Distribution of income from background maintenance
More than 100,000 businesses in Switzerland use music, TV and films for background entertainment. For this use, the businesses pay the authors, publishers, performers or producers a remuneration in accordance with the Common Tariff 3a. How and to whom is this income distributed?
The right background music in a store, hairdressing salon or restaurant makes an important contribution to making customers and guests feel comfortable, just like the lighting or decoration. And in a pub, the live broadcast of a football or cricket match is just as much a part of the interior as the dark furniture, the wooden signs and the dart board.
Just as the manufacturers of furniture, decorations or lighting must be paid, composers, lyricists, performers, screenwriters or producers are entitled by law to receive remuneration for the use of their works and performances outside the private sphere. The five Swiss collecting societies Pro Litteris, SSA, SUISA, Suissimage and Swissperform are responsible for this. On their behalf, SUISA collects the remuneration for the use of music, films and TV broadcasts in accordance with the Common Tariff 3a (GT 3a).
What does SUISA do with the income from background entertainment?
In a first step, the money collected is distributed among the five Swiss collecting societies according to a fixed distribution formula. SUISA's share for the remuneration of music content amounts to slightly more than half of the income. In a second step, each society is responsible for paying out this income to the authors, artists, publishers and producers.
In the case of SUISA, 88% of the aforementioned fifty percent is distributed to the rights holders in this second step. This means that for every CHF 100 collected, CHF 88 can be distributed to the artists and their publishers.
How and to whom is the income distributed? In principle, SUISA has three different distribution options: direct distribution, lump-sum distribution with program documentation and lump-sum distribution without program documentation. Program documents are lists of works that have been performed or broadcast.
With GT 3a, the money is distributed almost exclusively as a lump sum without program documents. For both the clients and SUISA, the submission or processing of work lists would entail an enormous effort that would be disproportionate to the benefit. Instead, SUISA uses existing program documents from various sources to distribute the income from GT 3a. In doing so, SUISA ensures that lists or uses are used for this distribution which allow for the fairest possible distribution.
Fairest possible distribution even without a list of listed works
Based on experience, for example, it is assumed that a large proportion of companies, stores, restaurants, etc. use works that are also broadcast on radio or television. It is assumed that a large proportion of companies, shops, restaurants etc. use works that are also broadcast on radio or television. Accordingly, a large part of the income from GT 3a is distributed on the basis of the program documents for the use of music, TV programmes and films from radio and TV broadcasts. However, SUISA also takes into account the fact that not only pop, rock or urban music is played, but also other genres such as folk music or even church music. Therefore, part of the income is also distributed on the basis of program lists for church performances, brass bands or yodel clubs.
In order to distribute the money to the artists, it is thus allocated to other, similar distribution classes of the performing and broadcasting rights (see distribution regulations item 5.5.2). Therefore, if a member receives a settlement in one of these distribution classes, he/she shall also receive a share of the income for background entertainment from GT 3a.
In some exceptional cases, direct distribution is used for the distribution of income from background entertainment. These are, for example, music that is used in a museum for an exhibition or music that is used for a longer period of time by a company in the telephone queue. In these cases, it is usually commissioned music.
SUISA distributes the royalties four times a year. In 2018, a total of over CHF 132 million was distributed to composers, lyricists and publishers of music.
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