17 U.S.C. § 114 : US Code - Section 114: Scope of exclusive rights in sound recordings

Search 17 U.S.C. § 114 : US Code - Section 114: Scope of exclusive rights in sound recordings

      (a) The exclusive rights of the owner of copyright in a sound
    recording are limited to the rights specified by clauses (1), (2),
    (3) and (6) of section 106, and do not include any right of
    performance under section 106(4).
      (b) The exclusive right of the owner of copyright in a sound
    recording under clause (1) of section 106 is limited to the right
    to duplicate the sound recording in the form of phonorecords or
    copies that directly or indirectly recapture the actual sounds
    fixed in the recording. The exclusive right of the owner of
    copyright in a sound recording under clause (2) of section 106 is
    limited to the right to prepare a derivative work in which the
    actual sounds fixed in the sound recording are rearranged, remixed,
    or otherwise altered in sequence or quality. The exclusive rights
    of the owner of copyright in a sound recording under clauses (1)
    and (2) of section 106 do not extend to the making or duplication
    of another sound recording that consists entirely of an independent
    fixation of other sounds, even though such sounds imitate or
    simulate those in the copyrighted sound recording. The exclusive
    rights of the owner of copyright in a sound recording under clauses
    (1), (2), and (3) of section 106 do not apply to sound recordings
    included in educational television and radio programs (as defined
    in section 397 of title 47) distributed or transmitted by or
    through public broadcasting entities (as defined by section
    118(f)): Provided, That copies or phonorecords of said programs are
    not commercially distributed by or through public broadcasting
    entities to the general public.
      (c) This section does not limit or impair the exclusive right to
    perform publicly, by means of a phonorecord, any of the works
    specified by section 106(4).
      (d) Limitations on Exclusive Right. - Notwithstanding the
    provisions of section 106(6) - 
        (1) Exempt transmissions and retransmissions. - The performance
      of a sound recording publicly by means of a digital audio
      transmission, other than as a part of an interactive service, is
      not an infringement of section 106(6) if the performance is part
      of - 
          (A) a nonsubscription broadcast transmission;
          (B) a retransmission of a nonsubscription broadcast
        transmission: Provided, That, in the case of a retransmission
        of a radio station's broadcast transmission - 
            (i) the radio station's broadcast transmission is not
          willfully or repeatedly retransmitted more than a radius of
          150 miles from the site of the radio broadcast transmitter,
          however - 
              (I) the 150 mile limitation under this clause shall not
            apply when a nonsubscription broadcast transmission by a
            radio station licensed by the Federal Communications
            Commission is retransmitted on a nonsubscription basis by a
            terrestrial broadcast station, terrestrial translator, or
            terrestrial repeater licensed by the Federal Communications
            Commission; and
              (II) in the case of a subscription retransmission of a
            nonsubscription broadcast retransmission covered by
            subclause (I), the 150 mile radius shall be measured from
            the transmitter site of such broadcast retransmitter;

            (ii) the retransmission is of radio station broadcast
          transmissions that are - 
              (I) obtained by the retransmitter over the air;
              (II) not electronically processed by the retransmitter to
            deliver separate and discrete signals; and
              (III) retransmitted only within the local communities
            served by the retransmitter;

            (iii) the radio station's broadcast transmission was being
          retransmitted to cable systems (as defined in section 111(f))
          by a satellite carrier on January 1, 1995, and that
          retransmission was being retransmitted by cable systems as a
          separate and discrete signal, and the satellite carrier
          obtains the radio station's broadcast transmission in an
          analog format: Provided, That the broadcast transmission
          being retransmitted may embody the programming of no more
          than one radio station; or
            (iv) the radio station's broadcast transmission is made by
          a noncommercial educational broadcast station funded on or
          after January 1, 1995, under section 396(k) of the
          Communications Act of 1934 (47 U.S.C. 396(k)), consists
          solely of noncommercial educational and cultural radio
          programs, and the retransmission, whether or not
          simultaneous, is a nonsubscription terrestrial broadcast
          retransmission; or

          (C) a transmission that comes within any of the following
        categories - 
            (i) a prior or simultaneous transmission incidental to an
          exempt transmission, such as a feed received by and then
          retransmitted by an exempt transmitter: Provided, That such
          incidental transmissions do not include any subscription
          transmission directly for reception by members of the public;
            (ii) a transmission within a business establishment,
          confined to its premises or the immediately surrounding
          vicinity;
            (iii) a retransmission by any retransmitter, including a
          multichannel video programming distributor as defined in
          section 602(12) (!1) of the Communications Act of 1934 (47
          U.S.C. 522(12)), of a transmission by a transmitter licensed
          to publicly perform the sound recording as a part of that
          transmission, if the retransmission is simultaneous with the
          licensed transmission and authorized by the transmitter; or

            (iv) a transmission to a business establishment for use in
          the ordinary course of its business: Provided, That the
          business recipient does not retransmit the transmission
          outside of its premises or the immediately surrounding
          vicinity, and that the transmission does not exceed the sound
          recording performance complement. Nothing in this clause
          shall limit the scope of the exemption in clause (ii).

