Why does ASCAP require you to re-register copyright to a vanity publshing company?

[Bob Olhsson]

That is why people incorporate and not why you need to create a publishing company to collect royalties using a PRO.

PROs are structured to handle all sizes of publishers. I'm not sure where you get this vanity idea. You don't need to use a PRO but good luck trying to collect performance royalties. They have been using this structure worldwide for a century and really have no reason to persuade every PRO in every country to change.

[TOM@METRO]

Great thread, good info. Thanks.

[mightyduck]

Originally Posted by Bob Olhsson

That is why people incorporate and not why you need to create a publishing company to collect royalties using a PRO.

PROs are structured to handle all sizes of publishers. I'm not sure where you get this vanity idea. You don't need to use a PRO but good luck trying to collect performance royalties. They have been using this structure worldwide for a century and really have no reason to persuade every PRO in every country to change.

O.K., Bob, it would be helpful if you would quote who / what you are responding to. You seem to be responding to two different individual's posts there as if they were the same person.

And this thread is getting more into the weeds with all the interesting historical factoids. Good stories, nevertheless, and I enjoy hearing about the stuff.

No one is arguing against the idea that PROs are useful, or even necessary, to collect performance royalties. And no one has made any argument in favor of persuading "every PRO in every country to change". That said, I think its common knowledge that ASCAP and BMI are widely criticized by their members. But I am not here with a thread about how crappy PROs are. I was just trying to get feedback on a specific question [see original post]. So far, the only person, aside from myself, attempting to stay on topic and try to answer the question has been @John_Toolbox.

As far as the structure of PROs, they have actually not been using the same structure wordwide for a century. ASCAP and BMI, for example, are very different in significant ways, including, specifically, the requirement for a writer to join as a publisher, or to affiliate with one, in order to receive the publisher half of performance royalties. BMI does not require that, whereas ASCAP does.

In at least some other countries, the PRO is actually responsible for collection of all kinds of different royalties, not just performance royalties. And that seems to many to be a smart and efficient way to go.

With regard to the phrase "vanity publishing company", they are called that because they are often not what an actual large publishing company [say Warner-
Chappell or the like] is. They do not take on a bunch of artists and work their catalogs and advance money for recording or demos or the like. They are just little entities that songwriters establish so that they can have a means to collect the publishing half of the performance money. Hence the term "vanity publishing company". Its not really a pejorative. Its just descriptive.

Anyhow, I am also getting some answers in a different forum on this topic, and I can share what information comes of that as it goes forward.

I think I will also start another thread where people can comment on the PROs generally.


Best always,

mightyduck

[mightyduck]

Originally Posted by TOM@METRO

Great thread, good info. Thanks.

No problem, Tom.

Lots to think about, huh?


Best always,

mightyduck

[mightyduck]

Originally Posted by John_Toolbox

I am not a lawyer, and this should not be considered legal advice... but as I understand it the idea of assigning your IP to the publishing company vs. yourself is to protect you personally from legal trouble if it arises. My understanding is if someone sues over a copyright dispute; your house, car and other personal assets are not at risk in the event that you get a judgement related to the copyrights since the IP is owned by the company instead of you. Definitely something a music business lawyer could answer better than me.

Yes, John, I notice that the blurb on the BMI site about the transfer of rights to the publishing company does indeed use the phrase "for an added layer of protection", or something to that effect.


Best always,

mightyduck

[Bob Olhsson]

I guess what I am trying to say is that the reason why ASCAP has that requirement is historical. Because they are an organization controlled 50/50 by member writers and member publishers, they have always had that structure. BMI is a non-profit business that was created (and is still operated) by the broadcast industry because ASCAP called a strike against them in an effort to negotiate higher royalties. ASCAP had limitations placed on them resulting from an anti-trust lawsuit from the broadcast industry. BMI has some of the same limitations resulting from ASCAP's counter-suits. Most countries have a single PRO like ASCAP originally was along with higher royalties that may or may not be a result of a single PRO's stronger negotiating position.

[Bob Olhsson]

The protection being referred to in that article is simply copyright registration.

[mightyduck]

Originally Posted by Bob Olhsson

The protection being referred to in that article is simply copyright registration.

No, I don't believe that's what is being referred to. The works are already "protected" in that regard by the writer's pre-existing copyright registration.

One analysis says that such a transfer of rights gives the publishing entity the legal authority to grant rights and so forth [to act as a publisher].


Best,

mightyduck

[mightyduck]

Originally Posted by Bob Olhsson

I guess what I am trying to say is that the reason why ASCAP has that requirement is historical. Because they are an organization controlled 50/50 by member writers and member publishers, they have always had that structure. BMI is a non-profit business that was created (and is still operated) by the broadcast industry because ASCAP called a strike against them in an effort to negotiate higher royalties. ASCAP had limitations placed on them resulting from an anti-trust lawsuit from the broadcast industry. BMI has some of the same limitations resulting from ASCAP's counter-suits. Most countries have a single PRO like ASCAP originally was along with higher royalties that may or may not be a result of a single PRO's stronger negotiating position.

That's interesting and useful info. We are still not getting to the question in the original post, though.

By "that requirement" I take it that you mean ASCAP's requirement for a publishing company to be in place in order for publishing portion of the performance royalties to be disbursed. That being in contrast to BMI, where they will just disburse them to the songwriter if he or she is not associated with any publishing entity.

But the requirement I was asking about is the one for the songwriter who is not affiliated with a "real" publisher [for want of a better word] to not only establish a self / vanity publishing company but also to transfer all of his preexisting copyrights to that self / vanity publishing company. I still do not see exactly where they are going with that and something about it strikes me as odd or improper. I realize that transferring rights from oneself to oneself's solely-owned company has the effect of retaining control of the rights, but it is still a little mysterious and odd because it may tend to technically leave the writer without any legal writer's claim to performance royalties. Or, as a follow-up question, do the PROs just disburse in accordance with whatever split is specified when the song is registered, without regard to actual copyright ownership?

Anyhow, lets just understand the question and then see if an answer somehow presents itself.



Best always,


mightyduck

[Bob Olhsson]

Are you certain that BMI pays both shares to writers who don't have or own a publishing company affiliation? That's something new from what I've always understood but I haven't looked into it for quite a while.