Tony Greenman, attorney at law
In two precedential decisions Israeli collective copyright administration corporations were declared to be restrictive arrangements, which are illegal, unless approved by the Israel Antitrust Tribunal. These rulings come as a blow to Israeli Copyright Societies, which up until now have been free from specific regulation of their activities, but are welcomed by users, who have long complained of monopolistic and arbitrary practices of some of the societies, particularly ACUM, the Association of Composers, Authors and Music Publishers. They also, and somewhat surprisingly, were rendered at a time when Israels Parliament, the Keneset is considering a bill to set up a Copyright Tribunal, which would have jurisdiction over disputes between the societies and users, and between the societies and their members.
The first decision, rendered by Antitrust Commissioner Dror Strum and announced April 2004, involves ACUM, the largest and oldest collecting society in . Acums members assign their copyrights exclusively to the society, which also administers rights on behalf of 107 affiliated societies through mutual exclusive representation agreements. Therefore, the organization owns, in its own words "the largest database of works in , which contains almost every work ever published (a claim which should have been limited to musical works).
The second decision, given by the
and announced May 2004, deals with the formation and operation of the Israeli Federation of Record Labels and the Federation of Israeli and Mediterranean Music. The corporations collectively administer the copyrights of member record labels and producers and are the sole source for licensing the public performance of their works.
In both cases it was held that the collective administration is a restrictive arrangement that may substantially harm competition. In the case of Acum, Strum also declared that Acum is a monoply, thus opening the way for further scruitiny of the way in which it exercises its powers to set royalty rates.
In the case of the Israeli Federation, after reviewing the advantages that the collective administration method holds for copyright owners, including the reduction of transaction costs and more efficient copyright enforcement, the court granted a permit for the continued operation of the arrangements under certain restrictions.
ACUM, which has not yet filed an application to approve its arrangements, .announced that it would appeal the decision. However until the time of writing, no appeal has been filed, and an application to suspend the operation of the Commissioners ruling was denied by the Antitrust Tribunal.
Case No. 3574/00 The Federation for Israeli and Mediterranean Music v. The Antitrust Commissioner