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90 STAT. 2554

PUBLIC LAW 94-553—OCT. 19, 1976

any; and

(ii) 0.675 of 1 per centum of such gross receipts for the first distant signal equivalent;

(1) 0.425 of i per centum of such gross receipts for each of the second, third, and fourth distant signal equivalents;

(iv) 0.2 of 1 per centum of such gross receipts for tho fifth distant signal equivalent and each additional

distant signal equivalent thereafter; and in computing the amounts payable under paragraph (ü) through (iv), above, any fraction of a distant signal equiralent shall be computed at its fractional value and, in the case of any cable system located partly within and partly without the local service area of a primary transmitter, gross receipts shall be limited to those gross receipts derived from subscribers located without the local service area of such primary transmitter; and

(C) if the actual gross receipts paid by subscribers to a cable system for the period covered by the statement for the basic service of providing secondary transmissions of primary broadcast transmitters total $80,000 or less, gross receipts of the cable system for the purpose of this subcHnuse shall be computed by subtracting from such actual gross receipts the amount by which $80,000 exceeds such actual gross receipts, except that in no case shall a cable system's gross receipts be reduced to less than $3,000. The royalty fee payable under this subclause shall be 0.5 of 1 per centuin, regardless of the number of distant signal cquivalents, if

(Þ) if the actual gross receipts paid by subscribers to a cable system for the period covered by the statement, for the basic service of providing secondary transinissions of primary broadcast transmitters, are more than $80,000 but less than $160,000, the royalty fee payable under this subclause shall be (i) 0.5 of 1 per centum of any gross receipts up to $80,000; and (ii) 1 per centum of any gross receipts in excess of $80,000 but less than $160,000, regardless of the number of distant signal equivalents, if any. (3) The Register of Copyrights shall receive all fees deposited under this section and, after deducting the reasonable costs incurred by the Copyright Offee under this section, shall deposit the balance in the Treasury of the United States, in such manner as the Secretary of the Treasury directs. All funds held by the Secretary of the Treasury shall be invested in interest-bearing United States securities for later distribution with interest by the Copyright Royalty Tribuna) as provided by this title. The Reg jater shall subiitto the Copyright Rayalog Tribunat, oma sem Araual basis, rompilation of stt statements of recount covering the relorant six month period provided by slette of this sub soction.

(4) The royalty fees thus deposited shall, in accordance with the procedures provided by clause (5), be distributed to those among the following copyright owners who claim that their works were the subject of secondary transmissions by cable systems during the relevant semiannual period :

(A) any such owner whose work was included in a secondary transmission made by a cable system of a nonnetwork television program in whole or in part beyond the local service area of the primary transmitter; and

Licensing Division

Licensing Division

Sutements of account, submitual to Copyright Royalty Tribunal. Royalty fees, distribution.

PUBLIC LAW 94–553_OCT. 19, 1976

90 STAT. 2555

(B) any such owner whose work was included in a secondary transmission identified in a special statement of account deposited under clause (2)(A); and

(C) any such owner whose work was included in nonnetwork programing consisting exclusively of aural signals carried by a cable system in whole or in part beyond the local service area of the primary transmitter of such

programs. (5) The royalty fees thus deposited shall be distributed in Distribution accordance with the following procedures:

procedures. (A) During the month of July in each year, every person claiming to be entitled to compulsory license fees for secondary transmissions shall file a claim with the Copyright Royalty Tribunal, in accordance with requirements that the Tribunal shall prescribe by regulation. Notwithstanding any provisions of the antitrust laws, for purposes of this clause any claimants may agree among themselves as to the proportionate division of compulsory licensing fees among them, may lump their claims together and file them jointly or as a single claim, or may designate a common agent to receive payment on their behalf. (B)

After the first day of August of each year, the Copyright Royalty Tribunal shall determine whether there exists a controversy concerning the distribution of royalty fees. If the Tribunal determines that no such controversy exists, it shall, after deducting its reasonable administrative costs under this section, distribute such fees to the copyright owners entitled, or to their designated agents. If the Tribunal finds the existence of a controversy, it shall, pursuant to chapter 8 of this title, conduct a proceeding to determine the distribution of royalty fees.

