MMF calls for PRS 'clarification' on admin rates hike

MMF calls for PRS 'clarification' on admin rates hike

PRS For Music reported record revenues this week as they issued their 2018 results.

But some in the industry are less impressed by the revised administration fees that the collection society has announced. The MMF has suggested that the problem of over-payments at PRS is partly to blame for the hike.

“PRS for Music’s announcement of a sudden and dramatic increase in administration rates, in some cases doubling and quadrupling the fees on overseas income collected for songwriters, could not have come at a more pertinent moment,” said the MMF in a statement.

“Apparently implemented to compensate for historic failures within PRS’ own distribution systems and pensions commitments, it will result in yet another levy on creators’ earnings - and at the very moment when, thanks to the monumental demand for audio streaming, their royalties should be increasing. New and upcoming writers will be penalised for the past business mistakes of others.”

From the December 2019 distribution, PRS will phase in increases of half a percentage point to administration rates for broadcast royalties. For example, ITV will go up to 14.5% from July 2020.

For public performance, three percentage points have been added to the rates, so the admin rates for tariffs on pop and classical concerts (up to a maximum deduction of £1,250), commercial disco and clubs, general live (non-concert) and public reception will be 23%. Major live concerts will be unchanged.

From the October 2019 distribution, PRS will be increasing the rates charged to process money collected from sister societies overseas. For the US, admin fees for collections from ASCAP, BMI and SESAC will double to 2%. For SOCAN in Canada, the admin fee is going from 3% to 8%, while the rate for STIM in Sweden is quadrupling to 8%.

MMF is calling for “greater clarification” about the announcement.

“In direct contrast to the artists who perform on recordings, who are increasingly compensated in a transparent and time-efficient fashion, those who write the songs frequently find their royalties shuttled through a network of overseas collecting societies and publishers,” said the MMF. “Such inefficiencies result in less and less money finding its way to songwriters’ pockets.”

The Featured Artists Coalition also referred to PRS’ overpayment “blunder” as it voiced concerns over the rise in fees. 

“With every link in this over-complicated chain charging for commissions and admin, the amounts actually received by writers, publishers and writer-artists members are reduced,” said the FAC statement. “Increasing those charges puts pressure on the whole chain and always affects the writers who earned the money from the uses of their works in the first place.” 

“We work on continually improving our systems each year so we can keep these as low as possible and we are one of the most cost-effective collecting society in Europe,” said PRS For Music in its email to members from Claire Jarvis, director of membership.

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