        (2) Statutory licensing of certain transmissions. - The
      performance of a sound recording publicly by means of a
      subscription digital audio transmission not exempt under
      paragraph (1), an eligible nonsubscription transmission, or a
      transmission not exempt under paragraph (1) that is made by a
      preexisting satellite digital audio radio service shall be
      subject to statutory licensing, in accordance with subsection (f)
      if - 
          (A)(i) the transmission is not part of an interactive
        service;
          (ii) except in the case of a transmission to a business
        establishment, the transmitting entity does not automatically
        and intentionally cause any device receiving the transmission
        to switch from one program channel to another; and
          (iii) except as provided in section 1002(e), the transmission
        of the sound recording is accompanied, if technically feasible,
        by the information encoded in that 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;
          (B) in the case of a subscription transmission not exempt
        under paragraph (1) that is made by a preexisting subscription
        service in the same transmission medium used by such service on
        July 31, 1998, or in the case of a transmission not exempt
        under paragraph (1) that is made by a preexisting satellite
        digital audio radio service - 
            (i) the transmission does not exceed the sound recording
          performance complement; and
            (ii) the transmitting entity does not cause to be published
          by means of an advance program schedule or prior announcement
          the titles of the specific sound recordings or phonorecords
          embodying such sound recordings to be transmitted; and

          (C) in the case of an eligible nonsubscription transmission
        or a subscription transmission not exempt under paragraph (1)
        that is made by a new subscription service or by a preexisting
        subscription service other than in the same transmission medium
        used by such service on July 31, 1998 - 
            (i) the transmission does not exceed the sound recording
          performance complement, except that this requirement shall
          not apply in the case of a retransmission of a broadcast
          transmission if the retransmission is made by a transmitting
          entity that does not have the right or ability to control the
          programming of the broadcast station making the broadcast
          transmission, unless - 
              (I) the broadcast station makes broadcast transmissions -
            
                (aa) in digital format that regularly exceed the sound
              recording performance complement; or
                (bb) in analog format, a substantial portion of which,
              on a weekly basis, exceed the sound recording performance
              complement; and

              (II) the sound recording copyright owner or its
            representative has notified the transmitting entity in
            writing that broadcast transmissions of the copyright
            owner's sound recordings exceed the sound recording
            performance complement as provided in this clause;

            (ii) the transmitting entity does not cause to be
          published, or induce or facilitate the publication, by means
          of an advance program schedule or prior announcement, the
          titles of the specific sound recordings to be transmitted,
          the phonorecords embodying such sound recordings, or, other
          than for illustrative purposes, the names of the featured
          recording artists, except that this clause does not
          disqualify a transmitting entity that makes a prior
          announcement that a particular artist will be featured within
          an unspecified future time period, and in the case of a
          retransmission of a broadcast transmission by a transmitting
          entity that does not have the right or ability to control the
          programming of the broadcast transmission, the requirement of
          this clause shall not apply to a prior oral announcement by
          the broadcast station, or to an advance program schedule
          published, induced, or facilitated by the broadcast station,
          if the transmitting entity does not have actual knowledge and
          has not received written notice from the copyright owner or
          its representative that the broadcast station publishes or
          induces or facilitates the publication of such advance
          program schedule, or if such advance program schedule is a
          schedule of classical music programming published by the
          broadcast station in the same manner as published by that
          broadcast station on or before September 30, 1998;
            (iii) the transmission - 
              (I) is not part of an archived program of less than 5
            hours duration;
              (II) is not part of an archived program of 5 hours or
            greater in duration that is made available for a period
            exceeding 2 weeks;
              (III) is not part of a continuous program which is of
            less than 3 hours duration; or
              (IV) is not part of an identifiable program in which
            performances of sound recordings are rendered in a
            predetermined order, other than an archived or continuous
            program, that is transmitted at - 
                (aa) more than 3 times in any 2-week period that have
              been publicly announced in advance, in the case of a
              program of less than 1 hour in duration, or
                (bb) more than 4 times in any 2-week period that have
              been publicly announced in advance, in the case of a
              program of 1 hour or more in duration,

            except that the requirement of this subclause shall not
            apply in the case of a retransmission of a broadcast
            transmission by a transmitting entity that does not have
            the right or ability to control the programming of the
            broadcast transmission, unless the transmitting entity is
            given notice in writing by the copyright owner of the sound
            recording that the broadcast station makes broadcast
            transmissions that regularly violate such requirement;