(C) During the pendency of any proceeding under this subsection, the Copyright Royalty Tribunal shall withhold froin distribution an amount sufficient to satisfy all clainis with respect to which a controversy exists, but shall havo discretion to proceed to distribute any amounts that are not

in controversy. (e) NoNSOLTANEOUS SECONDARY TRANSMISSIONS BY CABLE SYS

(1) Notwithstanding those provisions of the second paragraph of subsection (f) relating to nonsimultaneous secondary transmissions by a cable systein, any such transmissions are nctionablo as an act of infringement under section 501, and are fully subject. to the remedies provided by sections 502 through 506 and sections 509 and 510, unless

(A) the program on the videotape is transmitted no more than one time to the cable system's subscribers; and

(B) the copyrighted program, episode, or motion picture videotape, including the commercials contained within such prograin, episode, or picture, is transmitted without deletion or cditing; and

(C) an owner or officer of the cable system (i) prevents the duplication of the videotape while in the possession of the system, (ii) prevents unauthorized duplication while in the possession of the facility making the videotape for the system if the system owns or controls the facility, or takes reasonable precautions to prevent such duplication if it does

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PUBLIC LAW 94–553_OCT. 19..1976

90 STAT. 2561

copyrighted material any performance rights in such material. The :
report should describe the status of such rights in foreign countries,
the views of major interested parties, and specific legislative or other
reconimendations, if any.
$ 115. Scope of exclusive rights in nondramatic musical works: 17 USC TIS.

Compulsory license for making and distributing phono

records
In the case of nondramatic musical works, the exclusive rights pro-
vided by clauses (1) and (3) of section 106, to make and to distributo
phonorecords of such works, are subject to compulsory licensing under
the conditions specified by this section.
(a) AVAILABILITY AND Scope oF COMPULSORY LICENSE.-

(1) When phonorecords of a nondramatic musical work have
been distributed to the public in the United States under the
authority of the copyright owner, any other person may, by com-
plying with the provisions of this section, obtain a compulsory
license to inake and distribute phonorecords of the work. Á
person may obtain a coinpulsory license only if his or her pri-
mary purpose in making phonorecords is to distribute them to
the public for private use. A person may not obtain a compulsory
license for use of the work in the making of phonorecords dupli-
cating a sound recording fixed by another, unless: (i) such sound
recording was fixed lawfully; and (ii) the making of the phono-
records was authorized by the owner of copyright in the sound
recording or, if the sound recording iras fixed before February 15,
1972, by any person who fixed the sound recording pursuant
to an express license from the owner of the copyright in the
musical work or pursuant to a valid compulsory license for use
of such work in a sound recording.

(2) A compulsory license includes the privilege of making a
musical arrangement of the work to the extent necessary to con-
form it to the style or manner of interpretation of the perform-
ance involved, but the arrangement shall not change the basic
melody or fundamental character of the work, and shall not be
subject to protection as a derivative work mder this title, except

with the express consent of the copyright owner.
(b) Notice OF INTENTION TO OBTAIN COMPULSORY LICENSE.-

(1) Any person who wishes to obtain a compulsory license
under this section shall, before or within thirty days after mak-
ing, and before distributing any phonorecorıls of the work, serve
notice of intention to do so on the copyright owner. If the regis-
tration or other public records of the Copyright Office do not

Division identify the copyright owner and include an address at which

Licensing copyright
notice can be served, it shall be sufficient to file the notice of inten- of the
tion in the Copyright Dina The notice shall coinply, in form, Roya Ay
content, and manner of service, with requirements that the Region
der of the peritate shall prescribe by regulation.

(2) Failure to serve or file the notice required by clause (1) Failure to serve
forecloses the possibility of a compulsory license and, in the or file notice,
absence of a negotiated license, renders the making and distribu- pedalty.
tion of phonorecords actionable as acts of infringement under
section 501 and fully subject to the remedies provided by sections

502 through 506 and 509.
(c) ROYALTY PAYABLE UNDER COMPULSORY LICENSL-

(1) To be entitled to receive royalties under a compulsory
license, the copyright owner must be identified in the registration
or other public records of the Copyright Office. The owner is
entitled to royalties for phonorecords made and distributed after

Copyright Royalty

Tribunal

90 STAT. 2562

PUBLIC LAW 94–553—OCT. 19, 1976

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Tribunal

being so identified, but is not entitled to recover for any phonorecords previously made and distributed.

(2) Except as provided by clause (1), the royalty under a compulsory license shall be payable for every phonorecord made and distributed in accordance with the license. For this purpose, a phonorecord is considered "distributed” if the person exercising the compulsory license has voluntarily and permanently parted with its possession. With respect to each work embodied in the phonorecord, the royalty shall be either two and three-fourths cents, or one-half of one cent per minute of playing time or fraction thereof, whichever amount is larger.

(3) Royally payments shall be made on or before the twentieth day of each month and shall include all royalties for the month next preceding: Each monthly payment shall be made under oath and shall comply with requirements that the Hegister fopy with the shall prescribe by regulation. The Begroter shall also prescribe regulations under which delalled cumulative annual statements of account, certified by a certified public accountant, shall be filed for every compulsory license under this section. The regulations covering both the monthly and the annual statements of account shall prescribe the form, content, and manner of cer. tification with respect to the number of records made and the number of records distributed.

