Regulatory Affairs

The regulatory affairs role of the CMO can be divided into the following components:

4.12.1 CMO Oversight

65. It would be important to maintain good relations with the oversight ministry responsible for ensuring compliance with the terms and conditions of the CMO’s operating license (where this exists). The CMO’s oversight role must also ensure that the CMO’s operating license is renewed in a timely manner and that all terms and conditions relating to the renewal are strictly adhered to. The oversight role may be given to a business affairs manager, chief operating officer (COO), legal manager or company secretary. The responsible person must also ensure the timely filing or submission of any compliance reports required by the oversight ministry/regulator. It may also be important to constantly engage with the oversight ministry or regulator with regard to the interpretation and practical implementation of any regulations relating to the operations of the CMO, so as to attain a similar understanding of the regulations. The CMO could also make a case for exemption from some of the regulatory requirements until certain thresholds have been achieved (e.g. exemption from requirements relating to the level of administration costs permissible until such time as the CMO has reached

‘break even’ levels). The department/section responsible for regulatory affairs at the CMO must be available to provide constant advice and assistance to other CMO staff with regard to the CMO’s relations with the regulator. The CMO’s legal department/section should be able to provide assistance/advice with regard to matters relating to licensing scheme disputes and the referral of matters to the copyright tribunal/rate court/arbitration courts.

216 It has been said that a clear message must contain a (i) statement of the issue, (ii) evidence, (iii) an example and (iv) an invitation to action. See in this regard http://

www.making-prsp-inclusive.org/en/8-advocacy-and-lobbying-influencing-policies/82-basic-techniques/822-convincing-and-strategic-communication.html (Accessed on 18 March 2015).

217 See ibid.

4.12.2 Compliance with Laws, Policies and Regulations

66. Regulatory affairs are not only limited to matters directly relating to the administration of copyright but extend to other areas such as compliance with various laws affecting the CMO as a corporate entity. This may include:

(i) Requirements relating to corporate (or other organizational) law, such as the need to file annual returns, annual financial statements etc.;

(ii) Requirements relating to labor/employment law, including the involvement of the legal department/section in providing support to the HR department/section regarding various corporate policies and procedures, issues relating to disciplinary procedures for employees, trade union relations and recognition agreements and the like;

(iii) Requirements relating to tax laws – supporting finance department/

section in the interpretation and application of various aspects of national taxation law (VAT, income tax, withholding taxes, PAYE etc.) as well as any regional tax matters (see the discussion on taxation above under the section on CMO financial management);

(iv) Requirements relating to property and lease law. The CMO may be renting property or having property of its own that it leases out. The relevant department should be able to advise CMO management on issues arising from this; and

(v) Requirements relating to national/federal, provincial/state or municipal/

local regulations and by-laws, especially where the CMO’s operations are decentralized with offices in various parts of the country.

67. The responsibility for such broader compliance issues may lie with the company secretary, compliance officer or the legal manager (or a combination of these roles or either of the roles with the support of the other). This compliance role extends to ensuring compliance with the CMO’s own constitutional documents, rules, policies and procedures, and includes providing advisory support to the board on various matters relating to its governance of the CMO, rights and duties of board members, adherence to the board charter and/or code of conduct etc.

4.12.3 General Government and Relations

68. The department/section designated with dealing with regulatory affairs may also have been assigned responsibility for formal relations with government departments or agencies whose actions or decisions have an impact on the

CMO’s operations and is administration of rights. These departments and agencies include the following government departments/ministries:

(i) Department of Trade and Industry/Economic Affairs. In several jurisdictions, this is the department responsible for trade laws and policies (including intellectual property laws) and is thus in many cases the most-important department that CMOs have to relate to. In the case of regulated CMOs, this would most probably be the department that provides the supervisory role to the CMOs (either through the office of the registrar of copyright or another unit of the department designated for this purposes);

(ii) Departments of Justice, Police, Customs and Excise. These departments are important in that they provide the necessary enforcement

mechanism with regard to copyright protection. They administer the court system, the policing function, customs unit etc. and are instrumental in dealing with matters relating to the combat of piracy and the prevention of illegal importation of copyright works etc. In some jurisdictions (e.g. Germany) the Department of Justice also acts as an oversight department in respect of CMOs;

(iii) Department of Arts and Culture. In many jurisdictions the Department of Arts and Culture acts as the national custodian of the interests of national creators and publishers, directors, script writers, filmmakers and other artists. It provides an enabling environment for the promotion and development of arts industries by providing funding, support for arts initiatives, provision of archival and research services and working with the ministry responsible for intellectual property laws to ensure that the interests of arts professionals are taken into account. In certain jurisdictions such as France the Ministry of Culture is responsible for matters relating to the administration of copyright and the approval of CMOs;

(iv) Department of Broadcasting and/or Communications. This is an important department because it regulates matters relating to the licensing of broadcasters, cable operators, telecommunication

companies, ISPs/DSPs etc. It is also often responsible for the regulation of local content quotas with respect to the usage of copyright works such as music and audio-visual works. It is important that the CMO maintains a good relationship with this department as the department may be of assistance to the CMO when the CMO experiences difficulties in its endeavors to license certain broadcasters, telecommunication companies etc. Under such circumstances the department might, for example, be persuaded to include as a condition for the renewal of a broadcast license, proof that the broadcaster, ISP/DSP etc. concerned has a valid music/audio-visual license from the CMO;

(v) Department of Tourism. In countries where tourism is a significant contributor to GDP and employment, forging good relations with this department and supporting the department in its efforts to develop and protect the tourism industry would be important. This is because a successful tourism industry can immensely benefit rights holders whose musical works/audio-visual works are used in the accommodation and hospitality industry and other musical tourism initiatives.

4.12.4 Other Agencies of State

69. The CMO needs to also maintain good relations with other relevant agencies of state, including the broadcasting communications commission/regulator;

the copyright board, the competitions authority, the price controller, the law commission etc.