            (iv) the transmitting entity does not knowingly perform the
          sound recording, as part of a service that offers
          transmissions of visual images contemporaneously with
          transmissions of sound recordings, in a manner that is likely
          to cause confusion, to cause mistake, or to deceive, as to
          the affiliation, connection, or association of the copyright
          owner or featured recording artist with the transmitting
          entity or a particular product or service advertised by the
          transmitting entity, or as to the origin, sponsorship, or
          approval by the copyright owner or featured recording artist
          of the activities of the transmitting entity other than the
          performance of the sound recording itself;
            (v) the transmitting entity cooperates to prevent, to the
          extent feasible without imposing substantial costs or
          burdens, a transmission recipient or any other person or
          entity from automatically scanning the transmitting entity's
          transmissions alone or together with transmissions by other
          transmitting entities in order to select a particular sound
          recording to be transmitted to the transmission recipient,
          except that the requirement of this clause shall not apply to
          a satellite digital audio service that is in operation, or
          that is licensed by the Federal Communications Commission, on
          or before July 31, 1998;
            (vi) the transmitting entity takes no affirmative steps to
          cause or induce the making of a phonorecord by the
          transmission recipient, and if the technology used by the
          transmitting entity enables the transmitting entity to limit
          the making by the transmission recipient of phonorecords of
          the transmission directly in a digital format, the
          transmitting entity sets such technology to limit such making
          of phonorecords to the extent permitted by such technology;
            (vii) phonorecords of the sound recording have been
          distributed to the public under the authority of the
          copyright owner or the copyright owner authorizes the
          transmitting entity to transmit the sound recording, and the
          transmitting entity makes the transmission from a phonorecord
          lawfully made under the authority of the copyright owner,
          except that the requirement of this clause shall not apply to
          a retransmission of a broadcast transmission by a
          transmitting entity that does not have the right or ability
          to control the programming of the broadcast transmission,
          unless the transmitting entity is given notice in writing by
          the copyright owner of the sound recording that the broadcast
          station makes broadcast transmissions that regularly violate
          such requirement;
            (viii) the transmitting entity accommodates and does not
          interfere with the transmission of technical measures that
          are widely used by sound recording copyright owners to
          identify or protect copyrighted works, and that are
          technically feasible of being transmitted by the transmitting
          entity without imposing substantial costs on the transmitting
          entity or resulting in perceptible aural or visual
          degradation of the digital signal, except that the
          requirement of this clause shall not apply to a satellite
          digital audio service that is in operation, or that is
          licensed under the authority of the Federal Communications
          Commission, on or before July 31, 1998, to the extent that
          such service has designed, developed, or made commitments to
          procure equipment or technology that is not compatible with
          such technical measures before such technical measures are
          widely adopted by sound recording copyright owners; and
            (ix) the transmitting entity identifies in textual data the
          sound recording during, but not before, the time it is
          performed, including the title of the sound recording, the
          title of the phonorecord embodying such sound recording, if
          any, and the featured recording artist, in a manner to permit
          it to be displayed to the transmission recipient by the
          device or technology intended for receiving the service
          provided by the transmitting entity, except that the
          obligation in this clause shall not take effect until 1 year
          after the date of the enactment of the Digital Millennium
          Copyright Act and shall not apply in the case of a
          retransmission of a broadcast transmission by a transmitting
          entity that does not have the right or ability to control the
          programming of the broadcast transmission, or in the case in
          which devices or technology intended for receiving the
          service provided by the transmitting entity that have the
          capability to display such textual data are not common in the
          marketplace.

        (3) Licenses for transmissions by interactive services. - 
          (A) No interactive service shall be granted an exclusive
        license under section 106(6) for the performance of a sound
        recording publicly by means of digital audio transmission for a
        period in excess of 12 months, except that with respect to an
        exclusive license granted to an interactive service by a
        licensor that holds the copyright to 1,000 or fewer sound
        recordings, the period of such license shall not exceed 24
        months: Provided, however, That the grantee of such exclusive
        license shall be ineligible to receive another exclusive
        license for the performance of that sound recording for a
        period of 13 months from the expiration of the prior exclusive
        license.
          (B) The limitation set forth in subparagraph (A) of this
        paragraph shall not apply if - 
            (i) the licensor has granted and there remain in effect
          licenses under section 106(6) for the public performance of
          sound recordings by means of digital audio transmission by at
          least 5 different interactive services: Provided, however,
          That each such license must be for a minimum of 10 percent of
          the copyrighted sound recordings owned by the licensor that
          have been licensed to interactive services, but in no event
          less than 50 sound recordings; or
            (ii) the exclusive license is granted to perform publicly
          up to 45 seconds of a sound recording and the sole purpose of
          the performance is to promote the distribution or performance
          of that sound recording.

