Kenya: Copyright Board cancels registration of 3 royalty collection groups
The Kenya Copyright Board (Kecobo) deregistered three collective music management organizations (CMOs) over a dispute over the distribution of 114 million shillings to artists and breach of license conditions.
The CMOs are the Kenya Music Producers Association (Kamp), the Kenya Performers’ Rights Society (Prisk) and the Kenya Music Copyright Society (MCSK).
“The collection of royalties by these organizations is suspended until further notice,” said Kecobo Executive Director Edward Sigei.
The move came after Kecobo released CMOs’ justification letters for failing to meet administrative cost limits and diverting royalties to an undeclared bank account whose operations are not monitored by Kecobo.
KECOBO Cracks Whisk:
The Kenya Copyright Board struck off KAMP, MCSK and PRISK; says he has opened an investigation into what he qualifies as misappropriation of royalties collected by collective management organizations. # NTVAtOne @OBurrows pic.twitter.com/wsbnJPkS0q
– NTV Kenya (@ntvkenya) August 24, 2021
Mr Sigei explained that the three CMOs also failed to meet the conditions stipulated in the interim licenses set by Kecobo administrators in April of this year.
The provisional licenses were to remain valid until May 30, subject to conditions such as holding an annual general meeting and earmarking 70% of the income towards the payment of royalties.
CMOs were also required to engage the Kenya Revenue Authority to come up with a payment plan on the back taxes.
Another condition required CMOs to prove the marketing and promotion of the use of an ICT collection system, upload their directories to the system under the supervision of Kecobo and implement the CMO policy in its entirety. .
In issuing the conditions, Kecobo noted that several conditions for the 2020 license term had not been met.
Kecobo set the conditions on the understanding that rights holders (artists) would rely on royalties collected by CMOs during the pandemic period.
But in a meeting on Aug. 11, Kecobo noted that in the recent distribution of royalties, CMOs would have paid 41 million shillings (35.9%) instead of 79 million shillings (70%) out of 114. million shillings collected at the end of July 2021..
Mr. Sigei said the distribution formula used by CMOs defied Kecobo’s license terms.
“According to distribution reports from two entities received so far, PRISK has allocated an additional 4 million shillings while KAMP has allocated 1.2 million shillings out of their allocation of 10 million shillings and 8 million shillings, respectively, to cover administrative costs, ”he said.
“It should be noted that the distribution excludes money received and spent in other accounts in the Kecobo monitoring system.”
Kecobo also received several submissions from rightsholder organizations in response to a public notice posted by Kecobo in print and on social media platforms.
The Board of Directors, unhappy with the CMO’s explanations in response to the justification letters, invoked its powers, as enshrined in Sections 46 (9) to 46 (12) of the Copyright Act , to deregister organizations.
As the CMO’s licenses were revoked, royalty collection was suspended for three months or until further notice.
“The main issues reported by the Board include opening an account other than the KPM account authorized by Kecobo, having spent over 65% of finances on administration fees contrary to guidelines and not fulfilling their role. to engage the public and raise awareness about the KPM system, ”noted Kecobo President Mutuma Mathiu.
Kecobo, together with relevant ministries, will begin seeking advice on reforming the legal structure of the CMO to prevent embezzlement by CMOs.
Mr Sigei said he hoped this process would be completed in three months.