How Do You Collect Mechanical Royalties Due You Outside the U.S.?
How Do You Collect Mechanical Royalties Due You Outside the U.S.?
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A lot of developed countries that the U.S. works with have mechanical collection societies: either different or bundled with a performance rights society.
For instance, in a major royalty producing area such as France, both mechanical and performance royalties will be collected and paid through the very same entity, SACEM. If you have royalties in The Netherlands, it’s a bundled society called BUMA/STEMRA.
For physical and downloads, the U.S. and Canada deal with a “penny rate” mechanical royalty– indicating a fixed rate per unit (9.1 cents per copy).
In Europe, the mechanical royalty is based upon percentage of what is known as “PPD” or “released cost to dealer” (the record business prices to merchants). The efficient rate presently is 8.712% of PPD.
For interactive streaming, the rates are different from area to territory however are often paid in the kind of a “blanket” license.
This implies the international streaming services pay a fee based upon a percentage of their yearly revenue to the mechanical collection society.
The society is then accountable for matching payments. This is what MMA’s new MLC is designed after.
This global collection aspect is crucial for anybody with songwriting and publishing credit for tunes with international acknowledgment.
Publishing Administrators
It’s impossible for anyone to gather this foreign income without either a publishing administrator or associating directly in a foreign territory (if they enable it).
Publishing administrators do not take ownership of copyrights, but supply publishing services in their home territories for a commission of normally 10% to 20% of the gross. This does not include innovative licensing services, which may make higher income shares.
For instance, if you had a foreign hit tune, all of the mechanical / performance collection societies will need registration of song shares to declare the royalties.
“Black’Box” Royalties
If a tune is just half registered, half of the money enters into what is called the “black box”– a term used to describe the accrued-but-unclaimed royalties that have been positioned in escrow.
Time is limited to claim the unclaimed royalty funds, typically around 3 years for mechanical royalties, depending upon the nation.
Kevin James has over 20 years of experience in the entertainment industry in various facets. He has worked as a recording artist, songwriter, producer, on-air radio personality, background actor and film director. Kevin is a Member of the National Writer's Union.