          (C) Notwithstanding the grant of an exclusive or nonexclusive
        license of the right of public performance under section
        106(6), an interactive service may not publicly perform a sound
        recording unless a license has been granted for the public
        performance of any copyrighted musical work contained in the
        sound recording: Provided, That such license to publicly
        perform the copyrighted musical work may be granted either by a
        performing rights society representing the copyright owner or
        by the copyright owner.
          (D) The performance of a sound recording by means of a
        retransmission of a digital audio transmission is not an
        infringement of section 106(6) if - 
            (i) the retransmission is of a transmission by an
          interactive service licensed to publicly perform the sound
          recording to a particular member of the public as part of
          that transmission; and
            (ii) the retransmission is simultaneous with the licensed
          transmission, authorized by the transmitter, and limited to
          that particular member of the public intended by the
          interactive service to be the recipient of the transmission.

          (E) For the purposes of this paragraph - 
            (i) a "licensor" shall include the licensing entity and any
          other entity under any material degree of common ownership,
          management, or control that owns copyrights in sound
          recordings; and
            (ii) a "performing rights society" is an association or
          corporation that licenses the public performance of
          nondramatic musical works on behalf of the copyright owner,
          such as the American Society of Composers, Authors and
          Publishers, Broadcast Music, Inc., and SESAC, Inc.

        (4) Rights not otherwise limited. - 
          (A) Except as expressly provided in this section, this
        section does not limit or impair the exclusive right to perform
        a sound recording publicly by means of a digital audio
        transmission under section 106(6).
          (B) Nothing in this section annuls or limits in any way - 
            (i) the exclusive right to publicly perform a musical work,
          including by means of a digital audio transmission, under
          section 106(4);
            (ii) the exclusive rights in a sound recording or the
          musical work embodied therein under sections 106(1), 106(2)
          and 106(3); or
            (iii) any other rights under any other clause of section
          106, or remedies available under this title, as such rights
          or remedies exist either before or after the date of
          enactment of the Digital Performance Right in Sound
          Recordings Act of 1995.

          (C) Any limitations in this section on the exclusive right
        under section 106(6) apply only to the exclusive right under
        section 106(6) and not to any other exclusive rights under
        section 106. Nothing in this section shall be construed to
        annul, limit, impair or otherwise affect in any way the ability
        of the owner of a copyright in a sound recording to exercise
        the rights under sections 106(1), 106(2) and 106(3), or to
        obtain the remedies available under this title pursuant to such
        rights, as such rights and remedies exist either before or
        after the date of enactment of the Digital Performance Right in
        Sound Recordings Act of 1995.

      (e) Authority for Negotiations. - 
        (1) Notwithstanding any provision of the antitrust laws, in
      negotiating statutory licenses in accordance with subsection (f),
      any copyright owners of sound recordings and any entities
      performing sound recordings affected by this section may
      negotiate and agree upon the royalty rates and license terms and
      conditions for the performance of such sound recordings 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 payments.
        (2) For licenses granted under section 106(6), other than
      statutory licenses, such as for performances by interactive
      services or performances that exceed the sound recording
      performance complement - 
          (A) copyright owners of sound recordings affected by this
        section may designate common agents to act on their behalf to
        grant licenses and receive and remit royalty payments:
        Provided, That each copyright owner shall establish the royalty
        rates and material license terms and conditions unilaterally,
        that is, not in agreement, combination, or concert with other
        copyright owners of sound recordings; and
          (B) entities performing sound recordings affected by this
        section may designate common agents to act on their behalf to
        obtain licenses and collect and pay royalty fees: Provided,
        That each entity performing sound recordings shall determine
        the royalty rates and material license terms and conditions
        unilaterally, that is, not in agreement, combination, or
        concert with other entities performing sound recordings.

