Neighboring Rights
Rights that protect performers and record producers, separate from the copyright in the composition.
What it means
Neighboring rights (also called related rights) are a category of intellectual property rights that protect the interests of performers and producers of sound recordings, separate from the rights of the songwriter or composer. While copyright protects the musical composition, neighboring rights protect the people who bring that composition to life through their performance and the technical/financial investment of producing the recording. In many countries, neighboring rights generate royalties when sound recordings are broadcast on radio, played in public spaces, or used in certain types of streaming. The key distinction is that neighboring rights apply to the sound recording and the performance captured in it, not the underlying composition. In the United States, neighboring rights are more limited than in many other countries due to the lack of a terrestrial performance right for sound recordings (US radio stations do not pay recording artists for playing their music over AM/FM). However, SoundExchange collects digital performance royalties for non-interactive digital transmissions (internet radio, satellite radio, cable music channels) in the US. Internationally, neighboring rights are a significant revenue source collected by organizations like PPL (UK), GVL (Germany), and SENA (Netherlands). For ambient music producers whose music is frequently played on internet radio stations, in-flight entertainment systems, and background music services across the globe, uncollected neighboring rights can represent substantial missed revenue.
Technical details
Neighboring rights are established by international treaties including the Rome Convention (1961), the WIPO Performances and Phonograms Treaty (WPPT, 1996), and the Beijing Treaty on Audiovisual Performances (2012). In countries that recognize these rights, both the featured performer and the owner of the master recording are entitled to equitable remuneration when their recordings are publicly performed or broadcast. The payment is typically split 50/50 between the performer and the producer/label. Collection is handled by national neighboring rights organizations (PPL, GVL, SENA, GRAMEX, etc.). In the US, 17 U.S.C. § 114 establishes a limited digital performance right for sound recordings, administered by SoundExchange. The distribution split for SoundExchange payments is 45% to the featured artist, 50% to the rights owner (label), and 5% to a fund for non-featured musicians and vocalists.
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