Hotels to pay royalties on music

The operators of hotels, guesthouses and bed & breakfasts will have to pay royalties for any copyright music played in guest bedrooms following an agreement reached with the State at the High Court today.

Under the agreement, the music charges will be set by Phonographic Performance Ireland Ltd (PPI), which collects royalties for recording artists, and then paid on to the artists involved.

When it initiated its case in 2010, the PPI said it was seeking payment of about €1 per bedroom per week or about 14 cent a night. It estimates about 100,000 hotel, guesthouse and B&B bedrooms exist nationwide and it is losing more than €2.6 million annually.

Today, the PPI settled its action brought over the State's failure to amend laws which exempted hotels having to pay copyright fees for music played in such bedrooms.

The case raised preliminary issues which were referred to the European Court of Justice for determination and its decision last March effectively ruled there could be no such exemption. Among the issues the ECJ decided was that hotels were users of copyright music that can be played for the purposes of EU directive 2006/115/EC.

Today, when the proceedings returned before Ms Justice Mary Finlay Geoghegan, she was told by Michael McDowell SC for the PPI, the sides, on consent, wanted the court to make a declaration in relation to payment of the royalties.

The declaration is to the effect equitable remuneration must be collected as a single charge and divided between record companies and performers and the relevant provisions in the Copyright and Related Rights Act 2000 allowing for the exemption were contrary to the State's obligations under EU law.

The disputed provisions had stated there was no infringement of copyright where recorded music was heard "in part of the premises where sleeping accommodation is provided for the residents". Given that agreement, the rest of the action could be struck out and the PPI was not pursuing its claim for damages, the judge was also told.

Outside court, Dick Doyle,  chief executive of the PPI, said he was very pleased with the outcome and that the law was now clear. The situation now will involve the PPI setting the charge, hopefully by agreement with the Irish Hotels Federation and other bodies, but any dispute would be determined by the Controller of Patents, he said.