      (f) Licenses for Certain Nonexempt Transmissions. - 
        (1)(A) Proceedings under chapter 8 shall determine reasonable
      rates and terms of royalty payments for subscription
      transmissions by preexisting subscription services and
      transmissions by preexisting satellite digital audio radio
      services specified by 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, except in the case of
      a different transitional period provided under section 6(b)(3) of
      the Copyright Royalty and Distribution Reform Act of 2004, or
      such other period as the parties may agree. Such terms and rates
      shall distinguish among the different types of digital audio
      transmission services then in operation. Any copyright owners of
      sound recordings, preexisting subscription services, or
      preexisting satellite digital audio radio services may submit to
      the Copyright Royalty Judges licenses covering such subscription
      transmissions with respect to such sound recordings. 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 (3), 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), a transitional
      period provided under section 6(b)(3) of the Copyright Royalty
      and Distribution Reform Act of 2004, or such other period as the
      parties may agree. In establishing rates and terms for
      preexisting subscription services and preexisting satellite
      digital audio radio services, in addition to the objectives set
      forth in section 801(b)(1), the Copyright Royalty Judges may
      consider the rates and terms for comparable types of subscription
      digital audio transmission services and comparable circumstances
      under voluntary license agreements described in subparagraph (A).
        (C) The procedures under subparagraphs (A) and (B) also shall
      be initiated pursuant to a petition filed by any copyright owners
      of sound recordings, any preexisting subscription services, or
      any preexisting satellite digital audio radio services indicating
      that a new type of subscription digital audio transmission
      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 transmission 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 subscription digital audio
      transmission services most recently determined under subparagraph
      (A) or (B) and chapter 8 expire, or such other period as the
      parties may agree.
        (2)(A) Proceedings under chapter 8 shall determine reasonable
      rates and terms of royalty payments for public performances of
      sound recordings by means of eligible nonsubscription
      transmission services and new subscription services specified by
      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, except in the case of a different
      transitional period provided under section 6(b)(3) of the
      Copyright Royalty and Distribution Reform Act of 2004, or such
      other period as the parties may agree. Such rates and terms shall
      distinguish among the different types of eligible nonsubscription
      transmission services and new subscription services then in
      operation and shall include a minimum fee for each such type of
      service. Any copyright owners of sound recordings or any entities
      performing sound recordings affected by this paragraph may submit
      to the Copyright Royalty Judges licenses covering such eligible
      nonsubscription transmissions and new subscription services with
      respect to such sound recordings. 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 (3), 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), a transitional
      period provided under section 6(b)(3) of the Copyright Royalty
      and Distribution (!2) Act of 2004, or such other period as the
      parties may agree. Such rates and terms shall distinguish among
      the different types of eligible nonsubscription transmission
      services then in operation and shall include a minimum fee for
      each such type of service, such differences to be based on
      criteria including, but not limited to, 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. In establishing rates and terms for
      transmissions by eligible nonsubscription services and new
      subscription services, 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 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 its 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.

      In establishing such rates and terms, the Copyright Royalty
      Judges may consider the rates and terms for comparable types of
      digital audio transmission services and comparable circumstances
      under voluntary license agreements described in subparagraph (A).
        (C) The procedures under subparagraphs (A) and (B) shall also
      be initiated pursuant to a petition filed by any copyright owners
      of sound recordings or any eligible nonsubscription service or
      new subscription service indicating that a new type of eligible
      nonsubscription service or new subscription 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, 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.
        (3) License agreements voluntarily negotiated at any time
      between 1 or more copyright owners of sound recordings and 1 or
      more entities performing sound recordings shall be given effect
      in lieu of any decision by the Librarian of Congress or
      determination by the Copyright Royalty Judges.
        (4)(A) The Copyright Royalty Judges shall also establish
      requirements by which copyright owners may receive reasonable
      notice of the use of their sound recordings under this section,
      and under which records of such use shall be kept and made
      available by entities performing sound recordings. The notice and
      recordkeeping rules in effect on the day before the effective
      date of the Copyright Royalty and Distribution Reform Act of 2004
      shall remain in effect unless and until new regulations are
      promulgated by the Copyright Royalty Judges. If new regulations
      are promulgated under this subparagraph, the Copyright Royalty
      Judges shall take into account the substance and effect of the
      rules in effect on the day before the effective date of the
      Copyright Royalty and Distribution Reform Act of 2004 and shall,
      to the extent practicable, avoid significant disruption of the
      functions of any designated agent authorized to collect and
      distribute royalty fees.
        (B) Any person who wishes to perform a sound recording publicly
      by means of a transmission eligible for statutory licensing under
      this subsection may do so without infringing the exclusive right
      of the copyright owner of the sound recording - 
          (i) by complying with such notice requirements as the
        Copyright Royalty Judges shall prescribe by regulation and by
        paying royalty fees in accordance with this subsection; or
          (ii) if such royalty fees have not been set, by agreeing to
        pay such royalty fees as shall be determined in accordance with
        this subsection.

