Legislature(1995 - 1996)
04/03/1996 01:30 PM JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SB 263 COPYRIGHT ROYALTIES AND LICENSING SHERMAN ERNOUF, Senate Labor and Commerce Committee aide, explained SB 263 was introduced at the request of CHARR and has been a few years in the making. Senate Judiciary Committee staff has worked with CHARR to prepare the proposed committee substitute. SENATOR MILLER moved adoption of CSSB 263(JUD). SENATOR ADAMS objected to ask if the five proposed amendments were included in the committee substitute. CHAIRMAN TAYLOR clarified the amendments are not. SENATOR ADAMS removed his objection, therefore CSSB 263(JUD) was adopted. Number 349 CAROL WILSON, Executive Director of the Anchorage Restaurant and Beverage Association (ARBA) and the Cabaret, Hotel, Restaurant and Retailers Association (CHARR), testified in support of CSSB 263. Members of ARBA and CHARR are small business owners in the State of Alaska, who are not trying to escape paying something they are legally required to pay, but want identification of what they are charged for. Performing rights societies ask those businesses to pay for unidentified services. CSSB 263 provides all retailers, not just restaurants and bars, with certain rights under contracts entered into in this state. Although music licensing copyright law is federal law, this bill accomplishes a lot to help businesses. She read a letter of support from a business owner demonstrating the frustration business owners are experiencing when dealing with music licensing agencies. Thirteen other states have adopted similar legislation, 11 states have legislation pending, and two states have passed legislation and are awaiting governor's signatures. CHARR has attempted to work with other interested parties; one of the performing rights societies was represented in discussions on the proposed committee substitute. CHARR has agreed to support the proposed amendments. MS. WILSON explained the amendments. The first amendment decreases the length of time when notification is required from 7 days to 72 hours. The second amendment requires the performing rights societies to make available their most recent list of the people they represent and the list of the copyrighted musical works in their repertoire. That file can be made available electronically and would be made accessible through the CHARR office. Business owners want to be able to work with only one of the societies to save money. To remain legal, they need to know what songs are copyrighted by a particular society so that they play only those songs. Right now there is no way to get that information. SENATOR MILLER asked how a business that is not a CHARR member would access that information. MS. WILSON replied she has asked that the information be made available on computer disk, and she would be willing to make it available to other businesses. SENATOR MILLER expressed concern that the legislation apply to businesses statewide, and questioned how other businesses would know to contact CHARR for that information. MS. WILSON stated she would not be opposed to having the information available through a state agency. MS. WILSON explained the third amendment deletes a section that pertains to notice after a violation. This deletion was requested by the performing rights societies because they believe the section would hamper their attempts to investigate. The fourth amendment deals with people who are reproducing sound recordings without consent, and specifies that it does not apply to investigations by a law enforcement agency or other persons concerning a suspected violation. MS. WILSON noted the fifth amendment was added by Legal Services. Originally a violation was called an unfair trade practice, but because prohibited practices and a course of action are included in the bill, the unfair trade practice violation was removed. CHAIRMAN TAYLOR moved all five amendments as one amendment. There being no objection, the motion carried. MAURICE MCDONALD, a restaurant owner from Anchorage, stated he has followed this issue in Washington, D.C. and has attended several task force meetings on this issue. SB 263 is important to not only the restaurant industry, but to all of the small shops where background music is played. The businesses do not have a problem paying the fee to play the music, but as electronics have become more popular, BMI and AMCAP have found more ways to double and triple charge for their music. There seems to be no way to slow them down. Business owners are demanding they be provided with a list of the products they are purchasing. When representatives of the music copyright industry arrive at a restaurant they will have to identify who they are and why they are there before looking through a restaurant's music and video inventory. Business owners are currently negotiating in Washington, D.C. to get a compromise agreement with the performing rights societies. This bill will help businesses to know who, what, and why they are paying the charges. Currently, there is no consistency in charges, because the performing rights societies arbitrarily make deals with different businesses. Number 504 SENATOR GREEN questioned whether the bill before the committee adequately covers the concern of business owners that representatives of the performing rights societies can just walk into a business and demand to look at its inventory. MR. MCDONALD believed it does because AMCAP and BMI would be on notice that when doing business in Alaska, they will have certain responsibilities. CHAIRMAN TAYLOR commented at one time crew members brought videos on the ferry system to show to passengers, at no charge, but the practice was disallowed because it was considered a commercial service by the performing rights societies. He asked if that situation is being remedied in this bill. MR. MCDONALD responded that is under the jurisdiction of federal law and is considered incidental use of music and video. Congress must address those situations, but SB 263 will endorse the need for reform of the federal legislation. Number 513 SENATOR GREEN moved CSSB 263 as amended from committee with individual recommendations. There being no objection, the motion carried.