Russian radio stations intend to cut royalties for public performance

Russian radio academy (RAR) is industrial union. It represents interests of major Russian radio companies. Currently it considers to cut royalties for public performance payable to Russian authors’ society as accredited collecting society.

Radio stations want to change mechanism of collection and payment of royalties. The terms of protocols, regulating financial issues, with RAO expire this year. Usually RAR concludes special framework protocols with collecting societies prescribing principles of royalties calculation. Radio stations conclude with CMO separate agreements providing details how much licensee has to pay.

On the wave of scandals with Russian CMOs the radio stations want to take their chance. They have already discussed realisation of their idea in practice, but wait when the problem with CEO will be resolved. They simply don’t know who they should negotiate with. “RAO is organisation accredited by state. We can’t negotiate with any other organisation.” – believes one of the RAR member. “The question is postponed. It is not clear what actually is going on in RAO.” – said other member.

Licence owners have partners in regions; these partners require changing payment mechanism with RAO. Under current rules they are obliged to pay royalties from each licence. But very often regional companies have more than one licence; therefore they should pay for each licence. If they would pay from each owner of licence, it could help them to save moneys.

Stake holders from radio industry wait when current agreements expire. They already want to negotiate for new order with more favourable view to the future. It was separately mentioned that criminal proceeding in relation to Sergey Fedotov, current CEO of RAO, have nothing in common with their wish to cut royalties for public performance. It is intended to extend the term of current protocol with RAO but with certain changes – additions and amendments taking into account notes of regional partners.