        (C) Any royalty payments in arrears shall be made on or before
      the twentieth day of the month next succeeding the month in which
      the royalty fees are set.
        (5)(A) Notwithstanding section 112(e) and the other provisions
      of this subsection, the receiving agent may enter into agreements
      for the reproduction and performance of sound recordings under
      section 112(e) and this section by any 1 or more commercial
      webcasters or noncommercial webcasters for a period of not more
      than 11 years beginning on January 1, 2005, that, once published
      in the Federal Register pursuant to subparagraph (B), shall be
      binding on all copyright owners of sound recordings and other
      persons entitled to payment under this section, in lieu of any
      determination by the Copyright Royalty Judges. Any such agreement
      for commercial webcasters may include provisions for payment of
      royalties on the basis of a percentage of revenue or expenses, or
      both, and include a minimum fee. Any such agreement may include
      other terms and conditions, including requirements by which
      copyright owners may receive notice of the use of their sound
      recordings and under which records of such use shall be kept and
      made available by commercial webcasters or noncommercial
      webcasters. The receiving agent shall be under no obligation to
      negotiate any such agreement. The receiving agent shall have no
      obligation to any copyright owner of sound recordings or any
      other person entitled to payment under this section in
      negotiating any such agreement, and no liability to any copyright
      owner of sound recordings or any other person entitled to payment
      under this section for having entered into such agreement.
        (B) The Copyright Office shall cause to be published in the
      Federal Register any agreement entered into pursuant to
      subparagraph (A). Such publication shall include a statement
      containing the substance of subparagraph (C). Such agreements
      shall not be included in the Code of Federal Regulations.
      Thereafter, the terms of such agreement shall be available, as an
      option, to any commercial webcaster or noncommercial webcaster
      meeting the eligibility conditions of such agreement.
        (C) Neither subparagraph (A) nor any provisions of any
      agreement entered into pursuant to subparagraph (A), including
      any rate structure, fees, terms, conditions, or notice and
      recordkeeping requirements set forth therein, shall be admissible
      as evidence or otherwise taken into account in any
      administrative, judicial, or other government proceeding
      involving the setting or adjustment of the royalties payable for
      the public performance or reproduction in ephemeral phonorecords
      or copies of sound recordings, the determination of terms or
      conditions related thereto, or the establishment of notice or
      recordkeeping requirements by the Copyright Royalty Judges under
      paragraph (4) or section 112(e)(4). It is the intent of Congress
      that any royalty rates, rate structure, definitions, terms,
      conditions, or notice and recordkeeping requirements, included in
      such agreements shall be considered as a compromise motivated by
      the unique business, economic and political circumstances of
      webcasters, copyright owners, and performers rather than as
      matters that would have been negotiated in the marketplace
      between a willing buyer and a willing seller, or otherwise meet
      the objectives set forth in section 801(b). This subparagraph
      shall not apply to the extent that the receiving agent and a
      webcaster that is party to an agreement entered into pursuant to
      subparagraph (A) expressly authorize the submission of the
      agreement in a proceeding under this subsection.
        (D) Nothing in the Webcaster Settlement Act of 2008, the
      Webcaster Settlement Act of 2009, or any agreement entered into
      pursuant to subparagraph (A) shall be taken into account by the
      United States Court of Appeals for the District of Columbia
      Circuit in its review of the determination by the Copyright
      Royalty Judges of May 1, 2007, of rates and terms for the digital
      performance of sound recordings and ephemeral recordings,
      pursuant to sections 112 and 114.
        (E) As used in this paragraph - 
          (i) the term "noncommercial webcaster" means a webcaster that
        - 
            (I) is exempt from taxation under section 501 of the
          Internal Revenue Code of 1986 (26 U.S.C. 501);
            (II) has applied in good faith to the Internal Revenue
          Service for exemption from taxation under section 501 of the
          Internal Revenue Code and has a commercially reasonable
          expectation that such exemption shall be granted; or
            (III) is operated by a State or possession or any
          governmental entity or subordinate thereof, or by the United
          States or District of Columbia, for exclusively public
          purposes;

          (ii) the term "receiving agent" shall have the meaning given
        that term in section 261.2 of title 37, Code of Federal
        Regulations, as published in the Federal Register on July 8,
        2002; and
          (iii) the term "webcaster" means a person or entity that has
        obtained a compulsory license under section 112 or 114 and the
        implementing regulations therefor.

        (F) The authority to make settlements pursuant to subparagraph
      (A) shall expire at 11:59 p.m. Eastern time on the 30th day after
      the date of the enactment of the Webcaster Settlement Act of
      2009.

