and (6) total usage,
(iii) if the service’s rate base for the month was not its Canadian AV SOCAN revenue, then its AV ratio and its domestic ratio and all the usage data upon which each ratio was calculated, including, in respect of each play for which the service claims a SOCAN licence is not required, the information set out in subsection (4).
(4) If the allied audiovisual service claims that a SOCAN licence is not requ ired for a file, the service shall provide information that establishes why the licence is not required.
(5) An allied audiovisual service that is required to pay royalties pursuant to more than one paragraph of subsection 3(1) shall file a separate report pursuant to each paragraph of this subsection.
Files Made Available 6. Upon request, an allied audiovisual service shall provide to SOCAN, for each file that was made available to members of the public for on-demand streaming at any time during the year, regardless of whether the file was transmitted to any end-user,
(a) if available, the cue sheet; or (b) if a cue sheet is not available, the information specified in paragraph 5(2)(a). SOCAN shall not make such a request more frequently than twice per year. If a cue sheet is not available for a file, an allied audiovisual service shall, at SOCAN’s request, use commercially reasonable efforts to secure the cue sheet from any third party, including from the producer of the audiovisual work.
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
Administration Calculation and Payment of Royalties 7. (1) Royalties shall be due no later than 30 days after the end of each month. (2) All amounts payable under this tariff are exclusive of any federal, provincial or other governmental taxes or levies of any kind.
(3) All amounts required to be reported or paid under this tariff shall be reported or paid in Canadian dollars.
Late Payments 8. Any amount not received by the due date shall bear interest from that date until the date the amount is received. Interest shall be calculated daily, at a rate equal to one per cent above the Bank Rate effective on the last day of the previous month (as published by the Bank of Canada). Interest shall not compound.
Adjustments 9. (1) Adjustments to any information provided pursuant to section 5 shall be provided with the next report dealing with such information.
(2) Subject to subsection (3), adjustments in the amount of royalties owed, including excess payments, as a result of the discovery of an error or otherwise, shall be made on the date the next royalty payment is due.
(3) Any excess payment resulting from a service providing incorrect or incomplete information about a file shall be deducted from future amounts owed for the use of works owned by the same person as the work in that file.
Records and Audits 10. (1) An allied audiovisual service shall keep and preserve, for a period of six years after the end of the month to which they relate, records from which the information set out in sections 3, 4 and 5 can be readily ascertained, including — if the service has based its royalty calculation on either its AV ratio or domestic ratio, or both — all the usage data the service relied upon in calculating the AV ratio and/or domestic ratio.
(2) SOCAN may audit these records at any time during the period set out in subsection (1), on
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
reasonable notice and during normal business hours, but no more frequently than once in any 12-month period.
(3) Subject to subsection (4), if an audit discloses that royalties due have been understated in any quarter by more than 10 per cent, the allied audiovisual service shall pay the reasonable costs of the audit within 30 days of the demand for such payment.
(4) For the purposes of subsection (3), any amount owing as a result of an error or omission on the part of SOCAN shall not be taken into account.
Confidentiality 11. (1) Subject to subsections (2) and (3), SOCAN, the allied audiovisual service and its authorized distributors shall treat in confidence information received pursuant to this tariff, unless the disclosing party consents in writing to the information being treated otherwise.
(2) Information referred to in subsection (1) may be shared (a) between the allied audiovisual service and its authorized distributors in Canada; (b) with the Copyright Board; (c) in connection with proceedings before the Copyright Board, once the disclosing party has had a reasonable opportunity to request a confidentiality order;
(d) with any person who knows or is presumed to know the information; (e) to the extent required to effect the distribution of royalties; (f) with SOCAN’s agents and service providers to the extent required by the service providers for the service they are contracted to provide; and
(g) if required by law. (3) Subsection (1) does not apply to information that must be provided pursuant to the Copyright Act, to information that is publicly available, to aggregated information, or to information obtained from someone other than the allied audiovisual service or its authorized distributors and who is not under an apparent duty of confidentiality with respect to the supplied information.
Addresses for Notices 12. (1) Anything addressed to SOCAN shall be sent to 41 Valleybrook Drive, Toronto, Ontario
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.
M3B 2S6, email: licence@socan.com, or to any other address or email address of which an allied audiovisual service has been notified in writing.
(2) Anything that SOCAN sends to an allied audiovisual service shall be sent to the last address or email address of which SOCAN has been notified in writing.
Delivery of Notices 13. (1) Subject to subsection (2), a notice may be delivered by hand, by postage-paid mail by email or by File Transfer Protocol (FTP).
(2) Information provided pursuant to sections 5 and 6 shall be delivered electronically, by way of delimited text file or in any other format agreed upon by SOCAN and the allied audiovisual service.
(3) A notice or payment mailed in Canada shall be presumed to have been received four business days after the day it was mailed.
(4) A notice sent by email or by FTP shall be presumed to have been received the day it is transmitted.
Published by the Copyright Board of Canada, in accordance with section 68.2 of the Copyright Act, on November 18, 2022.