(4) If the copyright owner does not receive the monthly pay. ment and the monthly and annual statements of account when due, the owner may give written notice to the licensee that, unless the default is remedied within thirty days from the date of the notice, the compulsory license will be automatically terminated. Such termination renders either the making or the distribution, or both, of all phonorecords for which the royalty has not been paid, actionable as acts of infringement under section 501 and fully subject to the remedies provided by sections 502 through

506 and 509. 8 116. Scope of exclusive rights in nondramatic musical works:

Public performances by means of coin-operated phono

record players (a) LÄÄTTATION ON EXCLUSIVE RIGHT.-In the case of a nondramatic musical work embodied in a phonorecord, the exclusive right under clause (4) of section 106 to perform the work publicly by means of a coin-operated phonorecord player is limited as follows:

(1) The proprietor of the establishment in which the public performance takes place is not liable for infringement with respect to such public performance unless

(A) such proprietor is the operator of the phonorecord player; or

(B) 'such proprietor refuses or fails, within one month after receipt by registered or certified mail of a request, at a time during which the certificate required by clause (1) (C) of subsection (b) is not affixed to the phonorecord plaver, by the copyright owner, to make full disclosure, by registered or certified mail, of the identity of the operator of the phono

record player. (2) The operator of the coin-operated phonorecord player may obtain a compulsory license to perform the work publicly on that phonorecord player by filing the application, affixing the certifcate, and paying the royalties provided by subsection (b). (b) REOORDATION Or Coin-OPERATED PRONORECORD PLAYER, AMTIXATION or CERTIFICATE, AND ROYALTY PAYABLE UNDER COMPULSORY LICENSL

17 USC 116.

PUBLIC LAW 94–553–OCT. 19, 1976

90 STAT. 2563

(1) Any operator who wishes to obtain a compulsory license :
for the public performance of works on a coin-operated phono-
record player shall fulfill the following requirements:

(A) Before or within one month after such performances
are made available on a particular phonorecord player, and
during the month of January in each succeeding year that
such performances are made available on that particular

Licensinyal

Division phonorecord player, the operator shall file in the Copyright of the Offree, in accordance with requirements that the theater of Royalty Copyrights, utter consultation with the Copyright Royalty Tribunal (itantes the Tribuwat tros bees constitutet shall prescribe by regulation, an application containing the name and address of the operator of the phonorecord player

and the manufacturer and serial number or other explicit Licensing

identification of the phonorecord player, and deposit with

the Register of copyrights-a royalty fee for the current Division

calendar year of $8 for that particular phonorecord player.
If such performances are made available on a particular
phonorecord player for the first time after July 1 of any year,
the royalty fee to be deposited for the remainder of that year
shall be $A.

(B) Within twenty days of receipt of an application and
a royalty fee pursuant to subclause (A), the Register of Licensing
Copyrights shall issue to the applicant a certificate for the

Dinsion phonorecord player.

(C) On or before March 1 of the year in which the certifi. cate prescribed by subclause (B) of this clause is issued, or within ten days after the date of issue of the certificate, the operator shall affix to the particular phonorecord player, in a position where it can be readily examined by the public, the Licensing certificate, issued by the Register of Copyrights under sub- Division clause (B), of the latest application made by such operator under subclause (A) of this clause with respect to that phonorecord player.

(2) Failure to file the application, to affix the certificate, or to pay the royalty required by clause (1) of this subsection renders the public performance actionable as an act of infringement under section 501 and fully subject to the remedies provided by sections 502 through 506 and 509.

(1) The Registaraf fopyrights shall receive all fees deposited

under this section and, after deducting the reasonable costs Licewing incurred by the Copyright Office under this section, shall deposit Division

the balance in the Treasury of the United States, in such manner
As the Secretary of the Treasury directs. All funds held by the
Secretary of the Treasury shall be invested in interest-bearing
United States securities for later distribution with interest by
the Copyright Royalty Tribunal as provided by this title. The Statements of
Register shinitsubinis to the Copyright Hoyalty Tribunal, iPad sccount,
annual basis. s detailed statement of account covering It tous submittal.to
received for the relevant period provided by subsection that.

Copyright
(2) During the month of January in each year, every person

Royalty Tribunal.

Qaims.
claiming to be entitled to compulsory license fees under this sec-
tion for performances during the preceding twelve-month period
shall file a claim with the Copyright Royalty Tribunal, in accord-
ance with requirements that the Tribunal shall prescribe by regu-
lation. Such claim shall include an agreement to accept as final,

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