      (g) Proceeds From Licensing of Transmissions. - 
        (1) Except in the case of a transmission licensed under a
      statutory license in accordance with subsection (f) of this
      section - 
          (A) a featured recording artist who performs on a sound
        recording that has been licensed for a transmission shall be
        entitled to receive payments from the copyright owner of the
        sound recording in accordance with the terms of the artist's
        contract; and
          (B) a nonfeatured recording artist who performs on a sound
        recording that has been licensed for a transmission shall be
        entitled to receive payments from the copyright owner of the
        sound recording in accordance with the terms of the nonfeatured
        recording artist's applicable contract or other applicable
        agreement.

        (2) An agent designated to distribute receipts from the
      licensing of transmissions in accordance with subsection (f)
      shall distribute such receipts as follows:
          (A) 50 percent of the receipts shall be paid to the copyright
        owner of the exclusive right under section 106(6) of this title
        to publicly perform a sound recording by means of a digital
        audio transmission.
          (B) 2 1/2  percent of the receipts shall be deposited in an
        escrow account managed by an independent administrator jointly
        appointed by copyright owners of sound recordings and the
        American Federation of Musicians (or any successor entity) to
        be distributed to nonfeatured musicians (whether or not members
        of the American Federation of Musicians) who have performed on
        sound recordings.
          (C) 2 1/2  percent of the receipts shall be deposited in an
        escrow account managed by an independent administrator jointly
        appointed by copyright owners of sound recordings and the
        American Federation of Television and Radio Artists (or any
        successor entity) to be distributed to nonfeatured vocalists
        (whether or not members of the American Federation of
        Television and Radio Artists) who have performed on sound
        recordings.
          (D) 45 percent of the receipts shall be paid, on a per sound
        recording basis, to the recording artist or artists featured on
        such sound recording (or the persons conveying rights in the
        artists' performance in the sound recordings).

        (3) A nonprofit agent designated to distribute receipts from
      the licensing of transmissions in accordance with subsection (f)
      may deduct from any of its receipts, prior to the distribution of
      such receipts to any person or entity entitled thereto other than
      copyright owners and performers who have elected to receive
      royalties from another designated agent and have notified such
      nonprofit agent in writing of such election, the reasonable costs
      of such agent incurred after November 1, 1995, in - 
          (A) the administration of the collection, distribution, and
        calculation of the royalties;
          (B) the settlement of disputes relating to the collection and
        calculation of the royalties; and
          (C) the licensing and enforcement of rights with respect to
        the making of ephemeral recordings and performances subject to
        licensing under section 112 and this section, including those
        incurred in participating in negotiations or arbitration
        proceedings under section 112 and this section, except that all
        costs incurred relating to the section 112 ephemeral recordings
        right may only be deducted from the royalties received pursuant
        to section 112.

        (4) Notwithstanding paragraph (3), any designated agent
      designated to distribute receipts from the licensing of
      transmissions in accordance with subsection (f) may deduct from
      any of its receipts, prior to the distribution of such receipts,
      the reasonable costs identified in paragraph (3) of such agent
      incurred after November 1, 1995, with respect to such copyright
      owners and performers who have entered with such agent a
      contractual relationship that specifies that such costs may be
      deducted from such royalty receipts.

      (h) Licensing to Affiliates. - 
        (1) If the copyright owner of a sound recording licenses an
      affiliated entity the right to publicly perform a sound recording
      by means of a digital audio transmission under section 106(6),
      the copyright owner shall make the licensed sound recording
      available under section 106(6) on no less favorable terms and
      conditions to all bona fide entities that offer similar services,
      except that, if there are material differences in the scope of
      the requested license with respect to the type of service, the
      particular sound recordings licensed, the frequency of use, the
      number of subscribers served, or the duration, then the copyright
      owner may establish different terms and conditions for such other
      services.
        (2) The limitation set forth in paragraph (1) of this
      subsection shall not apply in the case where the copyright owner
      of a sound recording licenses - 
          (A) an interactive service; or
          (B) an entity to perform publicly up to 45 seconds of the
        sound recording and the sole purpose of the performance is to
        promote the distribution or performance of that sound
        recording.

      (i) No Effect on Royalties for Underlying Works. - License fees
    payable for the public performance of sound recordings under
    section 106(6) shall not be taken into account in any
    administrative, judicial, or other governmental proceeding to set
    or adjust the royalties payable to copyright owners of musical
    works for the public performance of their works. It is the intent
    of Congress that royalties payable to copyright owners of musical
    works for the public performance of their works shall not be
    diminished in any respect as a result of the rights granted by
    section 106(6).
      (j) Definitions. - As used in this section, the following terms
    have the following meanings:
        (1) An "affiliated entity" is an entity engaging in digital
      audio transmissions covered by section 106(6), other than an
      interactive service, in which the licensor has any direct or
      indirect partnership or any ownership interest amounting to 5
      percent or more of the outstanding voting or non-voting stock.
        (2) An "archived program" is a predetermined program that is
      available repeatedly on the demand of the transmission recipient
      and that is performed in the same order from the beginning,
      except that an archived program shall not include a recorded
      event or broadcast transmission that makes no more than an
      incidental use of sound recordings, as long as such recorded
      event or broadcast transmission does not contain an entire sound
      recording or feature a particular sound recording.
        (3) A "broadcast" transmission is a transmission made by a
      terrestrial broadcast station licensed as such by the Federal
      Communications Commission.
        (4) A "continuous program" is a predetermined program that is
      continuously performed in the same order and that is accessed at
      a point in the program that is beyond the control of the
      transmission recipient.
        (5) A "digital audio transmission" is a digital transmission as
      defined in section 101, that embodies the transmission of a sound
      recording. This term does not include the transmission of any
      audiovisual work.
        (6) An "eligible nonsubscription transmission" is a
      noninteractive nonsubscription digital audio transmission not
      exempt under subsection (d)(1) that is made as part of a service
      that provides audio programming consisting, in whole or in part,
      of performances of sound recordings, including retransmissions of
      broadcast transmissions, if the primary purpose of the service is
      to provide to the public such audio or other entertainment
      programming, and the primary purpose of the service is not to
      sell, advertise, or promote particular products or services other
      than sound recordings, live concerts, or other music-related
      events.
        (7) An "interactive service" is one that enables a member of
      the public to receive a transmission of a program specially
      created for the recipient, or on request, a transmission of a
      particular sound recording, whether or not as part of a program,
      which is selected by or on behalf of the recipient. The ability
      of individuals to request that particular sound recordings be
      performed for reception by the public at large, or in the case of
      a subscription service, by all subscribers of the service, does
      not make a service interactive, if the programming on each
      channel of the service does not substantially consist of sound
      recordings that are performed within 1 hour of the request or at
      a time designated by either the transmitting entity or the
      individual making such request. If an entity offers both
      interactive and noninteractive services (either concurrently or
      at different times), the noninteractive component shall not be
      treated as part of an interactive service.
        (8) A "new subscription service" is a service that performs
      sound recordings by means of noninteractive subscription digital
      audio transmissions and that is not a preexisting subscription
      service or a preexisting satellite digital audio radio service.
        (9) A "nonsubscription" transmission is any transmission that
      is not a subscription transmission.
        (10) A "preexisting satellite digital audio radio service" is a
      subscription satellite digital audio radio service provided
      pursuant to a satellite digital audio radio service license
      issued by the Federal Communications Commission on or before July
      31, 1998, and any renewal of such license to the extent of the
      scope of the original license, and may include a limited number
      of sample channels representative of the subscription service
      that are made available on a nonsubscription basis in order to
      promote the subscription service.
        (11) A "preexisting subscription service" is a service that
      performs sound recordings by means of noninteractive audio-only
      subscription digital audio transmissions, which was in existence
      and was making such transmissions to the public for a fee on or
      before July 31, 1998, and may include a limited number of sample
      channels representative of the subscription service that are made
      available on a nonsubscription basis in order to promote the
      subscription service.
        (12) A "retransmission" is a further transmission of an initial
      transmission, and includes any further retransmission of the same
      transmission. Except as provided in this section, a transmission
      qualifies as a "retransmission" only if it is simultaneous with
      the initial transmission. Nothing in this definition shall be
      construed to exempt a transmission that fails to satisfy a
      separate element required to qualify for an exemption under
      section 114(d)(1).
        (13) The "sound recording performance complement" is the
      transmission during any 3-hour period, on a particular channel
      used by a transmitting entity, of no more than - 
          (A) 3 different selections of sound recordings from any one
        phonorecord lawfully distributed for public performance or sale
        in the United States, if no more than 2 such selections are
        transmitted consecutively; or
          (B) 4 different selections of sound recordings - 
            (i) by the same featured recording artist; or
            (ii) from any set or compilation of phonorecords lawfully
          distributed together as a unit for public performance or sale
          in the United States,

        if no more than three such selections are transmitted
        consecutively:

      Provided, That the transmission of selections in excess of the
      numerical limits provided for in clauses (A) and (B) from
      multiple phonorecords shall nonetheless qualify as a sound
      recording performance complement if the programming of the
      multiple phonorecords was not willfully intended to avoid the
      numerical limitations prescribed in such clauses.
        (14) A "subscription" transmission is a transmission that is
      controlled and limited to particular recipients, and for which
      consideration is required to be paid or otherwise given by or on
      behalf of the recipient to receive the transmission or a package
      of transmissions including the transmission.
        (15) A "transmission" is either an initial transmission or a
      retransmission.